Customer

Apr 14 2013

The Ideal Profile of an Early Adopter

When you’re doing customer development, you are specifically NOT trying to understand and satisfy all of your possible users, or the total addressable market. You can deal with the whole market after you get off the ground, but you’ll never get there unless you understand and satisfy (or better yet, thrill) your early adopters. You need to find the people with your problem who feel it so acutely that they are willing to try your imperfect solution, and to help you see where it needs to be improved. These early customers are worth their weight in gold once you find them. They will be your greatest source of insight into why the product isn’t working, the most supportive when it seems like you’ll never get it right, and your loudest evangelists when you finally nail it.

Portrait of an Early Adopter

To find people with the problem you’re solving, look for five simple criteria:

They have the problem,
They know they have the problem,
EITHER they are paying for a solution currently
OR they have hacked their own together,
AND they are still unsatisfied.

If you’re talking to people who don’t meet all of these criteria, they are probably not your early adopters. They might be future customers. They might think they’ll buy your product at some future point, but that point may never come. If they aren’t willing to buy until the product is perfect, you can’t afford to focus on building the product just for them. Keep looking until you find the people who need your solution so badly they will climb on board with you before you’ve finished building the boat.

Nov 02 2012

The Founding Trio

Dave McClure of 500 Startups calls it the holy trinity of startup founders. The frequent mantra in the startup space is that there are three primary types of founders: hackers, hustlers, and designers. The prevailing wisdom is that you should have one of each of these on your founding team. But we don’t often talk about what constitutes each of these archetypes.

Hackers

Hackers are not simply code monkeys. They need to be able to do more than just code well. Comfort with ambiguity and an understanding for coding in that context is invaluable for the hacker-founder. Many programmers are happier simply building what they’ve been told to build, but the good entrepreneurs are those who think about what happens when the requirements change – and code as if they will. This means building some things quick and dirty, and accepting that there will be some technical debt incurred in favor of rapid iteration.

Communication skills are also critical for hacker-founders. To achieve company success beyond personal success, you need to be able to communicate a vision to other technical team members and to translate for your non-technical co-founders. Likewise, some comfort with project management is valuable. Finally, any good programmer should understand how their outcomes tie to the success of the business. For programmers working for others, this is the way you communicate your worth; for hacker-founders, this is how you prioritize, test, and iterate for your startup.

Hacker-founders are not the only ones who need these skills, but the reality that there is far less supply than demand for excellent technical co-founders may tempt many non-technical folks to overlook these gaps in their search for a technical co-founder. If all you’re looking for is a code monkey, don’t make them a co-founder; just hire them on a contract basis until you can attract someone who has the complete package.

Hustlers

Hustlers are usually the business development specialists in a startup. It is important to note that this is not the same as an “ideas person.” Ideas people are thinkers; hustler-founders are doers. In a startup, anyone who fails to contribute anything beyond ideas is dead weight and should be cut loose at the earliest opportunity. Hustlers are the ones making deals happen, talking to customers or partners, raising funding to extend the runway, and generally removing obstacles for the rest of the team. Hustler-founders need to be resilient in the face of an endless stream of “no” and tireless in their pursuit of opportunities to promote the company.

Designers

When we talk about designer-founders, most people think about web design or mobile app design, but these are not the most important skills. What startups really need is UX designers, not graphic designers. This point gets lost because many designer-founders have both sets of skills. But make no mistake: this role is not about making your product pretty. It’s about making your product enjoyable and effective. Designer-founders should have extensive experience with problem solving and a disciplined approach to understanding the customer’s problem and designing for the customer’s interactions and experiences with the solution.. Designer-founders might approach this task from perspectives including design thinking, lean startup, user experience design, ethnographic research, or some other school of thought. The important part is that the designer-founder focuses on creating an complete end-to-end experience for the customer, not just the gloss that covers it.

A little of column A, a little of column B…

Few roles fit squarely into one of these categories without overlapping with the others, and any early startup employee needs to be prepared to tackle any challenges that arise. However, if your founding team has the right mix of skills to cover each of these three areas, it will give you a better chance of overcoming challenges and ultimately building a sustainable company.

Oct 23 2012

A Better Website in One Afternoon

3243137849_1a56c6bfc0_b — Photo by vincen-t on Flickr

There’s a simple experiment you can run in a single afternoon that will give you all the information you need to improve the website for your restaurant or bar. Most bar and restaurant websites are terrible. This is almost a mantra in the web design community. Running a great restaurant doesn’t require having the skills to create a great website, but a good website also doesn’t require hiring an expensive firm to design and build your site. Visual designs are time-consuming and often need some technical knowledge to carry out but you can create a perfectly acceptable visual design based on a customizable template. A great website might take expertise, but it only takes a little to take a bad website and make it good enough.

