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How to validate idea if potential market is very small (high ticket)

Idea threads

Drq

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So here's the situation:

I've identified a problem that is a very large scale (costs companies potentially $xx,xxx,xxx/year), can be partially solved (20-30%, possibly up to 50-60%), I know who my clients would be, and I can solve it (to the % outlined above). It's not easy or simple, but i have some ideas on how I can approach it.

The problem comes with validation - all of my potential clients are very big companies - in the $x,xxx,xxx,xxx range if not more. So the question is - how do I validate the idea, or even if i just decide to take a leap and set up, when the time comes, how do I even get in touch/set up a meeting with the decision makers there, without any background in the industry before?
 
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liljmoneyswag

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How hard is it to solve this problem? When you approach a company and tell them that you are saving them 20-60% of figures, they are going to ask you how. No one is going to pay for the service if they don't have any trust in it.

If you tell them and it's fairly easy to save them money, then they might not need you and do it themselves.

If it requires software that hasn't been made yet, or a team of people to accomplish, or a some complicated system then they have a higher chance of hiring you.

If the market is low then you might have to charge a decent amount depending on your expenses. The good thing is, if you are saving them money every year than these will be repeating clients.

Competition(If you are making money, there's going to be sharks coming): I assumed that you already checked if someone has already taken your idea. If someone tries to replicate your business and tries to offer your clients a lower price, how will you respond? Does what you do require a specific skill set that is not easy to master? For example, billion dollar companies get their taxes done at kpmg, Deloitte, e&y b/c they provide top notch accounting services and not at some small firm. Even if your idea is difficult to set up, but if the solution is straight forward and not difficult to F*ck up, then the Entry commandment will be violated. Competitors will come for your clients. One way to stop this is to maybe offer a long term contract with your clients.

On the other hand, if you are saving them huge amounts of money, then one or two business deals can make you rich and you can retire or w/e. Companies are always looking for ways to cut cost. Make sure your idea will save them money, and that there aren't any barriers(laws,regualtions etc..) preventing you from doing it.

If you idea can actually save them 20-60%, then you should have no problem landing clients. "Hey, my company helps cuts cost by 20-60%, can we meet and i present my proposal?" Find their corporate emails and contact them.
 

Drq

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How hard is it to solve this problem? When you approach a company and tell them that you are saving them 20-60% of figures, they are going to ask you how. No one is going to pay for the service if they don't have any trust in it.

If you tell them and it's fairly easy to save them money, then they might not need you and do it themselves.

If it requires software that hasn't been made yet, or a team of people to accomplish, or a some complicated system then they have a higher chance of hiring you.

If the market is low then you might have to charge a decent amount depending on your expenses. The good thing is, if you are saving them money every year than these will be repeating clients.

Competition(If you are making money, there's going to be sharks coming): I assumed that you already checked if someone has already taken your idea. If someone tries to replicate your business and tries to offer your clients a lower price, how will you respond? Does what you do require a specific skill set that is not easy to master? For example, billion dollar companies get their taxes done at kpmg, Deloitte, e&y b/c they provide top notch accounting services and not at some small firm. Even if your idea is difficult to set up, but if the solution is straight forward and not difficult to F*ck up, then the Entry commandment will be violated. Competitors will come for your clients. One way to stop this is to maybe offer a long term contract with your clients.

On the other hand, if you are saving them huge amounts of money, then one or two business deals can make you rich and you can retire or w/e. Companies are always looking for ways to cut cost. Make sure your idea will save them money, and that there aren't any barriers(laws,regualtions etc..) preventing you from doing it.

If you idea can actually save them 20-60%, then you should have no problem landing clients. "Hey, my company helps cuts cost by 20-60%, can we meet and i present my proposal?" Find their corporate emails and contact them.

The development of the solution will be continuous, so as time goes, so will the barrier to entry. As I already have a lot of knowledge in the area, and the skillset I need, the risk of new competitors (that would perform better than me) is very low.

Yes, it will be repeat clients, because I am in a position to check if their problem is still not solved, and it's not. The only risk is that they might be benefiting somehow from leaving the problem unsolved (short term).

How do I position myself so they believe I can do a better job than some tech guys they hire for a salary?
 

conquer

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Offer your service for free or at a discount for your first customer to prove your results and have a solid testimonial for future customers. This method has been used and suggested by @snowbank .

Or you can hustle until you get in contact with a decision maker who is willing to try out your service or product.

Analyze the end outcomes of either method and make necessary tweaks and adjustments to deliver maximum value.
 
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G-Man

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It's not easy or simple, but i have some ideas on how I can approach it.

If you're going to get in front of shot-callers at large companies you're going to need more than ideas.

How do I position myself so they believe I can do a better job than some tech guys they hire for a salary?

You can't position yourself to make them believe anything. You have to actually provide more value to them than the tech guys they salary.

Work for free on a few might be the game plan on something like this.

.
 

Jon L

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I'd scale way, way back first. In order to solve an eight-figure problem, you can't be asking 'how do I find people to talk to.' You need to already know the answer to that question in order to play in this league.

Also, offering something for free isn't going to cut it, either. "Free" in this case could cost your customers tens of millions of dollars. They're not going to risk that just (especially?) because you're offering something for free.

Having said that, there's nothing stopping you from calling companies up and asking for their 'director of ____.' Tell the gatekeeper that you're doing some market research and want to validate an idea. If you ask nicely, that will often get you connected with someone.

When you talk to the Director, tell them about your idea, and ask them if there would be a need for a solution to that, and if they've ever considered what you're proposing.
 
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Drq

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If you're going to get in front of shot-callers at large companies you're going to need more than ideas.



You can't position yourself to make them believe anything. You have to actually provide more value to them than the tech guys they salary.

Work for free on a few might be the game plan on something like this.

.

As it turns out, i can make enough of a demo for a proof of concept, so I might be able to give them a preview of what's to come.

I'd scale way, way back first. In order to solve an eight-figure problem, you can't be asking 'how do I find people to talk to.' You need to already know the answer to that question in order to play in this league.

Also, offering something for free isn't going to cut it, either. "Free" in this case could cost your customers tens of millions of dollars. They're not going to risk that just (especially?) because you're offering something for free.

Having said that, there's nothing stopping you from calling companies up and asking for their 'director of ____.' Tell the gatekeeper that you're doing some market research and want to validate an idea. If you ask nicely, that will often get you connected with someone.

When you talk to the Director, tell them about your idea, and ask them if there would be a need for a solution to that, and if they've ever considered what you're proposing.

I do know who to call (company), just wasn't sure about handling the corporate structure I guess. It's a continuous service all year round, so free might be a week's worth or something that would just take time for me to put together, which is fine, I am okay investing or even taking a leap of faith to see where it leads me.

Thanks for the "just calling up companies" idea. It is basic, but hadn't occurred to me to just dive in.
 

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