Jason Cohen is an angel investor and the founder of Smart Bear Software. Here is his look at testing your business idea.
I recently reviewed hundreds of startup pitches at Capital Factory, an early stage accelerator program for tech startups. Of those, almost none had unearthed 10 people willing to say, â€œIf you build this product, Iâ€™ll give you $X.â€
Think about that: Hundreds of people were ready to quit their day jobs, burn up savings and risk personal reputation – all without identifying ten measly people actually willing to pay for what theyâ€™re peddling. Short-sighted, no?
Put simply: If you canâ€™t find ten people who say theyâ€™ll buy it, your company is bullshit.
Theyâ€™re understandably scared of being proved wrong, especially now that theyâ€™re all worked up about the new business idea, having told friends and family theyâ€™re doing this.
The only thing that matters is that people are willing to give you money. Business â€œexpertsâ€ can argue all day long that it makes no sense to buy shoes over the Internet, but as long as people give Zappos $1 billion per year, it doesnâ€™t matter what experts say.
When ten people say theyâ€™ll give you money if you build this thing, thatâ€™s the only validation that counts.
Photo by vcwear.com.