Build a Prototype First

A good prototype is very important for a startup as it is the first offering by the startup which gets to interact with the target market. The most important deliverable we can get from this is good, authentic market feedback.

A good prototype should

: convey exactly what the startup intends to do. Never confuse the product by adding features which do adhere to the core business idea. We tend to add more features to the product so as to make it more acceptable by our TG. For example, if I am trying to create a website to sell premium teas, I should not add other beverages to increase acceptance by the market. The aim of the prototyping stage is purely to get a feedback for the core business idea. So build a prototype which does exactly that.

: be a minimal product which can be easily modified. Sorry for being repetitive but the aim of prototyping is purely to get market feedback and make necessary amendments before going full steam ahead.

Prototyping is really important and is a stage which a lot of us tend to ignore completely. We go with our gut and end building a final product without taking any market feedback. This leads to a waste in resources as once we enter the market and get feedback, making amendments to a more complicated product is a much more costly affair.

Launching a Startup

In the early days of starting up, the ability to scale is overrated. “Scale,” in case you haven’t heard the term, refers to the concept that there are processes in place that are fast, cheap, and repeatable because there will soon be millions of customers who generate billions of dollars of revenue.

For example, if Pierre Omidyar had to test every used printer offered for sale, eBay couldn’t scale. If Marc Benioff had to make every sales call, Salesforce.com couldn’t scale. If James Hong’s parents had to check every picture to see if it was porn, Hot or Not couldn’t scale.

Holding yourself to a mass-scaling test in the early days is a mistake—putting the proverbial horse before the cart. This is akin to wondering if you should start a restaurant because it may be impossible to scale the perfectionism of an executive chef for multiple locations.

How about first ensuring that people within in a twenty-mile radius like the food before working about scaling the restaurant? That is, see if the business will work at all. For example, a company that I advise called Tutor Universe provides tutoring service via smartphones. Think of it as “Uber for tutoring.” The long-term plan was that students could ask questions about any topic and receive help in under fifteen minutes. However, in the beginning, a critical mass of tutors for every subject didn’t yet exist. Many startups face just such a chicken-or-egg challenge: if you had enough tutors, you’d attract enough students. If you had enough students, you’d attract enough tutors.

What do you do when you’re faced with this kind of challenge? The answer is simple: you cheat! You use your own employees to answer questions and hire tutors in the Philippines (highly educated, English speaking, and cheap) until you can reach a critical mass of a marketplace. Skeptics and inexperienced entrepreneurs might object: you can’t scale if you have to use employees or hire tutors because they are too expensive.

This might be true, but it doesn’t matter. What’s important is that you establish three key points:

: You can get the word out

: Students are willing to install an app

: They will pay for help.

Your priority, in short, is proving that people will use your product at all. If they won’t, then it won’t matter if you can’t scale. If they will, then you will figure out a way to scale. I’ve never seen a startup die because it couldn’t scale fast enough. I’ve seen hundreds of startups die because people refused to embrace their product.

(This post is a tiny part of Guy Kawasaki’s latest book, The Art of the Start 2.0.)

Importance of a 'beta launch'

A beta launch is the launch of the product to a small sample of users from the target market. As trivial as it may sound, it is extremely important.

Once the initial product is ready, entrepreneurs tend to get impatient and want to go live and start marketing aggressively. One step which is very crucial before a big marketing campaign is a beta launch. In a beta, we expose the product to a small number of users from the target market. These users help us in analyzing how these users are using the product and what their feedback, We can assess whether these users are engaging with the product as we expected them to and what improvements/changes we need to make in the product before marketing on a bigger scale. If we market aggressively without doing a beta, we might end up spending good marketing money on a product which might not be the optimum one.

A beta helps fine tune the product and assess user engagement. Once we optimize these should be think of scaling up.