Here are a few of my takeaways gleaned from this course. Click here to learn more.]
1. The Genesis of Lean Startup
“Ignorance is optional; there is no longer information you cannot get access to.” Eric Ries
2. Content As A Business
“Who is my customer and what problem of theirs am I solving?… Where do I find them, and how do I let them know what I’m doing?” Emily Best of Seed & Spark
“Write down who you believe your audience is, and how will you know that you got them? How will you know it’s a success? What do you want to accomplish?” Eric Ries
[EDITOR’S NOTE: To learn how to identify and understand your customer, read my interviews with Ivan Pejcic, Strategic Planner for Ogilvy and Peter Spear, Brand Listener as well as the talk The Next Revolution Will Be Psychological Not Technological by Rory Sutherland, also from Ogilvy.]
3. Creating An MVP – A Minimal Viable Product
A minimum viable product is “a product created with as little time and money as possible in order to test the market appetite.”
[EDITOR’S NOTE: For more information on how to create your miminum viable product, watch the ycombinator lecture How to Build Products That Your Users Will Love by Kevin Hale and Growing From Zero to Many Users by Adora Cheung.]
Learn from your failures. Originally beginning as The Point and spending a year and $1 Million trying to become a website that organized social movements through petitions, Groupon pivoted and offered a “Buy One Pizza, Get One Free” Coupon as a minimum viable product. They sent this coupon out to everyone they knew and found their first 20 customers to redeem the coupon. This important pivot and first coupon is what turned Groupon into the company that made them the fastest company in history to reach $1 Billion in sales.
Always add from a place of success. You can always add to and deepen your customer base, but to do this you must add from an existing customer base; a place of success rather than trying to learn from something that is half done.
Movie trailers are the main way people decide whether or not they will pay to watch a movie. For every successful movie, somebody had to see it first. Not because their friends saw it and said it was cool, but because they saw an advertisement or a trailer for it that made them say ‘Yes, this is a movie that I really want to see.’” So before you make the entire movie, consider shooting just the trailer. If nobody wants to see the trailer, then why make the movie?
[EDITOR’S NOTE: For more information on how Netflix and Amazon test movie and series releases, watch the TED talk How Netflix and Amazon Pleasure You through Data-Driven Algorithms.]
Test customer reaction. The film Dear White People by Justin Simien began as a simple twitter feed (@DearWhitePeople) from the voice of one female main character, and the twitter fan’s reactions formed what would become the film which would premier at Sundance Film Festival.
Emily Best of Seed & Spark
[EDITOR’S NOTE: Recall in my interview with William Channer of Dorm Room Tycoons that he prefers to forego a comments section because most comments tend to be noise – they don’t really add anything to the quality of the initial content. And when you’re sitting in front of someone really wise, you tend to prefer to be quiet and listen to what they have to say. Therefore DRT is designed to have the attention fully focused on the person being interviewed.]
A value proposition is “an innovative service or feature that makes a company or product attractive to customers.” How is what you’re creating valuable, impactful, and meaningful to your audience? Ondi Timoner
[EDITOR’S NOTE: For more in identifying and building upon your value proposition, watch the ycombinator lectures Create A Successful, Long-Term Company Culture by Brian Chesky and Alfred Lin.]
One idea can turn into one 140 character tweet which can turn into a lead to a new book, painting, or idea which can turn into a blog post which can turn into a full fledged book. Austin Kleon of Steal Like an Artist
What are ten different minimum viable products you could create to test the validity of your business to reach who you believe your target audience is?
4. The Build, Measure, Learn Feedback Loop
With your minimum viable product created, now it’s time to hone and expound upon it. Google analytics and other measurement software allow you to track the evolution of your product and business idea in real-time.
The point is not how fast you can make and improve your work, but how fast you can verify that you are on the right track to creating what customers want. If I keep putting my work out there and nobody is responding the way I want them to, am I really doing what I want to do?
