How to generate, setup, and test a business idea in 90 minutes

I’m currently going through a discovery phase where I’m looking for a product idea. I recently listened to an epsiode of Bootstrapped with Kids featuring the legend Dan Norris where he talked about WPCurve, one his more recent bootstrapped companies. It occurred to me that there may be a market for a similar service but targeted at the Ruby on Rails community, rather than the Wordpress community. I launched a few hours later to test the idea. I’d like to share my methods so you can create a build a great business as well.

Lean Lean Lean

You have to throw out any preconcieved notion about companies. You’re not going to be building any prototypes, MVP’s, or business infrastructure because if you’re doing those things in the idea validation stage, you’re wasting valuable time (and money) and they have the nasty side effect of making you feel like you’re a legitimate business owner when in fact you still have $0 revenue. Before you create an LLC, before you build anything, and before you start thinking about payroll, validate that you have a half-decent idea! You can run dozens of tests like these per year if you keep the process lean.

The Idea

So, you need a problem, and a solution. If you build a solution looking for a problem, you’ve missed the boat. We’ve all been there. Don’t make that mistake.

Message 100 friends and ask them to briefly talk about the biggest pain in their life at the moment. Dog at home all day. Negotiating time with partners in a school project. Cooking is a hastle.

Write them all down. You’ll start to see some themes.

Choose one that seems do-able. Let’s go with “cooking is a hastle”.

Go back to everyone with a cooking related “pain” and ask more questions. When you dive into the problem you’ll discover nuances that you missed the first time around. e.g. It’s not so much the cooking but the buying the groceries for a specific recipe that is the real problem.

When you’ve probed enough people, a solution should start to emerge. If a solution doesn’t emerge, keep asking questions. Go back to step 1 if you have to. Using our example cooking problem, the solution I’ve generated is to deliver a recipe and the required groceries to the customer’s home 2 nights/wk for $120/mo. With leftovers, this should provide most of the food for a single individual.

It doesn’t matter at this point if your solution isn’t profitable right now; you can always fiddle with the price or exact offering later. It only needs to make loose financial sense. Obviously you can’t deliver recipes and groceries for only $10/mo, but $120/mo seems reasonable. Let’s go with that.

The Validation

The goal here is to validate that people will pay for your product or service. Now, people will tell you “that’s a great idea!” or “I’d totally buy that!” but the real test is to get people to commit cold hard cash. Talk is cheap. Cash is king. Blah blah.

Shoot your friends a follow up message, “Hey, I’m launching a new business. DESCRIPTION OF BUSINESS. Send AMOUNT to PAYPAL_ADDRESS to try it out.” And you’re done. If 10 people sent me money for this fictional business, I’d have $1200 in reveue to get started and the peace of mind that my business has legs.

If you’re targeting a business, odds that they are going to fork over money to a paypal address are pretty slim. You may need a website to help legitimize the experience. No worries, I’ve got you covered.

Head over to Weebly and create yourself a basic page. Alternatives include Wix, Unbounce, or InstaPage. They all have drag/drop interfaces that make it pretty painless to build a site. Most of them have trials or plans < $29/mo. Remember, you’re paying $29 to save you thousands of dollars on building a business no one will pay for.

Craft a catchy business name and tagline that describes your product/service, “InstaMeal: Fresh Ingredients, Original Recipes, Delivered to You”.

If you don’t have a Paypal account, go ahead and create one, then [create yourself a subscription payment button](]. This will allow you to move someone through a checkout process in a more formal fashion than an instant message. Sprinkle that button through your site, just after your tagline and maybe down at the bottom of your page.

Email your friends who might purchase on behalf of their employer and send them your website. Include a short pitch so they can easily forward it to their colleagues. Alternatively, get on twitter and tweet at some folks and see if they’d be willing to signup.


At the end of your experiment, one of three things will happen:

  1. You got > 10 paying cutomers; time to deliver
  2. You got 1-8 paying customers; go back to step 1
  3. You got no paying customers; go back to step 1

DO NOT be discouraged if you don’t end up with paying customers after your first experiment. Really great entrepreneurs run multiple experiments constantly, often in parallel. I’m currently running the RailSupport experiment but I’m also working on a yet-to-be-launched podcast called Failcast, DockLister is still running, and I’m consulting for cash flow.

It can take dozens of iterations to hit on a great product or service. Keep at it!

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