The Hustle - 🤖 The return of Tamagotchi?!

Happy Trends Tuesday!

Today we’ve got:

• 1 trend alert

• 1 piece of operator wisdom

• 1 article you should read

• 4 tabs we have open

Let's get to it.

🚨 TREND ALERT

If you were a 90s kid, then you probably remember working tirelessly to keep the Tamagotchi alive that was dangling on a keychain from your L.L.Bean backpack.

The digital companions enjoyed a small resurgence last year, but they’re about to be dethroned: 3D virtual pets have arrived.

As virtual pets take off, opportunities include:

1. Virtual pet accessories. Spending on virtual fashion hit ~$33B in 2021, and in-game cosmetic enhancements, which are traded between gamers for real cash, have become a $50B market. Virtual pet accessories may be next. Brands could partner with AI pet companies to release limited-edition collars, outfits, toys, beds, etc.
   
   
2. Virtual pet-friendly AR activities. Like a Muddy Buddies obstacle course, specifically for owners and their virtual pooches, or AR dog parks. (Skeptical? We’ll just remind you that Tamagotchi playdates are still a thing.)
   
   
3. Limited-edition virtual pets. Popular dog breeds, like Vizslas, can have puppy waitlists for a year-plus. Virtual pet creators could leverage scarcity in a similar way with limited-edition releases of “breeds,” or fantastical pet types. Look to Reddit for inspiration — there are numerous subreddits dedicated to fans of rare animal breeds, like cats, for example:
   • r/MainCoons (106k+ subscribers)
   • r/Ragdolls (63k+)
   • r/NorwegianForestCats (23k+)

📊 EXCEL GRAPH GENERATORS

🧠 OPERATOR WISDOM

Validating your business idea is crucial. It’s also one of the most commonly discussed topics in the Trends community.

Here are two universal principles — regardless of industry — that you can apply when honing, testing, and iterating any idea:

• Work Backward. Trendster Pete Sena founded his creative consultancy on a $5k budget and grew it to eight figures with 50 employees by working backward. It seems abstract, but here are a few tactics to get you started:
  
  
  • Build a landing page. This goes one step further than a business plan or ideation method, because it immediately forces you to think about your idea through the eyes of the customer.
    
    
  • Write a mock press release. This is a big one from the Bezos playbook. In the same way that building a landing page forces you to view your idea through the eyes of the customer, writing a mock press release will trim the fat of your idea and help you lose the “geek speak.”
    
    
  • Create a broad strokes pro forma. This should take days, not weeks, and should include both a conservative and opportunistic model. Consider things like estimates for startup capital, physical asset requirements, your burn rate, and revenue model and variability.
    
    
• Conduct Open-Minded Research. When you’re doing business planning research, you’re seeking to validate your idea. We’re naturally prone to ignoring the outliers and piling on the research that supports our hypothesis. Do the opposite:
  
  
  • Focus on the problem, not your solution. The first rule of validating your idea? Do not talk about your idea (cue Fight Club). Instead, focus on the customer’s problem, and explore how they’ve already attempted to solve it.
    
    
  • Ask for feedback. Put your ego aside and ask your peers to shred your idea apart. Since non-SaaS products can be difficult to get into the hands of test customers, lean into your network of trusted peers.

🔥 ARTICLE YOU SHOULD READ 

You can’t build a powerhouse business overnight.

Startups need to survive a lot of different business life cycles to become successful, and each one holds its own challenges and obstacles.

We broke down the five main stages of building a business, and the strategies you can use to make the most of each one on The Hustle blog.

Read more here.

OPEN TABS

🧩 Perfect fit: Lenny Rachitsky’s guide to finding B2B product market fit.

💰 Deep dive: Everything you need to know about the fintech industry.

🎧 Podcast: Three niche business ideas from Sam Parr.

🥤 Watch: The history of how Coca-Cola kept its formula a secret.

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