@andrewchen

Get the newsletter · 2018 essays (PDF) · Featured · Recent

Verifying startup assumptions, Part 2

I recently blogged on 10 ways to verify assumptions around your startup project, but left the details as an exercise to the reader. I wanted to add a couple notes to what I wrote…

Notes on customer-centric questions

1. Who is your product is for?
2. What is the context of your customers’ world?
3. What motivations and values do they have behind their actions?
4. When potential customers see your product, what happens?
5. Do you talk to your customers every day?

In general, I found that when I was busy failing left and right on my various projects, a big chunk had to do with misguided assumptions about who users were, and why they would be interested in my product. In general, if you’re not declaring a target customer for yourself, and thinking about how to approach them in the best way, both from a marketing and product standpoint, then you’re not thinking about your user enough.

Are you building tagging/social networking/whatever for no reason?
One thing I did was build BitTorrent into a couple projects when it probably didn’t need to be there. Another example is building "tagging" or some other Web 2.0 functionality. Why are you building it? Is it really better for the customer? Or is it just something "cool" you wanted to add in? When you let the product and the technology drive the experience over what the user wants, then you are really shooting yourself in the foot.

Are you forcing things that don’t go-with-the-flow for users?
Another common thing that happens is, you want to develop feature X because it’s cool, but maybe it makes your user experience less convenient. "Oh, what the hell," you say. This is bad. So if you are building a client that needs to be downloaded, rather than putting things in the browser, that’s bad. Or if you are doing something like tagging when simple categorization will suffice, that’s bad too. Remember that eBay got to many many billions of dollars on a stupid categorization scheme, and Yahoo did too.

Are you building a fashion website but you’re a poorly-dressed nerd?
I am, and personally know, lots of nerds building shopping sites for women. Even TechCrunch has an article about it. If you’re building a website for a completely different audience than you, then you need to understand you’re going into uncharted territory. Are you talking to your target market every day? Ideally one of your co-founders is a girl/old-guy/teenager/Mormon for your girl/old-guy/teenger/Mormon social-networking website? Because if not, you are forcing an entire world of assumptions into their world. This is very hard, and I’m glad I tried to do it, because it didn’t go so well and I learned a lot about how the world works :)

Notes on product and business model questions

6. What is the "core mechanic" (or minimum feature set) of your product?
7. What factors can kill your business model?
8. How do you acquire users? Can you make an existence proof?
9. How do you make money? Can you make an existence proof?
10. What technology do you depend on? Can you prove it can work?

These questions really kill me, because even if you get the user stuff vaguely right, you can still fumble things by getting too structured when developing your product. I think these questions are all about being "lazy" to the extent that you build whatever is the simplest thing that could possible work, and you try it out. Then rinse and repeat.

What’s the stupidest, smallest incarnation of your product?

Everyone knows eBay, which is a big complicated beast with lots of auction models, specialized categories, metadata, attributes, etc. But before you try and build that, what is the "core mechanic" of eBay? You could argue that it’s really just a test of whether or not people want to put product listings in a forum. You might even argue that the auction piece of it is extra, which Craigslist pretty much proves.

So take your product, remove the user authentication (use e-mail or something else instead), remove the fancy tagging and extended profiles, take it all out. What’s the thing that people spend 99% of the site doing? On MySpace, it’s messaging and browsing profiles. On YouTube, it’s viewing a video. On World of Warcraft, it’s walking around and clicking on things. Once you get the 5 minute "loop" of the core mechanic right, then extend it out with all the fancy stuff. But if you focus on the profiles, tagging, social networking, and other fancy features, and then have a crappy core mechanic, you’re screwed.

In fact, a rule of thumb should be that you can prototype the core mechanic within a week or two at MOST. Most people think in months, but you should think in days.

Where do your users live? Can you get a couple of them to fill out a form?

