About our Faculty:
Arjita is a harry potter fan & a serial entrepreneur determined to make education and entrepreneurship a more equitable place. She started her first startup at 16. She has impacted over 50.000 people across 40 countries, sits on the advisory board of The NASDAQ entrepreneurial center. She teaches entrepreneurship at Hult International Business School and San Francisco State University. She received her Alien of Extraordinary ability visa in the US for her work in education and social entrepreneurship.
What is the difference between an idea, a goal, and a feature?
First of all, I want you to know the difference. An idea is not a goal. A goal is not a feature of your product or service. All these things are very, very different.
An idea is “I want to make people’s life simpler and get them to their work on time”.
The goal is to create a solution that improves their time and their duration.
A feature would be: is the solution provided through an application? Is it through a website? Is it a platform? Is it on their maps? Is it an extension that is helping them that would be a feature?
The Test of Competition.
How do you find competition?
I know some of you have said “Wait what I’m doing is really special. Nobody in the world has thought about that!”, and that is the uniqueness of being an entrepreneur, we all are building something special. But when a customer sees our product, they always try to compare it with something.
We need to get into the mind of that customer and see they are going to see us?
So when you go ahead and start finding your competitors, I want you to ask some key questions.
- What do your customers do today without your service?
- Where do they spend their money and time to fulfill their need?
- How are your competitors reaching your users?
- What ways do these providers use to keep getting users?
- How did your competitors begin?
Find the top 3 things they missed.
This is what is going to be your secret sauce.
This is what they did not even care to offer, or it is not their strength and this is where you begin creating the product of your idea.
Generally, where do you find the top three things they have missed? Go to their consumers and say, can I take five minutes of your time and talk to you? If you cannot find that, go into their comments section or reviews? I’m sure people who are not able to find all the things that they exactly want have left it there. Read about it.
What are people complaining about?
Is this the right opportunity for you?
Before we get started, I want you to know these three terms.
It’s very important to understand the vocabulary so that when anybody asks you these questions, you don’t feel overwhelmed or underconfident. Most founders know their stuff. They know their idea. They know their company, they know everything about it but then a term gets thrown around and they feel that maybe I’m not the right person to be a founder. That is not true. I want to empower you with these terms.
TAM – Total Addressable Market
SAM – Serviceable Available Market
SOM – Serviceable Obtainable Market
If your business or ideal launched today how many people out of your Sam would actually start using it? How many people would you be able to reach over the next three to five years? How much money would you be able to make over the next three to five years? This is your market analysis.
What opportunity are you going in for?
Is it 10% of the existing market is a 20% of the existing market? Generally, the market standard, say 10 or 20% but you will have to do your research.
How do you find this number?
Go to your competitors and see how many people were they able to reach in their first three to five years. That gives comparable data and a reliable form of data for even investors to work on and believe. Don’t go ahead and gently say hey, I’ll get 10% of the market. It’s great to be an optimist, but let’s add a little bit of realism to it as well.
Back your numbers back your data back your statistics.
If you look at your market analysis as a whole TAM shows up as the biggest number, the ultimate goal, the vision. SAM is something you wish you can reach over the next 10 years and then SOM is your target that you want to reach over the next three to five years.
How would you find these numbers?
Use online searches census data, competitive landscape industry, how big is this industry? The travel industry is a trillion dollars big, but can you get a trillion dollars, maybe you’re not serving the entire travel industry with section are you going ahead and eyeing on and then use your assumptions based on the population, the gender, the income levels, all of those and incorporate them.
This is not a simple process. Please don’t rush it.
We’ve talked about what is your idea, the clarity of the idea? How big is the market the TAM, SAM, SOM? Finally, who are your competitors, and how you can find your secret sauce?
Take all the information that you have and get your idea put together to actually now look at the screen and say, alright, this idea is really great. I’m passionate about it, but it doesn’t have a great market. But you see, there are no competitors for it. So maybe this is the first priority. Wait a second, there’s this idea that I have a great passion for the market is amazing and there are too many competitors at this point, maybe I put it as my priority to take some time. Put that information in charts, look at all this information, and then take a stab at it. What is the idea that I want to work on over the next three to 12 months?
Join the next New Founder School Ideathon to get started on your startup idea. The Ideathon is a 2-day workshop where you find a clear startup idea to work on for FREE. If you finish the Ideathon deliverables then you also get a chance to be a part of our 12-week Idea School (FREE AGAIN). At idea school, we validate your startup idea with REAL users and build an MVP a.k.a a minimum viable product.
Thanks for reading! Do you have a question about this lecture? Feel free to comment below.