Most founders skip validation and rely on their own judgment. Real validation means getting customers to commit to buying before you build, then checking if your unit economics work: is your lifetime value at least five times your customer acquisition cost? Without external proof, you're just confirming what you already believe.
Chapters
At every stage, the validation is with the customer. So you have different levels of validation. You have a level of validation with your customers, meaning early, early stage, your customers say, I will buy, if you build this product, I'll buy it from you for this much money. And then you build the product. That's your first validation, right? And then you build the product and they say, okay, I'll buy it. And then they buy it. That's your second validation. Your third validation has to do with, can you sell it? You know, with regards to unit economics, can you sell it, your customer acquisition cost at a profit up against your lifetime value? And then if you can, if you have like a, in other words, a 5 to 1, you spend a dollar and you make 5 on marketing and advertising and your go-to-market strategy, and you're at 5, then now you validated that you can get customers. Now you need to validate whether you can do the whole thing at profit margin and that you can retain customers, retention, and that you can continue to grow at a reasonable rate, growth. And those are the 3 valuation drivers, the 3 things that drive the value of your business.
So it sounds like at this stage of the business, you're mostly validating the idea of this.
You're always validating your idea. I mean, even if your idea is marketing, you're validating your marketing idea. If it's product, you're validating your product idea, whatever it is. You're always trying to have external proof because of the confirmation bias that every founder has. You want to get outside proof to try to prove you wrong because it's so easy to convince yourself that you're right.
