Over and over again, people spend fortunes building a product or service, discovering that nobody wants it. It is called lack of market need and is responsible for over 42% of business failures. These are the dumb ideas you see people pitch on TV or that idea your friend mentioned to you over drinks (and being a good friend, you told them, “maybe that’s not a good idea” … right?)

Before you run out and start building, you should identify a Minimum Viable Segment (MVS) of people you will serve with your product. Those are your early adopters and people most in need of it. They are also the most affordable to attract. One of the key determining factors to predict if a business will be successful (or not) is if it could onboard big companies early (according to Y Combinator).

Founders always fall in love with their ideas; family and friends play along because they want to support a loved one. Please don’t rely on them for honest feedback. Instead, look for outside, unbiased sources of feedback, where they’ll tell you exactly how they feel. For example, the most significant benefit of crowdfunding platforms isn’t raising capital (in fact, it creates an administrative nightmare to manage hundreds or thousands of tiny investors). Intelligent founders use crowdfunding to confirm market needs by gauging customer interest. When you raise a few million dollars from thousands of people, it demonstrates a market and gives you influencers who will tell all their friends about it. Failing to prove the market in some way (like crowdfunding) is critical. The only thing that matters is selling people something they want. [Continue Reading in XBIZ Magazine]