Taking A Closer Look At Startup Assumptions

Did you take a look at your startup assumptions lately?

Risk is a definite part of your startup. A startup is built on assumptions. Assumptions are made about products, clients, and the right business model. And assumptions stress us out, especially those that are riskier than others.

So how do you know which assumptions are risky?

First, be honest about your assumptions. What I mean with this is that you should be really clear about everything that you do not know for certain.

Second, look at the impact of your assumptions. Impact can be very small and not influencing the business model or product model or it can be detrimental, having you change your marketing strategy or pricing.

Now, as Method Frameworks states “no business possesses a crystal ball to know exactly what will happen in the economy, financial markets or competitors next bold moves. That means that assumptions are a necessary evil”.

Let’s have a closer look at the impact. Identify the kinks in your production cycle, employee knowledge, and financial dangers if sales targets are not met in the first few months. Got them listed down? Now divide them up into four groups, like in the matrix below. It will help to understand how these risks need to be dealt with if the assumption doesn’t hold up.


To help you identify assumptions, answer these questions:

  1. Are you taking anything for granted?
  2. What is your business model assuming?
  3. Why are you assuming potential clients like your product?
  4. What is not a researched fact about your target market that will influence sales?

Once you have the answers, test your service or product. Don’t worry about failure – that doesn’t exist. Learning an assumption is incorrect is great news, because you can now redirect your course of action and nip the problem in the butt. Sure, it’ll feel like one step forward and two steps back; that’s why you need to find out about the correctness of your assumptions early on.

Yes, I know you are probably scared of the ramifications. I was. Actually, I still am. But that doesn’t stop me. Because I know that learning from low moments is not theory but best practice and that has kept me in business.


lisette profile photo

As Founder of Kaleidoscope and Business Mentor, Lisette Andreyko works with start-ups on gaining strategic focus. She is passionate about leadership development in start-ups.

Connect with LisetteLinkedIn – Twitter – Facebook

Want to Get Featured or Advertise on StartupCatchup? Get in touch!