Over the past few years I’ve had the opportunity to talk with a number of startups that have gone through 90 day accelerator programs, some regional and some from the most well known brands. There’s typically two lean startup approaches that are related but different. The difference is characterized by the extensiveness of the customer discovery methodology and the timing of building of a minimum viable product.
Here are the two approaches to the 90 days of a startup accelerator:
- Build Something Simple Immediately and Iterate with Customer Discovery – The thinking here is that there’s a general market idea and opportunity, an extremely simple product is built, and the product is then constantly improved after getting input from prospects. As an approach, this solves the common mistake of startups building their product in a vacuum, only to emerge with something that doesn’t fit the market’s needs, have code debt, and usually run out of money before they can find product/market fit.
- Do Customer Discovery Without Product Building Until a Clear Need is Identified – The thinking here is that even with a general market idea and opportunity, you really don’t know what the market needs until you talk to so many people that a high percentage of a large enough demographic jump out of their seat and say they must have it. Only when it’s abundantly clear what the product needs to do it, prospects are ready to sign to be customers, and there’s a big opportunity should work be started (e.g. talk to 100 people and 15 out of a demographic of 20 say it is a “must have”, then start work on it).
As you can see, the big difference here is whether or not a simple product is started immediately and improved upon as more prospects are talked to vs talking to as many prospects as needed to find a clear market opportunity, and only then starting to build it. Most startups should do the second approach where no product work is done until a clear need is identified so that all the co-founders are focused on customer development and not distracted by product building, since they don’t actually know what the market needs. This approach is at the other end of the spectrum from building a product with tunnel vision for a year before coming up and talking to prospects, but it’s the right way to do it since time and money are so precious. As for the first approach where a product is started right away, it works well when the co-founders have extensive domain expertise in the market they’re going after and have experience first-hand with new product development. Both styles have their pros and cons and are much better ways than the traditional approach.
What else? What are your thoughts on these two lean approaches in the 90 day startup accelerators?