customer-development

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Received my Haley Strategic D3CR Chest Rig to run with my Shellback Tactical Banshee Plate Carrier with AR500 Curved Plate Armor.

Current load-out on the banshee:

Glock 19 Gen 4 inside Special Operations Velcro Holster
Two spare mags with Taran Tactical Innovations +6 base pads
4 Magpul Pmags
Winkler Knives fixed Blade
Will be adding a radio(still deciding on make and model) as well as first aid kit(VOK) from Tactical Response.

Stay tuned as I continue to run, change, and add to my current set-up.

Pictured with Battle Arms Development & Bentwood Gunsmithing Ounces Is Pounds Custom AR-15 with Hex Mag.

Let your customers help your Customer Development

You hear it again and again – stories that extoll the virtues of understanding what your customers need.  Zappos has built their whole business around the idea that happy customers are the key to success (see Delivering Happiness for more).  Pair that with the enthusiasm for the Lean Startup Movement and everyone points to customer development as critical to traveling down the road towards product/market fit.

At Profitably, we’ve generated such a backlog of ideas and tweaks that we could keep building in perpetuity.  Some of these concepts come from scratching our own itches, some come from experts in the finance space, and others come from business owners that never want to hear the words “general journal.”  So how do you effectively capture and act on those ideas?  How do you cut through the noise to develop the car and not a faster horse?

I don’t have the answer, but since we’ve gone through a number of iterations on this I’ll share what we’ve arrived at so far.

First off, there are many ways to get feedback from people and you should plan on using as many as you can.  There are many types of learners – some like to read the manual first while others rip open the box and start playing.  Before people even sign up for Profitably, we give them lots of resources.  We keep updating our FAQ to handle common questions, are constantly publishing relevant content on our brochure site (app specific and agnostic) and even give people the chance to jump into a demo.  We put an email address and phone number on every page, you can submit a question through the Zendesk tab on the side, and I’ve even hooked up live chat on the pricing page.  This alone generates a good volume of feedback and food for thought.  Remember – this is all coming from people who haven’t even signed up.

Now, let’s assume that all of this great content is able to convert some of these visitors into leads and trial signups. (You are tracking all of this and reading Lincoln Murphy’s great advice on SaaS marketing, right?).  Even signing up for a free trial is a commitment.  There’s an opportunity cost associated with the time you’ll devote to getting started, so bear that in mind.  In our app we offer the same communication channels from the brochure site, and I’ve also created Kiss Insights prompts based on specific triggers (e.g., someone has returned x number of times and has been using the app for more than x minutes).  I’m conscious of the fact that people are using the app to answer a business need, not take a survey, so the questions are quick and hopefully in context (and easy to ignore!).  I also follow up with every person that signs up to get a sense of their business and what problems they’re hoping we can solve.

Sounds great, now how do we turn all of those emails and calls and text snippets into stories/features?  We’re still rolling it out, but I love what I’ve seen so far with User Voice (believe it or not we use yawa – yet another web app).  We capture requests, questions, suggestions from all of these channels and figure out how to cram them into a sensible product development model.

The set up includes epochs (or “epics” as we call them) for the high level blocks of functionality that are still in the distance, along with more granular ideas or tweaks for what’s already out there.  We considered keeping the longer roadmap ideas internal but ultimately decided it’s more important to get your ideas out there and get feedback.

Product development is about figuring out the single most important problem that exists right now and doing that and only that (source)

This is important to remember, and tracking feedback through User Voice helps us be measured in our decision making.  When it’s time for us to start our next sprint we have a weighted backlog to pull from.  Even better, anyone that voted for an idea is updated on progress, from review all the way to completed.  Maybe some day we’ll let people add stories right into Pivotal Tracker! (ed. note from Francis: false).

What stinks: UV doesn’t allow me to attribute ideas to someone else, even as an admin.  Instead, I’ll do the adding and then send the link back to the requester.  If they vote or comment the link is still there, but I’d much rather see ideas linked to other people than me.

Overall I’m really happy with how our experiment’s progressing.  Want to hear more? Know how we could be even more awesome at capturing this feedback?  Leave a comment below!

