If you own, run, or work in a startup and you’ve never heard of The Startup Owner’s Manual, The Four Steps to Epiphany, or Steve Blank, you NEED to remedy that as soon as possible. Over the last few years, Steve’s speaking and writing have been an inspiration to many entrepreneurs to re-examine the approach they take to making their visions a reality and examine exactly why the majority of startups are destined to fail before they even hit their first milestone.
In a nutshell, most startups fail because they instinctively adopt the product development approach used by established companies to develop new products for EXISTING customers.
The Product Development Model:
The problem with this approach is that when you don’t have any existing customers, a heavy focus on product development usually means that very few resources are devoted to customer and business development until a product is close to launch – which results in products launched into a market with little or no buyers. While some companies that launch like this can adapt and survive if they are backed by a massive amount of funding – the majority fail.
What has been mostly neglected thus far by the startup and investment community is the customer development approach.
Customer Development Model:
From day one – or as soon as you have a functioning prototype – you should be talking to and signing up customers – even if only as on trial/experimental basis. This will give you key insight into if/how your idea or product will even be marketable – without this, money spent on product development and energy spent developing investor interest will likely be a waste.
If you’d like to dive deeper into this topic – definitely check out Steve’s books and check the articles from his blog listed below. Our whole team has here and we HIGHLY recommend you do too.