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Product Challenges for Startups

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This article was written by Taylor Wescoatt, one of Seedcamp’s Experts-in-Residence. Follow Taylor on Twitter @twescoatt. 

I was asked by Product Tank to talk about the main product challenges I see in startups. Fortunately, a few months working with Seedcamp cohorts showed me that similar questions were being asked by many of them. Founders won’t be hiring professional product people until the 10th or 15th hire, but they can benefit tremendously from ‘Product Thinking’ from day one, and this is the basis of my onboarding talks.

Here are the main early stage struggles I find startups encounter in the product domain;

  1. Hard to get the “Vision” into the minds of their growing team.
  2. Difficult to identify and laser focus on the real pain and real value they are working towards.
  3. Not sure which questions (there are many in every startup) to address first.
  4. Not engaging with customer nearly often enough.

Let’s walk through these individually, and while I won’t use this post to explain my suggested solutions, I will reference some other articles that go deeper on the topics.

(1) Getting the Vision into the Team

Daniel’s startup was doing really well. He and his CTO co-founder had been working side-by-side for over a year, in constant communication, and totally aligned. New funding allowed him to bring on three more developers and leads for marketing, ops, and product. He was crazy busy. But a month in, things felt a little off, and decisions weren’t being made like he wanted them to. He’d outlined the long-term vision, but the team was struggling to understand where to focus in the near term.

Founders need to see their growing team making decisions roughly in accordance with their vision, but time and hectic schedules tend to lead to fractured understandings of what the company’s mission is about. A “Mission Statement” is great, or some kind of manifesto maybe, but sometimes knowing where you want to end up doesn’t tell you what to do TODAY. For this, I recommend the Vision Roadmap. Your ultimate end-state vision is something you will build to over time

(2) Identifying “Real Pain” and “Real Value”

One great idea is the core of a startup. “Wouldn’t it be great if you could order a taxi from your phone?”  The idea gets people excited, investors, partners, employees, even early adopter users. But how do you really bring that to life in your product?

Any new business must CHANGE BEHAVIOUR of its customers, and for them typically it’s both hard risk. So it must be WORTH IT. How unhappy are they with how they do it now? This is Real PainHow much better off will they be once they do? This is Real Value.

I believe deeply in using the Customer Journey to clarify and deliver against these goals. It forces you to see things from your customer’s point of view.

(3) What Questions should I address first?

Startups are all bets. We take a punt, make a guess, develop a hypothesis that something can be better, and users will like it. As we build our business, we are making a lot of these assumptions, and we will find out many of them are not quite true, sometimes leading to a business ‘pivot’. The sooner we find out, the better. How do we do this?

The Assumptions Matrix lets you graph your assumptions based on x) how fundamental they are to your business, and y) how unknown they are. Naturally, you want to focus FIRST on the ones in the upper-right – The Pivot Zone – by either learning more about the assumption (less unknown), or developing alternative approaches (less fundamental). Some things, often the most important, however, will just need to get built so you can see “if the dogs eat the dog food”.

(4) How should I engage with Customers?

Anyone who has read the required “Lean Startup” book knows in their heart they are supposed to be engaging with customers. This is challenging on a personal level, it requires us to systematically challenge our own beliefs, knowing we will often find we are wrong. Embrace it!

Good, now that you’ve embraced it, how do you do customer research without breaking the bank? Above all, decide in advance what you want to learn for every validation exercise. Then, whether you’re doing needs analysis or product analysis, the following techniques can be done by anyone:

  1. Brief Interviews: three questions in the “Tell me about the last time you X” form
  2. Surveys: gets a little bit of quant and helps rank needs
  3. Deep Interviews: in 30-60 minutes get at the elusive “why” of a problem
  4. Remote Testing (e.g. usertesting.com or trymyui.com) are FAST and illuminating
  5. Guerilla Testing: grab first impressions in the mall or at a coffee shop
  6. Live Testing: some things you can only see with real customers 

BEFORE you go do any of these be very clear exactly what you want to learn, and dispense with any extraneous questions. In almost all cases, they will give you great insights, and if they don’t, at least you’ll learn a bit more about how to ask the right questions – where are you on each of these for your startup? Here’s a little more detail on how/when to use them.

Hopefully, some of these four challenges sound familiar to you as an entrepreneur or advisor to startups. They are plenty common, but fortunately there are structures and processes to resolve them. I’d love to hear from you (@twescoatt) if you’ve found similar or different issues!

For a list of all my articles: http://seedcamp.com/eir-product-articles/

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