The inevitable bi-product of a pivot is technical debt. Each time the product footprint changes, the foundational codebase required to support similarly needs to be retrofitted. Each pivot, and therefore each retrofit, adds a layer of complexity to the codebase. When you are rapidly iterating you don’t have time so rebuild the code base to accommodate each pivot. Until you have validated the pivot, it makes no sense to invest in durable code. Easier said than done. The product needs to work reasonably well for the business model to be validated with sales. But selling an MVP is a pretty tricky tightrope: customers will get frustrated pretty quickly when the realize the product is less than the promise. But this is actually a good thing. If clients believe enough in your product to get pissed off about it, it’s a sign you’re on to something. The best thing you can do, at this point, is to try to pay off the technical debt as soon as possible – building with intention and plans for scale – and then re-release the product. It’s an exercise in sophistry and chance, but it’s also the most efficient way to reach product market fit without letting technical debt force you into actual bankruptcy.
The only way to determine a product’s viability in the marketplace is to try to sell it to a customer.
Through the din of bullshit, the customer stands tall as an agent of truth.
His/her cash is truly the source of all that is beautiful and virtuous in startup-land. Predictions, assumptions, beliefs, and feedback are all bullshit until you can convince someone to pay for your product. Sales is the only validation that matters.
So how do you sell an early stage product when, ahem, there isn’t much of a product? Don’t you need a completed product before you can sell it?
No. Here are three ways to sell – gathering critical product-market-fit data – without a finished product:
1) Sell an MVP and a product plan, with payments due on product delivery milestones. You can show customers the early product, let them get value out of it, and then tell them what you’re building. If they like it, ask for a sale that requires them to pay you on delivery of those particular deliverables. Not before. There’s no risk for them and you know that there’s money up around the corner.
2) Create brochure-ware that presents a product / feature set / price with a way to sign up and pay. But don’t process the cards or take the money. Use this as an opportunity to call up the customer and arrange a pre-sale based on future deliverable. This approach will garner important data about pricing thresholds, traffic sources, and customer priorities. And nothing says intent to buy like hitting the “purchase” button.
3) Create a finished, working prototype that is a one-off (not a product of the platform) and attempt to sell versions of this. In essence, build the product before you build the platform. Once you’ve sold the product, or a version of it, then reverse engineer success. It’s a lot easier (and faster) to build systems when you know what the end game should be. No shoe cobbler ever built a shoe factory before he handcrafted a few pairs of shoes to make sure people would pay for them.
Sales is where the most honest discussions happen in any startup. Harness this dynamic to rapidly assess the viability of your business. Doing otherwise can be expensive journey in self-delusion.
(Also, it bears reminding that defrauding your customers or yourself is a really bad idea.)
There are many wonderful things about creating digital products for consumers, but the business model usually isn’t one of them. Getting consumers to pay for software is tough; they’ve been habituated to believe that it should be free or close to it.
Enterprise, not so much. Businesses spend a ton of money on software. Which is one of the many reasons I now work in enterprise: there’s an honest exchange of money for services. Rather than guessing what consumers want and hoping to get lucky, companies will tell you what they need and then write a check if you can deliver it. They’ve no interest in bullshitting you. As a result, product and business roadmaps can be built around articulated customer demands.
But that doesn’t mean it’s easy. Entrepreneurship in enterprise is not for the faint of heart. Here’s what I wish I knew when we started StoryDesk 2 years ago.
1) Companies don’t want, and will not pay for, minimum viable products. They want software they can rely on for critical business functions. Early products that you might ship to consumers, buggy and feature incomplete, don’t sail with enterprise. Doesn’t matter if it’s cheap or even free – companies seek reliability and continuity above all. So make sure you build in ample time for testing and QA into your product development timelines. A MVP might be a good way to vet and validate the market, but don’t expect people to pay for it until the product is stable to a fault and feature complete for the solution you are selling.
