Startup School 1: Six Product lessons from a failed healthtech startup
Kiteline Health has closed its doors. This is a series exploring what I’ve learnt over the past three years as CEO. Kiteline provided B2B2C health coaching to people with long-term health conditions, helping them improve their lifestyle habits and increase longevity.
Kiteline has shut its doors. It was a startup born out of my own personal story — that of facing breast cancer and grabbing on to the slivers of control where I could… by changing what I ate, how I moved, how I felt. When a startup fails, it’s hard. But when something that is so interwoven with your sense of self and identity fails, it feels like a crack in your soul.
One of the main culprits for the failure was the product itself. Even harder to admit is that it was my responsibility to create a vision, design, build and improve the product. It was supposed to help people. It was supposed to help people who really needed help — like those with cancer, but also other chronic conditions. We did help a handful in the end, for which I’m very proud, but not nearly as many as who needed it.
When something that is so interwoven with your sense of self and identity fails, it feels like a crack in your soul.
What follows are the key lessons I learned about product development over my three years as CEO of Kiteline Health. Some seem obvious in hindsight. Some I knew already, but were mistakenly pushed down the priority list by the urgent tasks of running a startup. I hope you find them helpful.
First of all… what is “Product”?
As a newbie to startups, I didn’t fully appreciate how much it takes to build tech products or what a “product” person actually does when we started. It turns out this is a critical function and every startup needs a good one.
For those in the dark like I was a few years ago, Product translates between user needs, business goals and the engineering team who build the app/platform/website (or the “product”). They deeply understand user problems, determine priorities and then work with coders and others to design, build and test ways to effectively solve those problems.
Product is really difficult to do well. You need to understand people, while also understanding what delivers business value and what is possible to deliver technically, in what time frame. You need to balance strategic long-term visionary stuff with running tight tactical product processes, ensuring work is shipped to meet business deadlines. I’d argue its the most important role in technology companies.
Lesson 1 — Your job as CEO is Product lead
In early startups, it’s usually the CEO who plays this role. That was my responsibility for Kiteline but I didn’t actually realise it was up to me until way too late. We tried to hire a Product lead for months and months, but with our meagre budget it was really difficult.
I learned how to do product on the job. We had an amazing product advisor who taught me that strategic product is not the same as day-to-day product management. He spent a weekend showing me exactly how to run a tactical product development process for our team. We implemented lots of his suggestions, but by the time I really understood what it meant to run product well, it was too late.
In hindsight, I should have made product development a higher personal priority, as I was ultimately responsible for what we put out. It’s obvious now, but when you are launching a business there are a million and one things to do (read the last piece in this series on confidence coming soon).
Lesson 2 — Choose a market wisely: build for your evangelists
We initially attempted a B2C approach and swiftly (within a few weeks) pivoted to target employee wellbeing through a B2B2C model. We went from having a laser focus on serving people with cancer, to a wider scope of employees with long-term health conditions and then all employees in order to make early sales and show traction quickly so we could raise more funds and survive.
We were guided in this direction by an investor who wanted to see numbers and progress quickly. There is sometimes a tension, I have discovered, between what startups need to show to get to the next stage of investment (particularly in the European market where pre-seed cheques pale in comparison to our American counterparts), and what is the right route to take for the ultimate success of the product. (See the 6th instalment of this series for more on my thoughts on fundraising, coming soon).
When we pivoted, we joined a huge wave of pandemic wellbeing startups (once described to me as “selling snake-oil”) targeting overworked HR leads. We weren’t able to get a tech lead right away, so we were not able to develop fast enough to beat or even match competition.
We ended up building a generic product in order to generate sales. Which then didn’t sell easily because of heavy competition in our new, much wider market. An age-old piece of wisdom we ignored: find customer evangelists who adore your product and build for them first (i.e. Strava and passionate cyclists). If you can prove a small group of people adore your product and are willing to use and pay for it, you can raise money to expand and then widen your target market.
Lesson 3 — Refresh your insight when you pivot
We co-designed our first course, Wellbeing for Line Managers, with one of our first clients, a mid-sized Housing Association. This was great, as it delivered exactly what they needed and turned out to apply more widely to other clients. It gave us something unique to sell in the market that employers were genuinely struggling with. What we didn’t have was a follow-on product. When we did finally create new courses, we worked with our medical advisors, not our clients, so they fell flat.
