Chapter 5 of 12

Chapter 5: Operational Feasibility Assessment

Technical feasibility, operational capability, and regulatory landscape.

Playbook Chapters
What You'll Learn How to check if you can build it, run it, and stay legal—especially for AI products.

Can We Build It?

Can you actually build this with your time, money, and skills? That's what we're checking.

For AI products, the question isn't "can we code it?" It's "will the AI behave the way we need it to?"

AI Isn't Always Predictable

Normal software always gives the same answer. AI doesn't.

The same question can get different answers each time.

If you need 100% accuracy (legal, medical), you may need humans to check every answer. That gets expensive fast.

Challenge The Risk Mitigation Strategy
Making things up AI invents fake facts Link every answer to real documents. Train the AI to say "I don't know."
Slow responses 5+ second waits lose users Show words as they generate. Use smaller, faster models for simple tasks.
Forgetting context AI forgets earlier parts of conversations Store key facts in a database, not just in the chat history.
Inconsistent answers Same question, different answers Lock AI settings. Give examples of the exact output format you want.
The Smallest Useful Version Test

Define the "Smallest Useful Version" without AI. If the product has zero value without the AI component, your technical risk is existential. The AI must work perfectly or the business fails.

Can We Deliver It?

The Operational Capability Audit assesses whether your team can actually execute on the plan.

Dimension Question Red Flags
Skill Gaps Do we have the specific expertise needed? Fintech without compliance experience; AI without ML engineers
Process Scalability Can current manual processes scale to 1,000 users? Wizard of Oz that requires 1:1 human attention
Supply Chain Are our suppliers reliable? Single API dependency; sole-source hardware
Team Scalability Can we hire the "second layer" of management? Founder-dependent operations; no documented processes

Is It Legal?

Compliance isn't a "later" problem. In 2026, it can kill your launch if you're not ready.

EU AI Act (2025/2026)

AI in HR, education, or critical infrastructure faces heavy compliance burdens:

  • Mandatory logging and transparency
  • Human oversight requirements
  • Conformity assessments

Impact: Compliance costs can be tens of thousands of Euros. If you can't afford it, your model isn't viable in the EU.

US Regulation

A patchwork of state-level requirements:

  • California: CCPA 2026 updates, AI safety laws
  • Colorado: Strict AI disclosure requirements
  • Federal: Fragmented but evolving

Impact: Model compliance costs for the strictest jurisdiction you'll operate in.

Build Compliance In From the Start

Can your system delete user data on request? Store data in specific countries? If not, fix it before you build. Adding compliance later costs 10x more.

What You Walk Away With

  • Technical Risk Score: Assessment of whether the technology can deliver.
  • Operational Capability Audit: Clear view of team gaps and scalability issues.
  • Regulatory Compliance Map: Understanding of what's required in your target markets.
  • Go/No-Go Input: Evidence for whether to proceed with the build.
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Works Cited & Recommended Reading
Unit Economics & Financial Modeling
SaaS Metrics & Benchmarks
  • 7. SaaS Trends 2025-2026: 25 Definitive Trends Shaping the Industry. Modall
  • 8. The Great SaaS Price Surge of 2025: A Comprehensive Breakdown. SaaStr
  • 9. SaaS gross margin explained: What it is, and why it's important. Stripe
  • 10. SaaS Gross Margin Benchmarks and How To Increase Yours. Lighter Capital
  • 11. 2025 SaaS Churn Rate: Benchmarks, Formulas and Calculator. Vena Solutions
  • 12. How to Compare CAC Benchmarks by Industry. Phoenix Strategy Group
  • 13. How I Calculate the CAC Payback Period. The SaaS CFO
  • 14. The Rule Of 40: How To Calculate And Use It For SaaS. CloudZero
Pricing Strategy & Research
  • 15. What Is A Hybrid Revenue Model? Definition, Types, Benefits. Marketplacer
  • 16. How To Use The Van Westendorp Price Sensitivity Meter. SurveyMonkey
  • 17. How To Price Your Product: Van Westendorp Pricing Model. Forbes
  • 18. Van Westendorp Price Optimization Using LimeSurvey. LimeSurvey
  • 19. Using Conjoint Analysis for Pricing Research. Qualtrics
  • 20. Understanding Conjoint Analysis in Market Research. LimeSurvey
AI Costs & Unit Economics
  • 21. AI Pricing: How Much Does AI Cost in 2025? Monetizely
  • 22. The Best Cheapest AI Inference Services of 2025. SiliconFlow
  • 23. Welcome to LLMflation - LLM inference cost is going down fast. Andreessen Horowitz
  • 24. Avoiding The Looming AI Unit Economics Crisis. Moreland Connect
  • 25. Beyond Benchmarks: The Economics of AI Inference. arXiv
Burn Rate & Cash Management
  • 26. What is burn rate? What startups need to know. Stripe
  • 27. The Bill Gurley Chronicles: VCs, Marketplaces, and Early-Stage Investing. Macro Ops
Feasibility & Risk Assessment
  • 29. AI Project Feasibility Checker. LaSoft
  • 30. Technical Feasibility Study & Risk Assessment Framework. Incurvo
  • 31. Startup feasibility: How to know if my startup idea is good. Business Model Hacking
  • 32. Startup Evaluation Checklist: Essential Investment Criteria. Qubit Capital
  • 33. What Is a Risk Matrix? [+Template]. Atlassian
  • 34. How to Run Pre-Mortem Exercises [Templates Included]. Atlassian
Regulatory & Compliance
  • 35. EU AI Act Compliance Checker. EU AI Act
  • 36. President Trump Signs EO to Stop State Regulation of AI. Ogletree
  • 37. Executive Order Limiting State Power to Regulate AI. K&L Gates
  • 38. How 2025 state legislative sessions grew the AI patchwork. Engine
  • 39. CCPA Requirements 2026: Complete Compliance Guide. Secure Privacy
Templates & Frameworks

Note: Some links may contain affiliate referrals. We only recommend resources we genuinely find valuable for startup founders.

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