Essential Startup Tips for Entrepreneurs
8 Tips from my Customer Development Course for founders on Udemy
Here are my essential tips for entrepreneurs, founders, product managers, and anyone launching or growing a startup.
Tip #1 — Customer Development in a Nutshell
Customer Development is the single most important skill entrepreneurs need to be successful. Whether launching a startup for the first time, or you’ve tried and failed before. This is where to start.
If you have an existing business is building out a new product — customer development is the critical activity you cannot skip.
The principles were invented by Steve Blank, the father of the lean startup movement. They’re tested, proven, and used by successful entrepreneurs and product managers every day to identify business opportunities and validate ideas — before you launch them.
- Stop wasting time on ideas that customers don’t want
- Figure out meaningful customer problems worth solving
- Validate your solution actually works with real customers
- Increase your startup success rate 10x
- Find product-market fit faster
- Gain confidence that your idea will work by interviewing customers
- Based on lean startup best practices
Tip #2 — What Is Product-Market Fit
Finding product-market fit is the holy grail for any startup. And not finding it is why so many startups fail.
Achieving this goal can only be accomplished by applying the customer development framework before you begin building your product or service.
Tip #3 — What is a Problem Hypothesis
The most essential aspect of business building is solving a significant problem or need for a specific segment of customers. The most effective way to identify a problem worth solving is to start with a problem hypothesis.
This is a process that informs your entire customer development process by helping you frame who you think the customer is, what problem they have, and what benefit they get after solving it.
Tip #4 — Problems are Found in the Why
Interviewing potential customers is the only way to know if your business idea is going to work. It’s an essential process to be done BEFORE you launch your product or service.
But how do you extract the real need from potential customers so you can validate a problem and confirm you are solving is the right one.
Tip #5 — Why Startups Fail
The truth is that most startups fail. But this statistic would be much lower if founders simply embarked on the simple, but not easy, the process of Customer Development. Unfortunately, most entrepreneurs neglect to do this before launching their business — mostly because it’s hard and not nearly as fun as building your product or service. But also because most people really don’t even know how to do it.
We’ve all heard stories of startups who had rocket-powered growth and an equally fast crash and burn. Companies like Ouya, YikYak, and Jawbone raised tons of money, launched a product, invested millions in sales and marketing only to come crashing down soon after they ran out of money.
In simple terms, they never did the work required to achieve product-market fit. This customer development tip looks at one of these companies, OUYA, and figure out why they failed.
Tip #6 — Stages of Customer Development
There are four stages of customer development: Customer Discovery, Customer Validation, Customer Creation, and Company Building.
Once you have successfully iterated through these stages, you will either have found product-market fit or you won’t.
- Provide powerful insights around customer needs that are rarely obvious
- Help achieve and reduces time to product-market fit
- Delay investing significant resources until a proven and justifiable need is found
- Understand if your idea actually solves the problem
- Conclude that people will pay a price for your product where you can make a profit
Tip #7 — Don’t Assume Customer Have a Problem
Too many entrepreneurs assume that a large group of people have a particular problem before they actually go out and talk to any of those people and find out if they do in fact have that problem. This is one big reason why startups fail. It’s essential to talk to customers before you launch your business. Find out who they are, what they do, what they like, what they don’t like, where they work, and where they play.
Your job is not to tell them about your business. And your job is not about asking them about their problem. Your job is to listen intently and ask questions that lead to stories. And if you do that, you’re more likely to build a business that solves a real problem for a large group of people.
Tip #8 — Using Surveys to Connect with Customers
The only way to really understand what your customer wants is to talk to them in person or on the phone. But many entrepreneurs find it hard to connect with enough real people in a target market to validate a problem. Surveys are a great tool to help surface potential customers and do live interviews.
The goal of these types of surveys is to get people engaged enough in the topic to agree to an in-person, phone, or video interview. And while the data you collect in customer development surveys is useful, the real goal is to get out of the building and talk to people. Here are some tips for using surveys to connect with real customers.
Ready to launch a startup and learn how to solve problems that matter? Get my entire 57 chapter startup course on Udemy for only $29.99.