Business Growth Framework - Idea Stage

This framework is the starting point for much of the work we do at Build Grow Last.

At the idea stage we think about the validation of our business idea:

  • Does it have value?

  • Will folks pay for that?

  • Who are they?

  • What do they expect from us?

  • How will we bring it to market?

Marketing

Our marketing and sales validation are likely to be the same steps here but there are some interesting aspects that are worth considering. When we think about marketing we need to identity the target audience for our work. We sometimes call this our Ideal Client Profile or ICP. Developing an ICP at this early stage is initially a work of imagination but later we’ll validate our thinking about the client through a set of structured market tests.

Essential Reading: Start with Why, Simon Sinek. This book is foundational reading that forces us to consider not just the problem we solve and how we solve it but ‘why’ its important to solve that problem. Looking deeply at why we want to get into this business will teach what we need to know about our prospective clients.

Framework: The ICP and Persona Workbook (concentrate on the left hand side, hard facts)

Sales

If our work on ICP can be considered the ‘hard’ facts about out customer (male or female, young or old, individual or business) then our work in identifying customers in that group is the ‘softer’ aspect of sales. We need to consider what problems, pains and fears this group have, what do they aspire too and need to happen after buying from us or working with is?

Essential Reading: The Lean Startup, Eric Ries. Focus on what Ries teaches us about the ‘job’ of a startup company, it’s to understand the customer, their problem, what stimulates action, and iterating that work until we really understand the people who need our product or service.

Framework: The ICP and Persona Workbook (concentrate on the right hand side, soft facts)

Operations

At the idea stage it’s not important for us to fully build out the operational aspects of the business (how will we keep our promises to customers as we provide the services or product, and what systems and processes will we need) because that would be overkill until we’ve worked on our marketing (audience) and sales (customer needs).

But it is important for us to run the mental exercise of how we will fulfil our promises to customers. This early operational clarity actually helps us to reduce the fear of moving forward with the business because we can start to understand how our lives will be in this new world and how this is a set of tasks that we can understand and control. Remember that this isn’t all about technology or tools at this point (although these are likely to be important) but focusing on the repeatability and consistency of process is powerful.

Essential Reading: The E-Myth Revisited, Michael E Gerber. You’ll love this book. Gerber gets to the heart of what it means to work on the business versus working in the business, his language is about moving from being the technician to the entrepreneur told through some wonderful anecdotes.

Framework: Use a tool like Miro, with great templates for building out processes even on the free plan.

Finances

Similarly to the operational aspects of the business we don’t need to worry too much about the finances at this stage. There’s no need for us to risk a lot of money to validate the business idea but we should have some proof that the business can make money. We should be thinking about the revenue and costs in the business and making sure that there is a profit to be made. It’s useful to work this through on a spreadsheet model.

Legal

One of the key elements to be validated at idea stage is the the legal aspects of the business. We should be ensuring that what we are proposing is within the law (of course!) but we should consider and get advice on what legal frameworks should be in place to support the business. This could include customer agreements, employment contracts at a basic level but could also extend to import and export rules or IP depending on business model.

Compliance

This is critical for validation at the idea stage. Many businesses must operate within some compliance framework and you should understand what is expected of yours. In some cases these are mandatory for you to operate (for example in the financial services space) but even if they are not required they can be high on the expectations of customers (for example data protection in the case of technology products or services businesses). You should understand the compliance burden that you’ll operate within and include this requirements as money in your costs and as time in your operational processes.

Research and Development

This is the key, priority area for the idea stage of business. Our business very likely centres around a product or service that is either new or has some innovation around what is available currently in the market. This is our innovation and this is what R&D is all about. You should spend the majority of your time at the idea stage developing the ‘new’ that you will bring to the market.

Leadership

At the idea stage it can be easy to dismiss Leadership as not being necessary, after all, we don’t have a team to lead yet. But we should not forget that Leadership can also refer to how we organise ourselves and set an example to our peers and our industry. If we’re validating an idea and we believe that this idea has the opportunity to change our customers lives we should be confident in showing that to our world, leading in that space.

Mindset

Crucial at the idea stage is how we manage our selves and our thoughts. This sounds a little whoo-whoo but becomes crucial in having the staying power to get an idea into the world. At this stage we value the qualities of a growth mindset, of grit, of resilience. After all it’s often an individual or small group that have to bring this change to the market and, if they stop believing in it, it will wither and die.