How to validate your B2B startup idea
To gauge the venture-scaliness of an idea, investors look for:
- Large enough market: Are there enough people (or companies) spending enough money for you to be able to generate $100M in revenue per year—and eventually $1B in revenue a year? This usually means that the total addressable market (TAM) needs to be $5B or more. And the bigger the better
Lenny Rachitsky • Your startup idea probably isn’t venture-scale
As a seed-stage investor at First Round Capital, I get to meet a lot of founders who are exploring and validating their ideas. It’s an exciting time for them and, as a former founder myself, I relate to the thrill and anxiety of just getting started. You believe you’re onto something and feel ready to bring your idea to life, but there’s also a lot... See more
Lenny's Newsletter • How to validate your startup idea
Founders spoke to a median of 30 potential customers to validate their idea before committing.
Lenny Rachitsky • How the most successful B2B startups came up with their original idea
A great business idea isn’t enough. You need to quickly and cheaply test your assumptions to establish whether your product meets the needs of a market and fills this niche well enough for people to pay for it. The early days of a startup should involve constraint testing, tweaking and learning with the ultimate goal of discovering product/market f
... See more