On Building Something People Want

Prominent venture capitalist Paul Graham once famously advised startups to “make something people want”. This might seem obvious, but it’s often overlooked. There are endless failed companies that create useful-sounding products, but never get much traction. Sure, we all love a romantic build-it-and-they-will-come success story (oh hello, Twitter). But unfortunately, the far more traveled Road to Nowhere often follows the perilous path of developing a “solution” without fully understanding the problem. And perhaps even more dangerously, launching a product without fully understanding the people that will consume it.

At Tala, we are focused on solving the issue of financial inclusion and bridging a multi-trillion dollar credit gap. Our mobile products and services are helping the billions of people around the world lacking credit scores to get access to fair and affordable financial services. Fast Company recently named us the world’s most innovative company in finance. We’re growing, we’re learning, and we’re incredibly excited about what happens next.

But this article isn’t about our solution; it’s about what we did to come up with it.

When we first set out to solve this problem, we knew that we needed to dig deep. We had to get into the weeds and learn from people in our market. We knew the numbers, but what was actually happening on the ground? How did the existing system work? What were the underlying causes of this massive credit gap? Rather than assuming we knew all the answers from thousands of miles away, we decided to be methodical, honest and humble. And this has been the key to our success.

Talking to Strangers in Nairobi

To give our process some structure, we set out with the following goals:

  • Understand the existing daily habits and behaviors of potential users around financial services.
  • Analyze how potential users think and feel about their finances.
  • Figure out what motivations people have around borrowing and repaying loans (why do they do or not do it? what are they trying to achieve?).
  • Understand the ability of these individuals to respond to these motivations and think about how we can make it easier for them to act on them.
  • Find common threads in the pain points and motivations of potential users and what triggers these occurrences (i.e. family member is sick, bad crop this season, increased school fees, want to expand my business, need to travel to see family, holiday expenses). Take time to not only understand what these are, but when, why, and how often they happen, what their current responses are to these situations and how effective these responses are.

So what did we actually do?

Our entire team traveled to Kenya and with the help of our favorite hospitality partner AirBnB, we set up a base camp for our research. We talked to hundreds of individuals in our market (focus groups have their place, but we have found individuals provide a lot more insight and remove the ‘groupthink’ mentality). We asked them to tell us about their lives: what they do for a living, where they grew up, how they spend time with family and friends, what kind of apps they use on their phones, how much they earn, how they save, any experiences (good and bad) they have had with loans in the past. When we had more time with people, we often did post-it exercises with images and words around financial experiences and had people rank which they experienced the most. Instead of just listening to their words, we observed their tonality, emotions, and physical responses around what they were describing. There is usually more than meets the ears.

Knowing What You Don’t Know

After months of research in five emerging market cities across the globe, the pictures of our users and their daily routines that were formerly on reports, videos and blogs were now alive. Theories on a white board were replaced by quotes from our own conversations. Hypotheticals were replaced by memories of our own experiences. Without fully realizing it at the time, we were building a foundation for our product WITH our users, not just for them.

We learned an incredible amount during this period of discovery, with a few key insights that are proving to be prominent for our business.

  • It is inconvenient for people in our markets to take loans from banks, as it often takes a pathetically absurd amount of time.
  • It’s not always about having money, it’s about the accessibility of that money to transact in real-time.
  • And not too dissimilar from much of the United States and other developed markets, almost everyone has an Android device (sorry, Apple) and uses Facebook in their daily routine.

These findings laid the groundwork for our initial product: we developed a simple Android app that allows individuals to apply for a loan in under 5 minutes directly on their device. Using our proprietary scoring methodology, we are able to qualify individuals for short-term loans and deliver credit to their mobile money accounts instantly.

And our users love it.

As always, 3 simple truths for doing your own research:

  1. Don’t assume you know what people want. Ask them! Your (current and potential) customers are your most valuable research tool.
  2. Avoid confirmation bias. This isn’t about selling a product or idea. It’s about learning.
  3. Iterate. There is no right way to do this and it should be an ongoing part of your business, even after you reach product-market fit.

Feel free to reach out with any questions or if you want to brainstorm on how to do your own user research.

Twitter: @amigosalia