There’s an infographic doing the rounds on LinkedIn at the moment enticingly titled How to Make Money the Startup Way.
Like a lot of things that promise quick riches, it’s pretty simplistic, but that’s not what really gets our blood boiling at Evolve. What gets us shouting at the screen are the bits about prototyping and user testing which perpetuate some pretty whopping errors. If you actually developed a product this way, your chances of satisfying a real customer need and making a fortune would be virtually zero. You would actually sabotage your product design.
9 out of 10 startups fail and it’s myths like this which contribute to that rate.
‘Find a product that is popular but not yet perfect’, instructs the infographic – but they’re missing the real first step of successful product development, which is understanding the problem space by speaking to potential customers.
User testing is the systematic way of doing this; in-depth interviews with customers, co-design workshops, ethnographic research on users’ daily life and data analysis to figure out what people are currently doing can all help understand what problem exists that you could solve with a new product.
The next step, the infographic claims, is to take an existing product and ‘study it, improve it, prototype’. But ‘studying’ a product yourself is highly unlikely to uncover a real problem or solve that problem effectively. You know those enthusiastic inventors on Dragon’s Den who think they’ve come up with the ultimate solution to our melon balling nightmares? It usually turns out that the rest of the world wasn’t having a problem with melon balling in the first place.
To uncover real problems, you need to watch real users interacting with a product, and you can do that with testing tools like ethnographic research or interaction recording tools like Jaco.
‘Show the prototype to 100 people’, the infographic instructs. This one really gets us. For one thing, 100 is just a number the author has put in there because it sounds good; there’s no science behind it. But more importantly, just picking 100 randoms and sticking your product in front of them won’t tell you anything. These particular randoms might not even have the problem you’re trying to solve!
‘Remake it until people start pre-ordering it’ says the infographic. They’ve got this backwards. You don’t make and then remake something until you somehow conjure a demand out of thin air. It’s the other way round – you establish that there is a demand, and then make the right thing to meet it. For example, you might not even need to build a prototype at all if you use a Kickstarter campaign to gauge demand for a concept before you build.
‘Sell your product to 1 million people’ concludes the infographic triumphantly. Well, that would be nice, wouldn’t it? But this simplistic nonsense doesn’t even hint at how to grow a company, get pricing right, reach a market or expand a product range, all the stuff businesses actually need to do to make a fortune. Even if you did sell this mythical product to a million people, what then? Where do your next million come from?