5. March 2013–
Author of Customer Seduction, Adelina Peltea explains how tech startups can reach their perfect market fit and get the passionate relationship with the customer you always dreamt of. Gathering together interviews with 68 founders, investors and specialists, here they explain why love at first sight is, indeed, the rarest of commodities – and what you can do to increase its chances...
Love at first sight is rare...
It rarely happens that founders come up with the best solution to a big problem or desire on their own, and when it's on the market, customers immediately fall in love with it.
Love at first sight is rare. In startups, just like in real life, relationships are built in time, and there are lots of compromises to be made. Founders and customers interact along the way, and this interaction can lead (or not) to a real love story.
When you build your startup, you have market risk. You don’t know if your solution will actually satisfy or delight your customers.
Validation is the key from Fantasyland to the real world
You can diminish this market risk by validating your assumptions before investing too much time and money into building your product.
Claus Rosenberg Gotthard - Founder of AppPointment (QI):
“You can make scenarios in your head, but you need to validate them. Yet, it is amazing how few entrepreneurs do their research properly before starting to build something."
Since the very recent spread of the Lean Startup methodology of Eric Ries, of the Customer Development concept of Steve Blank, or of the refined lean concept of Ash Maurya, founders seem to understand the importance of validation at each step.
Validating is not something new. It has just been more emphasised lately. Even Oliver Samwer stated the importance of this in his research paper, based on interviews with successful American entrepreneurs that was published in 1998 (and that was 14 years ago!): “Explore the customer need through conversations with the customer and refine the problem to a point that it is a mission-critical problem. Then assemble what it needs to build a solution.”
Corporates listen to customers too - often researching when they launch new products, start new communication campaigns, or enter new markets. Despite all their experience, they don’t assume they have all the answers. Uncertainty doesn't only exist in the world of startups.
And despite the abundance of “get out of the building” advice (an expression coined by Steve Blank in Four Steps to Epiphany), founders seem to still not get it right in practice.
“Startups don’t really apply the lean methodology, but they pray to Lean Startup God"
Luiz Piovesana – Co-Founder and CEO at Empreendemia:
"You don’t learn just by reading, you need to test and to work on results. A lot of people just stop after first experiments.
"We struggled, we failed when we thought we were a 'lean' startup, but we were not. Maybe it is something you need to do: fail and learn.
"People are afraid to fail. The difference is that, despite the fear, you can go step by step and know that every milestone you reach is stable and you can learn from that. For this to happen, you fail, you learn, next time you do it right because of the experience. You are afraid, we all are. Failure and learning out of it can drive you to success.”
Tristan Kromer – Lean advocate, Advisor, Coach at LUXr, Writer at GrassHopperHerder:
“It's not easy to be passionate enough about your idea to convince investors and teammates to join you, and simultaneously be skeptical enough to test your idea. Another obstacle is a lack of practice. You can’t just read a book and do a lean startup. It's like reading a book about how to play basketball. Entrepreneurship is a skill, it takes practice.”
“You need to realise that your mama is not your market"
Alex Barrera – Founder & Chief WOWness at Press42:
"Very few founders have actually talked to customers. 98 per cent of startups haven’t done this. Most think they talked to customers. But then you see their pitch and it is complicated, has technical words in their definition, and they don’t have a clear view of what they are building. They say they talked with their friends and they said it is great, because they have that problem and we have that problem too!
"You need to realise that your mama is not your market. Most people think that they know others have a problem. I always push them to actually go out.
"Why are they so reluctant to actually talk to real potential customers? There is a combination of issues for this reason.
"Developers are meritocratic... it's hard for them to talk to the average Joe"
"Developers are meritocratic, they look for people they can learn from, people with technical backgrounds. When you have a team with developers it is hard for them to talk to the average Joe. They don’t feel comfortable. And talking to customer is painful because they don’t understand you. Average Joe doesn’t understand you. They will do it once, twice, if you push them, but they will stop.
"Doing this properly requires training, some social skills. It is like a muscle, you need to train it. And don’t have a big ego in front of a customer. Listen, learn. It requires you to be humble.
"One thing is theory, another thing is practice. Every time I ask about Lean Startup and Customer Development, they all say they know the concepts. It is trending. But when I ask how many implemented, there are few. They need to practice and in time they get to know how valuable it is. And how stupid it is to write code before talking to customers.”
Asking the wrong questions or interpreting the answers in a wrong way is as bad as not seeking validation
When interviewing founders for this book, I noticed that one of the most important aspects to all of them was listening carefully to customers. In some cases, this attitude was adopted from the very beginning. In other cases, the founders realised the importance along the way, after learning from mistakes.
Not talking to customers to validate assumptions can be lethal for your startup. As is asking the wrong questions or interpreting the answers in a wrong way.
Therefore, you might need some help. The professionals in this field are Qualitative Researchers and User Experience specialists. They can offer consultancy or work with you hands-on during a pilot research.
Martin Christensen – Agile User Experience Designer at Kaeru.se:
“The gap is that founders think of UX as design only, not research. UX specialists are used to go out of the building. They are good at interviewing and understanding the target group quicker, because they have the experience. It is more the feeling they get, not recordings of data. It comes with experience. I brought the founder with me when doing research. He took notes, listened, and presented something. It was a good collaboration.”
Adina Madularea – Senior Qualitative Researcher, PhD Candidate in Sociology:
“Qualitative research may efficiently accompany the newly emerged business idea. Being either about testing an idea, a concept or the product itself, the qualitative research may provide useful information about targeting the right core of early adopters. And it may also inform the decisions on refining the product’s or service’s features to better answer customers’ needs.
There are two critical aspects that need to be understood about the qualitative research within such a context: on the one hand, how to run effectively the concept and price testing with the help of qualitative research and, on the other, how to adequately interpret the qualitative data in order to obtain useful and actionable information for the business decisions.
It basically requires handling the art of asking the right questions and the power of right interpretation of customers’ free discourse.”
Use insights from experts in the industry or think of your previous experiences if you are an expert
Philipp Kandal – Co-Founder & CTO at Skobbler:
“Try to read research papers from universities in the area you are in. They are painful to read, really academic, but they help a lot to understand. Take, for example, self-driving cars – you try to meet the people who work on that, they talk about long-term goals, what is happening on the market. Talk to people from research, not just people that go to tech conferences.”
Maxim Kamanin – Founder and CEO at Displair:
“People do not quite know what to do with Displair, except advertising and events. They can’t even imagine how many applications there can be with it. Customers can’t even imagine in how many directions they can use it. We help them do this: we have creative people, consultants that help us to find where our technology can be used in our clients’ businesses.”
But experts don't know everything...
Alex Barrera – Founder & Chief WOWness at Press42:
“There are no experts, there are people that know a lot, but they don’t know everything. Don’t trust the mentors. I am just giving you a hunch, you should test it. You still need to validate.”
Philipp Kandal – Co-Founder & CTO at Skobbler:
“We knew the industry very well because we worked on similar products before. We kind of knew what customers wanted. The challenge was to get the best price point for mobile. We wanted to get the technology down to a reasonable price, but we had to test which one this was.”
The best part of validating before you start building is that until you don’t see customers love you back, you don’t have to leave your current job (if you have one), struggle with hiring developers or with finding an investor. You can figure out if it is worth taking the leap before you actually take it. And you'll be further along the road to achieving the customer love you crave.