“Must-have” vs. “Nice-to-have”
A.T. Gimbel shares insight when it comes to evaluating a new business idea as a “Must-have” vs. a “Nice-to-have”.
Are you starting with the problem or the product features?
I have been speaking recently with a lot of entrepreneurs evaluating new business ideas. It has been great to see so many folks using these past couple of months to reflect and decide to go after their dream idea! One question I always ask is how do you know this is a “must-have” versus a “nice-to-have?” Responses are usually pretty telling into what level of customer discovery and market understanding the entrepreneur has conducted.
A “nice-to-have” usually starts with the entrepreneur speaking about their solution. They often mention the cool technology or all the features their product contains. They may have experience in the industry or look at some problem and determine it should be better. In early customer discovery, you often get feedback that your idea is interesting, would be neat, and they would love to try it.
A “must-have” usually starts with the entrepreneur speaking about the problem. They describe what the problem is, who it occurs for, how often it happens, how the customer is already trying to solve the problem but existing solutions are not good enough. This is usually one of the mission-critical priorities of that customer’s business. In early customer discovery, you hear customers wanting to know when/where they can buy it, how quickly they can get implemented, and you feel the passion/pain in their voice at solving this problem.
How these scale
You can build a business with a “nice-to-have” but it is more difficult to scale. There is higher churn, the sales cycles can be harder, when times are tough budgets tighten more and proving ROI can be difficult. A “must-have” has immediate ROI and part of a mission critical workflow. These types of solutions customers cannot live without and would be devastated if the solution were taken away. There is often a virality where customers will strongly recommend it to their colleagues and peers.
It takes a similar amount of time to build a business for a “nice-to-have” vs. a “must-have.” Why not spend the time to do the customer discovery up front and ensure your time is spent on a “must-have” problem that could have a greater chance of success and scale if you get it right?