Steps in the Rapid Startup Design Strategy to Create a Viable Company (655-2)

The Rapid Startup Design Strategy Overall : Go stepwise, don't dawdle, constantly always ask yourself, " Is this a dead end? &qu...

Saturday, March 31, 2018

#1 Who is going to pay you?

Rapid Design Process: Review Steps

The first step is to determine who do you want to help? The goal is to find your Ideal Target Customer. Yes, a customer. The primary goal of a company is to produce or offer something that someone will pay for.

Enthusiasm is great, but if no one is willing to pay you for your solution to their problem then this business isn't going to go anywhere. If you don't care about making money then this isn't a business. It's a hobby or gift to the world. Then you are not creating a startup and this is the wrong strategy for you.

Start by making it easy. Pick someone that you know well so can guess at the problems they have, the solutions they will accept, and what they will pay for. Likely options include:
  • You in the present - eBay was created to solve a problem of the founders. It's pretty common that companies are created to solve personal problems. After all, you know yourself pretty well. 
  • You in the past. This is tricky since people like you today could be different. Buts its a good start
  • A family member or friend
  • Existing customer. It should be easy to query them about their problems and the acceptability of a solution. And you already know what they will pay for
  • Business associate or co-worker. It'll be easy to chat with them. 
  • Someone you don't know or understand. I don't recommend this. If you go this route then you had better be willing to interview 10-20 of such folks to better understand their needs, desired solution and willingness to pay.
Then clearly define the ideal customer. In fact, identify the absolute perfect customer - perhaps there is only one. This person is suffering the most with a problem you can potentially address and will be most excited about the potential of your solution to solve it. They have cash and if you had the product available they would buy it. They might even seek it out and decrease your marketing costs. Parameters include:

Who: Young/Old, Rural/Suburban/Urban, Male/Female, Loves parties/like a quiet evening, Rock vs. Classical music. Keep going and defining that ideal person who is going to be so excited about your product and service that they will tell others about it.

What: What aspect of the problem is so troublesome for them? Perhaps you should focus your solution on that aspect.

Why: Why is this a problem specifically for them. In other words, why is this problem such a challenge? The ability of your solution to remedy that problem is what will make them ideal (or unhappy)

When: How quickly will they act? Is this something they will jump on immediately or will this purchase require time because of approval, price comparison, feature comparison, compatibility concerns, security concerns, high expense, the risk of failure, lifestyle change, etc. Your ideal customers will have few constraints and be able to purchase quickly. Others will be slower so your planning should account for the delays.

If you don't have an ideal customer that is so excited by your solution to their problem that they will pay for it, then you don't have an idea worth pursuing any further. If you can't excite them then your prospect is bleak.

Don't give in to inertia. Imagine how frustrated you will be if you spend your time and a huge boatload of money trying to convince folks that you do indeed have a great solution that they should pay for - and it fails. If the value of your design isn't obvious to the ideal customer then there simply isn't enough value.

Remember, there aren't many such customers so they alone won't create a viable business (unless you are Apple and we're talking about the iPod or the iPhone). The ideal customer is critical but not sufficient.

If you have an ideal customer laid out in detail then move on and define the problem they want to solve.

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