How to Validate a Startup Idea

In this post, we show you how to validate a startup idea.  It’s important to validate your idea because you nobody wants to waste their time building a product or service that people don’t want.

And I bet you don’t want to waste your hard-earned money and precious time on an idea that won’t make money, either. We all have bad ideas from time to time, so don’t worry if it doesn’t work out. But hopefully, it’s a really awesome idea! However, our parents, other family members, and friends should not be the people to determine if it’s good or not.

You’ll have to put some real work and research into invalidating or validating your startup idea. But, it’s a lot less work than building an entire startup based on an unsubstantiated idea.

With this guide, you’ll be equipped with tactics to validate or invalidate your idea or product and either prove or disprove its worthiness in the market. And while doing so, you’ll begin to create the building blocks of a startup, so if it’s a good idea, then you’re already making great progress!

So let’s start with what makes a good startup idea. Then, we’ll walk you through each step of the process as you build your case for your startup idea.

Read through this article once over so you learn the process and then come back to it as you’re working on your idea validation in real-time.

Once you think you’ve found a good startup idea, check out our post How to Start a Startup which has 30 steps for you to follow as you build your startup.


What Makes a Good Startup Idea?

A good startup idea solves a problem for a specific audience of people.

An idea worth pursuing needs to be cost-effective to produce. A good idea is also unique and it can grow without too much constraint.

Your startup idea should be comprised of hypotheses of your value proposition and unique selling proposition. They’re both similar but have slight differences.

A unique selling proposition shows how you’re different from the competition and what makes you stand out.

A value proposition shows people what problem you’re solving for them, how they’ll benefit, and what makes you different from everyone else.

It’s usually only when someone is an expert in a niche, should they be able to identify the gaps in that market which allow for the vision of a worthy startup idea to develop. Your startup idea needs to fulfill a need in the market and you need to know how to fill it.  However, if you’re clueless about how to fix the problem you want to solve, then you’ll have a lot of trouble successfully building your startup.

Paul Graham talks about the best startup ideas. He’s a co-founder of the first and arguably most successful physical startup accelerator, Y-Combinator.  In this quote below, Graham shares what he believes makes the best startup ideas.

the very best startup ideas - paul grahahm

Microsoft, Apple, Google, and Facebook disrupted the status quo and created something beyond what was available at the time. Except for Google — their differentiator was speed, initially.  They made something that was unique.  And, they knew how to build their products themselves.

As you know, these companies continued to innovate so they could stay ahead of the curve and compete with new and rising competitors, but their core offerings have generally stayed the same.

Knowing how your idea will solve a problem in people’s lives will help you validate your idea when you do market research, competitive analysis, and personal outreach.


Validating Your Startup with Target Customers

If you want to validate your startup idea, then you’re going to need to know who your customers are because these are the people that will use your product or service.  People using your product or service are the ultimate gauge of idea validation.  But before you get users, you need to know who those users are going to be.

There are usually a few different customer personas that will match who your target audience is.

A customer persona is a fictional representation of who you believe is your ideal customer.

The customer personas you develop will be really useful when it’s time for you to do your market research and when you do outreach to validate your startup idea.  Moreover, the outreach you do to discuss if your startup idea is something they’d be into using will be your next best friend when trying to validate your startup idea.

However, before we get ahead of ourselves, we recommend you read the guide, How to Build Customer Profiles and Buyer Personas to develop your customer profiles/personas.

Once you do that, it’s time to move to do market research and competitive analysis.


Market Research and Competitive Analysis

Market research and competitive analysis are vital pieces of the puzzle when you’re trying to validate or invalidate your startup idea.  It’s important because you need to know if your startup idea has been implemented already. In today’s technologically advanced world, so many startup ideas have already been done by someone else already.

Part of having a successful startup is finding a gap in the market and being able to exploit it and fill that gap.  In today’s world, if you want to thrive in a big market, then it helps to stand out, be unique, and provide solutions which are cost-effective.

People shouldn’t just start a startup with an idea that’s not unique and offers no difference to consumers. A difference in price isn’t a differentiation with your product versus theirs unless you’re doing something groundbreaking and cheaper. Too many people make this mistake.

One can have competitors and still have a unique idea. It’s all about your approach and the value you add to your audience. But you have to add a serious amount of value that is above and beyond that of what the existing competitors out there provide.

In addition, you must know your competitors and what they’re doing to be successful.

Ask yourself: How are you going to successfully build a multi-million or billion dollar company if you don’t know this information?

That’s another reason why you need to have an extensive analysis of your competition and the market.  Below, you’ll find out how to do market research and competitive analysis.


Steps to Perform Market Research and Competitive Analysis

Step 1) Research

Start off by researching on the web to see whether your product or service has been implemented by someone else already. This is one of the basic preliminary actions to perform before you build a startup. You can go about this by researching keywords and phrases on Google that describe your idea.


Step 2) Record the Research

Keep a record of every website you visit that is similar or equal to your idea via Google sheets and the search terms you used to find them. If you’ve signed up for our Startup Incubator Kit, then use the market research and competitive analysis template made available to you.


