8 Hard-Earned Innovation Tips For Startups

Tech startups need to innovate in order to survive, much less grow and thrive. But when there's so much else to do, from fixing bugs to business development to sales and customer support, how do you fit innovation in?

Just as important, how do you figure out which innovations are actually worth pursuing?

We asked eight successful entrepreneurs from the Young Entrepreneur Council (YEC) how they incorporate innovation, formally or informally, into their startups, and what information they use to plot next steps.

1. Convergent vs. Divergent Innovation

I learned this concept a few years ago and it completely changed the way we innovate as a company. The problem with innovation is when idea generation becomes a free-for-all, it's difficult to reach consensus. There is a time and place for divergent thinking; by divergent I mean throwing ideas at a wall and seeing what sticks. Divergent thinking is creative, innovative, outside-the-box thinking. This approach generally doesn't work if you're trying to solve a specific problem. That requires a convergent approach. A convergent ideation session should start with a specific problem and goal that requires more of a linear approach. At my company, we start most of our meetings by saying, "This is going to be a Divergent or Convergent meeting." It has made a huge difference in efficiency for us. - Mitch GordonGo Overseas

2. Institutionalizing Innovation

We use a very structured approach to innovation. On Mondays, the entire company meets for a standup meeting, where we brainstorm ways to improve one of our KPIs. Nothing is off the table; it's pure brainstorming. This often results in silly or impossible ideas, but oftentimes, we find a nugget that we would never have thought of in the ordinary course of business. We separate the idea from the execution, meaning an engineer could think of a marketing initiative or vice versa. Based on discussion and feedback, we allocate resources and test the idea. - Adam LiebDuxter

3. The Growth Factor Question

Contrary to popular opinion, the purpose of innovation isn't about what we can do to make our company more money - it's answering the question we call "The Growth Factor." This question is: "What can I do today to provide my customers, clients or patients with a greater advantage and benefit?" Now, in order to answer this question, you need to know the ultimate result people are seeking. Once you've found that answer, you are innovating from a place of creating a product or service that's helping your customer receive an even better advantage for working with you. - Charles Gaudet, Predictable Profits

4. Validate the Market - And Its Size

The key is finding an idea that people are willing to spend money on. How do you find out if people are willing to spend money on the idea? Utilize Amazon to see what people are spending money on. Check out the completed listings on eBay. Search Twitter to see if anyone is talking about the problem you're solving. From there, you can figure out the size of the market. Facebook Ads are a great way to get numbers for market size (you don't have to run ads to get these numbers). Then, determine the value of a customer by looking at what they're expected to pay for your product. Multiply that value by the market size to get your total available market value. If that number is attractive, then validate the idea to see if your product stands up to your theory. - Brett Farmiloe, Markitors

5. Pitch It To The Team

When someone comes up with a new idea, we expect him to sell it to the team. If you can’t sell it to the team, you’re not going to be able to sell it to the world. We often have multiple iterations of pitching the idea – each time, the pitch (and the idea itself) improves based on the criticism and feedback we give the person. Some ideas die off, but others become stronger and evolve into big, new ideas that have a meaningful impact on our business. Trying to sell your idea to multiple people out loud will make you think of questions and opportunities you never would have considered on your own. It’s become a game in our organization to see if you can anticipate all the questions you’re going to get when pitching a new idea. - Chuck CohnVarsity Tutors

6. Prove Your Concept With Current Customers

When we’re looking to launch a new tool or product, we poll our customer base. We never spend time or resources developing a product that won’t sell. So many businesses get caught in the love affair of some idea someone thought their audience would love. Always prove the concept will sell before producing it. - Brian Moran, Get 10,000 Fans

7. Test Before You Test

We use a methodology I call “Test Before You Test,” and it allows us to test an idea or concept in a low-cost environment before we even try it in the real world. Rather than surveying customers or spending a fortune on theoretical market research, we run data-gathering tests on real customer behavior in a simulated environment. This lets us see how successful we’ll be before launching. - Benji RabhanMorrisCore

8. Identify & Track Key Metrics

New ideas can come from all corners of an organization, from the CEO down to the office assistant. If an idea seems to have merit, push it to decision makers who can whiteboard the goals and project its potential impact vs. the potential resources it would require. It's important to identify metrics that will indicate if an idea is valid and to measure results against these metrics over time to see if it has been successful. Yodle’s National team began as an idea in a customer conversation. By testing the idea and finding merit in it, we launched a full-scale business unit focused on local online marketing for franchise companies, dealers and manufacturers, and national brands. Today, this business unit represents approximately a third of our business. - John Berkowitz, Yodle

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world's most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.