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Ask HN: Opinions on what success rate is enough for validation of a startup?
Hi everyone, on the Eve of Christmas and here I am posting a question on HN. There is an cool tool out there that proposes to experiment on startup ideas. The tools is http://www.javelin.com/experiment-board.html.
The opinions I would like to gather from you is what percentage of interviewed clients would you consider a success worth proceeding further?
Thanks and Merry Christmas to everyone !!
- striking 12y agoI consider every startup idea to have value. Although it is easy to get an approximation of how well an idea will work, one will never know unless he or she tries. The most oft cited example of this is AirBnB, [1] but one example most people haven't heard of is Washboard [2]; they charged $27 for $20 in quarters to help people pay at the laundromat. Did they get customers? ..yes, actually. I think the final count was 11 or so. Just goes to show you, any idea can succeed... to a degree, at least. Happy holidays to you, too. [1]: at first, people said "you want to rent your house out to a stranger? What!?" but then apparently many realized that it was relatively safe to do so. [2]: http://valleywag.gawker.com/real-startup-that-mails-you-quarters-for-laundry-isnt-s-1593540845 http://valleywag.gawker.com/real-startup-that-mails-you-quar...
- asotelo 12y agoStriking... you are right about the AirBnB [1]. Even Henry Ford said if he would have asked people what they wanted they would have said faster horses. Steve Jobs also was known to do as he pleased because users don't know what they want. Not familiar with washboard. I will check it out. Another interesting case is the founder of SnapInspect. He asked realtors if they would pay in advance for this solution. A few did... and now it seems to be doing very well.
- MichaelCrawford 12y agoIn general, 50% of American businesses fail during the first five years. (I was told that quite a long time ago; I don't know the current figure.) Go have a look at the websites of some venture firms. At least them list all of the portfolio companies they've ever had, even if they've exited. Now look into whether those companies failed, were acquired, whether the IPO worked out well and so on. That's going to be a lot of work but would be valuable information for everyone to know. If you wrote up on article about it on your site, you'd get lots of readers, inbound links, maybe press coverage.
- striking 12y agoIt would also likely dispel (to a degree) the survivorship bias [1] that is pervasive in the Valley today. [1]: https://en.wikipedia.org/wiki/Survivorship_bias https://en.wikipedia.org/wiki/Survivorship_bias
- MichaelCrawford 12y agoThe Anthropic Principle is conceptually similar to Survivorship Bias. Loosely speaking, the reason we humans find the Universe so hospital to us, if that if the Universe were not hospitable to humans, we wouldn't be here to wonder why. In reality, the vast majority of planets are completely unsuitable for life, not just intelligent life - too hot, too cold, too small, and so not enough gravity for an atmosphere &c.
- asotelo 12y agoThanks Michael, indeed it would be a nice article. I believe that in the early stages of ideation the percentages are considerably higher. The founders of javelin board mention 98% of startup ideas fail. My concern is only at the experiment or interview level. If you ask 100 people, how many should be enough to proceed spending time/money on further analysis? Do you think 70% of positive feedback is pretending too much??