The process is complex, never the same and we use different frameworks, but there's a saying: “It takes months, but may save years.”
We sit down, enjoy a cup of coffee and discuss the whole idea, getting the ABC’s of the concept. Everybody must understand the concept, acknowledge it and share the same vision. We write it down on paper and start launching assumptions and hypotheses about potential users/clients and the market.
Starting with the most critical part of a startup's journey, the Problem Statement Validation, we aim to find out if there is indeed a real problem or necessity we can solve through the idea. The real differentiator between good entrepreneurship and great entrepreneurship is finding the right market need, not building the right solution. As CB Insights emphasis, “Tackling problems that are interesting to solve rather than those that serve a market need was cited as the No. 1 reason for failure, noted in 42% of cases.”
Following the validation of the problem, we must continue with designing our Value Proposition. A value proposition is a statement that answers the ‘why’ someone should do business with you. It should convince a potential customer why your service or product will be of more value to them than similar offerings from your competition. You know why your company is great, but do your potential customers know what sets your brand apart?
On the other side, a Business Model is the top-line vision of the company. It is why the company exists. It ensures the long-term growth and sustainability of the organization. How the product will differentiate and innovate, impact people's lives, improve their well being and become something that everybody loves? How will you transform your idea into a product, and a product into a business which generates real revenue?
When you first start your startup journey, the whole idea is based on a bunch of assumptions and hypotheses. But these are nothing without proper, validated user and market research.
In this stage, we must concentrate our efforts on finding out which are the main competitors. Using different tools, we must establish what business strategies they have, what business model they use and how they make their money (revenue streams). We, at Stratefy, benefit from two methods called Competition Matrix and Competition Analysis. It’s an in-depth approach for finding “dirt” about competitor startups and the market you decide to target.
At the same time, we must tackle another vital part of an early-stage startup: user research. Remember how we talked about problem validation? Well, that part of the equation and this part of the equation are complementary. Because we build products and businesses that must address a real market need, all our efforts should be now streamlined to validate the assumptions and hypotheses we launched so far. Following a customer persona profile and a research structure (surveys, user interviews, focus groups, ethnographic research, etc), we must ensure that we are on the right path with our idea. And if we are not, that is even better. Because now we gather valuable information and focus on the validation of things that are working, things that might work and things that need to be changed. And that is like getting out of the dark based on real data, which is the only way of running a startup.
Before diving head-first into building an actual product, the easiest, safest, and cheapest way of testing your idea is to build an interactive prototype. “What is a prototype?”, you may ask. Simply put, a prototype is an example that serves as a basis for future models. Prototyping gives designers an opportunity to research new alternatives and test the existing design to confirm a product’s functionality prior to production.
Why it is so necessary though? The main best reason for making an interactive prototype is to figure out all the things that are wrong with your design before you spend a lot of time and money building your real product. You see, the only thing better for usability testing than an actual product is a close facsimile of that actual product. Basically, you use interactive prototypes when they will save you time and money by allowing you to test something that is very close to a real product without having to bother to build the whole thing.
Experimenting with various iterations of the same prototype ensures everybody that the product will be developed at it’s best version, without any compromises or huge mistakes. If you want to see the latest interactive prototype we are working on, just give us a nudge.
By now, you should be able to answer yourself to a list of questions about your idea. If you have a real sense about your market and potential customer, you’ve outlined your problem statement, a business strategy & value proposition, and validate them through research, you should invest in building a minimum viable product.
But first things first. What is an MVP? The idea behind a Minimum Viable Product is that, instead of taking months and months building a huge product with dozens of features and all sorts of bells and whistles before finally launching a giant thing that nobody wants, maybe it would be a better idea to launch something smaller and start learning earlier. The idea is not that you’re building a tiny, useless product. The idea is also not that you’re building a bad product. That is never the idea. The idea is that you’re starting with a good, small product and then iterating and adding features that people will use.
MVPs help solve that problem by making you validate each hypothesis quickly before spending a huge amount of time bolting a tremendous number of supporting features onto a product that doesn’t solve a problem. The MVP is a product with just enough features to satisfy early customers and to provide feedback for future product development.
If you think that the work is done, unfortunately, you are wrong. Building the MVP version of your product is just the beginning. But a beautiful one. You are now on the verge of an amazing journey.
Business-wise, you should now divide your attention between fulfilling your value proposition, business strategy and reaching scalability. Product-wise, you should focus on maintaining, but also improving (with new, user-validated features), your product. A method to do all this in an efficient and accurate manner is Lean Startup’s principle “Build, measure, learn”. The BML loop is a process of building a product, measuring consumer metrics and learning from them to better respond to customer needs and improve the product for the ultimate sustainability of the company.
Therefore, keep in mind that now is the time when your product must become a real business, that should generate real revenue, in order to survive and grow.
