Testing Business Ideas

DEFINITION

Hypothesis

The hypothesis has its roots in ancient civilization. The English word “hypothesis” comes from the Greek word hupothesis which means “to suppose.” Some even refer to a hypothesis as an educated guess. Hypotheses are instruments you use to prove or refute your assumptions.

For the purposes of Testing Business Ideas, we focus on your business hypothesis, which is defined as:

• an assumption that your value proposition, business model, or strategy builds on.
• what you need to learn about to understand if your business idea might work.

Creating a good business hypothesis

When creating hypotheses you believe to be true for your business idea, begin by writing the phrase “We believe that…”

“We believe that millennial parents will subscribe to monthly educational science projects for their kids.”

Be mindful that if you create all of your hypotheses in the “We believe that…” format, you can fall into a confirmation bias trap. You’ll be constantly trying to prove what you believe, instead of trying to refute it. In order to prevent this from occurring create a few hypotheses that try to disprove your assumptions.

“We believe that millennial parents won’t subscribe to monthly educational science projects for their kids.”

You can even test these competing hypotheses ...