How to build a successful company, Part #3
How not to f*#k up when starting up!
Estimated reading time: 4 minutes.
“Dear Raad,
I followed your advice and found a problem. I then validated that problem with a ton of people, and we’ve confirmed that it’s indeed a big problem for a lot of them. I think my next steps are to start building out the product and move fast…right?”
Not quite grasshopper…
This is where a lot of entrepreneurs make another big mistake — they jump right into building a product without really thinking things through. Fast forward to 12 months later — they launch the product and it kinda sucks. The product seems like it’s hacked together, over bloated with features, and is unfortunately not a great solution to the problem. Users end up disliking the product and writing crappy reviews — making the situation go from bad to worse…
Fear not my friends! I’m going to help you avoid this by providing you with a framework that will increase your chances of success.
Why listen to me? My name is Raad Mobrem and I am a successful tech entrepreneur. I raised $3m from investors for my last company Lettuce and sold it to QuickBooks for $30m. I’ve advised and invested in many companies, helping them grow to be multi-million dollar machines.
Part 3: Users don’t care about your company or how hard you work — they care about how your product will benefit them…
Think about the last time you got screwed over by an airline…you probably lost your shit! We’ve all been there and it’s an incredibly frustrating experience that no one enjoys. But here’s the kicker — it probably didn’t even occur to you that this very same airline spent billions of dollars to build a sophisticated system that gets you from point A to point B safely (in a flying metal tube), or that they have 80,000 hard-working staffers trying to make it all work. Nope! You cared about the plane being 20 min late, and by cared, I mean you went bat shit crazy! Users don’t care about you, or your features, they care about how your product will benefit them.
That’s why it’s important that before you even start working on your product, you figure out your Customer Benefits. I rarely see startups that take the time to figure this out and it’s an absolute shame. Customer Benefits provide a great framework for future product decisions (and even company decisions). You don’t have to be a big company to figure this out and I recommend you do this as soon as possible.
What are Customer Benefits?
It’s exactly what it sounds like 😀 …the benefits your product provides to your customers.
For example, Amazon’s Customer Benefits for its e-commerce product are the following:
(1) provide our customers with the biggest selection of goods, (2) provide our customers with the best prices, and (3) deliver those goods to our customers as fast as possible.
How I do I figure out our Customer Benefits?
This will take some serious thinking and research, but the process is pretty straight forward. Here are a few steps that will help you figure them out:
Step 1) Write out the problem.
For example, this is the problem that WeDo is solving: people have a lot of stuff that they need to get done everyday.
Step 2) Map out the user’s process.
Ask a bunch of potential users to guide you (in detail) through the real world process they’d go through when dealing with the problem.
For example, our users typically think of tasks on the fly and keep them in their head. As a result, they usually forget a good number of those tasks as they try to remember what needs to get done. This causes them to waste a lot of precious time (by not being organized), and ultimately fail at completing all of their tasks.
Step 3) Figure out the top three pain points in that process and set out how your business can help them achieve the opposite.
We established that the top three pain points in the process described above were that people had trouble remembering things, wasted time, and ultimately didn’t get enough done.
As a result, we concluded that our customers benefits would be the following:
(1) Help our customers remember to get things done, (2) help them save time, and (3) help them get more done.
How does this help with product?
From now on, every major feature or product you decide to work on should (1) fall under one or more of these benefits, and (2) not clash with any of these benefits.
We’re constantly coming up with new feature/product ideas that we think we should implement, but they usually end up kinda sucking. You might disagree with this, but trust when I say this — unless you’re a proven product genius, your product/feature ideas usually aren’t very good. Not all of them—just most. The problem is that we don’t know that they suck and we trick ourselves into believing that we need to add this new thing, taking us down the path of creating a bad product.
Establishing your Customer Benefits helps you decide whether to move forward on a feature/product idea or not. If the feature/product idea does not help increase one of your Customer Benefits, then I highly recommend scrapping the idea. In addition, if it’s clashing with one of your benefits, then it’s for sure a dud.
For example, the team at Headspace has built a great meditation product that benefits its users. Their Customer Benefits are the following:
(1) Help the user mediate anyplace, anytime, (2) help guide the user on how to meditate, and (3) help the user live a healthier/happier life.
Initially though the founders Andy Puddicombe and Rich Pierson started out by throwing meditation events. Whilst popular, these events had high upfront costs to put on and sucked away a great deal of time from their participants lives. In addition, the participants expressed that they wished they could somehow take this experience home.
The founders decided to make a shift. They learned that events did indeed help guide the user through meditation and have a healthier life, but they didn’t enable the user to meditate anyplace, anytime. The founders decided to build a web/mobile meditation app and their app (intentional or not) followed all three of their customer benefits. As a result, the app became a huge hit! They’ve now gone on to raise over $30m from investors and are growing at a nice clip.
Customer Benefits provide a great deal of clarity when building a product (and even a company). It provides a reference point that we can map our features to, that helps us decide whether or not to move forward. In addition, you’ll find that Customer Benefits will also help you with other aspects of your business, like marketing (which I’ll speak to later on in the series).
Now that you learned the concept of Customer Benefits, you should go figure them out for your business!
In the next post, we’ll talk more about product (to be continued)…
We will continue this in Part #4 (coming soon) of How to build a successful company.
If you liked this and want more:
Do me a solid! Heart it, comment on it, and/or follow me.
