Every idea has one unique unit of value…
Hint: It’s a linchpin experience that makes or breaks an idea
When an idea is pitched to me, I listen intently for how it will change someone’s life. And as soon as I hear it, I can’t help but do the maths on how many lives the idea will touch on a regular basis. If I don’t hear it, and instead get bombarded with a top-down opportunity analysis that misses why a person would change their day to take notice and use a product, my mind disengages and I lose interest.
You see, at the heart of every big idea is a single unit of value which will determine its fate, regardless of industry or how crazy it might sound in the beginning. Serial entrepreneurs and early stage investors can often identify each idea’s unique unit of value even though it’s often hidden by the hustle done by founders trying to excite and convince their audience that their idea has merit.
On the entrepreneurial spectrum of idea-to-market dominance, this single unit of value concept lives at the very beginning, before prototypes, before traction, before mission and vision are known, and even before a lean business model canvas is fully complete.
Five important factors make up each idea’s unique unit of value:
1. One single experience where someone is exposed to a new and easily addictive convenience. Obviously this experience is unique to each idea but the point is that it is the linchpin experience to which every other aspect of the idea relies and if you don’t get this right nothing else matters
2. The fact that this single experience is THE essential component in single actor business models (where users become paying customers) AND in multi-actor business models (where users and customers are different actors and value is monetised using a derivative currency e.g. the way Facebook leverages its millions of frequent users to generate revenue from advertisers). The latter includes marketplaces where buyers and sellers need to be simultaneously active in order for the model to create monetisable value.
3. The fact that this experience is present at the beginning of the idea and has real potential to transcend scale. Although business models evolve over time, the experience that delivers easily addictive convenience will create (and continue to create more and more) happy users and customers as long as the experience can continue to be the focal point of a growing team.
4. It can be easily expressed and internalised. This means that every person working on the idea, no matter their role, seniority, experience or tenure can rapidly develop a passion for why the experience matters, and how they can contribute to it moving from idea to remarkable.
5. A major hypothesis to test. A hypothesis is a proposed explanation made on the basis of limited evidence as a starting point for further investigation. Many first-time founders are afraid of or don’t understand the power of using hypothesis-led testing to validate or invalidate an idea. Crafting a compelling hypothesis is made significantly easier when a clear idea of the single experience you plan to deliver is available.
Let’s add a little color to this concept. At AirShr our unit of value is a radio listener pushing a button to save a moment of radio that they love.
Of course we obsess about making the act of saving a radio moment as elegantly intuitive and personal as possible for each and every listener. We do this to strive to match the way you would seamlessly create a memory because we understand the act of reaching out to hold onto sound from radio — one that’s just changed the chemistry of your mind to make you smile and laugh out loud or relax or make your heart beat faster or inspire a point of view or help you vividly re-live a memory from a time that seems like just yesterday — is important to many people’s every day.
We also know that helping one person instantly share a moment of radio with another, so that they can experience a similar feeling, is at the core of what we think is a new and easily addictive experience (Factor 1).
What I’ve described here is exactly my feeling on the first day I consciously experienced the desire to remember a radio moment, before there was a business model, co-founders, users, customers, funding or a team.
In helping people listen differently we have also discovered our purpose and just how passionate we are about making life insanely easy to remember, starting with radio. This is important because it’s led us to understand how the experience we’ve created fits into a business model. AirShr operates a multi-actor business model where listeners regularly using AirShr on a massive scale create a derivative asset which is sold to broadcasters so they can understand for the first time who’s listening (Factor 2).
The experience of listeners pressing a button (or using their voice) to save a moment of radio they love whether via a smartphone app, using AirShr Drive, tapping an Apple Car Play or Android Auto icon is as fundamental to AirShr future as it was on day one (Factor 3).
In terms of Factor 4, every listener I’ve met has experienced the issue of not being able to hold onto or share a moment they loved and our customers enjoy being able to leverage insight to create a better listener experience.
And when it came to testing AirShr’s validity, we developed this hypothesis:
Listeners care enough about radio to push a button to remember it (Factor 5). This hypothesis continues to be a guiding light for our team today, as it did in our first alpha test which you can read all about here.
The punchline is that there is a finite amount of time to determine if an idea is worth pursuing. Applying this unique unit of value concept will help short-circuit this process and help you begin validating a hypothesis which will either tell you if the unique unit of value is close to 1 (a new, easily addictive experience that draws high engagement) or closer to zero. If the latter, start celebrating and move on! You just saved yourself a potentially enormous investment in time that cannot be recovered!