Hypothesis for startups

When I was invited by Elisabet Miheludaki (CEO of Amplaffy) to coach at the Digital Prototyping Weekend (organized by the Shortcut), my laziness kicked in as I did not want to spend a whole weekend coaching. Eventually, I made it to the event on Saturday afternoon and what awaited me was one of the most interesting learning experiences.

There was a flock of enthusiastic people with creative ideas and the environment was brimming with positive energy and attitude. The aim of the event was to learn the process of creating a viable business model or a prototype over the weekend.

In my opinion, majority of the people had a clear idea on what they wanted to build and how the end-user should consume their idea. There seemed to be something missing. The core motivation, ‘why’! Why is this idea worth pursuing? I believe the creators should consider and develop a hypothesis before gearing up to full speed.

A hypothesis can be built on the following fundamental elements: Let’s imagine you are building an app for official document translations.

• Current problem: What is the problem and how big is the problem?

Finnish companies are spending around 10 million EUR a year on translation services ( mostly to have official documents translated to English ).

• Current behaviour: What are the available solutions?

There are 15 translation agencies in today’s market and the top 3 of those cater to 80% of the total demand.

• Annoyances: What are the biggest annoyances with the current solutions?

Translation agencies have an average turnaround time of 7 days, their services are expensive and the translations are not reliable.

• Value proposition: What is the added value brought by your solution?

Your app is based on AI and it reduces the turnaround time to 2 hours, your app has an affordable usage based pricing, and the translations can be quickly verified by a certified expert within the app.

That being said, all the teams managed to come up with awesome prototypes by Sunday evening and I was really happy to see how the teams had crafted a viable business model from an idea. Congratulations to all the teams as they have crossed the first hurdle by participating in the event and I am looking forward to see their ideas further down the path to success.

This article is just the tip of the iceberg as developing a hypothesis is the very first step. Asking the right questions and identifying the real problem is the next logical step. I will come up with another piece on that part really soon.

Originally published at chemmagate.eu on November 20, 2017.