You can't skip steps
(at minute 4:19)
I was recently talking with a founder. Last year he and I were spending a bunch of time together as he manually tested his theory of human behavior. At the time he had a full-time job and the manual test that I helped him execute had some holes, so I don't believe that he validated an intense enough consumer use case in order for him to build a bigger product.
During the course of our conversation he told me that he'd recruited some high-level advisor types "so that we can skip some steps" and he's now ready to build a bigger product.
There are many different founder styles to launch startups and many exceptions to every rule in business, but one of my main beliefs is that you can't skip steps with startups in the early days.
As best as I can tell, there are three reasons why this founder is 100% confident that his next product version will be loved, so he can skip all that pesky product-market fit stuff...
1) Domain expertise. He has lots of domain experience with the back-end of this space. He's never created a product directly for consumers, but he has sold software to companies in this space that was used ultimately by lots of consumers. While this experience is helpful, I would argue that it's just marginally valuable. There are many examples of people without any domain experience disrupting spaces. And having domain experience means you can "talk the talk" with people in the industry (usually on the supply side), but this doesn't equate to a product that consumers love.
2) Time has passed. He's been thinking about this idea and testing various things for three years. He built a big product a few years ago that didn't get used much. Then he did some manual tests a year ago. Loving the problem is super important, but more time doesn't equal progress.
3) Anecdotes. Some earlier users are contacting him and asking if he's still in business. He is in a space with a clear problem for the supply & demand side, so it's not surprising that the demand side is asking. Unfortunately one side of the transaction really wanting something isn't the same as product-market fit for a startup (as strange as this might sound). Said another way, there are lots of startups who have failed trying to build a product to solve the problem in this space. All of those founders failed despite having the demand side really wanting a product, so indication of demand is good, but not nearly enough for a successful product.
None of these (or even all of them taken together) are good enough to justify building a big product.
There's a rock-star developer in Atlanta who says "you have to earn the right to build product." I really love this because it aligns perfectly with my thoughts on new startup products...
Startups (including their products) are a series of momentum steps. It begins with an idea that you have to see in the world. You can't stop thinking about it. Then momentum continues when potential customers and trusted advisors tell you something is there. The next step of momentum is either a manual test (if you can) or a very small MVP product. Either way these tests have to validate the behavior that you expect from customers.
It's a process of one step after another and it requires a great deal of discipline because anyone who starts a startup has a grand vision that's exciting them. And it's much more exciting to fixate on your grand vision rather than making sure anyone wants your product.
Lots of stuff feels good and is psychologically important for founding teams, but shouldn't be confused with real customer momentum.
I'll sometimes hear people say "some big company is about to launch that same thing, so it's not even worth trying" or "this is the startup that will win because they have a celebrity on the team." To people outside of startups these things seem important, but they rarely matter because inherent in these statements are that big company money or the audience of a celebrity allows the founders to skip steps. Take a product without product-market fit and put $10M into their bank account or give them a celebrity with 10 million Twitter followers and that product still won't work. Alternatively give a good team a product with product-market fit and it will work without money or celebrity.
This podcast caught my eye because this founder pivoted twelve times in her effort to find product-market fit. My guess is that for each version she was looking for some missing piece to fall into place.
This is exactly how I would validate a new B2C startup...stay very small and try lots of things until evidence pulls you into a particular direction.
Sidenote: If you enjoyed this post, you might like this one as well.
Get Right to the Lesson
I’d recommend listening to the entire thing, but to get right to the point go to minute 4:19 of this podcast/video.
Thanks to these folks for helping us all learn faster
Adora Cheung (@nolimits), co-founder/CEO of Homejoy (@Homejoy)
Y Combinator (@ycombinator)
Paul Graham (@paulg) of YC (@ycombinator)
Craig Cannon (@CraigCannon), Director of Marketing at YC (@ycombinator)
Please let me and others know what you think about this topic
Email me privately at email@example.com or let's discuss publicly at @davempayne.
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