startup fuze: lean startup, customer development & validation process
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Startup Fuze: Lean Startup, Customer Development & Validation Process.TRANSCRIPT
Startup Fuze
June 2014
Lean Startup Customer Development
Validation Process
Startup Fuze June 2014
Day 1
HOLA
GRACIAS
Entrepreneurship coordinator, serial entrepreneurs,consultant, teacher, researcher.
Business & TI Blogger, Social Media, Startups
Computer Systems Engineer MBA
IT Management Master Degree
Who is talking?
basket ball, tech, human complexity
The 5 hottest mexican tech blogs: http://www.seedstarsworld.com/5-hottest-mexican-tech-blogs/
@lmalmanzalmalmanza.wordpress.com
about.me/luismiguelalmanza
why you are here?
First stepsç
First steps@lmalmanza
history…
2006: Dozens and dozens of cloud storage companies
VC: “There are a million cloud storage startups!”
Drew: “Do you use any
of them?”
VC: “No”
Drew: “…”
Learn early, learn often
Dropbox’s minimum viable product: !
3 min screencast on Hacker News (Apr 07): Lots of immediate, high-quality feedback
Simple landing page: capture interest/email address
Private beta launch video à 12,000 diggs; beta waiting list jumps from 5,000 to 75,000 in
one day (Mar 2008)
Public launch (Sep 2008): Time to get real
Public launch (Sep 2008): Time to get real
Our Web 2.0 Marketing Plan !
• Big launch at TechCrunch50 • Buy some AdWords • Hire a PR firm, or a VP of Marketing, or
something
Experiment: Paid search
Hired experienced SEM & affiliate marketing guy ($$)
Picked out keywords, made landing pages
Hid the free account option for people arriving via paid search, replace with free time-limited trial
Went live in early 2009
Cost per acquisition: $233-$388
Cost per acquisition: $233-$388 For a $99 product. Fail.
Experiments failing left and right
Problem: Most obvious keywords bidded way up
Probably by other venture-backed startups
Problem: Long tail had little volume
Problem: Hiding free option was shady, confusing, buggy
Affiliate program, display ads, etc sucked too
Economics totally broken
But we were still doing well…?
•Reached 1mm users 7 months after launch •Beloved by our community
Fourteen Months to the Epiphany
Typical Dropbox User
New strategy: viral
•Give users better tools to spread the love
•Referral program w/ 2-sided incentive permanently increased signups by 60% (!!)
– Inspired by PayPal $5 signup bonus
•Big investment in analytics
Trailing 30 days (Apr 2010) : users sent 2.8 million direct referral invites
Results•September 2008: 100,000 registered users
•January 2010 (15 mos later): 4,000,000
•Mostly from word-of-mouth and viral:
– 35% of daily signups from referral program
– 20% from shared folders, other viral features
•Sustained 15-20%+ month-over-month growth since launch
what is the goal today?
– @RAMONSCOTT
“The best entrepreneurship methodology is:
EXECUTION”
The rules of the game are different
Grid vs cloudold
new
Think and idea, work on it and…
see whats happen
¡EL COSTO DE INICIAR ES MÁS BARATO QUE NUNCA!
new business rate
98% of startups fail
why?
why?
most startups fail from a lack of customer ($)
they build the wrong things for the customers!
Why so dumb?
• Love
• Bias
• Passion
• Lack of vision
goal: have a chance
Source: The Center of Entrepreneurship and Technology / Berkeley
What to build?
understanding basics
lean
lean
Startup Company
lean startup?
Sales + Costs -
$
one example
Methodologies
Marshmallow challenge
marshmellow challenge
Customer Development
Build customers
first
4 steps to ephifany
Customer Problem Solution Product Market
Company
Why is important customer
perspective?
Mentores
customer is more important than you!
how?
get out of the building
what is the problem?
NO
Instructions
• Teams (3)
• As many NO´s as you can.
• Unknown people
• Record in video (1 x px)
• Send it to:
Validation Process
validation
comprobation
comprobar que
método científicoscientific method
1. Construct hypotheses 2. Test by doing an experiment 3. Validate or invalidate
most startups fail from a lack of customer ($)
there is no process
hypotheses = assumptions
experiments
experiments
metrics / documentation
take decision
take decision
pivot
Types of pivot• Zoom - in
• Zoom - out
• Customer segment
• Customer need
• Platform
• Business architecture
• Value capture
• Engine of growth
• Channel
tools
are they important?
is a framework
Javelin Board
ideas
experiments
Brainstorm
Execution
Customers h1
Problems h1
Solution
Risks h1
h2
h2
h2
h2
h3
h3 h4
yeahhh, now what?
MVP?minimum viable product
– Eric Ries
“The minimum amount of effort you have to do to complete exactly one turn of the Build -
Measure - Lear feedback loop”
how?
1. Exploration
observation
observation
story board
Story board
talk!
interviews
surveysNot now
record, evidence
record, evidence
2. pitch!
cold email
cold email
cold call
cold call
fake ad
Walking into a store and pitching
the owner
Meetings, user groups, conferences
meetings, user groups, conferencesHand out cards with invite to:
landing page
don´t forget the ACTION
“Singup to be notified when we launch”
one example
examples
demos
videos
real life simulation
extra: research
OK. Let´s do it.
Today
• Javelin Board & at least 2 iterations
• 10 interviews by team
Tomorrow
• Proposed MVP
• At least your landing page
how i can find people?
where are they?
get out of the building
¿fin?
I did it!
next steps
Gracias!
contactolmalmanza.wordpress.com
about.me/luismiguelalmanza
Imágenes
• flickr.com
• slideshare.com