Customer discovery is the process of translating a founder's vision for the company into hypotheses about each component of the business model and creating a set of experiments to test each hypothesis.
Steve Blank
Part of Customer Development is understanding which customers make sense for your business.
The Value Proposition Canvas functions like a plug-in to the Business Model Canvas and zooms into the value proposition and customer segment to describe the interactions between customers and product more explicitly and in more detail.
The Lockheed Skunk Works, led by Kelly Johnson, was responsible for its Advanced Development Projects - everything from the P-80, the first U.S. jet fighter plane, to the U-2 and A-12 spy planes.
At the intersection of food science and technology, food replacement startups are creating substitutes for the basic components of meals as well as replacements for complete meals.
Great entrepreneurial DNA is comprised of leadership, technological vision, frugality, and the desire to succeed.
The Lean Startup process builds new ventures more efficiently. It has three parts: a business model canvas to frame hypotheses, customer development to get out of the building to test those hypotheses, and agile engineering to build minimum viable products.
Value Proposition Design is a 'must have' for anyone creating a new venture. It captures the core issues around understanding and finding customer problems and designing and validating potential solutions.
The Lean Startup is a process for turning ideas into commercial ventures. Its premise is that startups begin with a series of untested hypotheses. They succeed by getting out of the building, testing those hypotheses and learning by iterating and refining minimal viable products in front of potential customers.
In the past, when venture-funded startups told their investors they'd found a profitable business model, the first thing VCs would do is to start looking for an 'operating exec' - usually an MBA who would act as the designated 'adult' and take over the transition from Search to Build.
The food replacement category is what it sounds like - companies are substituting plants or food grown in a lab to replace meat, fish, eggs, milk - or, like Soylent, to package nutritionally complete meals into a drink.
The Columbia Startup Lab is a visible symbol of how the university is making entrepreneurship an integral part of all colleges at the university.
Entrepreneurial education in grades K-12, if it exists at all, still focuses on teaching potential entrepreneurs small business entrepreneurship - the equivalent of 'how to run a lemonade stand.'
It's worth noting that everything - from the Internet to electric cars, genomic sequencing, mobile apps, and social media - were pioneered by startups, not existing companies.
Innovation in an existing company is not just the sum of great technology, key acquisitions, or smart people. Corporate innovation needs a culture that matches and supports it.
Learning how to keep track of inventory and cash flow and creating an income statement and a balance sheet are great skills to learn for managing existing businesses.
The art of entrepreneurship and the science of Customer Development is not just getting out of the building and listening to prospective customers. It's understanding who to listen to and why.
Measuring how hard your team is working by counting the number of hours they work or what time they get in and leave is how amateurs run companies.
For busy young adults, the lure of meal substitutes is simple - it's all about convenience - the level of effort to open a bottle or package is minimal, and the time from thinking you're hungry to eating is almost zero.
As I've gotten older, I've come to grips that the unexamined life is what works for most people. Most take what they learned in school, get a job, marry, buy a house, have a family, become a great parent, serve their god, community and country, hang with friends, and live a good life. And for them that's great.
The business model is both the starting point and the scorecard for Customer Development progress.
The introduction of new technology is always disruptive to existing markets, particularly to content/copyright owners who sell through well-established distribution channels.
While 'The Owner's Manual' is not a formula for guaranteed success by any means, we're confident it will help reduce the failure rate of most startups that use our Customer Development process.
When your product solves a problem that costs customers sleep, revenue, or profits, things are definitely looking up.
My imagination ran 24/7, and to me, every problem was a challenge to solve and new product to create. It wasn't until I started teaching that I realized that not everyone's head worked the same way.
We now understand the distinction between startups - who search for a business model - versus existing companies - that execute a business plan.
Visionary CEOs are product- and business-model-centric and extremely customer focused.
On Day One, a start-up is a faith-based initiative built on guesses.
Persuading employees to let go of old values and beliefs and adopt new ones can be challenging.
It typically takes multiple iterations and pivots to find product/market fit - the match between what you're building and who will buy it.
Customer Development changes almost every aspect of startup behavior, performance, metrics, and, as often as not, success potential.
You can get a good handle on a company's culture before you even get inside the building. For example, when companies say, 'We value our employees' but have reserved parking spots, a private cafeteria, and over-the-top offices for the executives, that tells you more than any PR spin.
Companies that acquire startups for their intellectual property, teams, or product lines are acquiring startups that are searching for a business model. If they acquire later stage companies who already have users/customers and/or a predictable revenue stream, they are acquiring companies that are executing.
Out of electronics school, my first assignment was to a fighter base in Florida. My roommate, Glen, would become my best friend in Florida and Thailand as we were sent to different air bases in Southeast Asia.
At 19, I joined the Air Force during the Vietnam War.
Great VCs do everything they can to make you successful. But just like your bank, credit card company, mortgage holder, etc. they are not confused where their long-term loyalty lies.
Decades before we were able to articulate the value of 'getting out of the building' and the Lean Startup, the value in having skunk works controlling their own distribution was starkly evident.
Visionary CEOs don't need someone else to demo the company's key products for them. They deeply understand products, and they have their own coherent and consistent vision of where the industry/business models and customers are today, and where they need to take the company.
Everyone on the founding team ought to invest the time in a coding bootcamp.
History has shown that time and market forces provide equilibrium in balancing interests, whether the new technology is a video recorder, a personal computer, an MP3 player, or now the Net.
Products are sold because they solve a problem or fill a need. Understanding problems and needs involves understanding customers and what makes them tick.
If you think the job of a CEO is to increase sales, then Ballmer did a spectacular job.
Skunk works were emblematic of corporate structures that focused on execution and devalued innovation.
Startups have finite time and resources to find product/market fit before they run out of money. Therefore startups trade off certainty for speed, adopting 'good enough decision making' and iterating and pivoting as they fail, learn, and discover their business model.
First and deadliest of all is a founder's unwavering belief that he or she understands who the customers will be, what they need, and how to sell it to them.
All too often, a corporate innovation initiative starts and ends with a board meeting mandate to the CEO followed by a series of memos to the staff, with lots of posters and one-day workshops. This typically creates 'innovation theater' but very little innovation.
A startup is not just about the idea: it's about testing and then implementing the idea. A founding team without these skills is likely dead on arrival.
In a web/mobile startup, coding is not an outsourced activity. It's an integral part of the company's DNA.
The goal of listening to customers is not to please every one of them. It's to figure out which customer segments serve your needs - both short and long term.
The music and movie business has been consistently wrong in its claims that new platforms and channels would be the end of its businesses. In each case, the new technology produced a new market far larger than the impact it had on the existing market.
