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Startups are different pt5

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  • 1. WHATS‟S THE KEY DIFFERENCE BETWEEN ASCALEABLE START UP AND A LARGER ESTABLISHED COMPANY? PART FIVE
  • 2. Unlike a large In a start up,profitable cash is notcompany, king;start ups have The number of times you canlimited time adapt to findand require the right businessprocesses model before you run out ofthat are cost money iseffective andquick
  • 3. CUSTOMER DEVELOPMENT INTERVIEWS
  • 4. Know your goals andquestions ahead of time
  • 5. Have your assumptions and thus learning goals prioritised ahead oftime. Decide who you want to talk to (age, gender, location,profession/industry, affluence, etc), and target intervieweesaccordingly. Prep your basic flow and list of questions. You might veer off the plan to follow your nose, which is great, but go in prepared.
  • 6. Separate behaviour and feedback in discussion
  • 7. Decide up front if your focus is going to be on learning a user‟sbehaviour and mindset, and/or getting direct feedback orusability insights on a product or mock up. Do not mix the two inthe discussion flow or things will get distorted. Put “behaviour and mindset” first in your discussion flow. During this part, don‟t let the interviewee go too deep in terms of suggesting features (some people can‟t help it), but keep them focused on if they have a problem, how they think about the problem space, and if and how they have tried to solve it in past. Getting people to discuss their actual actions, not just opinions, is very useful.
  • 8. Work from an outline of 3-5 key questions
  • 9. E-mail these in advance and also bring a hardcopy. Theirname should be at the top of the paper along with the dateof the interview. The interview may last a few minutes or itmay last an hour but set expectations up front about whatyou want to talk about. It‟s OK to ask follow up questions butthese 3-5 should form the spine of the interview. Why: you need to focus on the essential questions you are trying to answer..
  • 10. Get psyched to hear things you don‟t want to hear
  • 11. If you don‟t do this, you might find yourself selling or convincing, or evenhearing what you want to hear. Remember, the goal in this early stage islearning and validation, not a sale. Unless, of course, you have set a sale or „Letter Of Intent‟ as a goal. You might want to shoot for a commitment from the interviewee as a way to measure true demand. If so, keep it entirely out of the behaviour/mindset portion of the discussion.
  • 12. One person at a time Focus groups are a group-think, distraction-filled mess. Avoid them and only talk to one person at a time.
  • 13. Have two people interview
  • 14. Both of you taking notes as you go. The second personcan listen more attentively while the first one asksquestions. Trade off every few questions so that theconversation stays lively and fresh.Date and number each page (or 3×5 card) of your notes. Why: this is more time efficient for the person being interviewed.
  • 15. Disarm “politeness” training
  • 16. People are trained not to call your baby ugly.You need to make them feel safe to do this. My approach was to explain that the worst thing that could happen to me was building something people didn‟t care about, so the best way they could help me was absolute, brutal honesty.
  • 17. Ask open ended questions
  • 18. Do not ask too many yes/no questions. For example, minimize such questions as “do you like Trademe?” Instead ask “what kinds of deals do you look for, if any?” “What motivates you to hunt for deals?” “How do you discover deals?” “Do you get frustrated with the deal sites out there?”
  • 19. Listen, don‟t talk
  • 20. Make sure you are learning, this is not asales call; this is an opportunity to gathersymptoms and a prospective customer‟sperspective on their needs with respect to aspecific problem or capability.Try to shut up as much as possible, and try to keepyour questions short and unbiased (i.e. don‟t embedthe answer you want to hear into the question). Why: there is a strong tendency to talk about your solution or theories of the problem. The more you do that the less that you learn: use your eyes and ears..
  • 21. Encourage but don‟t influence
  • 22. If you stay *too* quiet, some folks might start gettinguncomfortable, thinking that they are boring you or you arejudging them. You can keep things rolling with little motions ofencouragement, such as nods, “I see”, “interesting”, etc. But donot say things that might steer or influence the interviewee.
  • 23. Focus on past behaviour andactual situations and events to bound the problem
  • 24. Don‟t focus on hypothetical, potential, or future problems. Or at least don‟texplore them until you are confident that there is a clearly defined businessneed or critical capability that they are looking for today. Walk throughactual situations and events to develop a model for the costs and impact ofthe problem on their current business. Why: businesses are more likely to pay for problems or needs that are impacting them today.