We made a big mistake by not revisiting our customer insight to capture what more HR or Wellbeing Directors really needed out of a product like ours. We didn’t fully understand the needs of enterprise clients. B2B features like dashboards delivering employee usage, progress and demographic insight were overlooked for too long.
Our product also wasn’t agile enough to roll with what we were learning about our clients every day. It turned out we weren’t creating something that was meeting a burning need — it was “a vitamin, not a painkiller”. We followed the age-old wisdom of “don’t build anything for as long as possible”, but then built something way too stiff, and without knowing enough about our customers after switching focus from consumers to business. As such, our service was easily cut during the cost of living crisis when corporate HR budgets were frozen and downsized.
Lesson 4 — Build your differentiator first
A product development concept we also failed at embodying was #MonkeyFirst. If you’re trying to teach a monkey to juggle on a platform, don’t build the platform first — train the monkey first! I.e. prove you can do the hardest thing first.
We definitely built “the platform” first — we spent our precious development time building a scheduling and booking system which we could have white-labelled until necessary. We should have built the smallest bit of our future differentiation and tested that people wanted and used it. We could have started by building a scalable coaching model and implementing a strategy that would use our top-selling real-time coaching to start building our data set. We could have used Wizard of Oz techniques to test openness to and efficacy of chatbot coaching in the meantime, offering something new in the market. We could have spent our energy really nailing behaviour change, and how to solve the issue of tracking progress without getting people to input everything they eat or do.
Competitors like Sanctus, Liva and Unmind were offering a very similar service and content library to what we could offer, and it was never really clear how we were different. Or why employers should choose us now, rather than wait until later when our product was more complete.
Lesson 5 — Talk to your users constantly
“Kiteline Health Coaching helped me get my thoughts in order, and get out of my own way. I’d gotten to a point where I had all these things I thought I couldn’t do because of my health. My coach helped me realise it was an obstacle I put in my own way that wasn’t really there. I learned not to let my health limit what I want to do in life.” — Kiteline pilot participant
Feedback like this is why I built Kiteline. Talking to users about their experience with us was the most fulfilling part of the past three years. Hearing directly about the change in their lives and how their coaches helped them thrive is what it was all about. Sadly, when you get in the throes of building product with a very small team, finding the time to have these conversations becomes tricky (but essential).
The most detrimental mistake we made was not talking to our users and clients enough. We didn’t get any user feedback during the initial design or build. We tried, but it was difficult to find users who would give us their time. We should have built a culture of continuous testing and learning (for which we needed a large user base… which we didn’t have). And when we did get feedback, we were not able to dynamically update the product and test things out (e.g. like different content formats) with only one developer who was often firefighting issues.
User voice is ideally built into the process, so you constantly get data that you can translate into design and action. My favourite resource on learning how to ask questions properly is The Mom Test.
Lesson 6 — Build in retention from day one
We didn’t build user retention into the product from day one. Massive fail. A majority of our ~700 users logged in to our platform for their real-time coaching sessions and then just left without exploring all the amazing wellbeing courses we created with our coaches. We just thought about this too little too late.
We did lots well too
We did a lot of things really well too. We connected over 40 people with high calibre health coaches leading to a meaningful impact in their lives. We built a platform that was stylish, functional, secure, and delivered value to many people. We were bullish and hired a developer to bolster our tech team when we had a large prepayment from a client. We created five expert-led courses on lifestyle change which all had great feedback. By the end, we had about 700 users with varying degrees of engagement. I am very proud of all we achieved together as a team.
Because of all that, the product was not fit for purpose. But no early stage products are — you have to build shabby products on minuscule budgets to prove you can do more with more. I fundamentally still believe in the problem area, and hope to see others excel where we could not.
As for me, I’m taking time now to be with my family until the new year. I discovered I really enjoy product development, and look forward to contribute what I know to a team genuinely making the world a better place.
Lessons Recap (or what I would do differently next time):
- Startup CEOs are ultimately responsible for Product. This should be a top priority, so get support to better understand product development if you need it.
- Have a laser focus of customer evangelists and build for them first. Niche markets are great because there is less competition and you can build something meaningful.
- If you pivot, refresh your insight and make sure you build a painkiller, not a vitamin.
- Build the smallest bit of what makes you unique first. See if you can sell that first.
- Talk to your users constantly. Period.
- Build in user retention from day one, as it is where apps live or die.
Read Startup School 2: People here.
Read Startup School 3: Luck here.
Read Startup School 4: Sales here.
Read Startup School 5: USP here.
Read Startup School 6: Funding here.
