Risk Management and Reading Market Trends in Startups#

The biggest thing I've realized while preparing to start a business is that risk management accounts for 90% of the whole game.
No matter how great your idea is, it seems really hard to succeed without properly managing risk.

People Don't Readily Use New Products#

Most people tend to stick with what's familiar.
If there's no compelling reason to use a new product or service, they won't easily open their wallets.
That's why founders absolutely must verify that there's sufficient pain.
It's crucial to validate whether customers truly feel discomfort and are ready to spend money to solve that problem.

How to Turn High Risk into Middle Risk#

When you first start a business, everything feels like High Risk.
But if you read market trends (demand) well and launch your product (boat) along that current, you can lower the risk to Middle Risk. In other words, it's much safer to launch your boat on a river that's already flowing.

Learning from Funded Teams#

If you watch Premier, SparkLabs Demo Day videos on YouTube, you'll see that only teams that have already received investment make it to the stage.
These teams are proven cases in the market, so you can learn a lot by watching their presentations.

• Primer: 50 million KRW investment, 10% equity -> Company valuation of 500 million KRW
• SparkLabs: 40 million KRW investment, 6% equity
• Blue Point Partners: 100 million KRW investment, 10% equity -> Company valuation of 1 billion KRW

If you have an even stronger team, you can receive even larger investments.

The Difference Between a Service and a Platform#

• A service is one-directional. One side provides, the other receives.
• A platform is two-directional. Multiple parties interact and create value together.

You need to clearly distinguish whether what you're building is a service or a platform, and approach it accordingly.

Verify That Customers Are Ready to Pay#

Before diving deep into development, you absolutely must confirm that people are ready to pay money for that problem.
Don't just trust what people around you say -- validate through real situations.

Evidence Based Entrepreneurship#

Entrepreneurship shouldn't be based on gut feeling -- it should be evidence-based.

• Founder team -> Customer discovery -> Customer validation -> Validated business model
• Customer discovery -> Customer validation -> Customer creation -> Company building

You should progress by validating at each stage like this.

Strategy When Your Awareness Is at Zero#

At the beginning, nobody knows your service. That's why you need to find the customers who are most desperate about this problem.
Focus on them, get quick feedback, and iterate. That's what matters.

Using Problem Definition Statements#

Apply these two sentence templates to your service to define the problem concretely:

• I believe that [a certain person] experiences [a certain problem] when [doing a certain thing].
• I believe that [a certain person] experiences [a certain problem] because of [a certain constraint].

Defining the problem this concretely helps you create a clearer solution.

Startups are always uncertain and risky.
But I believe that if you read market trends and accurately identify customer pain points, you can increase your odds of success.

Adversity causes some men to break, others to break records.

— William Ward