5 ChatGPT Prompts To Validate Your Business Ideas

For aspiring entrepreneurs, validation is the difference between a lightbulb moment and a profitable business. As LinkedIn co-founder Reid Hoffman has written, “(G)reat entrepreneurs know: Not every idea is going to succeed. But every idea should be treated like it could. You can only know in retrospect which ideas go the distance.”

It’s exciting to come up with a product or service that you think the world could use. Validating your idea is the process of determining if there’s a need for your product or service in your target market. In other words, it’s a way to gauge whether people will actually become paying customers.

When I launched my business nearly two decades ago, I offered a free version for nearly a year, all while keeping my day job. During that free period, I discovered that there was definitely value in my product—I had a profitable venture. Whether you’re considering a side hustle or ready to go all-in on your business idea, tools like ChatGPT can help you to validate it before you launch. Here are some simple prompts to get started today.

Define your unique value proposition

Some aspiring entrepreneurs mistakenly think that a business idea must be completely original. But in fact, some of the most successful companies didn’t reinvent the wheel—they merely offered an improved version of it. Consider a company like Warby Parker. When they launched, there were countless eyeglasses retailers; but none offered their then-revolutionary “Home-Try-On program,” allowing customers to select five frames from the website and try on at home before choosing which frames to keep.

ChatGPT can help you to define your unique value proposition—how you’ll stand out from the competition.

“I am launching a business and want to define its unique value proposition. The business will (brief description of your business idea). I’d like your help to identify what sets my business apart from competitors, considering factors like product or service benefits, market gaps, and any unique features or value it offers. Can you guide me through a process to craft a compelling unique value proposition?”

Research the current market

The Art of War author Sun Tzu once said: Keep your friends close; keep your enemies closer.

Business isn’t war but companies in the current market are your competition. The more you know about them, the better. Entrepreneurs can use ChatGPT to get a clear picture of the market as it stands.

“I am launching a business that offers (brief description of your business and any relevant geographic or demographic information). I want to research the current market to identify my key competitors and understand their unique value propositions. Can you help me identify the top competitors in my industry and provide a brief description of each one, and summarize their unique value proposition in one or two sentences. The competitors should be businesses that target a similar customer base or solve similar problems.”

Carve out your target market

Another strategy to strengthen the validity of your business idea is to focus on a specific segment of the target market—in other words, identifying the customers whom you can attract away from competitors. A classic example is Airbnb. Hospitality was already a behemoth global industry. People already rented their homes on short-term bases. Airbnb carved out a space for itself by focusing on travelers seeking unique accommodations and people looking to rent their homes, and streamlined the process for both parties.

ChatGPT can be a great tool for carving out your target market.

“I am planning to launch a business that offers (brief description of your business idea). I’m looking to find a niche within an existing market. Can you help me identify a specific target market that I can focus on? Specifically, I’d like help with the process of segmenting potential customers based on their needs, behaviors, and pain points. I’d also like a few suggestions on how I can attract them away from competitors.”

Gather customer feedback

Customer feedback is critical for refining your product or service and making it as useful as possible. It can reveal insights that might seem obvious in hindsight but are only discovered once potential customers interact with your product and share their experience.

At Jotform, for example, we once released a product update. We were convinced that users would love the new and improved version of our product—but our data showed otherwise. Instead of giving up, we dug deeper, asking customers to share their thoughts through a quick survey. It turned out that they didn’t prefer the old product to the new one—they just wanted a choice. Customer feedback can inform not just the product itself but how you offer it. ChatGPT can help you to collect invaluable insight, through surveys, targeted interview questions, or setting up focus groups. Here’s one prompt to get you started.

“I am launching a business that offers (brief description of product/service). Can you help me design a survey to gather feedback from potential customers about their needs, preferences, and expectations? I’d like the survey to focus on topics like product features, pricing, and perceived value. I’d like to understand what, if anything, they would change, in terms of the product/service itself or how it’s offered.”

Determine the financial feasibility

The final peace of the validation puzzle is financial viability. At the end of the day, this is the most important consideration—and surprisingly, is the most overlooked.

As Forbes notes, determining the financial feasibility of your business idea requires identifying the initial investment required, ongoing operational costs and your potential revenue. You can use these figures to calculate your break-even point and expected return on the investment, and compare these findings with the pricing feedback from your potential customers.

ChatGPT can guide you through the process.

“I am launching a business and need to evaluate its financial feasibility. Can you guide me through the process and help create a financial template? I’d like the template to include key figures such as initial investment, ongoing operational costs, and potential revenue projections. I also want to calculate the break-even point, expected return on investment (ROI), and determine the optimal pricing structure for my products or services.”