Should You Pour Money Building A Full Featured App Or Website On An Untested Business Idea?

Should You Pour Money Building A Full Featured App Or Website On An Untested Business Idea?

There is a saying, that goes something like this,"If you build it, they will come?" - That might be a misstated line from a Hollywood movie. Actually, the correct line from the movie called, "Field of Dreams" (starring Kevin Costner) is, " If you built it, He will come." While the line might have worked in the movie," Field of Dreams", the reality is, that history is strewn with tales of companies that ended up pouring extensive amounts money building technology that few wanted it. In the end such advice: “If you build it, they will come”, has proved disastrous for many startups and even well established companies for that matter where sometimes millions of dollars are expended on ideas that we not properly vetted.

In my opinion (in most cases), pouring your money building a full featured app or website before confirmint whether or not any market deman exists, it unwise. Frequently, even experienced entrepreneurs, get so over-confident/enamored with "some" idea that they end up betting an extensive amount of money on an idea, only to sadly fail in the end because they failed to overlook a simple factor: There is no buyer for what they have built!
Consequently, entrepreneurs must balance their urge to be controlled by their emotions and waste money building a technology prior to eliciting pivotal feedback, guidance and direction from the market that is willing to pay for their solution. Entrepreneurs must ask simple yet fundamental questions, "who exactly will readily pay for this solution that we are building?". Furthermore, is our decision to build this service or product backed up by solid evidence?

It is my belief that each and every one of us is very capable of coming up with a perfectly monetizable idea. However, most of us were not taught the idea creation to monetization process that is involved. And, from time to time some of us come up with amazing business ideas. And deep down inside you feel pretty sure that "this idea" has potential for being the "next hottest idea", however, perhaps a small doubt begins to creep into your mind and you are not honestly sure if you should invest "oodles" of your own hard earned money, time and efforts into it, let alone other people’s hard earned money. Consequently, the idea stays permanently dormant in a person’s mind and never reaches fruition. Because, when it is all said and done, who wants to launch an idea that could have been “half-baked” and had a likely possibility of failing? None of us do, correct? Therefore, it makes common sense to avoid taking unnecessary risk by yourself or risks that are not in the best interests of potential investors. So you begin to wonder how you could minimize the risk of failure of your business idea.

You begin to wonder if there might be a way to atleast test your idea first? I mean, “testing” whether your idea is viable or not makes sense right? because, you would want to make sure first and foremost, that there is actual demand for your idea. And it has to do with minimizing the risk associated with investing hard earned cash of your own as well as the hard earned cash of your investors.

Possible Solution: And this simple concept of “testing”, is in my opinion, priceless in many ways. For example: If you are looking for investors to fund your startup, (in my opinion), I believe that nothing usually makes a believer out of potential investors than actual orders from real clients willing to pay for your services. However, you are going to rebut by saying that how can I get orders when my service/product doesn’t even exist?

Two possible way of testing if any demand exists for your idea can be achieved by:
a.) Starting a simple blog about the market segment where you foresee your target audience and calibrate if you are able to attract internet activity that leads to actual sales of something of value such as an ebook
OR
b.) By creating Landing Pages

1. Validate you idea: talk to your target audience first Before you even hire a software developer to write your first line of code it makes common sense to confirm that there exist actual paying clients for your product or service. In most cases, is it wiser to focus on a small but vital component that people will be willing to pay for; then build it, deliver it, build a customer base of your first paying clients, gain success that will hopefully validate that there is a market indeed for your idea and take it to the next step. Test and Validating your idea at every step is a crucial component to evolution/ eventual monetization of your business idea.

2. Could you build and deliver just one small but highly desired feature at a time? Should you develop your whole on-line service or product, it might make it fairly impossible to confirm which features/benefits your potential clients love or hate. By introducing new features/benefits, you will most likely be able to calibrate what your potential clients would be more than willing (and able) to pay for. Consequently, you will receive valuable insights that you will be able to build into future versions of your product/service. This practice takes the guesswork out and might save you immensely in terms of time, heartache, loss of wasted money on features that do not resonate with the needs of your target market.

3. Welcome feedback from your potential clients Throughout history, arrogance, over-confidence and egoistic behavior have led to the demise of many a company or an empire. As a humble reminder first and foremost to myself and fellow visionary entrepreneurs, I suggest being humble and listening to what the market is communicating and act upon the feedback received from the market.

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