What products will we continue to offer?
What new products or services are we taking to market?
Doing my research for this article, I considered the opposite perspective of what the title of this article communicates. I found a lot of content about how perseverance is the key to success, ‘there is no success without perseverance’, ‘perseverance is a major key to a life of success’. In the last few years, there has been a significant increase in the promotion of motivation for success material, or perhaps I have just become more aware of it; and a lot of content motivates the reader to keep at it, keep pushing, just persevere. My goal here is not to throw the value of perseverance out the window, but to share a perspective that I have realised: perseverance is not what it takes to be successful.
Let’s define ‘persevere’:
To persevere means to continue in a course of action even in the face of difficulty or with little or no indication of success.
(Source: Google Dictionary)
Insight should be the cornerstone of innovation.
Few companies have become successful exactly as their founders had envisioned in the beginning. Just about every successful technology company you have heard of has pivoted – innovated. For instance, Youtube was initially set up as a video based dating website where users upload their video profiles with the hope to attract an ideal partner. Twitter was a podcasting network named Odeo. Android was founded in 2003 with the intention of building an operating system for cameras. Instagram was called Burbn and the app had a mix of checking in (like Foursquare) and gaming functions.
Sidebar: Learning that Instagram was once called Burbn dissipated the pressure I had been feeling to come up with the perfect name for a project I have been working on.
One of the sure ways you can achieve exponential organic growth is through word of mouth, and a sure way you can get word of mouth is to truly delight your customers. And the best way to truly delight your customers is to understand them and deliver a product that meets their needs, tends to their wants and appeals to desires they didn’t even know they had. It is not advisable to persevere on a path that has yielded little or no success, but seek the above for your customers, because that right there, is the sweet spot were success materializes.
Product – Market Fit
To find a solution you need to understand the problem. Every problem has a solution but not every solution solves a problem. Business is about opportunity – problems bring opportunities not failure. A lot of this motivational talks has made us think that surviving failure and still persevering on the same path is in itself success. No, it is about seeing the new opportunities you can now identify from the market insight you have gained and then creating products that capitalize on those opportunities.
How do you assess your product market fit?
Form your hypothesis: Who is your customer, what is their problem, how do you want to fix it?
Choose a testing method: Talk to your target audience and build a minimum viable product, deliver it to them and test how good it is at solving the problem you identified.
Analyse your results: KISS – which stands for, Keep it Simple, Stupid – should be your guideline here. What signals will indicate that the solution you have built is effective as solving the problem? It is more effective when you set the threshold for viability before you start testing.
Here’s an example: I want to sell colourful net bags for supermarkets to bag fruits for display, because I believe that colourful net bags will attract customers in the supermarket. I will test this by selecting 10 supermarkets and supplying them with colourful net bags for a weekend. If there is an increase in sales from the previous weekend by at least 25% – all things being equal – it will be viable for supermarkets to purchase our net bags.
Please note: The threshold you use for statistically significance will depend on your understanding of the business and context you are operating within.
The Big Mistake We Make
The value hypothesis of your business is the what, who and how. Yes, many people answer these questions in their business plan; but this supposition is not proven till you have confirmed these through successful sales. Only once you’ve proven your value hypothesis should you start to explore your growth hypothesis. That is, how you cost effectively acquire your customers. A big mistake we make as entrepreneurs is focusing on growth before we’ve proven our value hypothesis. Using the example above, if I shift my focus to getting 100 supermarkets onboard by July 2019 before I have established that these 10 supermarkets are truly delighted by the results my solution has delivered I will be putting the cart before the horse.
Shiny Object Syndrome (SOS)
This is a disease of distraction; the same qualities that make entrepreneurs unique are what makes us susceptible to this. We see problems everywhere and our minds are constantly creating solutions. We are motivated and want new technology and new innovations. How is this relevant to our discussion? Some of us have the opposite problem: we don’t spend enough time on any one project/product before jumping to others. How do you strike a balance? How do you know when to let go or persist? I found asking myself these questions here have often led me in the right direction.
Are your answers are mostly yes, persist. Are your answers are mostly no, it may be time to move on to your next opportunity.
If you are looking to start a business in 2019, read my article on start up here.
Happy New Year!