Founders, Use This Scientific Method to Build A Thriving Startup
The scientific approach prevents costly mistakes incurred by the normal gut-driven decision-making process
Entrepreneurs have to grapple with the challenges of starting and running startups. Most entrepreneurs depend on trial and error to achieve their desired goals.
According to the conventional formula, you write a business plan, pitch it to investors, assemble a team, introduce a product, and start selling as hard as you can.
While there’s nothing wrong with this approach, it’s particularly exposed to hidden loopholes and subjective bias. Somewhere in the normal sequence of events, entrepreneurs almost always face setbacks they had not accounted for.
The good news, however, is that the entrepreneurs don’t have to be at the mercy of the trial and error method. The reason, a different field of study has already laid down a blueprint with a proven track record that entrepreneurs can adopt.
Somewhere in the 17th century, the introduction of scientific dogmas into conventional knowledge sparked a significant revolution — one that is responsible for the success of humanity as we can see today.
The scientific method promotes a system that understands things through experimentation and reproducibility. Its main goal is to eliminate cognitive bias and emotional thinking in the search for the truth.
The philosophy behind science is to abandon assumptions and approach with an open mind.
Entrepreneurs too can leverage the same structured, systematic approach that scientists use to improve their chances of success. The main advantage of this approach is that it prevents costly mistakes incurred by gut-driven decision making.
A report by the MIT Technology Review underscores the superiority of the scientific method over intuition and data analysis. Both may be biased and are almost always incomplete. Overreliance on any of them can lead to disastrous results.
Furthermore, the world is too complex for any single recipe to apply. Founders across a wide range of contexts could benefit from a scientific mindset toward decision making.
Here’s how to use the scientific method to achieve success as an entrepreneur.
Creating a startup:
1. Ask a question
All startups begin with a question. The question is based on the problem the startup is built to solve.
For example, let’s assume Airbnb doesn’t exist yet. We can come up with this question — what if people could rent out their extra space?
We have already begun our scientific method of thinking and are on our way to developing a successful startup.
Many more questions will arise from our starting point. It’s important to raise as many as possible.
A weird fact about science is that in the preliminary stages of developing an idea or theory, scientists tend to focus more on why it wouldn’t be viable to rule out all possible limitations.
This is sometimes referred to as the paradox mindset and its importance in making decisions can’t be underestimated.
A paradox mindset is a counterintuitive approach involving contemplation of apparent contradictions to break down our assumptions.
Founders can benefit from the widened scope of view that stems from basing their ideas on valid questions, rather than their gut-feeling.
2. Do some background research
Let’s face it, whatever idea we come up with, a lot of other people or companies have thought about it before. There might even be many existing enterprises offering the same services or commodities.
In science, background research is needed to eliminate personal bias and broaden existing frontiers of thought. This usually involves gathering past research from other scientists and using it as a foundation to build on.
For entrepreneurs, there are two main sources for research: potential customers and competitors.
Take time to do some serious research. Find a selection of people from within the target audience, and find out what makes them tick. Hold a focus-group meeting, or use existing market research to build a full perspective of the main users.
Competitors will also provide some valuable information. Figure out what they’re doing, how they’re doing it, and most importantly, how to differentiate yourself from them.
Through background research, founders can understand the nitty-gritty that it takes to run their startups like experts.
3. Construct a hypothesis
So, we’ve done our research and found out that Airbnb doesn’t exist.
We’re gonna be rich, right?
Well, maybe not yet.
Scientists formulate hypotheses to summarize what they expect to find when experimenting, or how they think a particular system functions.
For most business owners, this hypothesis is, on a broad scale, the business plan. Constructing a hypothesis helps us to address the question further by formulating a theory which we can test. We need to come up with a means to substantiate the viability of the idea, and a hypothesis is exactly the right tool.
For instance, do we believe people would rent out their extra space as a means of making money? If so, will the prospective clients buy into the idea as a means of saving money?
Hypotheses enable us to visualize our expected outcomes in broad detail. Only then can we be sure of how feasible the idea is in a real-world setting.
4. Test with an experiment
This is my favorite part.
Experiments are the holy grail of science. They reveal the tiny details we seem to overlook. They create new perspectives. They make us flexible and adaptable to the demands of real-world scenarios.
When starting, founders usually don’t have a lot of money or a wide market. Instead of going the all-or-nothing way, we can first test the idea of using a given sample size.
For example, with regards to the Airbnb idea, how about we try booking a friend traveling from a different city into another friend’s extra space available for a short term stay?
This simple experiment will expose the idea to the real-world challenge to confirm whether it’s workable. At the same time, it will provide an avenue to adjust the elements that might derail the progress.
5. Analyze and conclude
By the time we get this far, we will already have a great understanding of what we need to accomplish our goals.
What’s more exciting is that we would have subjected the idea to rigorous analysis and developed an objective approach. Most founders will undergo a paradigm shift in their mindset at this stage.
The prevailing perspective is one of the most important factors that will determine whether or not to pursue the idea.
The conclusion should address all the previous steps, their strengths, and weaknesses.
Running a startup:
1. Rinse and repeat
The next stage in the scientific approach involves refining the idea according to the results of the experiment. Numerous other experiments have to be conducted under different conditions to find out how different dynamics influence the results.
In business, you might have found something people want. But guess what, there are 10000 different ways you can improve the idea or optimize the factors of production further. This is the stage where you will you can formulate more questions. Each question comes with more tests and conclusions that ultimately lead you down the road to truth.
Once you have established your truth and made the necessary adjustments, it’s the perfect time to scale up the enterprise.
2. Leverage reproducibility
At this point you already know what works and the factors that influence your business, and how to tackle them.
Using the same systematic approach, replicate the business to advance into different levels, locations, market niches, platforms, etc.
It’s like utilizing a blueprint to build a tower; everything follows the plan to avoid running into preventable challenges when you are high up.
Run Your Startup Like a Scientist
Building and running a startup is a challenging task. But millions of people around the world are doing it anyway. Some, like Elon Musk, are running several non-traditional startups at the same time.
What’s their secret?
It’s all hidden in the subtle approaches they choose to follow, the scientific approach being one of them.
Every enterprise has questions they can ask and experiments they can run to improve their products and services. The good news is that science has already science laid down the blueprint to do this centuries ago.
Before settling on the unpredictable trial and error method, it is prudent to look into the considerable benefits you can incur from using science as an entrepreneurial tool.