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Test your business idea

Maybe you’re new to business and have the beginnings of an idea. Or you’re an experienced operator looking to explore a new product or service. Before you invest a lot of time and money into any new venture, it’s helpful to test your idea first.

Do your research

Start by finding out as much as you can about your business idea and how it might work in your chosen market. Think about your idea and the problem it might be solving. Learn about potential customer groups and competitors. What are similar businesses doing elsewhere, either in New Zealand or overseas, that you could bring to your local market?

If your idea is specific to an industry, industry associations often have guidance and information that can help. If your idea is specific to a city or region, talk to the local council or economic development agency.

Support from Stats NZ

Stats NZ has free data and information to help give your idea financial and strategic context. Topics include:

  • Population projections – What’s the population of your region? Is it projected to grow or decline over the coming years?
  • Business – How many businesses operate in your industry and how many employees do they have?
  • Industry – Is your industry growing or slowing down?
  • Imports/Exports – What are the trends of a certain import or export from/to one or more countries?

Stats NZ homepage(external link) — Stats NZ

Stats NZ provides free help with finding data through their Information centre advisors. These advisors answer thousands of questions from businesses every year and can quickly guide you to useful information.

You can chat online with an advisor on the Stats NZ website, give them a ring on 0508 525 525 or email them at

Information centre(external link) — Stats NZ

Using Stats and data

Hear from a Wellington-based start-up

Hear how a Wellington-based start-up used statistics and data to research their potential market, hone their product, build a case for investment and make better business decisions.

Talk about your idea

Talk to as many people about your business idea as possible. Talk to friends, family, business networks, potential competitors and potential customers. The more perspectives you can gather, the better you will understand how your idea might work.

Paul Norrie, Business Innovation Advisor at Callaghan Innovation, offers some advice when approaching these early conversations. “Go and interview ten prospective customers and users of your products or services,” says Norrie.

“Don’t try to sell them on your idea. Instead, ask them to describe the hardest part of the task/action/project that you are proposing to find a solution for. If they describe the problem you are solving, unprompted, then you’ll know you’re on to something.”

Intellectual property

Intellectual property (IP) is about protecting the time, money and effort you put into your business. The earlier you identify your IP, the better you can protect it.

While you should hold off on discussing your invention widely until you’ve worked out the kind of IP protection you will need, you can apply to register your trade mark as early as you like. If you register your trade mark early, then you can use it for website domains and social media handles.

If your idea is a secret recipe or a trade secret, only tell those that must know about it. You may consider having them sign confidentiality agreements.

You can start by using our ONECheck tool to see if you can use a name for a business or website domain. Our IP section also outlines the types of IP that are available and ways to protect your name, brand and ideas.


Case study

Case study

Countdown to launch

Before launching tech company Common Ledger, Carlos Chambers and his team had an idea for software to streamline the information accountants received from their clients’ different programmes. They spent six months speaking to accountants in New Zealand and Australia to understand their potential market and refine their product.

“We learned there was this really deep problem that accountants around the world were facing. That’s what we were looking for — huge problem and huge opportunity and a huge way to really help this industry move forward.”

The next step was to develop an 18-month plan and a three-to-five-year strategy to turn their start-up into a fully fledged company. They have since raised more than $1m and launched in both countries.

“We’re close to our targets on our initial forecasts. We’ve brought on the right board. We’ve hired the right team members. All these things are probably the result of thorough planning. We would never have been able to usefully create our strategy if we hadn’t done that first six months of research.”

How to write a business plan

Test and iterate

Once you’ve done some research and have a good handle on the problem you’re trying to solve, then it’s time to test and iterate.

Start by building or designing a prototype of the product or service you’ve got in mind. This first prototype doesn’t need to include the full suite of features. In fact, you may just start with one aspect of the idea to confirm that it’s essential. Then you can move onto the next feature.

Share your prototype with those you spoke with originally or find new potential customers. Try not to talk too much or ask any leading questions. Instead, let them work out for themselves how the prototype might solve their problem. If they ask questions, then you can give them more information. But you’re aiming for the product or service to sell itself, without you having to explain too much.

After your first round of feedback, iterate the prototype. Try to change one thing at a time, then retest. If you find it’s better to start over from scratch, this is OK too. You may have to test and iterate a lot more than you anticipated, especially if your business idea doesn’t already exist.

Don’t be afraid to ask for help.

Don’t be afraid to ask for help.

Spending some money up front on research may save you from losing money in the long run.

You don’t have to go it alone. There are different kinds of support and programmes that can help you through the process of testing your business idea.

Business advisors

The Regional Business Partner Network has offices throughout the country. Their business advisors can chat with you about your current situation and connect you with the right people and information, at the right time. You can start by registering on their website and they’ll get in contact with you within 48 hours.

How it works(external link) — Regional Business Partner Network

Specialist advisors

Advisors that specialise in one field, like an accountant or lawyer, can fill significant gaps you may have in skills, time and resources. An accountant can help you determine if your idea is financially viable. A lawyer can cover any legal aspects that you need to be aware of.

Co-working spaces

If you’re looking to connect with other businesses, you might look into co-working spaces. Co-working spaces are popping up all over the country. Shared working spaces can offer a sense of community, especially if you’re working from home. They also present opportunities to collaborate with and learn from other businesses.


An accelerator, start-up or incubator programme might be a good option if you’re looking to test and iterate quickly in a supported environment. A programme is also a great way to connect to the wider community of entrepreneurs and mentors.

Organisations, like Auckland-based incubator ecentre, offer virtual and in-person programmes. They provide businesses with tools and methods to validate ideas at an early stage. They also have coaches to guide and support businesses through the testing process.

Programmes(external link) — ecentre

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