I doubt that Steve Jobs has ever asked Apple customers what type of products they want, or that he cares about what they need. Jobs believed that if he developed a mobile phone that plays music and surfs the web, he could create both the want and need. He was right: his iPhone changed the industry and started a mini technology revolution. Most of the entrepreneurs I know fancy themselves to be like Jobs. They think they know—better than their customers—what the customers want, and what they need. Or they believe, as in the movie Field of Dreams, that if you “build it, they will come”. But it just doesn’t work this way in real life. The vast majority of technology startups fail because no one buys or uses their products.

Strategy consultant Sramana Mitra calls this failure “Infant Entrepreneur Mortality”. She says that in the hundreds of companies she has mentored, lack of customer validation is by far the biggest cause of failure. Startup guru Eric Ries says that “validated learning” about customers is even more important than revenue for a nascent startup. Revenue, by itself, doesn’t build traction for a business; it is only when you have products that are tested and proven, that customers are ready to buy, and that you can sell and deliver profitably that you have the right ingredients for a successful business.

How do you determine what customers will buy (or, if you’re building a free web technology, what it is that they will invest the time and effort to use)? Unfortunately, this isn’t a simple matter of asking. Your customers know what their problems are; they know what they like; and they know what they don’t need. They don’t know what you can uniquely develop for them that they will really want. This is what you need to figure out. Start by understanding what the customer’s problems are; use your experience and vision to conceive solutions; share this with potential customers in ways that they can understand; and learn. It is an iterative process.

The best example I’ve seen of a startup looking before it leaps is Campfire Labs. The startup has spent 14 months prototyping products. It hasn’t even started developing its products yet. It could be that Campfire never gets off the ground, but if and when it does, it has a better than average chance of becoming a Zynga or Facebook. In the meantime, it has already lived at least three lives (but, fortunately, hasn’t had to die three painful deaths). Campfire was founded by former Yahoo! search technologist Naveen Koorakula and, former Youtube head of international strategy and product, Sakina Arsiwala. Their goal is to change the way people collaborate on line—to make it more meaningful and to better manage the many contexts in which they interact (work, home, school, etc.).

Naveen and Sakina started by building a prototype of a personalized news/media site and sharing it with friends. But, while their techie friends would really get excited about algorithms, the others would scratch their heads trying to figure what the purpose of the product was. Next, they experimented with content sharing, interest graphs, and other technical concepts. They came with product ideas and asked their friends who were specialists in various disciplines to brainstorm with them. Once they thought they were on to something, they talked to random people on the street and workers in the mall next door. They went to university campuses and bought smoothies and sodas in order to get students to spend a few minutes with them. They carefully observed user reactions, read between the lines, and dug deeper to understand what the users were really saying. They incorporated what they learned into the next iteration.

Last time I met the Naveen and Sakina, they were still trying out new ideas. But they seemed to be getting closer and closer to having a product that users were eager to use.

Getting back to Steve Jobs. Does he really have some secret powers or a divine vision that lets him build one earth-shattering technology after another? I don’t think so. My guess is that in his secret lab, Jobs has teams developing and testing hundreds of ideas. He just implements the best of them. Jobs is not afraid of abandoning failures, and when something does click, he rules like a tyrant and makes it happen. Eric Ries agrees with me and prescribes a five-step process that can help people become more like Jobs:

  1. Hold your team to high standards; don’t settle for products that don’t meet the vision; iterate, iterate, iterate.
  2. Be disciplined about which vision to pursue; choose products that have large markets.
  3. Discover what’s in customers’ heads, and tackle problems where design is a differentiator.
  4. Work on as few products as possible; keep resources in reserve for experimentation.
  5. Start over (change direction) if you find yourself with a product that’s not working.

Tags:

  • Pingback: Interesting articles « Is not you, it's me()

  • Raj Arora

    Vijay, isn’t it true that what people say is not what they want. So why spend 14 months to build a perfect solution for this imperfect world. With that many resources, I would build 4 variations of the product and let those ride in the market for 6 months. Whichever works is the perfect solution.

