6 dynamics that govern market viability for startups
There are 6 dynamics to consider when evaluating new product opportunities. Each dynamic is but one piece to the puzzle and to see the full picture you must put all of the pieces together. By taking the time to evaluate opportunities from all sides, you can gain a richer understanding of opportunities and challenges you may face, and potentially reduce your own blind spots.
i. Customer – Who are you going to serve and what need or desire do you plan to address?
ii. Product – What is the solution to the customer’s need or desire and is it in a form that the customer will embrace?
iii. Timing – Is market timing favorable or are you going to be fighting an uphill battle?
iv. Competition – How strong is the competition and how open is the market to a new entrant?
v. Finance – How much capital must you invest and do the returns justify the risk?
vi. Team – How fit is your team to be a leader in providing the proposed solution?
The 6 Market Dynamics is a core concept within our Startup Strategy framework and as such We have developed a set of tools to that apply this fundamental concept. Most notably we have provided a set of heuristics to better understand the dynamics, and a couple scoring tools for evaluating opportunity:
i. Startup Heuristics – The Startup Heuristics are a set of 18 generally accepted best practices that provide ideal guidelines for an ideal business. There are three heuristics for each of the 6 dynamics. Read More →
ii. Startup Scorecard – The Startup Scorecard is a simple grading card for evaluating a startup or product opportunity. The heuristics are listed in a box for each of the 6 dynamics, and the practitioner is asked to provide a letter grade (A-F) for each dynamic. This have be useful when walking through the steps of evaluating an idea and improving its weaknesses. Read More →
iii. Evaluation Matrix – The Evaluation Matrix takes the Startup Scorecard and simply adds a dimension by putting it on a spreadsheet and making it easier to evaluate and compare multiple opportunities. We describe this tool as part of our Opportunity Discovery process which provides tools for first systematically generating ideas and secondly evaluates these ideas using the Evaluation Matrix. Read More →