Lean LaunchPad NYU ITP - Value Proposition, with additional design and enthrography tools for how to talk to customers, observe, and get underneath the obvious pain points.
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Lean LaunchPad NYU ITP 2.3.2014
1. LEAN
LAUNCHPAD
AT NYU ITP
Class 2 / 12
February 3, 2013
Jen van der Meer | jd1159 at nyu dot edu
Josh Knowles | chasing at spaceship dot com
Rockets Sketches borrowed from Harry Allen Design
2. TODAY:
6:00 – 6:40:
Customer Development + Value Proposition
Guests: Ajay Revels and Anthony Viviano
6:40 – 7:25 :
3 Teams present (5 minutes present, 10 minutes feedback)
7:25 – 7:35:
break
7:35 – 8:00:
2 Teams present (5/10)
8:00 – 8:55:
Tarikh Korula, Founder, Seen.co
3. WE ARE HERE
.
2/3
Value Proposition
UX Tools, Frameworks
1/27
Business Models
Customer Development
UX Tools Intro
3/17
Spring Break
2/17
President’s Day
2/10
Customer Segments
Research Tools
3/24
Customer Development
Product Development
3/3
Customer Relationships
Partners,
Product Development
2/24
Revenue Streams
Distribution
Product Definition
4/7
Customer Development
Product Development
3/31
Customer Development
Product Development
3/10
Resources,
Activities, Costs,
Product Development
4/21
Product MVP
4/14
Customer Development
Product Development
4/28
Lessons Learned
4. CUSTOMER DEVELOPMENT
What is your product or service?
How does it differ from an idea?
Why will people want it?
Who is the competition and how does your customer view these competitive offerings?
Where’s the market?
What’s the minimum feature set?
What’s the market type?
What was your inspiration?
What assumptions drove you to this?
What unique insight do you have into the market dynamics or into a technological that
makes this a fresh opportunity?
5. WHAT IS A STARTUP?
Eric Ries: A startup is a human institution designed to deliver a new product or service
under conditions of extreme uncertainty.
A startup is a temporary organization designed formed to search for a scalable
repeatable business model. – Steve Blank. *Most startups change their business model
multiple times.
A scalable startup is a special class of startup – world class team, large vision, large
target market, passionate belief and a reality distortion field.
A startup is a company designed to grow fast. –Paul Graham. Y Combinator.
-For a company to grow big, it has to make something a lot of people want.
-Reach and serve all of those people.
6. TYPES OF BUSINESSES STARTED 2012
Retail
Store
13%
Service:
Business
Service
13%
Consulting
29%
Real Estate
14%
Services:
Other
17%
Technology:
Internet
14%
Source: Kauffman Foundation Legal Zoom Startup Environment Index 2012
7. KINDS OF BUSINESSES
Small business or Main street: barber shop, gluten free bakery, grass fed butcher, farm-to-table
pizza, deli, grocery, dry cleaner
Lifestyle business: strategy consultancy, PR film, jewelry-making, film production, digital media
studios, and advertising agencies
Social enterprise: social or environmental purpose, may be willing to limit scale opportunities to meet
more local goals, or directly serve the need. B-corp is a type of social enterprise
Social business (Yunnus): a for profit business that re-invests to meet a social need
Not-for-profit: an organization designed to solve a social/environmental need, that does not retain
profits, nor distributes ownership
Intra-preneur startups: building a business inside of an incumbent company to prevent a Kodak
moment
Buyable startups: designed for acqui-hire, or value to acquiree
Scalable startups: designed to scale, repeat
What are we doing HERE: experimenting to see what is possible with the teams we have in the
room, figuring out the opportunity space, and most importantly your motivation
18. WHAT IS YOUR INTENTION?
Your team values
Your vision
Why do you want to do this?
Then find a segment, a market, and a value proposition that fulfills this vision.
21. PAIN DRIVEN DESIGN
“Design is not art. Design should solve a problem for humans. We can find the
problems that we’re causing for humans by looking for pain points. Usability testing helps
us understand the very obvious pain that we’re causing for users, which is fantastic. But
beyond discovering user pain in our products, we should be doing user research on
various demographics and understanding what in their lives is causing them pain.”
Laura Klein, UX for Lean Startups
22. WHY PAIN????
As a customer, it has to hurt enough that you would go out of your way to pay for it.
It has to feel way better than staying the course, stasis, or inertia (which make people
sometimes feel warm, and comfortable, and your thing scary, and risky).
23. THE PAIN IN PAIN-DRIVEN DESIGN
How do you move beyond superficial needs?
How do you know when someone is telling the truth?
How do you get to unspoken, deeper needs?