One other issue I wanted to touch on is the tactics of reaching out to users. I think nerdy, product-centric people like me typically focus on the technology and not on the people, which is a huge mistake. There are lots of ways to make sure you can tap a willing-and-able audience for your site. Here are two variations…

First, there’s the beta-signup page. Make one up that articulates the offer, and asks them to put in an e-mail address to get announcements when the site is done. Maybe put in a text field that asks them why they are excited. This will take you an incredibly short amount of time. Now go get some traffic from your site – from blogs, forums, Google Adwords, etc. Track your conversion rates, so that you know how many people are actually interested. Theoretically, if your site is awesome, people will want to sign up, and they might even forward the URL to their friends too! But, if your conversions suck and the people fill out weird things, you’ll have learned something.

Another option is just to hook up a SurveyMonkey landing page to Google, and ask your users a bunch of random questions. Do they want to upload videos of them dancing? Do you have a webcam? Do you spend money on shoes online? (Or whatever) This is NOT a replacement for qualitative interviews with your user market, but you can learn a thing or two. You can verify a couple assumptions around issues like, how much of the MySpace crowd has a webcam to shoot  videos? This can be life and death for your little project.

Go collect those startup scars :)

I’m just pontificating off of random scars I’ve picked up from starting projects, and I’m sure very smart, intelligent people have had different experiences. The most important part is to start trying, as often as you can, and learn your own set of heuristics at evaluating these situations. A couple have really stuck with me because of my product/technology-bent, but if empathizing with customers is your thing, you’ll learn a whole set of other interesting things about the product side.

Comment with any additions to my notes above!

PS. Get new updates/analysis on tech and startups

I write a high-quality, weekly newsletter covering what's happening in Silicon Valley, focused on startups, marketing, and mobile.

Views expressed in “content” (including posts, podcasts, videos) linked on this website or posted in social media and other platforms (collectively, “content distribution outlets”) are my own and are not the views of AH Capital Management, L.L.C. (“a16z”) or its respective affiliates. AH Capital Management is an investment adviser registered with the Securities and Exchange Commission. Registration as an investment adviser does not imply any special skill or training. The posts are not directed to any investors or potential investors, and do not constitute an offer to sell -- or a solicitation of an offer to buy -- any securities, and may not be used or relied upon in evaluating the merits of any investment.

The content should not be construed as or relied upon in any manner as investment, legal, tax, or other advice. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment. Any projections, estimates, forecasts, targets, prospects and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. Any charts provided here are for informational purposes only, and should not be relied upon when making any investment decision. Certain information contained in here has been obtained from third-party sources. While taken from sources believed to be reliable, I have not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. The content speaks only as of the date indicated.

Under no circumstances should any posts or other information provided on this website -- or on associated content distribution outlets -- be construed as an offer soliciting the purchase or sale of any security or interest in any pooled investment vehicle sponsored, discussed, or mentioned by a16z personnel. Nor should it be construed as an offer to provide investment advisory services; an offer to invest in an a16z-managed pooled investment vehicle will be made separately and only by means of the confidential offering documents of the specific pooled investment vehicles -- which should be read in their entirety, and only to those who, among other requirements, meet certain qualifications under federal securities laws. Such investors, defined as accredited investors and qualified purchasers, are generally deemed capable of evaluating the merits and risks of prospective investments and financial matters. There can be no assurances that a16z’s investment objectives will be achieved or investment strategies will be successful. Any investment in a vehicle managed by a16z involves a high degree of risk including the risk that the entire amount invested is lost. Any investments or portfolio companies mentioned, referred to, or described are not representative of all investments in vehicles managed by a16z and there can be no assurance that the investments will be profitable or that other investments made in the future will have similar characteristics or results. A list of investments made by funds managed by a16z is available at https://a16z.com/investments/. Excluded from this list are investments for which the issuer has not provided permission for a16z to disclose publicly as well as unannounced investments in publicly traded digital assets. Past results of Andreessen Horowitz’s investments, pooled investment vehicles, or investment strategies are not necessarily indicative of future results. Please see https://a16z.com/disclosures for additional important information.