The six questions
Questions Every Founder Should Answer About Their Business Idea.
The method starts with the founder answering six questions, as the first step when evaluating their business idea
When you ask yourself about your business idea: “Is this a good idea?” isn’t really something you can answer immediately. It’s too vague and broad. What you can answer is a set of specific claims about how the idea actually works.
That’s what these six questions do — they turn a vague idea into six concrete answers, each one a hypothesis you can check, instead of a feeling you can’t.
Once you have those six answers written down, two things become possible: You can compare them against each other, and find where one answer quietly is not on sync with another.
This is usually where an idea actually needs more attention — not in the idea itself, but in the gap between two parts of it that were never checked against one another.
Later in the method the plan is for you to analyze those answers against your own time, money, skills, and partners, and see honestly what this specific idea is going to demand from you.
Here are the six questions that need to be answered
- What value does your company provide for the customer?
- Who are the users receiving that value?
- How does the customer get that value delivered?
- How does your company capture that value as revenue?
- Who are the paying customers?
- What does the customer use today to solve that pain?
But to answer these questions properly, they need to have some specific information.
1. What value does your company provide for the customer?
The answer to this question needs to include two things. First, what the customer actually gains, or what problem stops happening for them. Describe it from the customer’s point of view, not from your product’s point of view. Second, the answer needs to show the primary Core Value Driver behind that gain. This means naming the real reason people would pay for it — for example, saving money, saving time, or gaining status.
2. Who are the users receiving that value?
The answer to this question needs to include two things. First, a behavioral description of this person: what they actually do, and why. Age, income, or job title are not enough, because two people with the exact same profile can behave in completely different ways. Second, their specific motivation or pain, described in their own words whenever possible.
3. How does the customer get that value delivered?
This answer needs two things. First, the specific channel the customer uses to access your solution. Second, how the customer experiences that delivery. It is not enough to name the tool or format, like “a mobile app.” You need to describe what actually happens for the customer, step by step, when they use it.
4. How does your company capture that value as revenue?
The answer to this question needs to include two things. First, the revenue mechanism: for example, per unit, subscription, commission, or advertising. Second, the pricing positioning. This means explaining what that price tells people about where you sit in the market. Naming the mechanism alone does not tell you if you are the cheap option or the premium one.
5. Who are the paying customers?
This answer needs two things. First, whether the payer is the same person as the user, or a different person. Second, if the payer is different: who pays, why they pay, and whether the two sides of your model need each other in order to work. Founders often skip this second part, and that is one of the most common reasons a business model looks solid on paper but fails once it meets reality.
6. What does the customer use today to solve that pain?
This answer needs two things. First, the customer’s specific current alternative. This can be something as simple as a spreadsheet, a manual workaround, or simply living with the problem. Saying “I have no competition” almost always means you have not looked hard enough. Second, the switching cost: what it would actually take, in money or in changed behavior, to get the customer to give up that alternative for yours.
In future posts, I’ll go deeper into the Core Value Drivers, and I will provide more details into how to properly answer each of these six questions.
Now I have some question for you:
What do you think about these six questions?
Do they cover everything you need to properly evaluate your idea?
Which one is the hardest to answer, in your opinion? And which one is the easiest?
Your comments and feedback are what’s actually going to make this a solid framework.