Financiando sua Startup

A cena Startup vem crescendo a cada dia nas diferentes regiões do planeta e aqui no Brasil não é diferente. Investidores estrangeiros têm cada vez mais voltado suas atenções para o Brasil. E os investidores brasileiros, principalmente no Sul/Sudeste, também já se movimentam e organizam fundos, aceleradoras e incubadoras utilizando capital privado de maneira a investir em negócios de Internet. O momento é fértil para as Startups. As barreiras para o financiamento estão diminuindo e o acesso a investidores globais está cada vez mais fácil. 

Para melhor aproveitar estas oportunidades e tirar sua Startup do papel é bom ficar ligado em alguns conceitos que, se tudo der certo, passarão a fazer parte do seu dia-a-dia. Equity, Vesting, Venture Capital, Convertible Notes, Preferred Stocks, Cap, Convertible Debts, Angel Investor e Exit são apenas alguns dos termos que o empreendedor irá se deparar nesta jornada.

Compartilho aqui como vocês a apresentação que acabei de fazer no Intervalo Técnico do C.E.S.A.R, uma iniciativa muito boa liderada por Luiz Borba que compartilha sua experiências aqui no Borba on Software. Agradeço aqui a todos os que compareceram. E é muito bom saber que a cena Startup de Recife começa a mostrar suas garras.

Startup success is more about markets than ideas

I’m a big fan of the Lean Startup and Customer Development movements, which emphasize testing your assumptions, reducing waste, and failing fast (it’s easier to see if something won’t work than to prove it will).

But it’s also clear to me that starting with a “big idea” and trying to validate it by finding customers is much harder than starting with a customer segment, and deriving your “idea” from actual problems you identify in that segment.

So my rough order of activities for a new startup would look like this:

1. Find a customer segment you actually care about and can reach, and spend a lot of time with them.  You have to care about the segment, because startups are frustrating, demoralizing, life draining marathons. Without the passion, it’s hard to push through when things get tough.  And it’s virtually impossible if you actively dislike your customer segment (hint: don’t pick a segment you hate).

And you have to be able to reach them easily.  Otherwise it makes learning from them difficult because…you can’t reach them.  Bonus if your segment actively engages online in forums, LinkedIn groups, or industry associations.

2. Discover their painful problems.  This is trickier than it seems.  People often complain about things that they have no intention of changing or fixing.  The best problems to build a business around often show up as something people are trying to solve, just badly.  That could mean the existing products or services aren’t doing the job, or are targeted too high-end or too low-end.  Pro tip: this is easier if you are already a member of your target segment.

3. Validate that they’ll pay for a solution.  OK, so the startup graveyard is littered with the bones of great solutions to problems people decided they don’t want to pay for.  Much better to figure out if there’s a market. 

Here’s a ridiculously oversimplified shortcut for this - focus on things that help people make money, save time, or both.  Oh, and focus on businesses, not consumers.  Businesses are used to paying for things that add value for them (read make them more money, or save them time).  If you’re about to say “What about Facebook?”, sorry, I regret to inform you that you’re not Facebook, move along, nothing to see here.  

4. Build the smallest thing they’ll pay for.  Lean startup folks call this a Minimum Viable Product or MVP.  Why the smallest thing?  You’re a startup, you don’t have time to build the biggest thing before you know how many you can sell.

By starting with the smallest thing your customer segment will pay something for, you can start to learn from paying customers which is pretty much the only kind you should listen to (unless you don’t have any of those, which probably means you skipped step #3).

5. Repeat Steps #2 - #4 until profitable.  Seriously.  Keep talking to customers (and potential customers) to find out what their problems are, and whether they’ll pay for solutions.  You’ll move from the 100,000 foot view of problems down to the tiny details of their workflow.  You’ll become the world’s leading expert on your customer’s problems, and how best to solve them. Or you’ll discover you skipped step #1 and have no interest in this segment.

Got another approach?  Add a comment and let’s talk about it.

Our first publication of the PriceTag teams effort to disrupt the mobile search, coupon, and check-in market.

