HOW TO: Do Seed Research

HOW TO: Do Seed Research
Based on a SeedStart lecture
by Amol Sarva, CEO of Peek
entrprnr dot com

to have a hypothesis
just asking questions in your research will help to sharpen your ideas
DO RESEARCH: entrprnr dot com

to test your hypothesis
when you ask people what they think of your idea, most of them will probably give you an exaggerated, positive response because who wants to tell you your product sucks?
so it’s your responsibility to figure out which questions will generate authentic answers
check out how Vin Vacanti’s ( Yipit ) does it
[go to the first under “Get Honest Feedback”]

to create credibility
when you present an idea to investors, don’t assume they have a secret stash of PPTs with your market statistics already pie-charted
some investors are DATA-LESS CREATURES and don’t have time to do the research you’re supposed to do anyway
providing data for investors says “we’ve done the work for you”
plus, you need to have a credible hypothesis you can thoroughly justify

to check if you are RIGHT
you will have found the right product market fit when a good percentage of your users say they would be “extremely disappointed” if they lost your product
so get out there and ask potential users how they would really feel if you closed shop tomorrow

to know your MISTAKES
even if you end up completely changing your product (e.g., sticky bits turned turntable.fm ) , the research you did will still be valuable

surveys & focus groups
quantify your responses as much as possible
e.g., rate preferences based on a scale of
1-10 instead of asking open-ended questions
like “what do you think?”
then prioritize the answers with the most extreme numbers (closest to 1 or 10)
when developing a product, this will help
you figure out what people really want and
what they really could care less about
HOW TO RESEARCH: entrprnr dot com

surveys & focus groups
most people who participate in anonymous survey groups either have low attention levels or are just in it for the compensation
set up easy questions (e.g., multiple choice) and
make sure you use language that is familiar to
the people you are asking

desk research
top down approach : look at the macro-economics of your market and multiply
e.g., people eat X meals per day; there are Y
people in the city; we want to capture Z% of that
bottom up approach : take revenue numbers from real companies
e.g., cost of McDonald’s average transaction
# of customers in the market
# of potential annual transactions

desk research
unit economics approach : think about your business in its unit levels (the financial flow)
e.g., how many you are going to sell
what people would pay for it
most investors like to think about businesses in their unit levels
they also want to see all three forms of desk research in your analysis of the market

anthropological methods (reach out and touch somebody)
watch how long/often someone surfs websites that are relevant to your product
take photos or videos
e.g. dump out a person’s purse to see if
your product belongs there
( what’s in your bag? tag on Flickr)

use online survey panels, then take the results and create your own charts
GreenFieldOnline (recently acquired by Toluna) reward
system for people who answer surveys
email surveys to your friends (expect mainly answers to “is this dumb” type questions)
Google Docs and SurveyMonkey are good
tools for setting up surveys and collecting answers
when you’re hiring, use job interviews to find candidates who have worked at your competitor companies
call competitors as a potential client and ask intelligent questions

making ads is cheaper than products (see what people click on to gauge their interests)
Cars.com started by just creating a website;
if a customer bought a car through them,
the founders would literally go to a car lot and
buy the car and drive it to the customer’s
door; they just wanted to see if there
was interest around the idea

make vaporware (things that simulate user behavior), even if it’s just images
Peek ’s first prototype was a block of wood;
the founders carried the block around and
pretended to use it as if it were the device
they were trying to build, because they
wanted to see their own user behavior
around it

use screenshots of other people’s products
modify to make it your own to show how your product works
add “could do” elements that interest those you’re pitching

and finally . . . articles like this one will NOT help you do research
entrprnr dot com

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HOW TO: Do Seed Research

by entrprnr on Jun 28, 2011

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HOW TO: Do Seed Research — Presentation Transcript