There is absolutely no point building a blockchain-based product that nobody wants, will ever use, or build on top of.
If you’re planning a crypto project purely for the money, or if you’re in it to raise funds without much thought of how that money will be invested, your project has already failed before it’s even begun. According to data from DeadCoins and Coinopsy, approximately 1,000 cryptocurrency-related projects failed in 2018 and are now nowhere to be seen.
It’s commonplace for startups to fail in the initial year or so of their inception, and the crypto space is no exception to the rule. Many speculate about the reasons for failure. A deficit of funds, scams, little community support, the list of failures goes on and on. Very few cite market validation when perhaps they should.
To know whether or not your crypto project has a good chance of success, it should be validated. In this article, we will look at the three steps you should follow to properly validate your project idea.
STEP 1: Validating The Problem
It may seem like the most obvious step of all, but you’d be amazed how many people skip it. No matter how confident you are in your project idea, you first need to first figure out whether the problem is real. To do this, your best option is to talk to potential users directly. Your focus here is on getting qualitative validation of the project idea. The goal is to ask potential customers open-ended questions, then listen and learn from user responses.
Test Your Idea At Crypto Events And Within Online Communities
This can be done by attending local meetups like cryptomondays, joining online communities on Telegram, attending hackathons, and by talking to other cryptopreneurs that are starting or have already started a project. Let your trusted connections know about your idea and get feedback from them. Don’t rely on their feedback alone - those who are willing to play devil’s advocate to your ideas are among the most valuable people you will meet.
The learning you take from attending these events and talking to potential users will give you the confidence you need to move your idea forward. Or they’ll teach you that you need to pivot your idea as you learn more about the real underlying problems.
Find People Willing To Use Your Product
This is a simple way to get a feel for whether your idea is worthwhile in the still relatively new, but highly competitive market of blockchain-based projects. While talking to potential users, at crypto events and within online communities, find a representative amount of people who say they would be keen to use your hypothetical product.
While it doesn’t necessarily guarantee that your proposed solution is good or valuable, it’s the simplest way to begin validating.
By setting yourself a firm goal of, for example 10 users, you have a target to hit before you can complete this stage. It doesn ́t matter if what you're building is end user-centric or developer-centric, if you can find a handful of people to gain feedback from within these online and offline events, it’s well worth the investment of time.
Spend as long as needed talking to your potential users, figuring out their pain points, which products they’re using and what they need. By now you should have an idea of who your potential users are and how your product will help them.
STEP 2: Validating The Market
There is no point in building a blockchain-based product if nobody will ever use it or build on top of it. Yes, we already said that part, but it’s important enough to mention again.
Once you’ve spoken to potential users and validated that the problem exists, you need to make sure there is a large enough market to justify taking the idea further. By this, we mean enough businesses, developers, crypto enthusiasts, and end-users in general, to adopt what you’́re going to build.
By gathering as much information as you can about the potential market, you’ll be able to make an educated guess as to the size of your target audience and the number of end-users and developers you can acquire. It’ll also help you to figure out potential pricing for your product, which will be valuable as you start to make other financial projections.
This article continues in Part 2.