Those Negative Customers? They’re Who You Should Be Listening to Most
Written by Jordan Rosenfeld, contributor for Lean Startup Co.
Editor’s note: From now through the end of the year, we’re offering excerpts of talks from select Lean Startup Week 2016 speakers. These pieces are a combination of tips from their presentations and interviews that took place at the conference in San Francisco.
Wildly successful companies undertake big ideas before anyone else. “Be the first to do something. Don’t do what everybody else is doing,” says Caterina Rizzi, cofounder and Chief Creative Officer for Breather, which creates beautiful on-demand work spaces in select cities around the world.
Rizzi and her cofounder Julien Smith dreamed up the idea for Breather in 2012 in their home city of Montreal, Canada. Their MVP involved setting up a room, putting a lock on the door, and “begging people to use it,” Rizzi says. They ran with the premise that many people don’t need or can’t afford a full-time office. They saw an underserved customer base comprised of entrepreneurs, “small businesses, artists, consultants, etc.” who spend most of their working hours in coffee shops and other random meeting spaces. “The idea was really about being able to give this generation an ability to use space only when they needed it,” says Rizzi.
Since they were the first to undertake the idea of office space on demand, Breather’s cofounders had no benchmark for what their company would look like — but they understood that experimentation and customer feedback would take them a long way toward success. Now, the startup has gone from that lone room to what Rizzi and colleagues describe as “a thousand keys in your pocket.”
Rizzi sees Breather as a kind Car2Go for office spaces. “You know what to expect from your experience every time you enter one of [Breather’s] rooms. I have the confidence in my team to make sure that every space has that consistent experience happening in it.”
Below are some of the tools that helped Breather connect with such a large user base.
Treat Everyone Like It’s Their Birthday
The pathway to successful product design starts with the Lean principle of listening to customer feedback, says Rizzi. But she takes this a step further by aiming to make every user, particularly the disgruntled ones, feel “like it’s their birthday” — which allows Breather to “build, iterate, and listen” over and over again. In Breather’s early days, Rizzi says the most valuable users were “the people who had a lot of complaints.” In addressing customer pain points with receptivity instead of defensiveness, they received information that helped them to iterate their product to meet user needs.
Focus on One Metric for Growth
It’s tempting for startups to try and grow all areas at once, but this can lead to problems. In early 2014, before Breather launched its spaces in New York, Rizzi recalls Smith receiving the feedback to “pick one metric to focus on [e.g. growth] instead of trying to do everything.” They set a goal to grow eight percent every month. They knew this was a huge number, but it allowed them to determine exactly how many hours in their spaces they had to sell every month.
“When you had the ability to focus on one thing as opposed to trying to do it all, that united us as a company,” Rizzi says. “Everyone was turning different parts of the machine, but we were all focused on that one thing we had to hit.” Every time they reached their goal early on, they went out for beers. Before long, Breather turned eight percent growth into twenty percent growth every month. Now, the company is opening a space a day, it has grown to 160 employees across 12 US cities, and it recently expanded into London.
Breather’s success is the result of testing the product from the launch of the MVP. “Make something that you can show somebody, a lot of people, anyone who will give you feedback, and get as much feedback as possible,” says Rizzi.
Start and Stay Lean
Rizzi points to Breather’s lean beginnings as the key to its success. “Don’t blow your cash on a nice office,” she says. “Hire only the people you need, buy only what you need, and get yourself a good money person.” Because at the end of the day, investors are giving you money “to do something cool with it,” she says. “Don’t let the opportunity pass by because you spent prematurely.”
Enjoyed what you just read? You can watch Caterina Rizzi’s full talk at Lean Startup Week 2016 here. Learn more about Lean Startup at http://leanstartup.co.