  • Mohd Farid

    I am trying to bring this sort of mentality to a group of high school kids here in Malaysia. We are making the Steve Blank’s book as the first bible and Business Model Generation book as the second bible. It is unfortunate that in Malaysia, failure means you are done for the business. To make it worst, the government put in place of so many restrictions on university students and high school students from starting their own business venture.
    Our aim is to promote ‘the right way into entrepreneurship’ from the high school level and encourage these students to make mistake in their quest to become entrepreneurs.

  • http://twitter.com/eaboyeji Iyinoluwa E Aboyeji

    I am impressed Campfire has done so much testing but I will say it is only because they have the funding to afford it. Sometimes, especially if like me you are bootstrapping it with a lean startup, you just have to close your eyes and take the deep plunge, not because you think you are steve jobs but because you can’t afford to do any less. #speakingfromexperience

  • alfonso

    Hello,nvery interesting article. I’m not an entrepreneur, but obviously I’m fascinated by the field.nI find it curious that the bottom line of the article (“donu2019t settle for products that donu2019t meet the vision; iterate, iterate, iterate”) is (in my opinion) quite opposite of what Reid Hoffman from LinkedIn suggests:n”He subscribes to the u201cfail fastu201d mantra u2014 you need to ship your product as soon as you can, and if youu2019re not embarrassed by the first product you launch, youu2019ve waiting too long.”nfrom http://techcrunch.com/2010/10/16/reid-hoffman-startup-school/nnI'd be happy to hear your view.

    • http://www.wadhwa.com Vivek Wadhwa

      I agree with Reid, validate, build, iterate, and learn. I just detailed all the things that lie ahead when you have done this…

  • Pingback: わかったつもりになっていませんか:「ビジネスモデル」とはなんだろう?()

  • Pingback: What Exactly is a Business Model? | Garbage Collector 4.0()

  • Pingback: What Exactly is a Business Model? Balakrishnan V K - Balakrishnan V K()

  • Ahivarn

    Steve Jobs is the Gods of modern technology for the masses. If even 10% people were intelligent like him; we would be spared many crashes and low battery life! The list can continue long!

    • http://www.wadhwa.com Vivek Wadhwa

      Wouldn’t it be great if we could clone him. :)

      • FU

        how come a***holes like u end up teaching students.

    • http://pulse.yahoo.com/_WQG6STJDJ2BTDUDHCU725QBXZM i

      Even if 100% people were as intelligent like him, we (perhaps) would not be spared crashes because it crashes are not a function of intelligence alone!
      East Bay Prophet

    • http://pulse.yahoo.com/_WQG6STJDJ2BTDUDHCU725QBXZM i

      If 100% of the people were as intelligence as Jobs (in the specific area), it would leave him “no-better-than-us”. As far as crashes; they are not a function of intelligence alone! – East Bay Express

  • Pingback: What Exactly is a Business Model? | Ebay shopping tips()

  • Pingback: markitd - What Exactly is a Business Model?()

  • Pingback: İş Modelleri ve Teenage Sex()

  • Pingback: Oh, Sugar! » Business Models and Teenage Sex()

  • Pingback: How Prototyping and-or Beta Improves Success « All Things CC:()

  • http://www.buyger.com 渡云飞

    We should not be Steve Jobs, on the contrary, we found details of life to become a person. Jobs is not God, at best just a magician. His magic is that we do not see him in the hands of magic before attacking it.
    Read the autobiography of Steve Jobs, he saw the problem of attitude, self-definition of the aesthetic and the team have given me great inspiration.
    However, your article last-mentioned four very good suggestions.
    Concerned about the living, moving people found the moment in life, you can create a stunning and practical, and revolutionary products. Hope to share with you my MSN: duweife@live.cn
    My gmail: duweife@gmail.com
    I was in China, but Steve Jobs is very respected. Hope to share with you, common trends found in changes in the world.