When I am looking at entrepreneurial opportunities and deals, the critical piece I value is the proof of concept. This can take varying forms. Let’s examine software as a service, for example.
Is there demand for the product? Starting with a service that is sold and delivered manually shows that a paying customer values the fulfillment. Everything does not have to be automated at first. The kinks have to be worked out by truly solving the complex, nuanced problems a customer faces in the trenches.
After working hard at efficiently delivering a service, it makes it easier to build software as a service because the requirements are contained in the fulfillment and customer success processes.
From there, seek to sell to multiple new customers. Then automate. Automation represents scaling by doing more with less, whether through tools or full stack software.
When you have paying customers working with the minimal viable product or service, the proof of concept has emerged.
The entrepreneur next challenge is scaling with development, sales and operations. Without knowing if someone will buy or refer what you have to offer in the first place, you are guessing at what the market wants and that’s a high risk bet. Better to lower risk by testing, testing, testing and then extrapolating the learning into a bigger bet later.