This link has been bookmarked by 4 people . It was first bookmarked on 16 Nov 2008, by someone privately.
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18 Mar 09
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03 Dec 08
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No, totally different than the traditional waterfall way - basically think of it as extending Agile out to the business end. Treat the customer as an unknown, the distribution as an unknown, and the initial featureset as an unknown, and do the smallest possible iteration of the entire business (end-to-end, customer to distribution to product) and bring that to market. Then recalibrate using user research and analytics, and bring the next iteration. The entire cycle should be very small.
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16 Nov 08
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At one of the other panels at the Web 2.0 conference, Dave McClure (master of 500 hats and 473 font colors– and one of the smartest guys in the game) summed up the life-cycle of a startup in a great way. “There’s the product development phase, the market development phase, and the revenue development– or revenue optimization– phase.” Rings true to me.
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As I’ve said before, the business guy often doesn’t have a lot to do in the early stage of product development– especially if the builders are building something that they actually want themselves. If you’re a bunch of hackers building a simple photo sharing, you don’t need a business guy telling you what the market wants. Of course, if you’re a bunch of hackers building business time management software, you might well need that. Your mileage may vary.
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But as the market development phase sets in, builder entrepreneurs are oftentimes increasingly obsolete. It’s no longer time to hurl features willy nilly at your users– you’ve already built something that they like. No you need to measure the hell out of it and turn it into something that they love. You need to iterate on it and turn it into something that confuses 4% of your new users instead of 7%. It means finding a way to tune your viral loop and conquer your SEO enemies to increase the organic flow to your product. And you need to start expoloring the market to figure out who they hell is going to pay for all of this. That means crafted adwords campaigns. That means cold calling. That means price experimentation. That means exploring the world of direct ad sales. Well, it can mean all sorts of things, depending on whether you are a free web service, a freemium product, a pure b2b play or some combination thereof.
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As Papa PG says, if you look at the leaders of successful tech companies you see more CS degrees than you see MBAs. That makes sense– geeks are critical to conquer the first (and most important) problem of a startup… Building a badass product. But if you look at these same tech companies, you see CS geeks who’ve actually set aside their geeky roots (though maybe not their geeky instincts) and become very very shrewd business guys. And you also see inferior products kicking the crap out of superior products through better sales/marketing/and distribution.
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So to all of you builders out there… Beware! When you reach a challenge in the evolution of your business, the most natural thing in the world is to frame it as a product problem. “If we just build this new feature/product, we’ll be off to the races and we’ll never have to do any of that business crap!”. Keep your eyes peeled for the time when you have to personally evolve and start tackling business problems, or step out of the way and let someone else do it for you.
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tony, have you been following any of the "customer development process" that Eric Ries and Venturehacks have been referencing? A summary of that process is to flip market and product development, and make sure you understand your channels, target customers, and build the smallest possible product to accommodate those needs. In that case, the biz guys can get started super early.
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I think the best market research is throwing an early version of a product at users. Market research can yield from pretty interesting/valuable information, but I'm not sure that it can create a recipe for a good product. I watched Jobster (my previous employer) spend tons of time getting smart about the market, but they have yet to build a product that excites their market.
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I think for consumer internet startups the "throw an early version of a product at users" model tends to work well because it lets your target customer find you. A lot of what Blank describes in the early chapters of his book is similar to what you advocate. He suggests finding a market for the product you have developed rather than the focus group approach of trying to develop a product for the market you have identified.
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