Problems are often opportunities in disguise and entrepreneurs are the problem solvers who have the ability to identify problems and find solutions. With funding provided by the Kauffman Foundation, Entrepreneurial Learning Initiative, LLC has developed a tool called the Opportunity Discovery Canvas.
During periods of global disruption or such as the financial crisis of 2007-2008 or a crisis such as the COVID-19 pandemic many existing businesses will fail and supply-chains will break opening up potential new markets, new regulations are passed breaking existing business models, and new industries are created or strengthened as consumer demand changes in a post disruption world. Savvy entrepreneurs can use the Opportunity Discovery Canvas to validate the potential of a possible new business idea or an entirely new business model.
The Opportunity Discovery Canvas tool was designed to help entrepreneurs that have identified a problem to work through a basic framework to evaluate the feasibility of their solution.
Using a series of questions that make up the Opportunity Discovery Canvas, entrepreneurs can examine the problem in detail, propose a solution, and connect with the customer to help them determine if their idea is worth building a business around.
The first step in the Opportunity Discovery Canvas is to focus on the problem that you intend to solve. The following questions are intended to enable you to understand the problem through the eyes of prospective customers and potential investors.
- Describe the problem you want to solve.
- How did you encounter this problem or unmet need?
- Do other people have this problem?
- Why is this problem worth solving?
- Describe the people who most likely have this problem.
- What is their age, gender, areas of interest, profession, etc?
- Which of these potential “customers” can you most easily connect with?
- Describe other solutions that are currently available.
- Why are the current solutions inadequate?
- How important is this problem?
The next step in the Discovery Opportunity Canvas is to help you think through potential solutions to the problem identified in the previous problem step. The following questions will help you define a potential solution and see if potential customers will value it enough to pay for it.
- Describe your proposed solution.
- What is the single most important feature of your solution?
- What is the most effective way to demonstrate your idea?
- How will you know if others are interested in your solution?
- How is your idea better than existing solutions?
- Describe the key differences.
- How will you know if others value this improvement?
- Will people be willing to pay for your solution?
- How often will they need your solution?
- How will you know that your solution is valuable to others?
Entrepreneurs are encouraged to test their ideas by developing minimal viable products and talking to potential customers. By presenting potential solutions to customers you will discover new obstacles as well as new opportunities. The process may also make you rethink the problem.
The final step in the Opportunity Discovery Canvas is to determine the product-market fit for both early adopters and majority adopters. In this step, entrepreneurs will assess the best possible channels to get their solution into the hands of potential customers.
- How will potential customers know about your solution?
- How can you find people who would be interested in your solution?
- What methods of communication will you use to reach them?
- What messages do you intend to convey?
- How can you make it easy for your customers to purchase your solution?
- What different channels (online, door-to-door) are competitors ignoring?
- How are they currently accessing other solutions?
- How will your customers know they can rely on you?
- How will you communicate this message explicitly?
- Why is this problem worth solving?
The Opportunity Discovery Canvas process results in two potential outcomes. One, you decided that the solution has no real merit and that customers are not likely to embrace your solution. Two, you have discovered a potential new solution that customers will exchange money for. If your solution has legs, now is the time to further develop your idea using the business model canvas.
How can you use the Opportunity Discovery Canvas to refine your business idea?