24. VISIBLE: IN AWARENESS
IN CONSCIOUSNESS
PAIN DRIVEN DESIGN
Expressed Needs
Plans
Artifacts
Behavior
Norms
Traditions
Attitudes
Assumptions
Beliefs
Values
HIDDEN, INVISIBLE:
OUT OF CONSCIOUSNESS
25. WAYS OF EXPLAINING REALITY: SYSTEMS THINKING
PAIN DRIVEN DESIGN
EVENTS
What just happened?
PATTERNS
What’s been happening?
TRENDS
What are the
common forces at
play?
STRUCTURES
MENTAL MODELS
How do processes
and organization
impact?
How does our
thinking allow this to
persist
26. HOW TO CONSTRUCT A VALUE PROPOSITION
LEAN LAUNCHPAD @ NYU ITP
DEVELOP EMPATHETIC
MUSCLE MEMORY
PRACTICE THROUGH
CUSTOMER DEVELOPMENT
ARTICULTATE PAIN
POINTS + NEEDS
STATED, VISIBLE, AND
HIDDEN, TACIT
27. HOW TO CONSTRUCT A VALUE PROPOSITION
LEAN LAUNCHPAD @ NYU ITP
DEVELOP EMPATHETIC
MUSCLE MEMORY
PRACTICE THROUGH
CUSTOMER DEVELOPMENT
Diverge
ARTICULTATE PAIN
POINTS + NEEDS
STATED, VISIBLE, AND
HIDDEN, TACIT
Converge
28. DEVELOPING EMPATHY
From: D-School Bootcamp Bootleg:
Observe: View users and their behavior in the context of their lives.
Engage: interact and interview users through scheduled and short “intercept” encounters.
Immerse: Experience what your user experiences.
The problems you are trying to solve are rarely your own – and you won’t find a market
until you can understand the needs that other have.
29. INTERVIEW FOR EMPATHY: STORIES ARE WHERE
THE RICHEST INSIGHTS LIE
From: D-School Bootcamp Bootleg
Intentionally setting the context to get deeper into the truth.
All of you are working on businesses designed to make human life betterstart their. Describe your intentions.
Work to get into the emotional reasons when testing your key hypotheses.
When does someone light up? When do they resist?
30. A – E – I – O – U FRAMEWORK
AEIOU is an organizational framework when you get into the natural habitat of the person
you are interviewing, and gives you a construct to look, listen, and observe (rather than
talk, and hear):
Activities: goal directed sets of actions. What are the pathways that people take toward
the things they want to accomplish, including specific actions and processes?
Environments: include the entire arena in which activities take place.
Interactions: between a person and someone, or something else, and are the building
blocks of activities.
Objects: Building blocks of the environments, key elements put to complex or even
unintended uses, possibly changing their function, meaning, and context.
Users: people whose behaviors, preferences, and needs are bing observed. Who is
present? What are their roles and relationships? What are their values and biases.
From: Universal Methods of Design. Bella Harrington, Bruce Hanington.
36. AND, GO OUT AND TALK TO PEOPLE:
PREPARING FOR AN INTERVIEW
Customer development IS different than ethnography or design research inquiry –
You are NOT a neutral observer. While you can practice the art of neutral
observation, you, as a founder, are making contact with your first potential customers.
We’re going to start wide, and expansive, and go deep, getting to deeply unmet needs.
But we will be quickly moving to understand the business model that will feed your vision.
37. THE BRAIN DUMP
Convene a brain dump.
Get what’s in everyone’s heads out on the table.
Assumptions, expectations, closely held beliefs, perspectives, hypotheses.
Contradictions are inevitable, and become great fodder for hypotheses to test on your
business model canvas.
“Think about it as a transitional ritual of unburdening, like men emptying their pockets of
keys, change, and wallet as soon as they return home.”
– Adapted from Steve Portigal, Interviewing Users.
38. INTRODUCE, BE HONEST, ORIENT, GIVE CONTEXT
Introduce yourself and any associates (note takers, equipment operators, unseen
observers)
Obtain consent / agreement to be interviewed, recorded, photographed
Discuss: use a note taker or an audio recorder. Be sure to tell participants about it. (Don’t
conceal a recording devices). And know when to go off the record to get the backstory.
