James Caan’s seven-day startup guide: Day two Testing out your idea to fit customer needs
If you read my last blog and you still want to continue your entrepreneurial journey welcome aboard! you’ve established you have a profitable business idea, you think there’s a demand in the market for it, you’re positive people will want to buy it and you think you have what it takes to execute the business successfully.
This is all great and it’s absolutely essential you believe in your business, BUT what have you done to test it out? Remember, a business is nothing without a client base. You may think you have the best idea in the world but if it doesnt fulfil a customer need, what’s the point? If you’re the only one who can see the benefits in your service or product then Im afraid to say, you’re probably fighting a losing battle.
Research should always be your number one priority. Before you start thinking about how to market the business, where to find clients, if you need to rent an office, how you’re going to pay yourselfthe list goes on you need to have conclusive findings which support the potential success rate of the business.
it’s really important you don’t get carried away trying to make an idea work if there’s no demand for it because the risks will end up outweighing the benefits. Of course, entrepreneurship is all about taking risks but these risks should be intelligently made. A risk is only a risk when you don’t understand it, calculated risks mean you’ve already worked out what you’re prepared to lose and give you a chance to make sure you’re very comfortable with the downside of the situation. If everything in business was guaranteed, there would be no risk to take and the predictability would remove the buzz that is fun and challenging when starting up.
To analyse your idea you have got to do your research. it’s fundamental because it’s the deal breaker between success and failure. Look at your competitors what are they doing well and what arent they doing so well? Who are they marketing? What is their USP and how can you offer something different, something fresh?
You need to identify your target audience and study their consumer behaviours. Research the sector, find out what’s been happening in that space recently, look for interviews by leading figures in the industry, network as often and as much as you can to get your name out there and meet your competitors face-to-face. Take all of the information you collect into consideration before you even start thinking about marketing your idea.
The concept of starting a business is that it should be customer-led and market-led, and shaped by customer response. It should never be the business pre-empting everything and then having to undo it all.
Renowned investor and business builder James Caan is currently the founder and CEO of Hamilton Bradshaw, a firm specialising in buyouts, venture capital, turnarounds and real estate investments.
Prior to that, he was one of the longest-running investors on BBC television show Dragons? Den, founded and exited recruitment business Alexander Mann and was the chairman of the government's Start Up Loans initiative.
His efforts were recognised when he was awarded a CBE for services to entrepreneurship and charitable services through the James Caan Foundation.
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