Validate user willingness to pay at scale before committing massive production budgets
When entering a new content or product category, test whether your target audience will actually pay before investing heavily in supply. Raising capital and securing content deals validates investor interest, not consumer demand. Run small-scale experiments with real users before scaling production.
When to use
When launching a new product category that requires significant upfront investment in content, inventory, or infrastructure before users can experience the value
Don't do this
Treating fundraising success and industry partnerships as validation of consumer demand - investors and suppliers are not customers
1 Founder Who Did This
Raised $1.75B from investors and major studios, spending $100K/minute on content production, but never validated whether consumers would pay $5-8/month for short-form mobile video before committing those budgets