Avoiding the Startup Fire, Ready, Aim!

And finding the path to Desirability

I saw a post recently on one of the startup forums I frequent from a founder who was panicked because his early-stage company was foundering. He chronicled a frightening story - they are well-funded (many millions of dollars), have a great team, and what they were sure was a terrific idea. However, their MVP didn’t catch fire. So, they pivoted to a new idea, built another MVP which also flopped. Then another pivot, and another flop. Each time their idea didn’t generate the response they hoped for.

This founder said they are now planning their fourth pivot – all in one year mind you! He was seeking to understand what they are doing wrong, and why they can’t get traction. Maybe it’s a problem with marketing, sales, and positioning. Maybe their pricing model isn’t right. Their investors are getting restless, and they keep searching for the magic formula that will give them 100x scaling.

What went wrong? This is a problem we see often, and it’s pretty easy to read between the lines. In this blog post we’ll dig into this scenario a bit and see what you can do to avoid the same pitfalls.

Stop guessing, start validating

OK, so back to our founder’s tale of woe. Let’s call the company 4Pivots. With that many pivots and MVPs, this clearly means they are throwing stuff at the wall and hoping something sticks.

If you regularly read our blogs, you’ll know that we are disciples of the Design Thinking methodology. The Three Pillars of Design thinking are:

All are important of course – any one of these that are missing dooms a company to failure. What is clear from our founder’s story is that 4Pivots didn’t start where everyone should start, and that’s Desirability.

Desirability sounds obvious at the surface. Of course, we are going to build a product that everyone wants. It isn’t that simple, as our 4Pivots founder now realizes.

The Path to Desirability

There is a lot to Design Thinking, and in particular the principle of Desirability. We won’t go into everything here, but we’ll touch on some of the foundational things you should do to achieve Desirability in your product. 

Empathize

The first step of design thinking is to empathize with the user. We focus on understanding their problems, their motivations, and their needs. You will need to connect with your users at a fundamental level. Do interviews. Observe them grappling with their problems. It’s important that you drop all preconceptions about what you think they need and start at square one.

Define

If we have done a good job of empathizing with our customer, we’ll now be able to clearly define what problems and pain points we are going to solve. These pain points and problems are the opportunity, and at this stage it will be clear. If it isn’t clear what those are, stop and go back to square one!

Ideation

Now that we know the problems and pain points – the opportunity – we’ll start generating ideas on how we we’ll be solving them. This is the fun and exciting part. We’ll storyboard and create user personals. We’ll roleplay, brainstorm, mindmap, braindump and brainwalk. We’ll question our assumptions. We’ll crystalize our best ideas, but we still are not done.

Prototyping

The value of good prototyping cannot be overstated. Prototyping gives us the opportunity to create a user experience that can be tested and validated before a single line of code is written which reduces risk dramatically. Because they are lightweight and easy to build, we can test different interface and workflow ideas quickly and at low cost.

But what we are really doing with great prototypes is testing desirability. It’s not just to make sure it looks great, and functions and workflows make sense, though they should. Prototypes give us the opportunity to know if our idea is truly what the user wants through testing, feedback, and continuously improving the experience before you commit to coding the MVP.

Once you have answered the question, “Is it desirable?” You are ready to start building your product MVP, right? Not so fast.

Feasibility and Viability

In upcoming blogs, we’ll spend more time on the other two critical pillars of design thinking, Feasibility and Viability. However, we do want to touch on them here because just creating a desirable product doesn’t ensure that it’s feasible or viable.

Feasibility

Determining if a product idea is feasible is a lot more complex than determining if it is technically possible. An idea might be technically possible, but not within the grasp of your engineering team. Or, it could be highly desirable, but it’s not within your budget (this is a big one).

Viability

Viability answers the questions:

These are important questions to answer, and without the right answer, don’t go forward.

It’s important to note that Desirability, Feasibility and Viability are not done linearly, but concurrently. You can’t create a desirable product that at the end isn’t feasible or desirable. They have to done together to get the right answer. 

Too much money

It sounds counterintuitive – having too much money can cripple or even sink a startup. There are a lot of reasons why early-stage overcapitalization can have negative consequences, but from a Desirability standpoint, it can be tragic.

4Pivots reported a long runway with millions in cash at their disposal. OK, so getting that much cash for a startup doesn’t happen very often but having a slug of cash that seems inexhaustible is something that can happen if you get a sizable grant, or an angel investor that is seriously backing your idea, or even a VC group that wants to take a chance on you.

Most founders would kill to have that kind of runway. So, why can having too much money be a problem? Here are a few reasons that relate to failing to be find a desirable product.

Overspending – You begin thinking that by throwing money at the problem you can pretty overcome any obstacles. You hire a lot of people, you shotgun-approach your marketing, you believe in failing fast, breaking stuff, and fixing it. You don’t think things through because you believe you don’t have to.

Pressure to scale too fast – With all that capital to spend, and the accompanying valuation, the expectations of scaling quickly from your investors are enormous. Of course, growing and scaling is always the goal, but your investors are going to be wanting performance that is commensurate with their investment. This pressure can lead to skipping critical first steps to determining the true value and desirability of a product before you build it.

The takeaway is to not be too excited for a large early raise. Be wary of being complacent, and by staying lean and mean, you’ll be more efficient, and you’ll avoid the added pressures and expectations that come with excessive capitalization.

Summary

We picked on our 4Pivots founder mercilessly, but deservedly. Armed with a pile of cash and a great team, they still are failing to find a successful product. It’s a shame, but it’s a story told many times and it won’t be the last.

Startups are perilous and full of risk. The best way to minimize risks is to spend the time to fully understand your customer using empathy, to ideate to solve problems and pain points, and to prototype and test before building your product MVP with an eye always on feasibility and viability. If you do that, your chances of success skyrocket!

But without that validation, you run the risk of building expensive, beautiful products that no one wants. The startup landscape is littered with the carcasses of products that failed to offer value and solve problems because they were not desirable.