product development in a startup venture

Stanford Technology Ventures Program | MS&E 273 Technology Venture Formation

Product Development in aStartup Venture

Rahul [email protected] @rashrtwit

mailto:[email protected]

mailto:[email protected]


Product Development in a Startup Venture

Product Go-to-market Users/Customers

People and Culture

Process andExecution


What’s Different

Now you are an entrepreneur…Unknowns and constraintsPassion and convictionSkepticism and over-optimismFast and hectic

Feels like a roller coaster… and fun


Stages in a StartupPre-seed Seed Funding Series A Series B

Theoretical business model Initial customer traction

Proven go-to-market model

Planning,Idea validation

Product development

Product market fit,Customer traction

Scale revenue and customers

Idea on paper or prototype

Initial product Commercially launched product

Revenue scaling product

Founders with passion and conviction + no resources

Founders,2-3 engineers

Founders,Engineering team,Product mgmt,Initial Sales and go-to-market team

Scale on sales, marketing and engineering teams

Reference: http://workingwiththn.blogspot.com/

Business model

Focus areas

Product

Team


Product DefinitionWhat we will build?

Inputs into product definition:• Vision and idea• Alignment with go-to-market• Voice of customers and users• Unique and differentiated• Must have tablestakes• What is possible given time and

resources

Not a one-time decisionBe agile and iterative-incremental on product


ProductWhat to build?

• What not to build is an equally important decision• Align the product with business objectives: Build only necessary-

and-sufficient product to meet the objectives:– Seed phase: Customer input and validation on compelling use cases– Series A phase: Product market fit, usage, referenceable customers

• Avoid falling into these traps:x Keep building and they will comex Just a few more features will turn-around the customerx Build one-offs or features for a small sample set of customersx Let’s just pivot… yet again


Getting to Product Market FitTarget compelling use casesTrack measurable business metricsDrive usage from users and customersGet paying and referenceable customersGet tangible validation of repeatable

go-to-market model


Process: How to build?Choose what applies best to your product and people:• Lean startup and Minimal Viable Product

(MVP); experiment, pivot and persevere; build->measure->learn cycle• Agile development with sprints, scrums

and releases• Even waterfall makes business sense in

some cases

Be pragmatic and agileThere is no one process to fit all cases


People and Team

• Core team is the most critical• Build the team with the best from your own network• Define and plan team structure, growth, roles and

responsibilities• Scalability of team a must but over-hiring is not a

solution: Optimize team size• Offshoring and outsourcing


Offshoring and Out-sourcing

Ensure critical mass for the teamIdentify functional areas that can be outsourced: testing, product supportContract manufacturingTrade-off between cost benefit and product execution


Building product the right wayTechnology and Architecture

• Use cases and requirements• Architecture and design principles• Foundational tenets • System architecture and design• Choices on platform, infrastructure, frameworks and

programming languages• Patents and IP


Execution

• Startups cannot afford long multi-year product development cycles

• Agility on execution a must• Release cadence: fast incremental and iterative

product cycles• Product early and often to customers and users


Financial Plan and Resources

Plan, budget and track:– Headcount– Development tools and services– Hardware equipment– OPEX: cloud services– Licensing of 3rd party software

components integrated into product– Open source components


Innovation and Differentiation

Innovator’s dilemmaPatents and intellectual property are MUSTNew-unique-and-differentiated in productCompetition—emerging and existing


Culture• You have to develop the culture; it doesn’t happen by

itself• Work hard and have fun• Celebrate each and every success