Cheat Codes: Early idea validation part I: known knowns and known unknowns

The stakes are high, and the last thing any founder wants is to pour time, energy, and resources into an idea that doesn't have legs. But how do you learn this quickly and with conviction?

You'll read many articles about building "painkillers," not "vitamins." The intent of that analogy is that building a painkiller leads to building a solution that customers genuinely need—there's both severity and urgency. But thinking in this framework obfuscates half of the market. The market size for OTC vitamins (~$30B) is larger than that of OTC painkillers (~$20B)—clearly, customers do want and buy vitamins.
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At MVL, we think in terms of the type and size of opportunity. Some opportunities are severe pains for customers, but others are meaningful benefits. Either way, the opportunity is measured by how much better it could be—how much pain it can relieve or how much growth it can achieve. 

In both cases, we follow a rigorous validation process to identify venture-scale opportunities and build compelling companies that customers want and purchase.

Establishing Knowns and Hypothesis

Typically, initial domain knowledge has led us or a founder to an opportunity space. It's helpful to write down all of your initial "known knowns"—all of the facts you know to be true. These could be current customer behaviors, their current solutions, or macro trends/changes. Not only does this formalized known-knowns exercise ground your initial thinking, but I've found that it's helpful to share with others to get them up to speed and ensure we're all working off the same knowledge.
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From here, detail what must be accurate - your core hypothesis - that must be validated in the early opportunity-validation process. You can consider these your "known unknowns." This isn't just about customer validation; these 'must-be-true' statements can span across types of validation, including:

• Customer Validation - What must be true about their behavior or motivations? (For example, must employees be willing to have their meetings recorded? Must the CRO care less about forecasting predictability if top-line growth is positive?)
• Tech Feasibility: Are there technical capabilities that need to be de-risked? (For example, must an unsupervised agent be able to navigate a SaaS application on its own?)
• Market Sizing: What must be true to make this a venture-scale opportunity? (E.g., how many SaaS companies spend >$X on software? How many roles within an enterprise company need access to PII?)
• Market Dynamics: Are there market heads or tailwinds that impact the opportunity space or approach? (For example, are regulatory changes imminent?)
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Mini Case Study: Otto focused on early validation to assess feasibility and venture-scale opportunity

Otto (a recent spin-out of MVL) is an AI-based travel agent that autonomously plans, books, and ensures business travelers have the perfect trip.

Before investing significantly in building the product, the team spent time rigorously validating the product and gaining conviction in the opportunity space. This included validation in the following areas:

• Tech Feasibility—Otto's 'why now' was the significant advancement in natural language understanding and agentic capabilities. However, the feasibility of building an agent that can understand travel nuances and preferences needed to be validated, as did the ability to use the model to call third-party travel APIs and marry the travel preferences with data in large JSON payloads. The team built a lightweight POC focused on the flight-booking workflow to de-risk and demonstrate feasibility.
• Market Sizing - Customer pain is most evident among high-frequency, unmanaged business travelers. The team investigated the market size, diving into the unmanaged business segment, specifically the massive group of travelers who "go rouge," meaning they have a corporate travel manager, but it's so cumbersome they avoid it and book directly -- so they are in a managed program, but act like unmanaged because they book direct -- we found this is 50% of our market!
• Market Dynamics—In recent years, suppliers have applied pressure, creating incentives (lower fares, loyalty benefits) for business travelers to book directly with them, yielding better margins for the supplier. This trend upends the viability of travel management companies and opens up an opportunity for self-managed solutions. 
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Summary

We've identified what needs validation. Some of these will lead you to de-risk tech feasibility or do deeper research on impending market tailwinds. Others will lead to deep customer conversations - which we will discuss in Part 2: Uncovering Insights.

To learn more about MVL, read our manifesto and let’s build a company together.