99 Reasons Why Innovation Fails: Part 1 - The Idea Stage
A big idea is like betting all your money on a single number in the casino. It’s a big bet but you can win big too. It’s a better strategy than a series of small bets, since the odds are structural in favour of the casino. But entrepreneurship isn’t a casino. It’s both a science and an art. Focusing on a big idea may not be to your advantage. Instead you could come up with small ideas and combine them as long as the result makes an impact. No matter how great your idea is, if you can’t execute it, you won’t get their money. Luckily, the cost of getting business ideas out, is getting lower and lower. That’s why Carine Lucas and I wrote the book “99 Reasons Why Startups Fail”, to identify the reasons that can lead even great ideas to complete failure while at the same time presenting how you can make your way around them. What follows below are already 6 reasons why start-ups - as well as innovation projects in large companies – fail in the idea stage. If you want to know more, you can find me at the nexxworks Ignition Bootcamp in September or check out the full book.
#1 - THE IDEA DOESN’T UNIQUELY SOLVE A BIG PROBLEM
Contrary to the old line, “Everything that can be invented has been invented,” the more complex the world becomes, the more problems there are to solve. That said, it’s got to be a big enough problem (otherwise no business) and a frequent problem (otherwise no market) and a way better solution than what’s already out there. Better means 10 times better not 10 %, i.e. a magnitude improvement.
#2 - HAVING A DERIVATIVE IDEA
Many startups make imitations of some existing company. That’s one source of ideas, but not the best. If you look at the origins of successful startups, few were started in imitation of some other startup. Usually they got their ideas from some specific, unsolved problem the founders identified, often with the purpose of overcoming an obstacle they encountered themselves.
#3 - FOCUSING ON SOLVING TECHNICAL PROBLEMS
Some startups are run by techies who are obsessed with solving interesting technical problems, instead of making users happy. In a startup, you’re not just trying to solve problems for the sake of it. If you want to do that, turn to fundamental research. In a startup, you’re trying to solve problems that users actually care about.
#4 - NOT STARTING SMALL ENOUGH
If you can’t make your own prototype, it’s probably too big. So lower your ambitions and make it feasible. A solid existing but less complete prototype is better than a perfect hypothetical one that will never see the light of day.
#5 - NOT DOING YOUR RESEARCH
Just because you think it is a ‘great idea’ doesn’t mean it is. You could be wrong. Pivot on feedback, not on assumption Don’t seek validation from the wrong people, like friends, VCs, startup folks, bloggers, angels, etc. Go directly to your customers. And don’t believe your own PR. Confidence can help foster success. Arrogance and self-deception can be poison.
#6 - NOT ADDRESSING AN “EXTREME PAIN”
A value proposition or an event is never compelling enough for a buyer to actually commit to purchasing. Good sales people will tell you that to get an order in today’s tough conditions, you have to find buyers that have their “hair on fire”, or are “in extreme pain”. Another way to say this is talking about whether a product solves a mosquito bite (nice but not essential to solve), or a shark bite (absolutely must solve).