In my last email I covered the technical mistakes that cost founders the most.

Today's the second risk: market risk. That's when you build something without proving people will actually pay for it.

With my own product, I built what I thought people wanted instead of finding out what they'd actually buy. That one assumption cost me as much as any engineering mistake I made along the way.

Every founder I work with feels the same confidence about their idea. But no matter how good you think the idea is, you still have to prove that strangers will spend money on it.

Most founders assume they need a finished prototype before they can do any real validation. That's one of the biggest myths out there.

You can start proving demand long before you have a working product.

So if I were starting a new product today, here's the process I'd follow before spending significant money on custom engineering.

The first thing I'd do is get in front of real potential customers. Not friends, not family, but strangers who have no reason to be polite about your idea.

Friends will tell you it's great because they care about you, not because they'd spend money on it. Strangers don't have that incentive.

I know this can feel intimidating if you've never done it before. It doesn't have to mean cold-calling people or putting yourself in uncomfortable situations.

There are simple, low-pressure ways to get honest feedback, and it's one of the things we help members figure out inside the Academy.

You're trying to find out whether the problem is painful enough that people are already spending money or effort on bad workarounds. "That would be nice to have" isn't demand, but someone who's already paying for a bad solution and still frustrated is a real signal.

Once you've confirmed the problem is real and painful, the next step is testing whether people will actually put money behind it.

Surveys don't count as validation. People will say yes to "would you buy this?" all day long, but saying yes costs them nothing.

So set up a simple reservation funnel where people can put down $1 to reserve a spot. A dollar isn't much, but it crosses the line from interest to real commitment.

If you can get strangers to put down a dollar, you've got a real signal. If you can't get anyone to commit even a dollar, that's worth knowing before you've committed thousands.

Once you have a later-stage prototype, you can move into pre-sales or crowdfunding to validate demand at a larger scale. This does double duty: it confirms the market at real volume, and it starts generating the capital you'll need for production.

That last part ties directly into the next email, the third risk: financial.

The principle is the same at every stage. It's always cheaper to find out something's wrong now than after you've locked in tooling, certifications, and a production order.

Cheers,

John Teel

Founder / Engineer
Predictable Designs

P.S. If you're not sure how to validate demand before spending serious money on development, that's one of the things we help members work through inside the Hardware Academy.