The biggest gain (and best way to set yourself apart) is not how your site looks, but how it makes the user feel. User experience (UX) matters and it’s not hard to be just a little better than your competition.

The Simple UX Experiment

Recruit 5 potential customers from your local Craigslist board (offer cash or a discount or voucher for a meal at your restaurant).

Example

Stagger arrival times by 15 minutes to give yourself time to reset between test subjects. When your first volunteer arrives, sit them down in front of a computer and tell them the name of your restaurant. See if they can find your website on the first try. [box type=”tick”]Explain to your volunteer that you’d like them to speak their process out loud, stream of consciousness style, so that you can understand where they hit problem spots.[/box]
Ask them to try to find your restaurant’s address on the website. See how much time and how many clicks it takes. Pay attention to how long they spend deciding which links to click, and see if they make mistakes or get frustrated.
Ask them to find a menu on your site. See if they can find and open the menu. See if they get confused or lost if they are downloading a PDF.
Ask them to make a reservation. See if they use an online reservation service (if you have one) or if they find a phone number to call.
BONUS: Ask them to try each of these tasks on a smart phone or other mobile device.

Going through this process with 5 volunteers will take you less than 2 hours and only $100 (or less if you’ve offered vouchers). The insights gained from actually watching your customers struggle with your website will uncover the most common barriers that are keeping visitors to your website from becoming visitors to your restaurant. As an added benefit, even customers who succeeded at using the old website will be happier with the improved user experience. A few simple changes can make a big difference.

Aug 29 2012

Good Enough Technology

Most people don’t need the cutting edge. If you do audio production, you might need top-of-the-line monitor speakers or pro headphones, but most people are content with the earbuds that come with their iPods. If you make your living trading stocks in real time, you might need a blazing-fast and redundant internet connection, but most people are perfectly happy with their garden-variety DSL or cable internet connections. If your business is large-format photo printing, you probably need to invest in the best printers you can afford, but for most people, a standard inkjet or laser printer is all they need.

What You Really Need

So what do you need for those activities that are not part of your core? If your business is feeding the homeless or providing a safe space for victims of domestic abuse, you still have office needs. You still need to coordinate your team and file your paperwork. You could invest in high-powered ultraportable notebooks, a dedicated server, and a fat data pipe. In fact, some technology consultants will tell you that these investments will pay for themselves in increased productivity. They may, but that doesn’t mean they are the best investment for your organization.

Pareto principle

The Pareto Principle, named for Vilfredo Pareto, and nicknamed the 80-20 Rule, states that roughly 80% of the effects come from 20% of the causes. 80% of your profits come from 20% of your customers; 80% of the world’s income is controlled by 20% of the world’s population; 80% of healthcare resources in the USA are consumed by 20% of the patients.

How to Leverage Pareto

If the Pareto principle holds true for technology spending (and in my experience, it is close enough to be a good estimate), it follows that your organization can have 80% of the existing cutting-edge technical capacity for 20% of the potential cost. Cloud hosting services, Google apps for business, and internet connections that are fast enough for almost all organizations can all represent significant savings for you and help focus on using your resources to serve the organization’s mission.

What will you do with the 80% of the cost that you have saved? If technology is not core to your business there is probably a much more powerful point of leverage for that investment. Get your good-enough technology, and put the rest of your investment towards your organization’s core mission.

Jul 30 2012

Measuring Productivity

When you zoom out, the measure of productivity often changes.

For a single-minded programmer, productivity might be lines of code committed.
For a development team, productivity might be working code.
When you zoom out to a product view, working code that implements a feature no one uses is waste, but implementing features that people use is productivity.
Zoom out further to a business level, and it’s not just about using the feature, it’s about that feature making the customer more likely to pay for your service or product.
Zoom out again to an ecosystem (or, for you MBAs, value chain/system) level, and it’s not just about what people will pay for, but what adds value to their lives. And not just any value, but adds more value than the cost of providing said value. (N.B.: people are not rational actors, and will sometimes pay for things that don’t add value to their life.)

Now we’re in the realm of things that are hard to measure. And zooming out once again to a global level doesn’t make it any easier. What does productivity look like on a global scale? Even if we are creating value for people at a direct cost lower than the amount of value produced, are we factoring in the negative externalities to our productivity? If we are introducing pollutants, or stress, or social inequality into the world, are we truly being productive?

I don’t have the answers, but I’d love to start a conversation.