1. Why we're here: Introduce the purpose of the conversation
2. Explain freedoms (let’s stop at this time, ask questions, take a break, etc)
3. Explain time constraints (we have only 30 mins, 45 mins, an hour, today)
4. Provide an overview of what will happen (I will walk beside you, I will watch you do
XYZ)
5. Explain briefly what you'd like to hear about (Tell me what you're
thinking, doing, looking for, etc)
-Ajay Revels, Polite Machines
39. SHOW ME AROUND: OPEN ENDED TOUR
Who (who are we observing)
What (what are they doing)
How (how are they doing it)
Why (are they doing it)
From: Ajay Revels
When (are they doing it)
40. HOW TO AVOID LEADING QUESTIONS
Agree with me: Leading questions
•
Interviewer wants a specific agreement
•
Question narrows the focus of the conversation
•
Typically Yes / No or Agree/ Disagree or Choice #1 vs Choice #2
•
Examples/ leading question:
– The city is doing a great job of managing the subway aren't they?
– Given that you're a stay-at-home-mom, you agree that women shouldn't work?
– This app has a high rating so you'd expect it to work well, correct?
-Ajay Revels, Polite Machines
41. CUSTOMER DISCOVERY IS NOT JOURNALISM
There is no value in leading questions – you are trying to get underneath the cover story
people tell themselves.
(open) Charlie Rose:
You’re doing well at it too. So what’s the mission?
Where is this thing going?
(closed / yes-no)
Charlie Rose:
Has the Groupon experience and has other things
changed your sense of the timing of an IPO?
(closed / agreement)
Charlie Rose:
But you’re already getting in each other’s
businesses. You know that. They have something
called Google+.
44. NEXT WEEK PREP:
.•
Watch Customer Segments lecture.
•
Business Model Generation, 126-145.
•
The Founder’s Dilemma (HBR) and optional – The Founder’s Dilemma
Noam Wasserman (Stanford Entrepreneurial Thought Leaders Podcast)
•
The Lean UX Manifesto by Anthony Viviano
•
Talk to at least 5 potential customers. Post discovery narratives on your
team blog.
45. NEXT WEEK PRESENTATION:
.•
Cover slide WITH YOUR NAMES and your quick description.
•
What hypotheses related to your value proposition and segments did you
test last week. What did you validate. What did you invalidate. Who did you
talk to in order to validate these hypotheses.
•
Share the Latest version Business Model Canvas with changes marked
•
Share any updates to your Market size (TAM, SAM, Target Market)
•
Propose experiments to test your customer segments. What constitutes a
pass/fail signal for each test?
47. RESOURCES FOR FURTHER UNDERSTANDING
Value Proposition Canvas: Business Model Generation
Legal Zoom Kauffman Foundation Startup Environment Index 2012
Interviewing Users: How to Uncover Compelling Insights: Steve
Portigal
Universal Methods of Design: Bella Harrington, Bruce Hanington.
DSchool Bootcamp Bootleg
And this just in from Ash Maurya: How to Interview Your Users and
Get Useful Feedback
48. A PALETTE OF CUSTOMER DISCOVERY TYPES: GATHER
CONTEXT, COLLECT DETAILS:
Ask about sequence: “Describe a typical day.”
Ask about quantity: “How many diapers do you change.”
Ask for specific examples: “What is the last movie you downloaded.”
Ask about exceptions: “Tell me when you had to solve that problem
without using our software.”
Ask for a complete list: “What are all of the different toddler learning toys
have you tried.”
Ask about relationships: “How do you work with vendors?”
Ask about organizational structure: “How do you work with the Board of
Education?
Adapted from Interviewing Users, by Steve Portigal
49. PROBE WHAT HAS BEEN UNSAID:
Ask for clarification: “When you said everything changed after
September, what happened then.”
Ask about code words: “What does that acronym stand for.”
Ask about emotional cues: “Why do you laugh when you mention
Seven Eleven.”
Probe delicately: “You mentioned that changes in your organization
led to a different decision – can you tell me what that situation was.”
Probe without presuming: “Some people have strong opinions about
teaching children to read before they enter first grade, while other’s
don’t. What is your take.”
Adapted from Interviewing Users, by Steve Portigal
50. QUESTIONS THAT CREATE CONTRASTS TO UNCOVER
FRAMEWORKS AND MENTAL MODELS:
Compare processes: “How is applying for preschool different than
applying for pre-k.”
Compare to others: “Do you learning habits differ from your fellow
grad students in your program”
Compare across time: “How have your shopping habits changed
from the time you lived with roommate, to living alone, to living with a
partner.”
Adapted from Interviewing Users, by Steve Portigal
51. ITP TEACHING TEAM
Jen van der Meer, Adjunct Professor at ITP since 2008
ITP courses + workshops: Bodies and Buildings, Products Tell Their
Stories, ITP VC Pitchfest, . Currently: Luminary Labs, Angel
Investor, Health Data Challenges, Judge for startup competitions, + SVA
PoD
Josh Knowles, ITP ’07
15+ years as an independent developer/consultant, working with
numerous brands and start-up clients (currently under the aegis of
Frescher-Southern, Ltd.)