Market Opportunity Navigator

Core Framework: The 2×2 Grid

Evaluates ideas based on Potential (economic/social impact) vs. Challenge (implementation difficulty).

Quadrant	Characteristics	Recommendation
Gold Mine	High Potential, Low Challenge	Pursue immediately (e.g., scalable SaaS).
Moonshot	High Potential, High Challenge	Pursue with caution; secure resources (e.g., deep-tech innovation).
Questionable	Low Potential, High Challenge	Re-evaluate timing/feasibility (e.g., niche product in saturated market).
Quick Win	Low Potential, Low Challenge	Low-risk but limited upside; easily replicated (e.g., simple app).

---

Market Opportunity Attractiveness Evaluator

I. Evaluating Potential

Three dimensions with sub-factors (rated Low → Super High).

1. Compelling Reason to Buy

• Unmet Need

  • High rating: Severe unsolved problem (e.g., life-saving tech).
  • Low rating: Well-served market (e.g., food delivery apps).

• Effective Solution

  • Does it deliver promised value?
    • Example: AI diagnostics vs. manual processes.

• Competitive Edge

  • Unique advantage (e.g., cost, speed, quality).

---

2. Market Volume

• TAM (Total Addressable Market)

  • Overall revenue opportunity (e.g., $5 B Indian EV market).

• SAM (Serviceable Addressable Market)

  • Target segment (e.g., $1 B for EV scooters within TAM).

• SOM (Serviceable Obtainable Market)

  • Realistic share considering competition (e.g., $200 M for a new EV scooter brand).
    

• Growth Rate

  • CAGR (e.g., 15% for eco-friendly products).

Key Tip: Validate data via multiple sources (e.g., industry reports, GPT cross-checks).

---

3. Economic Viability

• Margins

  • Gross margin = (Revenue – COGS) / Revenue. Target > 40% for scalability.

• Customer Ability to Pay

  • Affordability vs. premium positioning (e.g., ₹2,300 smart bottle limits adoption in India).

• Customer Stickiness

  • Retention strategies (e.g., subscriptions, consumables, brand loyalty).

---

II. Evaluating Challenges

Rated Low → Super High (lower = better).

1. Implementation Obstacles

• Product Development Difficulty

  • Tech maturity, sourcing complexity, R&D timeline (e.g., nascent AI in EdTech).

• Sales/Distribution Hurdles

  • Brick-and-mortar vs. online (e.g., EV showrooms vs. D2C e-commerce).

---

2. Time to Revenue

• Development Time

  • Prototype → market readiness (e.g., biotech approvals take years).

• Sales Cycle Length

  • B2B: 6 – 12 months
  • B2C: Immediate (e.g., Amazon listings)

---

3. External Risks

• Competitive Threat

  • Crowded markets = high risk (e.g., fitness apps with 50+ competitors).

• Third-Party Dependencies

  • Supply chain/regulatory risks (e.g., drone materials shortage).

• Adoption Barriers

  • Cultural resistance, pricing, complexity (e.g., smart bottles vs. ₹500 alternatives).

---

Case Study Insights

Ashana (Fitness Coaching Service)

• Mistake: Overestimated market volume by citing entire wellness industry (₹ 2.6 B) without segmenting for coaching.
• Economic Viability: Mid -rated due to subscription retention challenges.
• Feedback: Focus on service design to boost stickiness (e.g., personalized experiences).

---

Arithra (Eco-Friendly Smart Water Bottle)

• Market Volume: Rated high based on $60 M India market but corrected to mid – too small for VC funding.
• Economic Viability: Low margins (25 – 30%), high price barrier (₹2,300), low stickiness.
• External Risks: High competition and dependency on local manufacturers.

---

Key Takeaways & Best Practices

• Bias Mitigation

  • Entrepreneurs often overestimate potential. Use third-party evaluators for objectivity.

• Revolutionary Ideas (e.g., SpaceX)

  • Framework limitations: Market size unknown, challenges extremely high.
  • Solution: Validate through action (prototypes, early adopters, co-founder buy-in).

• Data Triangulation

  • Cross-verify market numbers from ≥ 2 sources (e.g., reports + GPT + expert interviews).

• Social Enterprises

  • Adapt “Potential” to include social impact + financial sustainability.

• Ultimate Validation

  • Desk analysis is preliminary; real-world testing (e.g., MVP sales) is critical.

“The ultimate evaluation for any idea is action itself.”