2) Sales cycles aren’t long – they’re ridiculously long. In a NTW product in an emerging market, prepare for sales cycles that are 3-6-12 months long. Lowering the barriers to adoption through free trials and self-service adoptions can compress these timelines. But whatever your expectations are for close rates and sales cycles, lower them. That said, once the product has been figured out and you’ve nailed the pitch, things will pick up. That’s what I’m seeing in our business. It’s very exciting.
3) Content is king. Blog posts, thought leadership, videos, white papers – this is the honey in the fly trap. Devote a big chunk of time to your content marketing effort, as this is by far the best way to attract leads, let potential customers educate themselves, and then have more efficient sales conversations when they’re ready to buy. Done well, content widens the funnel and shortens the sales cycle.
4) Reduce sales risk for your client. The project leader’s first goal is not to get fired. After all, he/she’s got a minivan, a mortgage, and nice big company benefits package. He/she isn’t going to bet that on a “speculative” software product. No one ever got in trouble for making the safe bet. Your startup is unlikely to be the safe bet (otherwise you wouldn’t be a startup). So, find ways to reduce the risk for your client. A proof-of-concept , a pilot project, a money back guarantee (not recommended, but certainly not uncommon) are all ways to do this. Make the cost of failure (capital or political) low, and talk up the potential upside.
5) Follow up. Follow up. Follow up. Closing deals is very hard. The only way it happens is if you go after it with tenacity and diligence. Shelve your pride. Business is won by the individual with the greatest capacity for rejection. All those girls who shot you down in high school? Send them a thank you card – they’ve done you a great service.
Are there best practices for happiness in individuals or families? Can a set of rules, a paradigm, a logic be applied uniformly toward achieving a predictably positive outcome? Why, in a nation of great stability and generalized and shared experience, is there such heterogeneity in the human outcomes? In short, why are some people happy and others miserable? What are the ingredients for happiness? And if it’s unique to a person, why is it unique to a person? Shouldn’t there be some basic guidelines that lead to a positive outcome at least 80% of the time? We know that this is certainly the case in the inverse – that if, for example, one is chronically violent it will lead to personal unhappiness. But why is the opposite untrue? Why is that non-violence doesn’t lead to happiness? I understand the rejoinder – that its necessary condition of happiness, necessary but not sufficient in what is a multivariate equation of infinite complexity. What I don’t understand is why this is infinitely complex. Surely we can control for some of the variability given a common set of experiences or circumstances. Or at least the absence of a negative set of experiences or circumstances.
Who has looked at this? I ask not because I am unhappy – alas, I am not. I ask because I find myself surrounded by people who are unhappy, who lack obvious reasons for this condition.
Cycling has taken off in New York City. This is good news for a host of obvious reasons I don’t need to belabor here. Along with many cyclists taking advantage of the city’s many bike paths and greenways, some are also seeing fit to ride on the sidewalk.
This causes me great distress.
The sidewalks of New York are a marvel of urban life. Wide, smoothly paved (most of the time), generally free from obstacle or peril, the sidewalk lets us navigate the city free from risk to life or limb.
Sidewalks are a safe zone, where we can travel without fear of collision with moving objects exponentially more powerful than ourselves. Because of this we can walk with abandon and free of fear.
That doesn’t meet walking on the sidewalk is without risk.
As pedestrians, we accept as part of the civic contract the harms that may come as a result of walking on a sidewalk: tripping, stepping in dog poop, bumping into a stranger, and that’s pretty much all I can think of. We accept these (admittedly minor) risks and then set out on foot to work or to buy a sandwich or wherever else we must go. The ability to travel by foot is a hallmark of urban life. It’s why some of us pay a premium to live in densely populated areas like Manhattan: because walking is a pleasurable and safe way to get around the city.
Except for when some asshole on a bike decides to use the sidewalk as bike lane.
It’s at this point that the sidewalk, and by extension walking, becomes dangerous.
