Things we teach our startups #1
Just over a month ago, we selected 10 startups for our 4 months accelerator program. All of the startups were at a different stage when they joined the program, but yet every startup had one thing in common – the need to shape their initial idea into a viable business to avoid building a product nobody wants. The biggest risk for startup founders is wasting their talent and opportunity by building the wrong thing, when they were so close to the right thing. A classical approach for startups is:
- Startups have ideas
- Build it
- Promote it
- Customers don’t buy it
- The startup dies
Eventually every startup wants a nice organic growth curve, however they end up not increasing their traction over time, and think that marketing is the only solution. And what’s the problem? Poor validation of a good idea.
So how do you end up building a product everybody loves?
By identifying your potential customers, discovering their pains and seeing if your solution addresses that pain. There is no success formula for building a product everybody loves. Each startup is different.
But you need to watch out with the word ‘problem’ or ‘pain’. Your idea isn’t always a very obvious pain or problem in your customers life. It’s about identifying how your product would make their customer journey a lot easier.
As Kevin Systrom from Instagram said:
‘The hard part is finding a problem to solve’
There are several ways to identify how your product would fit in a customer’s life. It’s about validating the assumptions you have about your startup. Think of: customer interviews, paper prototypes, explainer videos, google keyword planner, clickable wireframes, email first products, low fidelity MVP. They are called ‘smoke tests’.
As an accelerator we learned that our founders took the word ‘building’ too serious. The first month they learned how to conduct customer interviews, allowing them to test some of their assumptions. Doing customer interviews can be very demoralizing. Instead of first pitching your product as a solution, you need to find out what problems your customers are facing and how could your product fit somewhere in their day to day lives?
“Too many founders build some initially mediocre product, announce it to the world, find that users never show up, and not know what to do next. As well as not getting any users, the startup never gets the feedback it needs to improve the product.”
So how do you get feedback?
You conduct the interviews and the output is a long list of feature requests and assumptions you need to validate. You need to iterate on the feedback from customers, allowing you to build a product that is desirable.
Let’s take the example of a problem we encountered with the Telenet Idealabs team:
- Our problem: How can we inspire the startups and prepare them for the workshops in the coming week?
- Our solution: Share interesting content in an email format called ‘startup digest’ with a recap of the week, articles section linked to the topic of each week, and the agenda of next week.
- The assumption: Our startups will read the articles and be prepared for next week.
- The validation criteria: If 8/10 of the startups read the digest, then it is a success.
What did we do?
We created the digest:
We measured the impact of our digest:
Our assumption didn’t get validated! People were not reading our articles, and were not prepared for next week. So we used another test to understand why and validate our updated assumption:
- Our problem: How can we inspire the startups and prepare them for the workshops in the coming week?
- Our solution: Create a presentation, summarizing the key points from the articles, presenting them to the group, and have an open discussion.
- The assumption: Our startups will learn something, will be inspired and find the content interesting.
- The validation criteria: Receiving a 4 out of 5 grade on the survey question: How useful was the session for the current stage of your startup?
After the session we asked for feedback, and the startups seemed enthusiastic about the new approach. We’re still sending out the digest and measuring if readings have increased. They did after the presentation! So this approach also had an effect on their behaviour. We also booked new sessions where we’re going to present tips & tricks from others.
Why did we do this?
Too many startups get stuck when defining their Minimum Viable Product. They still see it as ‘one big thing’ they can build at once to test their business. We want to teach them about the concept of an MVP as a series of experiments that test critical, falsifiable hypotheses of their business.
So, what is an MVP?!
“An MVP is a tool to conduct fast, measurable customer learning. The MVP is just the vehicle. You need to decide which assumptions you want to test, and choose your weapon”
So keep testing your assumptions through basic representations of your idea in the form of experiments/smoke tests. Remember these are not first versions of your product and they will help you to validate your assumptions!
Next week in we will go into detail on specific types of smoke tests run by the Telenet Idealabs startups. In the mean time: stop talking, start testing!
Originally published at telenetidealabs.be.
