The building is not on fire, you are! You are passionate, you are pumped up, you have an idea and you are driven to search and find a business model that works. This is not something you do sitting at your computer even though much of the data we uncover online is helpful, you need to “get out of the building” and talk to real people.
We used to call this the MITS (man in the street) analysis, meaning get out there and profile your customer by asking them questions!
One of my earliest mentors, whom I’ll call Richard was a successful investor and did his basic research at the corner pub spending a disproportionate amount of time there! Why the corner pub (he wasn’t a drinker) however he said that was where he heard about people’s problems and needs ” Just sit at the bar and listen to what people are complaining about and when you hear the same “pain” issue over and over again, there’s an opportunity to solve a problem”.
Richard was an avid reader of almost everything, and especially science fiction and he would advise, ” if you want to have an idea of what society will look like in the future, to research the future of things, read science fiction!” He was a very early investor in IBM!
Richard wasn’t just a listener, he’d know exactly what questions to ask to get people to open up about what was important to them; what made their jobs difficult, what burdens they carried, issues they faced and what ideas they had about better ways of doing things…… after an evening, a week or a month at the bar a pattern and or a trend would emerge and off he’d go and look for a company that was working on the solution(s). If he found one, liked what and how they were doing, he’d invest!
How many VCs or Angel Investors do you know who take this proactive approach; rather than waiting for a startup founder to pitch them on what pain or need the startup is solving?
It’s all very well for investors to get out of the building, but way more urgent for founders! They need to talk to customers just the way Richard did all those years ago; maybe not literally at the corner pubJ however, get out and ask questions to find out if there is a connection between the idea for the business model and the reality of implementing it profitably!
Why should the founders do this, why not send a research assistant or intern? The reasoning behind this is clear; the founder(s) have the vision, the power to change the value proposition and the direction of the company, to pivot fast all as a result of feedback from customers! Feedback from potential partners and vendors can also be invaluable.
What should the founders be doing? They should be testing their understanding of the customer’s problem, pain or needs by talking with the customer, and listening to what the customer says. Are they on the same page with the customer, and is it a repeatable scalable business model?
In some scenarios founders have a minimum viable product so customers can give feedback ~ will it match their needs, solve their problem and will they want to buy it? This is a way of testing the problem, and understanding the customers needs and seeing if they sync together!
In other scenarios founders may test to see if they can get users and or buyers.
If it’s a product or service that is as yet unknown, find out if and how it will change customer’s lives (think iPhone!)
For the unexpurgated version of “Get Out of The Building” head back to Steve Blank’s free Udacity course on “How To Build A Startup”
Getting out and talking to customers, just the way founders do to prove and test the business model should not be limited only to the startup or early stages of a company. No matter what stage of a company’s life cycle, things can change so it is most prudent to advise your clients or your company to have a “get out of the building” strategy of customer development; a reality check to find out if they are still in sync with their customers.
This post appeared first on The LinkedIn Publisher.
