“Know your customer”. That was the take-home message from Lean Startup Machine Brisbane last month.
The three-day event at River City Labs gave entrepreneurs a guide to fast-tracking their startup, or as organiser Peta Ellis put it: teach skills in “one weekend what it would normally take six months”.
“The takeaway is about making sure you know who the customer is and whether they have the problem you think they do,” Ellis said. “Just because you think they might or you might be a potential customer yourself, doesn’t mean other people will.
“It’s all about finding a problem opposed to finding a solution,” she said.
LSM is structured around The Validation Board, which provides a framework for finding the core assumptions of customers and testing the validity of startup ideas. After listening to case studies and practices for customer interviews, participants interviewed members of the public to gauge the legitimacy of assumed problems.
Entrepreneur Dave Masefield worked with the Toowoomba Startup Group on Terese Piper’s idea of a shared caring system for families. He is currently developing a startup community in the Darling Downs and came to investigate the possibility of bringing the event to Toowoomba.
“We had trouble connecting with our customer,” Masefield said. “While we managed to ask our questions to 45 people, we don’t believe we connected with the customers we were looking for so are looking to pivot to a different approach.
“It’s a very valuable tool, learning to validate your idea and your assumptions before going further down along the track,” he said. “If we launched straight up with what we were thinking straight away, we may be on a completely wrong track.”
Other business ideas included family care options, repurposing surveyor data, and superannuation services for young people. Ellis said some consultation quickly showed the last idea wouldn’t fly because while young people don’t pay much attention to their super, they also don’t care enough to do anything about it.
The idea soon pivoted to focus on debt consolidation, and it wasn’t the only one to change direction.
“It often means that if they realise that no one had the problem they thought they had, then they need to go back and look at the problem to see who that potential customer would be,” Ellis said.
“You need to be willing to change, [but] some people who come in with one idea and aren’t willing to move too much away from that, which is a shame because it stifles growth.
“One thing I personally always find hard is that no’s are good,” she said. “Getting a no from a customer is just as valuable as getting a yes, often more so.”
Another participant, Marty Sparhawk, worked on the idea of a collaborative community sharing application, which consisted of borrowing and lending from members of a local community with an aim to “widen the net and find a lot more opportunities to borrow/lend stuff”.
“This process is a lot more efficient than how we usually do things with focus groups,” Sparhawk said. “Walking down the street and just talking to people, we got some good insights.
“It was initially quite difficult, but once people got used to it, you get a lot more comfortable. It wasn’t structured questioning, with clip boards etc; you’re having a conversation.”
Finally, an added topic for the event included a discussion on the onerous but often necessary “concierge stage” of a startup, wherein entrepreneurs manually operate processes that will eventually be automated.
“It’s the process of your business operating before it’s ready to operate as such,” Ellis said. “Smoke and mirrors, fake it till you make it; you appear like you’ve got everything working but behind the scenes, you’re doing everything manually.
“But you’re doing it to keep process and customers flowing until you’ve built the whole thing”.