Let us imagine for a moment the following circumstance. You wake up in the comfort of your apartment, totter about listening to the radio and drinking a coffee, utterly absorbed in the day ahead. After a hot shower and a bowl of cereal, you step out of your apartment building and begin walking toward the subway. As you check your phone or iPod and wonder if your coat is either too warm or not warm enough, you round the corner on to the avenue. Turning the ninety degrees you expect to see a neighborhood vagrant or a smile from the neighborhood dry cleaner. Rather than these forgettable sightings – WHAM – you collide with a cyclist traveling at approximately 10 miles per hour.
Now, let us take a minor detour to the physics department. If you recall, Momentum = mass*velcocity.
The net effect of a 170 pound cyclist (about average), traveling at 10 MPH (pretty slow) is equivalent to having a 350 rock tossed at your person. Except for a rock isn’t made of aluminum, sharp gears, bones, backpacks, shifters, handlebars, and teeth.
Needless to say, if you get hit by even a slow moving cyclist it’s going to do significant damage. Unless you hit your head you probably won’t die. But you can expect some significant scrapes and perhaps a broken bone or two. That’s one bone too many and one scrape to which you should not have to apply Neosporin. There will be a trip to the ER or doctor’s office, some X-Rays, missed work, and the usual $3,000+ of medical expenses associated. This figure ignores any physical therapy, surgery to reset a broken elbow, or cosmetic surgery because you sliced your cheek on a Multi-Lock and want the scar fixed.
So, at best it’s expensive and inconvenient. At worst, it’s life changing. And not in a good way. Why?
In a word, the answer is risk.
Riding a bike on the streets of New York is inherently dangerous. The drivers are terrible, the taxis reckless, the flow of traffic generally chaotic. Traffic laws are barely enforced. When have you ever seen a speed trap on First Avenue? Or a cabbie get pulled over because he failed to signal?
Cyclists are acutely aware of the risks of riding in the street. So to mitigate this risk, the cyclist moves to ride on the sidewalk. In his mind, the sidewalk is safe. There are no cars with which to collide with or be run-over by. A two-party accident, if it were to happen, inherently favors the cyclist, who usually represents the larger mass in a sidewalk collision. To be sure, a crash on the sidewalk is preferable to one on the street.
So to mitigate his own risk, the cyclist moves to the sidewalk.
In doing so, he shifts this risk to the pedestrian who hasn’t agreed, explicitly or implicitly, to shoulder this burden.
Therein lies the rub: Cyclists riding on the sidewalk unfairly assign the risks of their commute to pedestrians. When you hop on a bike in New York city, you sign up for the possibility of death or injury. When you set out on foot, you’re signing up for an experience so safe it’s mundane. When cyclists ride on the sidewalk, he’s indirectly and forcibly burdening pedestrians with the risks of his activity.
Risk and cost are closely related dynamics. Insurance (the cost of it) is the market’s way to deter risky activity. For this reason, drivers who get in lots of accidents pay more than those who do not.
Cyclists aren’t typically insured for collision or liability. So the costs of risky activity, which should be born by the individual in the marketplace (as they are with autos) graduate to a negative social externality with paid for, disproportionately, by individuals. In other works, the pedestrian who gets hit by the cyclist will probably end up paying for his own treatment. That’s not right.
I’m a cyclist. On sunny days, I love riding my bike around Manhattan and Brooklyn. When I saddle up, I accept the possibility that I may get hit by a car or slip into a pothole and go flying over my handlebars. But when I return a safely, shower, and step out to walk to dinner, I should be free from these risks. As should the old ladies, families, and happy couples who’re using the sidewalk for their commutes.
Walking on the sidewalk shouldn’t be dangerous. For this reason and others, cyclists need to stay off the sidewalks.
In the main, the lean startup movement is a credible methodology for helping entrepreneurs reach product market fit. By building customer feedback and quantitative analysis into the process of innovation, lean methodologies can be an invaluable accelerant to learning.
But there is insufficient recognition as to the limitations of the lean framework. Increasingly, entrepreneurs – especially first time entrepreneurs – look to lean as a formula rather than a set of guiding principles. That’s problematic; there is no formula for innovation. And putting forth a framework as doctrine sets people up for a different kind of failure.