(use google translator from estonian language if needed)

Martin Born aitab leida odavat õlut

01. juuli 2011 11:40                 

External image

Martin Born (Tiina Jõgeda)

Martin Born (25) ja tema arvutiinseneride tiim tahavad peagi turule tuua suviselt asjakohase nutitelefoniteenuse nimega BeerMe. See aitaks inimestel leida parimate pakkumistega õllekaid esmalt Tallinna linnas, hiljem ka näiteks Pärnus. 

Plaani järgi 15. juulil käivituv teenus annaks kasutajatele hea ülevaate, kus ja mis hinnaga Tallinna pubides õlut müüakse, millised on eri kohtades sooduspakkumised või kampaaniad ning milliseid kohti peavad kunded lihtsalt ägedateks. Kasutajad saavad häid pakkumisi sõpradega jagada, end Foursquare’i põhimõttel pubidesse sisse registreerida ning osaleda pubide kliendimängudes.

BeerMe peaks välja kujunema kasutajate endi poolt edastatava info põhjal. See tähendab, et mitte Born ise ei kavatse kõiki Tallinna pubisid kaardistada, vaid seda teevad BeerMe kasutajad. Born ütleb, et BeerMe sihtgrupp on tehnoloogialembesed tudengid, kelle jaoks on õlu möödapääsmatult oluline. Samuti Soome turistid, kes väldiksid BeerMe abiga pubides petta saamist.

Born on terve elu mänginud korvpalli ja hiljem õppinud Tartu ülikoolis kehakultuuri. Kuus aastat müüs ta USAs ukselt uksele raamatuid, samuti on ta töötanud Peep Vainu koolitusfirmas.

check our early beta invitaion site: http://unbouncepages.com/beerme/ to get the hands on the app once it comes out in within august.

Steve Blank on Customer Development

This post is from Anthony Yu, who is a social entrepreneur with Urban Light, a 501c3 providing direct services for sexually exploited boys and teenagers in Chiang Mai, Thailand. He is interested in applying Steve Blank’s principles of customer development in the social field. You can follow him at @baconstarvation.

————-

The following is a synopsis of Steve Blank’s interview as part of the E-Provocateur series at the Stanford GSB.

All credit for the concepts below should be given to Steve Blank - for developing these ideas - and to Stanford’s Center for Entrepreneurial Studies and Andy Rachleff, for hosting and being an awesome interviewer, respectively.

For those angry with the tenets of customer development, please immediately direct all apples, oranges, and sasquatch meat stick projectiles at Steve Blank. His wonder-beard will subsequently consume these items and fire a comically large cannon ball at you, for we know these customer development tenets to be honorable and true. 

Twitter Handles

Technological startups are not smaller versions of larger companies. (Here are Steve Blank’s slides on this subject matter.)

  • Startups search, for at least two years, for new, scalable, and repeatable models.
  • Large companies, on the other hand, execute large business models. 
  • Business school skill sets can be toxic to early stage start ups.
  • If a person is in fact an entrepreneur, both McKinsey and startups should not both be seen as equal, viable life paths.

Entrepreneurship is a calling, not a job.

  • It’s like being an artist: it’s something you have to get out of your system.
  • Founders are not normal people and see things that normal people do not.
  • Caveat: A lot of founders, however, are hallucinating.
  • (The points above do not necessarily apply to joining a founder’s team as a non-founder.)

Customer development cannot be outsourced.

  • It’s not possible to outsource customer development and do something along the lines of hiring a customer development manager, or pushing the role to a VP of sales.
  • Founders must do customer development themselves.
  • It’ll take a while, but a great founder will listen to customers and determine ways to pivot their products into product market fit. (More on this topic from Steve Blank.)

MBAs are not necessarily suited to be sole founders of a technological startup.

  • However, MBAs are capable of being co-founders in a good mix of individuals, operating executives, and founders of non-technological companies.
  • Engineers almost always run the teams of successfully technological start-ups.

In many situations, second-mover advantage provides more benefit than first-mover advantage in a new market.

  • Simply having first mover advantage does not push tech ahead a few years. 

