Thread by @warikoo

Validate your startup idea in less than 14 days and less than Rs. 5,000

A thread...

I am constantly generating ideas.
Mostly really bad ones.
Occasionally good ones.

And it got to a point where I had to find a way to objectively select or reject an idea.

So back in 2010 I came up with 2 tests.

1. The shower test (or Balti test - doesn't matter)
While taking a shower, ask yourself all possible questions about the idea that your worst enemy would ask.

> How will this fail?
> Why are you the right person?
> Why won't the competition win?
> Why
> Why
> Why

At the end of the shower, I invariably had a lot more clarity about the idea than I did going in.

90% of my ideas never make it beyond the shower test.

If a higher percentage of your ideas make it through, you are not being harsh enough.

2. Run the biz before you have a biz

For the 10% ideas, I built a 14-day economical process to gauge their relative potential

It is a 7-step process

Step 1: Name the idea

For me, naming something is critical.
It adds emotions to my thinking process.
It feels important.
The idea becomes a personality.

Don't worry about the name being perfect (or even the final name, should you work on the idea)
Key is for it to have a name

Step 2: Define what the idea does and what it solves

What the idea does is the function of the idea
(Zoom allows video meetings)

What it solves is the purpose of the idea
(Zooms allows people to connect remotely)

This takes time.
Should take time.

Step 3: Design a logo

Basis step 2, creating a visual identity that makes the idea more real.
You begin to see it, imagine its positioning, imagine the emotions it will generate

Earlier, I used to find inspiration online and then make it on PPT
Today, I spend $5-15 on @fiverr

Step 4: Book the domain

This is important for the next few steps.

Again, do not worry whether this is the final name and identity for the idea.
Book something long-tail

Step 5: Build a landing page for your idea
This is the most important step

Using a site builder (plenty of them - @Wix, @GoDaddy, @squarespace), build a digital brochure for your idea.

Something that piques the interest of those visiting the page.

If the idea is a

> book - build a landing page writing about the book, reviews, testimonials etc
> app - what the app does, screenshots (doesn't need to be of your app), play store reviews (fake)
> B2B saas - how it works, which brands use it (fake), testimonials

Invest your time in being true to the eventual form of the idea, the way you have imagined it.

Do not invest your time in mockups or designs or creating something.

Remember, at this stage you are testing the idea, not the product!

Step 6: Run Google, FB, IG ads
With a budget of max Rs.200 per day, run search, display and video ads for 14 days.

Do not worry if you do not know how to. In less than 5 hours, the best instructors can teach you through courses on @udemy, @coursera - it's a life skill to acquire

On google search, the intent is explicit - so you have to spend time thinking "what is it that potential users will be searching for, when they would want this product?"

On display and video, the intent is implicit - so you have to think of "what message will get them to click?"

Earlier search used to work far better for me.
Today video works much better.
Find out what works for you.

When people click the ad, take them to the landing page.

There, you will speak about the idea, showcase the product and finally,
Ask for their email

> Book: Enter email to get sample chapters
> App: Enter email to get download link
> B2B saas: Enter email to setup demo
> Clothing brand: Enter email to get catalogue
> Offline store: Enter email to get discount coupons
etc

PS: You aren't really sending them anything. Its fake

Ideally you should not spend more than Rs. 3,000 cumulatively on this campaign.

And run it for 14 days, to cover potential differences in weekday/weekends/start-end of the month etc

Step 7: Measure
Measure essentially 3 things

1. CTR (Click-through-rate)
% of people who saw the ad & clicked on it
In Google search, this shows interest in the idea, when the need is explicit
In video ads, this shows interest in the idea, when the need is implicit

2. CPC (Cost-per-click)
At what cost was this click generated

This shows potential cost of generating awareness.
It will vary, by design, for search and videos ads.
And by geography (if you have selected multiple countries)

3. CPA (Cost-per-action)
At what cost was an email collected

This shows potential cost of generating leads.

Side Metric:
Conversion rate
% of people who filled up their email after landing on the page
Anything less than 10% is either b/c of a poor landing page or a poor idea.

At the end of 14-days, you will have data for the campaigns you have run for your ideas.

This data is NOWHERE close to the actual reality, however acts as a very effective comparison tool to select which idea to pursue further.

So do not use this method for just 1 idea.

In summary:

7-step process to validate an idea
1. Name the idea
2. Define what the idea does (function) and what it solves (purpose)
3. Design a logo
4. Book a domain
5. Create a landing page to share idea and collect email
6. Run ads on Google/FB/IG
7. Measure CTR/CPC/CPA

I have benefited immensely from this process.

> It helps me think through the idea in detail.
> It allows me to test the reaction of people I do not know and thus can't directly influence.
> It gives me data to back my intuition.

Today, entrepreneurship is sexy.
Everyone wants their business card to say "I'm CEO, Bitch"

But the idea in our head of a startup is very grand.
It is raising money, it is becoming a unicorn, it is to rake in the millions.

We rarely recognize, all big stories started small.

This test was shared as part of the 1st chapter in the 8-chapter series I have created called
"The Complete Guide To Starting Up"

If you found merit in this test, you will find the entire course very meaningful
ankurwarikoo.com/startup

Fin.