The term “lean startup” is new. The idea is as old as the industrial revolution. In the pre-internet era, where scaled production took years to achieve, product development was a slower process – one that began by building for individual clients and slowly developing a manufacturing system to achieve economies of scale. The cobbler started out by making a few pairs of shoes, seeing if people liked the fit and were willing to pay, and then only would he build a shoe factory. Or something like that.
The internet is unique in its ability to rapidly achieve scaled production of services. This makes it very attractive for investors and entrepreneurs looking to achieve rapid growth. When the product is right, then this is indeed a wonderful outcome. When the product is wrong, the whole scheme comes crashing to a halt and the venture fails.
Since 2000, more often than not, the product has been wrong.
Instead of building a few pairs of shoes to see if people liked and would pay for them, we skipped ahead and built the factory. A factory that builds shoes no one wants is completely worthless. But it’s still expensive and time consuming to build.
Failing sucks. Failing at great time and capital cost is worse.
Enter the idea of the “lean startup.” The doctrine is simple: build a pair of shoes, see if that makes a customer happy, and slowly move up from there.
The approach applies scientific method to product development. Hypothesize, test, measure, wash and repeat.
That’s all good and well, but creativity, vision and leaps of faith exist at the opposite end of scientific method.
Everything can’t be measured. At some point you need to take a leap of faith. Especially with consumer-focused products, you may not always be able to reliably measure performance. Consumer products take a long time to seed, and users generally try a product multiple times before they adopt it and begin to see value from the product. So it’s very hard to know if the you’re not seeing uptake because the product is wrong or if it’s just because consumers need time to get their heads around the product’s value to them. Great businesses seldom materialize overnight – they are the product of tremendous patience and persistence. There’s no framework to know when to trust your instincts vs. trust the data.
Innovation is executing on the imagination. Seeing the world not as it is, but as it could be. The world doesn’t just gather around a new invention and say a hail mary. Inventions need to be willed into existence. People need to be convinced and re-convinced. There’s a missionary element to this process that’s necessary and not at all well served by trying to measure each incremental bit of progress. Creativity is an incredibly powerful force. Harness and apply it. Give your newborn irrational love and passion – the world needs to know why your idea is special and why they should care. And when the time is right, start to measure its performance.
I’ve been thinking a lot about the nature of apologies, forgiveness, reconciliation, and moving forward.
The dynamic of transgression (someone wronged someone), issue-centric apology (sorry for wronging you), and reconciliation (let’s move forward) reflects a very basic – sort of grammar school – notion of human relationships. It’s ignores the past. And it ignores everything that led up to this moment. That’s all good and well when you’re 9 years old and there really isn’t a history to speak of. But it’s different when you’re an adult.
So how can adults do conflict well?
What are the frameworks that allow interpersonal relationships to deal with the inevitable pothole without blowing up an otherwise stable foundation?
Put in political terms: Would the Palestinians really be happy if the Israelis returned territory to pre-1967 borders? I mean, would all be solved by this concession? No way. There’s too much scar tissue. The conflict has transcended an issue-based discussion and is now very much inward focused. The rage is now an identity-defining attribute. Hurt becomes a source of energy. But it draws from a toxic tributary. So ultimately it’s the self who is poisoned.
Other questions: If, as actors in a conflict, we get what we want, will we want what we get?
And in a larger sense, what is it, ultimately, that we as individuals seek in these relationships?
When the bond is broken with other people, we tend to objectify them and judge them, not seeing them as persons, but only as objects of our anger and hurt. This is our sinful reaction. We categorize people in terms of their transgression against us. The longer we nurture the anger and alienation, the more deeply the resentment takes hold in our heart, and the more it feeds on our soul. Resentment is a cancer that will destroy us if we don’t forgive!…Forgiveness means overlooking the sin or transgression, and restoring a bond of love. It does not mean justifying the offensive action or accepting it as right, nor does it mean justifying one’s own anger or sinful reaction. Forgiveness means laying aside our judgments of the other person and our own sinful reactions, and accepting others for who they are.
Now, this makes all the sense in the world. But how does this work, exactly?