This article is the second in a series of blog posts focused on using lean principles to build a startup.
In my first post, I highlighted the process that my company has undertaken to move from idea to implementation – the Lean Startup methodology. In this post, I’m going to dive a bit deeper into turning an idea into a product through Customer Development.
In her book, Lean Customer Development: Building Products Your Customer Will Buy, Cindy Alvarez details the theory and process that both startups and large companies alike should use to validate new product ideas. The main argument for ‘lean’ customer development is to learn as much as you can before you build something and reduce the risk of building something that no one wants. This process is exactly how my company moved from our original hypothesis to our current product.
The premise is straightforward: You have a bunch of assumptions about the problem you are solving and the people who need your solution. Based upon your assumptions, you create a hypothesis that says:
I believe [these types of people] experience [this type of problem] when doing [this kind of task] OR because of [this kind of limit or constraint].
This is the essence of your solution. You’ve identified your target customer, the pain point they are feeling, and when or why they are feeling that pain. You’re describing the reason these targets will want to use your solution; refuting, refining and finally validating your hypothesis is the crux of customer development.
You take that hypothesis, go find your target customer and hold short informational interviews with them. Alvarez does an exceptional job not only detailing how to find your targets, but how to ask for time, formulate the questions, hold the interviews, AND to ask for referrals. While you’ll begin with who you know, the chain of referrals will help you find more individuals who (hopefully) will take you out of your network and put you on the path of an initial customer base. Brilliant!
However, let’s not get ahead of ourselves. These interviews aren’t to find out if these people want your product; they are to validate or invalidate your hypothesis and assumptions. When you invalidate your assumptions, you can refine your hypothesis and continue this cycle of learning until you validate a hypothesis that defines the real problem you are solving for a target group. You want to do this as quickly as possible.
This is why this customer development process is ‘lean.’ It’s a build / measure / learn cycle like the Lean Startup methodology. However, in this cycle, you’re focused on simply understanding your customer’s pain points and the potential value you can offer.
Once you’ve reached a validation point, this is when you can start building your MVP and use lean methodologies to cycle your product. If you don’t start with this customer development process, you will most likely be building your initial solution based upon the wrong set of assumptions – a costly and potentially devastating mistake.
