Don’t get me wrong. When you’re an entrepreneur, you need every great idea you can muster. You want to drink ideas out of a firehose because you never know where the next great product or feature or improvement is going to come from.
But you also need a filter — a very fine, very strong filter — to separate ideas that are great on paper from ideas that turn into expensive failures that damage reputations, morale, and bottom lines.
In over 20 years building products and running startups, I’ve rejected some really great ideas. I’ve also had some of my best ideas rejected by people who, as it turns out, were smarter than me.
Rejecting ideas is a necessary skill and one you’ve got to be confident about. Otherwise, you could find yourself picking up pieces of what, on paper anyway, was such a sure thing.
The “killer” idea
We’ve all been on the other end of someone else’s killer idea becoming reality, where we’re one of a small minority, maybe the only person convinced that the killer idea is actually going to kill the company. Or at least hurt it badly.
Maybe we weren’t in a position to speak up at the time. But what if we were? What if we are now?
Do you have the experience, the skill, and the straight-up fortitude to kill a great idea before it kills your company?
I’m not talking about bad ideas, like a bathtub full of mayonnaise. I’m talking about great ideas, an idea that everyone around you thinks might be comparable to the invention of fire.
Anyone — and I mean anyone — can spot a good idea. Bandwagons and mobs are pretty easy to join. Not everyone can walk into the party and turn off the music.
You need justification because there are quite a few ways a great idea can turn into a terrible idea, you just need the proper protocols to turn your doubt into data.
Gut Check 1: The idea doesn’t have a strong revenue case
The most dangerous great ideas come about when something your company is already doing triggers the possibility of doing something else that’s really cool, maybe even amazing.
The easiest response to this kind of idea is to point out a lack of revenue case. But that argument can quickly devolve into the same kind of argument used to prop up the idea in the first place.
In other words, it’s very easy to turn the statement: “This is so amazing, everyone will want it” into “This is so amazing, everyone will buy it.”
You’ve probably been on the losing end of that argument in the past. The counterargument you’re looking for is: “At what price?”
There are a lot of truly groundbreaking ideas out there yet to be productized because the idea is waiting for the right advancement before the solution can be offered at a price point and packaging that makes sense for mass adoption.
There are usually a handful of reasons for the failure of successful productization of an idea, and here are the top three:
A solution in search of a problem. There is a big difference between a cool product and a must-have product. The former is a guaranteed failure, the latter is a guaranteed success. It’s difficult to know if you have a must-have product or not, but one surefire way to know you don’t is if the idea is a solution in search of a problem.
Hidden costs and complexity. As I said, a lot of ideas come about as variations of an existing success that require “just a small tweak” to expand into a new product, feature, or market. Consider how that small tweak will create issues downstream from the prototype into the customer’s hands. You may find that before you get to a customer, there are a lot more necessary pivots in production, sales, fulfilment, and maintenance that add up to a lot of new costs.
Scale. Most business ideas die at scale. Remember, no matter how similar an idea is to an existing successful execution, the scale doesn’t replicate, ever. Otherwise, every movie sequel would be more successful than its predecessor.
So what happens if the idea passes all those checks?
Gut Check 2: The idea doesn’t align with your product pipeline
The only thing harder than supporting two products at the same time is running two companies at the same time. If you’re not careful, the great idea that’s in front of you could be the beginning of both of those scenarios.
I’m not saying that every new feature has to be a clone of an existing feature. In fact, it can be healthy to make major pivots to your business, even in the best of times.
Just remember that with any pivot, you’re changing direction, not adding a new direction. Consider what happens to your existing product, feature set, and the market as you put all or most of your focus into something new. If there’s no alignment, no bridge between the two, then the current business will certainly suffer.
I’ve run two companies at the same time. I finally got the sense to sell one so I could focus on the other, and I’ll always feel like the potential of the one I sold went unrecognized.
But what do you do when the idea can be shoehorned right into your existing plans?
Gut Check 3: The market for the idea isn’t addressable
A glaring mistake most rookie entrepreneurs make is when they assume the customer they’re going after has unlimited money to spend. Customers have budgets. Therefore, markets have limits.
I’m in the process of rejecting a great idea right now because someone finally said to me: “You’re making the customer decide between your product and another product. If they have or want the other product, they’re not going to buy your product, even if you have what they need.”
In other words, the changes the idea brings to your product should create the kind of positioning that puts your product into a new category. If you solve problem A, and your competitor solves problem B, you can’t just start solving problem B. You need to combine the problem into problem C, and solve that.
You don’t want your new customers to be forced to make a change, you want them to evolve. Otherwise the great idea really just boils down to going after your competitor. If the market is worth it and you think you can win, fine, but remember, it takes money and time to take a competitor out.
But what if the idea checks all those boxes and you’re still very much against it? Don’t make another rookie mistake.
Experiment the idea to prove its validity, not find it
Experiments are great. A good experiment can significantly reduce the amount of risk in implementing a great idea for a new product, feature, or market.
But experiments should only be run to prove an existing, quantifiable hypothesis. They should never be run as a test to see if “Everyone will buy it.”
Again, I’m a huge fan of experimentation with business and product, but here are three situations where I won’t run an experiment.
1. The MVP has to be built before viability can be tested
A company should never build an MVP without some pre-existing proof of viability that is rooted in the market and validated by the customer. An easy way to do this is market research, but that will produce the least accurate results. A hard way to do this is with a prototype, which will produce more accurate results, but is expensive and starts to bleed into all those focus problems that you want to avoid in the first place.
2. The experiment isn’t for the customer
Never run a market experiment to see if you can pull something off. This is what R&D is for. If you need R&D to validate the idea, dedicate resources or partial resources to the idea and segregate them from the rest of the company to work on the idea in a vacuum. That team will need to prove the concept without market pressures forcing them to declare a positive result.
3. The idea doesn’t align with the company mission
This is my most popular reason for rejecting a great idea, and it’s also the easiest reason to reverse if I want to un-reject the idea. It’s also the most important reason to give.
Just because an idea is great doesn’t mean it’s the right time, you have the right team, or that the idea will result in sustainable success. A leader succeeds not by making the right decision in the moment, but by making the right decision for the success of the company’s mission.
As a leader, the responsibility to protect that mission is yours. And that’s reason enough. If it isn’t, take a hard look at your company mission. It may be time for a rewrite.
This article was originally published on Medium by Joe Procopio
Joe Procopio is a multi-exit, multi-failure entrepreneur. In 2015, he sold Automated Insights to Vista Equity Partners. In 2013, he sold ExitEvent to Capitol Broadcasting. Before that, he built Intrepid Media, the first social network for writers. You can read more and sign up for his newsletter at www.joeprocopio.com