The venture capitalist secret memo for founders:

  • For some venture capitalists, if a company has discovered liquidity, then they’ll start to look to replace the founder with an operating executive. 
  • Many business school graduates are adept and can perform the role as operating executive quite well.
  • When it comes time to execute, not all founders will have the chance to move onto the next steps of execution. Again, a lot of founders can be replaced by an operating executive. 

Other key points:

  • Steve Blank has cracked the code, not to make one specific individual a great entrepreneur, but rather to make a larger population of entrepreneurs less likely to fail overall.
  • After customer development proof, the next challenge for startups to figure out is how to scale.
  • Military organizations (ex: Roman legions) reflect the growth of startups very well. 

Twitter highlights with #seprov:

Stanford Business (@StanfordBiz): “We have a special word in Silicon Valley for what we call failed entrepreneurs - they’re called experienced entrepreneurs. @sgblank #seprov”

@karenlee: “A simple but clear distinction by @sgblank: Large companies execute known business models. Startups search & create new ones. #seprov”

@alanchiu: “You cannot outsource customer development. The founder has to do it personally. @sgblank #seprov”

@mduboe: “A disproportionate # of founders are from dysfunctional families. Ability to see order out of chaos is a huge advantage” #seprov @sgblank"

@mduboe: “Consumer Internet companies are NOT technology companies” #seprov @sgblank"

@StanfordEntrepr: “The most successful entrepreneurs are technologists but there are no hard and fast rules @sgblank #seprov”

@kslicer: “a start-up = temporary organizaton designed to search for a repeatable and scalable business model @sgblank @StanfordBiz #seprov”


Quick Tips for Effective Customer Interviews

I work with many entrepreneurs who often mistake the concept of “talk to customers” as a sales pitch or an online survey. They go into salesman mode, pitch hard without hearing what the customer has to say, and ask leading questions that steer the customer into responding in ways that reaffirm his beliefs.

The goal of customer interviews is to collect detailed stories on customer mentality, behavior, and frustrations. Ideally, this is done in person, or over Skype, so you can dig deeper into the answers they provide. This builds empathy, uncovers richer insights, and reveals opportunities you could solve for that you may not have considered before. 

Here are some quick tips to help you get the most out of customer interviews.

Interview Preparation:

  1. Effective exploration starts with having a clear customer in mind.

  2. Get rid of any preconceived notions you have about your solution; focusing too early on testing the solution makes you prone to biases that will prevent you from hearing what customers have to say.

  3. Jot down a list of questions that test your riskiest assumption. It’s not necessary to write out the questions one by one. The best approach I’ve found is keeping in mind key objectives you’re looking to get insight on, and having a casual conversation with your subject around those objectives.


Interview Techniques:

Don’ts

  1. Never start off by saying that you’re working on an idea. This biases the interviewee and they will feel inclined to be nice or reverse engineer your questions.

  2. Never ask leading questions. You are priming the interviewee for the answer you want to hear.

    Bad: It’s really awful to wait in long lines, isn’t it?

    Good: Tell me about the last time you waited in a long line.

  1. Never put the interviewee in hypothetical scenarios. The more you ask them to imagine a situation, the less you can trust their answers.

    Bad: If you were stopped by the police, what would you do?  

    Good: Have you ever been stopped by the police? What did you do?

  2. Never start a question with “would.” This asks them about future behavior, which they cannot predict and is not reliable.

    Bad: Would you pay for this?

    Good: Actually test if they will through a Pitch experiment. 

  3. Never start a question with “do,” unless it’s a qualifying question.

    Bad: Do you want more free time?

    Good: How do you manage your time?

    Qualifying question: Do you have kids?

Do’s

  1. Qualify the person you’re talking to and make sure he/she fits your customer hypothesis.

  2. Always ask about past behavior.

  3. Always start questions with “who, what, why, when, where, how.” Why and how questions surface the most insightful answers.

  4. Always close by asking for their contact information and an intro to others who fit the customer profile. Chances are they have friends or colleagues who do.

