A big problem I'm seeing is that people don't know the sequencing of validation when creating new products. Doing the various types of validation in the wrong order or skipping a step will likely pull your product development in the wrong direction.
Here are the proper steps as I see it when you have a theory you want to validate:
Step 1: Market Research
Is there truly a problem in the marketplace? That is, how many companies or consumers are feeling that pain? Is it worth continuing? This validation is done via market research using Google or reputable sites like the Harvard Business Review to find as much data as possible on this. If it is established that there may be a market, outline a summary of what the problem is and your best guess as to who is having that problem then move to step 2.
Step 2: Business Problem Validation
Start having detailed discussions with the consumers/companies you think are having the problem. It is important that you don't show them mockups or steer them towards specific features as that will bias your findings as people are naturally predisposed to saying 'that is a good idea' or 'that sounds interesting' leading you down the wrong path potentially. Step 2 is about listening to their pain and about understanding what they are doing currently? Is what they are doing 'good enough' or is there an opportunity to add value with a new product or not? Ask a lot of 'Why is that important' questions and dig deeper into their pain. This will result in a detailed requirements' list.
Step 3: Feature Validation
Once you've identified the requirements and begun developing personas, create a lean canvas to outline your business case then brainstorm with your team what features can resolve the requirements being requested while keeping in mind the personas.
From this will come a rough mockup to validate with potential clients. The mockups should be rough for a couple of reasons. 1. You don't want to take too much time developing the mockups, and 2., you want the person you are validating with to not get preoccupied with colors or its look. This step and its mockups are there to help with validating functionality. Do you have all of the features you need to resolve the problem is the key question that needs to be answered at this point.
As part of this process, you might determine that a rough prototype may also be required so the user can more fully interact with the application to get more engagement from them to make it more likely that they will notice if there is functionality missing or not.
Step 4: Design Validation
Once the functionality has been nailed down in step 3, your design team can then improve the look and feel of the product to the point that it looks finished. These mockups/prototypes are then taken to prospects/clients to ensure it is intuitive and looks good. Is the product visually pleasing? Is it intuitive? Once the answer is yes, the product can then go to R&D for technical specifications and development.