  • 25. Don‟t talk about possible solutionsuntil you have thoroughly bounded their problem or need
  • 26. Don‟t mix how they describe the problem with the kindsof solutions that they are interested in. Why: again resist the temptation to talk about your solution until you can talk with very high confidence about their situation, needs, and challenges.
  • 27. Follow your nose and drill down
  • 28. Anytime something tweaks your antenna, drill down with follow up questions. Don‟t be afraid to ask for clarifications and the “why” behind the “what”.You can even try drilling into multiple layers of “why”, aslong as the interviewee doesn‟t start getting annoyed.We can use the technique of asking why five times toget to the root cause of the problem.
  • 29. Probe for what‟s changed
  • 30. What has happened to make this problem or need morecritical? Explore the environment or system(s) that the group orfirm is operating in. What is the context they operate in? Whattrends are at work that are making the problem more serious(and what might happen to make it less serious)? Were theyignorant of the problem (or ignoring it) until a particularsituation or event occurred? Have they been managing it andnow need it solved? Why: businesses have many problems. They are more likely to invest in solutions for the critical ones that are likely to get worse if they don‟t take action to address them.
  • 31. Probe for quantities and ranges
  • 32. Wherever possible try and get them to put a number or estimate arange on an adjective (e.g. small, large, light, heavy, thin, frequent,rare…). Write down both their adjective and their estimate for theappropriate quantity or range. Why: you will need to develop specific target prospect selection criteria and some simple ROI or value models for your offering. These are much more useful if you can use numbers or objective criteria.
  • 33. Parrot back ormisrepresent to confirm
  • 34. For important topics, try repeating back what the person said. You canoccasionally get one of two interesting results through this. In the first, theycorrect you because you‟ve misinterpreted what they said. In the second, byhearing their own thoughts, they‟ll actually realize that their true opinion isslightly different, and they will give you a second, more sophisticated answer.Another approach is to purposefully misrepresent what they just said whenyou parrot it back, and then see if they correct you. But use this techniquesparingly, if at all.
  • 35. Don‟t overstay your welcome
  • 36. This allows you to come back. Take two or three minutes to wrapup by thanking them and providing a high level summary of whatyou heard. Commit to providing them with a more detailedsummary within a day or two. Meet that commitment.Why: unless the person is energized by the conversationyou should end it promptly..
  • 37. Ask for introductions
  • 38. At the end of every interview, see if you canget leads to another 1 to 3 people to talk to.
  • 39. Write up your notes as quickly as possible
  • 40. The details behind a conversation fade fast, so if youhaven‟t recorded the session, write up your notes and colour commentary as soon as you can. walk through the interview notes that same day with your partner, but don‟t do a final summary until you have slept on it. Why: there is value in your first impressions, your shared impressions, and your second opinion. Don‟t lose the first two and rely on just the third.
  • 41. Afterwards: Look forpatterns and apply judgement
  • 42. Customer development interviews will not give you statistically significantdata, but they will give you insights based on patterns. They can be verytricky to interpret, because what people say is not always what they do.You need to use your judgement to read between the lines, to read bodylanguage, to try to understand context and agendas, and to filter outbiases based on the types of people in your pool of interviewees. But it isexactly the ability to use human judgement based on human connectionsthat make interviews so much more useful than surveys.Ultimately, you are better off moving fast and making decisions fromcredible patterns than dithering about in analysis paralysis.
  • 43. Find the right information
  • 44. I want to additionally stress that your goal is not to ask thecustomer to define the solution. Perhaps this is obvious, but theentrepreneur needs to have the vision to look deep into aproblem and come up with the right solution.Don‟t ask people what they want, but rather study theirbehaviour for what they do and what they need. To this end, tryto get your interviewee talking about specific situations, notabstract feelings and concepts.
  • 45. Follow up by e-mail
  • 46. Thank them again. Provide a detailed summary(include their numbers and ranges) of what you heardand let them critique it (this does not mean that youhave to share all of your perceptions or plans). Ask if there are other folks that they feel you should talk to, either at their company or other companies, who would be able to provide you with a valuable perspective on the problem Why: Introverts are much more willing to share their thoughts in writing once they have had a chance to reflect, give them a chance to do so. Extroverts can have second thoughts and follow on observations, capture them all.
  • 47. Want to quickly find a profitable customers and scale faster? See part six

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