We’ll take a look at some useful mental models for startups, product and leadership.
Visionary idea fallacy
The biggest mistake you can make as a startup founder is to fall in love with your business idea.
This is especially a problem for the solution-first kind of startups, that typically start from the idea of “wouldn’t it be cool to do X” and “build, and they will come”
The caveat lies in the assumption that if you create a cool product, there will be a market for it.
This assumption is based on a bunch of other assumptions: about the problem it solves, the magnitude of the problem, the target audience, their values and habits, the cultural and policy environment, etc.
The problem is — some of your initial assumptions will be wrong.
And this is enough to make the whole idea not work.
“No business plan survives first contact with a customer”
— Steve Blank, The 5.2 billion dollar mistake.
No, not all solution-first startups are destined to fail. And yes, you still have to believe in your product and work on the coolest thing you can imagine.
But.
Be ready to adjust your vision when you learn that it doesn’t match reality.
Iterate on how you communicate your idea and the stories you tell, based on feedback.
Commit to tweaking and changing your product until you make it work.
You’ll be glad you did.
“Often, the most striking and innovative solutions come from realizing that your concept of the problem was wrong.”
— Eric S. Raymond, The Cathedral and the Bazaar
MVP is for learning
These days many people know what an MVP is.
The problem is that people don’t understand the how and the why of building an MVP.
Here is a typical MVP plan:
Build MVP
Launch MVP
???
PROFIT!!!
Quite often, the ??? means “pray and hope the market is gonna like it”.
While this approach may work sometimes, more than often step 3. never happens. It assumes executing steps 1. and 2. based on assumptions and offloading all risks to step 3, where it typically falls apart.
The reason why you might want to build an MVP is to learn whether a particular idea of a product can work.
So here is a better way of how to create an MVP:
Prioritize learning, instead of building and launching.
Learning means you have to start interacting with your target audience before you start creating anything.
Learning means you build your MVP based on a feedback cycle with your target audience.
Learning means you convert assumptions into facts and minimize risks upfront.
Here are the outcomes of prioritizing learning:
You know exactly what you need to build based on factual evidence, and not “visionary ideas” (which quite often turn out to be hallucinations)
It forces you to connect with your potential users much earlier so that by the time you launch you already have your early adopters in your email contacts
You understand your users and know what they want and what they don’t want, and even in case you learn nobody wants to use your product — well, at least you’ve figured it out before you’ve spent months building and launching it.
Many startups stop learning after they get traction. This is a dangerous trap to confuse initial success with “figuring it all out”.
Even for an established company, learning should be a part of your processes and culture, whether it is through data, or answering customer support emails.
Because once you stop learning, you start disconnecting your decision making from reality, which leads to making more and more mistakes.
The biggest risk is not to start learning in the first place.
Let me know your thoughts!
Until next time 👋