  5. Always make sure your interviewee is not your mom, dad, or friend.

Lean Startup Conference Recap: An Amazing Experience in West Michigan

I was honored to have the opportunity to speak on the founders panel for the Lean Startup Conference this past week in Grand Rapids, MI.  As a Michigan native and startup-advocate in this state, I couldn’t have imagined a better experience!

Here is a quick recap from a “speaker” perspective:

Accommodations
:  They put us up at the amazing JW Marriott in downtown Grand Rapids.  It was within walking distance to everything (bars, restaurants and conference location) and hosted the initial VIP event.  Couldn’t have been placed in a better place.

Pre-Party
: The pre-party, or VIP dinner was great.  It was in our hotel, so there was no excuse to miss it.  The crowd was small enough to be “VIP” and was a great chance to chat with the other presenters in the conference.

Pro-tip
This may be obvious to some, but the best networking takes place over dinner or beers with those who are in attendance.  We went to a local bar and got dinner and drinks (where Eric Ries was gracious enough to cover the entire tab! What an amazing guy.  Seriously..).  Anyway, it was a great chance to chat with Eric, Brant Cooper, Patrick Vlaskovits, Dug Song, Dan Martell, Zach Steindler and Gagan Palrecha among others.

The Conference:  I have been to more than a half-dozen startup events and the quality of the content was the best I have ever witnessed – hands-down.

Eric Ries - Eric simply killed It.  His presentation was thoughtful and energizing.  He was like a rare college professor who had ‘standing room only’ for each lecture.  You need to buy his book - http://lean.st/

Patrick Vlaskovits and Brant Cooper - Filled with hilarious dry humor and great stories, this presentation was the perfect complement to Eric’s keynote.  They presented “10 Reasons to Not Do a Lean Startup.” They are the authors of The Entrepreneurs Guide to Customer Development - another book every entrepreneur should own.

Rob Walling - Rob brought an interesting take from a marketing perspective.  It was really insightful, especially coming from someone with a technical background.  Great message and several key takeaways.  Check out his book: Start Small, Stay Small.  You should also check out his upcoming conference – MicroConf

Dan Martell - Lots of energy and great stories.  Dan had the most upbeat presentation and was filled with great info and an inspiring story about his brother. 

William Pietri - Very well spoken and although he spoke about programming and agile development there were several great jokes and very interesting commentary for the non-technical people in attendance.  

Hosted by the Momentum, the conference was first-class all the way.  A special shout-out to Amanda Chocko, who did an excellent job and has been a huge startup advocate in the region.

I hope we can do it again next year. 

What if consumers aren’t looking for a "Disruptive Synergized Paradigm Shift” in a breath mint?

I have been diving into the concept of Lean Enterprise.  I think this is going to take off in many corporations.  The larger, more established enterprises are trying in vain to remain relevant and innovative as the pace of markets and technologies cycles ever faster.  Despite their massive balance sheets, troves of talent, and significant market share, their ability to be truly innovative usually falls far short.

Lean Enterprise could help shift much of the inertia in large companies that stifles new ideas. It may not turn companies into lean, mean startup machines of innovation, but it may help with two major pitfalls that plague most new product initiatives. 

The first is the lack of custom input early on in the product development cycle.  Often customer input is ignored or never filters back from sales to the the engineers and product teams.  My friend and entrepreneur Peter told me countless times of this occurring in his work in the medical device industry, thus his motivation to start Enhatch.  If he could get surgeon input back to the product teams in a more efficient and organize manner, it could save millions in costly design and product mistakes.

The second is the massive disconnect in the understanding of what disruption really means.  Truly disruptive ideas create entirely new ecosystems, change market dynamics, and are leaps ahead of existing technologies and processes.  For most enterprises, a new cereal flavor is about as disruptive as it comes.  I am being facetious, but they either create something that is mildly iterative or they dive down into some massive skunkworks project that produces a product that is totally divorced from market reality.  In short, they develop a flop which we have seen time and again in the marketplace even as recently as Blackberry that were innovators in mobile technologies a decade ago, and are now a shell of themselves.

The moral of this story?  Listen to the customers and the market, whether that is an early startup or a massive multinational corporation.