
Got customers? How we almost sunk our startup before it started. - ryanwaggoner
http://mightybrand.com/2009/10/got-customers-how-we-almost-sunk-our-startup-before-it-started/
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josephruscio
Missed a 4th reason for a lack of customer development: 4) Hard to get
meaningful face time with customers and/or get honest, well-thought out
responses from them, particularly hard for a brand-new startup without
existing customers on existing products.

Customers are very busy people too, and they are not on your payroll. Totally
agree that you should make your decisions as informed as possible, i.e. do as
much Customer Development as you can, but ultimately a big part of a early-
stage startup is making decisions without the luxury of a complete data set
i.e. gut and luck.

Which is precisely why you need to "ship early" (get paying customers ASAP)
and "ship often" (start developing them immediately and incorporating their
feedback into development).

~~~
ryanwaggoner
Agree on ship early/ship often, but most of the startups I've observed
(granted, a small sample) didn't skip customer development because potential
customers wouldn't call them back. By and large, I think most folks are
willing to sit down with you for a cup of coffee for 30 mins and talk about
their needs and how your product could help, especially if you make it clear
up-front that this is _not_ a sales call.

YMMV, but we've had great success with just sending an email or picking up the
phone and asking people if we could chat for a bit.

~~~
josephruscio
Agree that most people who skip CD are doing for lack of trying ;-). I think
the ease of gaining access depends largely on the target customer profile.
Consumer, even SMB targeted stuff by definition has a large number of
potential customers compared to the Enterprise. Additionally their barrier to
purchase is much lower than the Enterprise, therefore the signal from your 30
minute cup of coffee is much stronger. It's a trickier proposition with
Enterprise customers, but I guess that's why the deals are bigger.

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futuremint
I've been a part of two startups, neither of which did anything remotely like
"Customer Development". The one was consumer oriented, and they sort of
stumbled through the launch of a prototype that was built to scratch their own
itch (i.e. they were their own customer, so they kind of knew what it needed).

The 2nd still has very little revenue and I would say is still struggling to
align with the customer. They've spent many years now developing a product
that they think will fit the customer based on their experiences working in
the target industry 10 years ago. Its a little scary to watch this company
spend their money after only showing a mockup to a customer once, about 3
years ago.

This 2nd company is starting to get paying customers, and then they panic when
the customer says, "Wait. It doesn't do x, y, and x? I assumed it did, I mean,
_everyone_ in our industry does that! You didn't know that?"

I'm curious to know how these 2 companies would be different had they done
solid customer development first.

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ryanjmo
I did that too. Oops. But it was actually Paul Graham's essays that made me
realize I was doing the wrong thing.

Oh, well it was only about a year of my life I wasted, I'm not bitter at
all... seriously.

Did anyone else make this mistake? How did you realize what you were doing was
the complete wrong approach?

~~~
ryanwaggoner
Author of the post here.

You can take some solace in the fact that some entrepreneurs never seem to
learn this lesson, and fail repeatedly until they stumble into a success by
chance.

I touched on this in the article, but I think the VC industry can be blamed
for some of this. If you start a company and raise a few million and hire a
team and spend two years blowing through your cash before shutting down, it's
easy to blame "execution" or hiring the wrong people, or whatever, rather than
face up to the fact that you went down the wrong road from the beginning
because you had a poor product/market fit.

Success is a poor teacher.

~~~
ryanjmo
Well luckily for me I did not have success ;)

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dotcoma
hard not to agree, isn't it?