[EDITOR’S NOTE: For more on managing consumer feedback to improve your product offer, watch the talks:
- The Importance Of Finding Your Idea & Product by Sam Altman of Y Combinator
- Optmizing For Growing Your Business by Alex Schultz
- 10 Proclamations to Win New Cliens Without Pitching by Blair Enns]
There isn’t enough sharing of failures to be able to successfully create a broad, sweeping movement towards success. Emily Best of Seed & Spark
[EDITOR’S NOTE: Recall that Rory Sutherland’s argues in his talk The Next Revolution Will Be Psychological Not Technological that were the percentage of successful startups to increase by a mere 10% while the % of failed startups decrease significantly because we reached a point where we understand and predict humans well enough that we could just slightly increase the odds of success, the world’s Gross Domestic Product (GDP) could be increased by up to 2.6%. Rory posits that the next improvement in economic growth might actually come from improvements in marketing efficiency; particularly in our understanding of human behavioral economics.]
Vanity metrics are “data collected about a company or its users that does not help entrepreneurs make decisions.” With your minimum viable product, the total amount of people that have viewed your content isn’t as important a metric as how engaged the people who view your content are.
[EDITOR’S NOTE: For more great information on understanding your metrics and SEOing your website, read my interview with Data Consultant Benjamin Descazal.]
Split testing, or A/B testing, involves “comparing a controlled factor with a changing factor and putting them side by side in order to measure the customer’s reaction.” If you want the odds of success in your favor, then you want to know ahead of time what your target audience thinks of your product, so you’ll need to test and measure what they like and what lures them in, and then incorporate those features into your product.
Your goal is to interact with customers and fans, but not necessarily to listen to what they have to say because by and large customers don’t know what they want until it’s staring them in the face.
What are three different platforms you could use to not only distribute your work, but also to get feedback on? Choose one of your minimum viable product ideas from above and throw it onto the internet. How are people responding to it?
5. The Pivot
In business, a pivot is “a change in strategy without a change in vision.” It’s imperative to look at a business’s idea at it’s very first origins rather than where it is today because almost every company out there today initially began as something different, although you can see the chain of thought in the process.
“When people tell entrepreneur startup stories, they tend to tell them in a way that makes the entrepreneur look like a genius.” Eric Ries
[EDITOR’S NOTE: Recall in Tyler Cowen’s TED Talk Why You Should Be Suspious of The Stories You Hear that stories act as an information filter allowing the storyteller to pack a lot of information and social power into a brief narrative by ignoring certain bits of information while highlighting others, and the more inspiring a story makes you feel, the more nervous you should become because the best stories are often the trickiest ones.]
Markets and technology change so fast that having a five year business plan is risky, if not impossible. Waiting until you’ve created the perfect, flawless product is risky because by the time you’ve gotten it ‘perfect,’ the market around that product may have already moved on, or another company may have come in with a less then perfect product and stolen the market, having “perfected” their product to consumer needs along the way.
Launch. Keep what works. Throw away what doesn’t.
You can’t write for two audiences. Choose one.
Early adoptors prefer to actively seek out new and unknown products and services, whereas mainstream adopters are consumers who prefer to hear about products and services from friends. The vast majority of consumers aren’t, and prefer not to be, early adopters.
When launching your business, target early adopters before trying to go mainstream. If you cannot find any passionate early adopters, then there are no mainstream adopters either.
Imagine yourself in a position as though your current business idea were a failure. What would you need to know in this moment in order to make a good decision about the future of your business? Now set a meeting 4-6 weeks from today where you seriously evaluate the viability of your business, and now spend the next 4-6 weeks leading up to that meeting answering the question of what you would need to know in order to make a good decision about the future of your business.
6. Building A Fanbase
No matter how obscure your passion is, the power of the internet is its ability to help small, niche markets find each other. Meaning that a lot of people can make a successful living doing what they love that is only appreciated by a small amount of people; you don’t have to be an international hit to be successful.
