Got a Business Idea? Here’s 25 Questions You Must Answer
The fantastic course lasted six weeks and my lecturers were the esteemed Bill Aulet and talented Erdin Beshimov from MIT Sloan School of Management. It taught me a lot about entrepreneurship and I’ve jotted some of the questions posed that you may like to take a look at if you’ve got an entrepreneurial itch.
I’m adamant that entrepreneurship (and coding) should be taught in all schools. The way I see it, the vast majority of people work for businesses and need to know how to create value and articulate this process. That being said, studying only equips you with the tools to tackle a problem, but gaining experience, whether it be at work or a side project lets you put it into practice.
If you have an idea for a business, have a go at answering these questions;
Market segmentation is a marketing strategy that involves dividing a broad target market into subsets of consumers who have common needs and priorities, and then designing and implementing strategies to target them.
- What industry do you want to enter? E.g. automotive.
- What market do you want to enter? E.g. non-electric, hybrid, electric.
- What market segment do you want to enter? E.g. sports, SUV, truck.
- Who is the end user? E.g. the person who uses the product, rather than pays for it.
- How will end user actually use your product?
Part of a market that a company obtains, hoping to obtain more of the same market or part of another larger market that is near the first one.
- Does the customer have the money to pay for your product?
- Can you easily get your product to the customer?
- Does the target customer have a strong reason to buy your product?
- Is there entrenched competition that could block you from getting the business (real or perceived in the eyes of the target customer)?
- Can the market help you win other segments? Is it a strategic market that will help you win other markets that will be equally or more profitable?
End user profile
End user profile is a description of a narrowly defined subset of target end users with similar characteristics, similar needs, and word of mouth.
- Who is your customer?
- What kind of people would benefit from your product the most?
- What are their unique needs?
- What do you need to know about them to make a great product?
- What makes them special and identifiable?
Total addressable market (TAM)
TAM is the amount of annual revenue expressed in dollars per year your business would earn if you achieved 100% market share in your chosen market. It helps you find out how big the market is for your idea
- What is your pricing structure? E.g. freemium, subscription.
- What’s the potential number of end users?
- How much revenue is each user worth per year?
- How much revenue will you make if you sell your product to the whole market?
- Is your TAM between $20 and $100 million each year?
Build a good persona and your team will be able to see your customer very clearly — someone you know and have interviewed.
- What gender and age are your customers?
- Where do they work and what are their challenges?
- What do they consider when making a purchase?
- What are their shopping habits?
- What’s their preferred method of communication?
These questions are just an overview of the course, if you’re interested in learning more about entrepreneurship, I’d recommend you take a look at the many courses available via edX.