Step 3) Analyze Findings

Analyze the offerings and differences between them and your idea from within your spreadsheet.


Step 4) Scout Competitors Automatically

Set up Google news alerts to notify you when your competitors are mentioned in the press so you can keep an eye on them.


Step 5) Keeping Track of Competitors

If your idea turns out to be good, then you’ll want to check out your competitors monthly and keep track of any changes you see occur. This will be regardless of whether or not you see a Google news alert. Set up a monthly repeating calendar notification to help you stay on top of this task.


Step 6) Market Research

Look up market statistics for your target market.  Find as much data as you can on:

  • The size of your target market (worldwide and in other countries/continents)
  • Information about your target customers such as demographics, interests, behaviors, and devices used.


After Market Research

When you’re developing your concept, you have to ask yourself and answer a handful of important questions. Answering the following questions will help solidify your idea and the framework of your startup, which are crucial.

The purpose of these questions is to identify if your hypothesis still has merit based on the market’s saturation or lack thereof. However, after you figure that out, there’s still work to be done to validate or invalidate your startup idea.


Questions to Answer After Market Research and Analysis:

  • Has your idea been done by anyone else?
  • Can you offer something different that adds value to and solves a problem for your target customers?

If there are too many competitors and no opportunity, then don’t pursue your idea any further. However, if your idea is unique, then that’s great, but your idea isn’t yet validated. You have more work to do.

The next section outlines the next steps you should take to validate your startup idea.


Idea Validation by Feedback Collection

Below are two ways you can collect feedback to help you validate your startup idea.

1) Individually contact target users asking them for feedback on your idea.

You can find and talk to target customers through social media channels, message boards, and forums. Contact a few hundred of the people you describe in your customer personas. Tell them about what you want to do with your startup idea and ask them the all of the questions except for the first question as described in #2.

2) You can validate your startup idea by collecting user feedback from a survey on a landing page you create with the description of your idea. The survey could look like:

  • Was this product idea what you expected when you visited?
  • Is this something you would buy if it was available?
  • Would you recommend our service/product to a friend if it were available today?
  • If you would buy it, what is the most you would pay for it?
  • At what cost would you consider it to be too cheap?
  • Do you have any suggestions on how to make our product/service better?

You can also have a call to action to get people to sign up to your email list for updates.

If you had an overwhelmingly good response to this from your target market from your marketing efforts (hundreds of subscribers after marketing it for a few weeks), then it’s probable that you’ve found a worthy idea. A landing page is also considered a vanity form of a minimum viable product but it’s not actually a product.

Feedback collection is the best way to validate your startup without building a real minimum viable product, which is the next step once you’ve gotten the green light from your outreach.


Minimum Viable Product

A minimum viable product is basically a barebones version of your startup’s product.  It’s the cheapest workaround for your idea without building it out in its entirety.

An MVP is used so you can test the hypothesis of your startup idea in a real-time environment. Because of this, not much can take place of a minimum viable product (MVP).

For a complete description of how to build an MVP, read the guide via our Startup Incubator Platform or via the following link: How to Build a Minimum Viable Product.


Next Steps

If your idea holds up after all of the above, then get started on your executive summary and find a co-founder to build an MVP with.  However, many people that want to launch startups can’t code.  If you don’t code, then look for a programmer/developer who might co-found the startup with you.

To find one, check out the article, How to Find a Co-Founder and What to Look For to help you find a developer and other co-founders. Alternatively, you can hire a developer, which is obviously more expensive. In that circumstance, you should check out the post we have regarding where to hire contractors and freelancers or you can go with a development agency.  Whether you can or can’t code, you’re going to need to write down how your product/service will work including the features and functions of your website. That’s called a functional specification.

If you’re having someone else build it for you, then you should be serving the contractor, vendor, or manufacturer a non-disclosure agreement to protect your idea.  You’ll use it to help share your vision with the developer you work with.



The prospect of creating a startup is so exciting.  Before you even start building your product, always make sure you validate your startup idea.

Don’t blindly build a startup without determining if it’s something your target market actually wants and needs. Do a competitive analysis, market research, feedback collection, and executive summary.

Save yourself from the heartache, headache, and empty bank account stemming from a bad idea. You’re better off spending a month on idea validation than spending a year or two building a product to find out that nobody cares about what you made. It will save you time, money, stress, and relationships.

Moreover, the actions you take to validate your startup idea will be of great benefit to you if your idea holds up. This is because you’ll also need all of the information you compile countless times in the future. Be smart about your startup idea.

Make a product people will want. Better yet, make a product people need.


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Carl Potak
Carl is the Founder and CEO of StartupDevKit, an online startup incubator and accelerator with the mission of supporting and empowering early stage startups with education, resources, and mentoring to help founders and their teams not only succeed, but reach their highest potential.

Carl has been building and growing startups since 2007 as a founder, consultant, marketer, and recruiter. He's the author of the book Startup Survival Secrets, earned a certification in Inbound Marketing from HubSpot Academy, earned a certification in Google Analytics from Google, earned a Bachelor's Degree from Binghamton University, and achieved Eagle Scout as a young adult.

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