“What’s cool about having an embarrasingly small number of followers is that you can get to know them extremely well.” Eric Ries
Whatever work you’re doing, as long as you’re able to at least slowly grow your list of followers, you’re gaining traction and getting closer to making your business viable.
There is no distinction between your product and your marketing. Everything about your customer’s experience is fundamental to your product.
[EDITOR’S NOTE: For more information on how to build a wireframe for a product or service that is intuitive and customer-centric, watch the Step-By-Step User Interface Workshop by Janne Jul Jensen.]
The first 20% or so of your business funding will be your team and your friends and family. Next comes your social media network: schools and organizations you were involved in, etc. Beyond that you have complete strangers and those ouside of your circles of influence.
How quickly can you find five people who will give you their email address and join your list of supporters?
7. Financing Your Creativity
Today you don’t have to own the means of production in order to create high-quality products. You can rent them.
Create your own store and diversify your income as much as possible; don’t put all of your eggs in one basket. Finance your business using multiple streams of income. When people understand and can see an actual list of what needs to be purchased, rented, outsourced, and managed as well as the estimated costs associated with each item on the list, people will more readily support you financially, or if not financially be able to provide the services and products you need.
Accelerators are organizations or investors that offer entrepreneurs mentorship, office space, and financial investment in exchange for a percentage of your business’s revenue.
Don’t be afraid to ask directly for contributions and sell your products for what you feel they are worth.
8. Approaches To Distribution
Uploading your content to be distributed online is easy. Getting people to actually want to consume and use your content is VERY difficult. The trick is building an audience once you’ve gotten your product/service distributed.
Niche markets are “highly specialized markets composed of customers that are like-minded and have similar interests.”
With thousands upon thousands of advertising impressions per day, how can you break through the noise and get noticed by your target audience?
Simple mathematics: the entrepreneurs who spend more time talking about their brand, product and service are the ones consumers will hear more about.
Making long-form content more digestible is important in today’s culture. Short content must be an element to your marketing plan.
You are as much your own distributor as you are your own marketer. Uploading your content and then doing nothing, nobody will see it. You have to make noise. Make alliances.
9. The Keys To Monetization
For every dollar you make, be prepared to give away a thousand times as much for free. Doing so builds the trust and reputation they need to feel comfortable giving you their money.
[EDITOR’S NOTE: Recall in my interview with entrepreneur and community manager Kevin Knight that “80% of what I do doesn’t bring in any immediate revenue. But if it weren’t for all of that unpaid work I wouldn’t be able to launch the next products. Everything you do should build upon what you’ve created before. Starting my simple blog gave me just enough followers to launch a successful event, which turned into a string of successful events which attracted even more followers, which allowed me to unite those followers into one successful Facebook group, which allowed me to launch a second, then a third… Having organized such a large community of 18,000+ followers allowed me to launch the Expatriates Magazine publication and sell the advertising space. If I had tried to launch my magazine without already having 18,000+ readers, it would have been much more difficult to sell the advertising space in the magazine.”]
Don’t make your best quality information available for free. Charge for it and then give away for free those remaining bits and pieces; the snippits on the cutting room floor. Doing so provides the back story to your paid product and further immerses your fans, making them all the more interested in what you offer and feel a connection with you, your morals and philosophy, and your world.
“If you make it convenient for people to give you money, they will.” Also, make the checkout process as streamlined as possible. You will always have those who steal and find ways to access your content without paying, but those who love and respect what you do will be willing to financially support you. Even those who don’t pay will become evangelists for you, telling others to check you out.
[EDITOR’S NOTE: For more informaiton on managing piracy, watch the documentary How to Ru(i)n A Business: Streaming & Filesharing Better Absorbed Than Fought and read my interview with entrepreneur and editor in chief of Ever Magazine Roc Chaliand.]