Last week, we covered what customer discovery is, why it’s especially important for hardware startups, and how you could conduct honest, insightful, and productive conversations with your potential customers. This lesson will hone in further on how to situate yourself for as many relevant conversations as possible, and debunk the myth of needing a shiny, finished product before approaching customers. We’ll also go over what to do if your technology by nature makes it difficult to find your market.
It may seem like we’re focusing for too long on finding your customers. We can’t stress enough how important this stage is for every startup. You want to do this ground work now so that you can secure as much as you can your product’s success ($$$) once it’s shipped. It also touches on many other facets of building a startup, like growing a mailing list pre-launch, and having access to direct market research. Once you’re at the beta stage with your prototype, you’ll be very glad to have a pool of consumers who can provide real feedback for final fixes and tweaks.
First, a story
When Drew Houston, CEO of Dropbox, first started building what we know today as one of the most seamless ways to share files between users, he wanted real customer feedback to aid Dropbox’s development efforts. The trouble was, what Dropbox was trying to do at the time was so radically different (and better) that people often had difficulty understanding the concept—it was a problem most people didn’t even know they had. On top of that, it was impossible to demonstrate the “magic” of the software because there were still many technical hurdles to get over in its prototype stage.
To solve this issue, he did something unexpectedly easy: He made a video.
The three-minute demo was Dropbox’s MVP (read our post on ideation to learn more about the MVP). Without any engineering effort, he conveyed the core function of the product. He put something in the users’ hands and got solid confirmation that this was something customers wanted.
The cardboard prototype
Drew’s story is a great example of why delivering something to the user as soon as possible is such a valuable move for startups. For hardware, this means not being afraid of presenting an “ugly” prototype. As long as it shows what it can do, it could be made out of cardboard with wires hanging off of it. Entrepreneurs tend to hesitate when it comes to sharing their product while its in development, or default to assuming that they need more polish for fear of causing a bad first impression. This is a critical error. Evolve your product in parallel with real customer feedback. Assumption at this stage can be detrimental to your startup and all your capital and engineering effort will ultimately be for nothing.
Are you a customer of your company?
Hopefully by now, we’ve successfully ingrained in your mind that customer feedback is an imperative component to building your startup. But where do you start? How do you find your customers and vet your idea?
The first thing you need to ask yourself is whether you are a customer of your company. Are you personally familiar with the problem that your product is fixing? If you weren’t building this product and came across it in a store, would you buy it and use it? This is your ideal square one. You’ll already have a pretty good idea of where people with similar problems/interests like to hang out. Or even better, you’ll have direct access to a network of users (friends!). Expand on this resource and reach out to once-removed, twice-removed connections (friends of friends). Start your conversations down this channel.
If the answer to the question above is a no, your customer discovery is going to be a slightly murkier process. Do you know one or two people who have the problem that you’re trying to solve? Grill them on everything: Where do they discover new things? What publications do they follow? What events? Who do they know that experience similar problems? Leapfrog to their social circles and grow your pool of customers.
Now—if the answer to the question above is a no, and you also don’t know a single person that you can tap into, you’re starting to enter the danger zone. You’re venturing into a realm where you may be trying to solve a problem that really isn’t a problem; the solution without a problem category.
This was a dilemma that Upverter CEO Zak encountered with a young startup called Jugnu. They’ve developed a super high-speed way of wirelessly transferring data through a beam of light. The technology is no doubt innovative and cool, but they were at a loss with who had this problem. In other words, they had no idea who their customer was.
If you find yourself in a similar situation, try following Zak’s recommendation to Jugnu: make a list of ten hypothetical places that could have this problem. Reach out to professionals in these places and narrow down the list to those that actually experience the pain (remember The Mom Test in order to collect valid responses!). For Jugnu’s technology, it made sense to target places that don’t allow RF like airports and airplanes. Another potential scenario could be places with no infrastructure, no outlets, but access to batteries and laptops. If transferring high-speed data in these regions is an obstacle that exists today, they’ve found one market segment where their product makes sense. They may even evolve the way their product operates to better suite other conditions that are present in these scenarios.
If by the end of your list, you find that none of your hypothetical places experienced the problem that your product is trying to solve… kill it. Have your Old Yeller moment. It’s sad and upsetting, but there’s no point in carrying on if the needle points to no on buying your hardware in the end. Learn from as much as you can from this attempt, and rebuild.
So far, we’ve done a lot of necessary pre-op for building your hardware startup. You may be more advanced in the process than what we’re covering now. Stick around! We’ll be releasing a chunk of the course outline next week so that you’ll know what’s coming up in the next few lessons.
And as always, share the course with your friends and colleagues! Get them building their startup today.