At Bunny Inc., we love to innovate. We have experimented with many products and services and we will experiment with many others in the future. All this innovation requires resources. Those resources are usually obtained with money. As such, sustainable innovation usually requires a sustainable business. Determining whether an idea is viable as a business is key to its long-term success.
In the book Zero to One, Peter Thiel proposes a set of questions that every entrepreneur should answer in order to know whether a good idea can become a great business. We've taken the liberty of altering and expanding that list.
Whenever you are working on a new business (or considering investing more in an existing one), answer these questions honestly:
- The Secret Question: Have you identified a unique opportunity that others don’t see?
- The Engineering Question: Can you create breakthrough technology instead of incremental improvements?
- The Timing Question: Is now the right time to start this business?
- The Size Question: Is the potential market size large enough?
- The Growth Question: Do you have a way to not just get, but to systematically get new clients fast?
- The Monopoly Question: Can you quickly own a big share of a small market?
- The Lifetime Value Question: Will your clients use your product or service over and over again?
- The Durability Question: Will your market position be defensible 10 and 20 years into the future?
- The People Question: Do you have the right team?
Only if all these questions are answered positively should you move ahead.
Here are our answers for VoiceBunny:
The Secret Question: Have we identified a unique opportunity that others don’t see?
Yes: Clients want predictability in terms of pricing, quality, and turnaround when it comes to professional voice over recordings. This can be achieved with an end-to-end marketplace that uses ▊▊▊▊▊▊▊▊▊▊ and ▊▊▊▊▊▊▊▊▊▊▊▊▊▊▊▊▊▊▊▊.
The Engineering Question: Can we create breakthrough technology instead of incremental improvements?
Yes. We did. That’s why VoiceBunny has grown quickly. You can learn more about our technology here.
The Timing Question: Is now the right time to start this business?
We think it was, given that VoiceBunny has been quickly adopted by the market.
The Size Question: Is the potential market size large enough?
Borderline yes (around $500 million per year).
The Growth Question: Do we have a way to not just get but to systematically get new clients fast?
No. SEO (search engine optimization) and WoM (word of mouth) have allowed us to grow, but at a small pace. The virality factor is almost null. Unfortunately, we haven’t been able to find a solution.
The Monopoly Question: Can we quickly own a big share of a small market?
No. We haven't been able to achieve this. We probably own less than 1% of the voice over market. We don’t think we’ll own most of it anytime soon.
The Lifetime Value Question: Will our clients use us over and over again?
No. Most people only need one voice recording.
The Durability Question: Will our market position be defensible 10 and 20 years into the future?
Probably yes, because of network effects.
The People Question: Do we have the right team?
Yes! Check it out. By the way, we are hiring.
Verdict: VoiceBunny is a nice business, but because three of the questions have negative answers, we haven't been able to make a great business out of it. Fortunately, VoiceBunny is just the beginning. We are now expanding to other categories.
What’s the verdict for your startup idea?