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Building Wallor was not easy because no startup is the same. Whether we're talking about a unicorn like Uber or AirBnB, or a business like Wikipedia, every business needs one resource in order to survive: money. You might think that this is not your primary goal, that you want to help your customers, or help society, but without money, you have no business.

So, how do you make money? How do you make that big pile of cash? Do you go world wide, do you setup an initial target market or do you just go with your guts and hope for customers to discover you? Look around, do you see how fast the modern economy is moving? Look at the trend and check the linear product development process used by most of the companies: 

  • Step 1 - concept
  • Step 2 - product development
  • Step 3 - alpha/beta test
  • Step 4 - launch/1st ship.

A simple look at this process will tell you that by the time you reach Step 3, you will have a developed product, but your target market is unknown. Following only the product development approach, for a regular startup Step 3 is their target goal. To reach it they create a fictional business plan, have some hypothesis and maybe a solution to a possible problem, but no hypothesis testing. 

So, what should we do about it? Is there any alternative, any better option? Well, before starting the work on the actual product development, you should consider alternating the product development with the customer development process.

Split your customers into four categories: technology enthusiasts, visionaries, pragmatics, conservatives and skeptics. Put your efforts in identifying the first two categories and build your customer base before you launch the product.

crossing the chasm

How does customer development work? Easy, it has four simple circular steps: customer discovery, customer validation, customer creation and company building. It’s a process of trial and error and at the end of each phase, you need to stop, analyze, revisit and understand if your goal is achieved. If it is, you can move to the next step. If not, start all over again.

  • Customer discovery  —  find who your customer is, and whether the problem you believe you’re solving is important for them
  • Customer validation  —  build a repeatable sales road map for the sales and marketing teams
  • Customer creation  —  create end-user demand and drive it to the company’s sales channel
  • Company building  —  transition from informal, learning and discovery process into formal departments of sales, marketing and business development.

These are four steps that will help you validate your business idea, save money and understand your client and requirements. To achieve them, there are some clear rules you have to follow:

  • Identify your startup type — enter in existing market, create a new market, re-segment existing marketing as low cost, re-segment it as a niche player.
  • Leave your office and meet your customers, learn and discover your market, before you start developing a product
  • State and test your customer hypotheses -  this is a process which should involve the product development team too.
  • Develop the first product for the few, not for the mass market. Find your earlyvangelists — customers willing to take a risk on your startup idea because they envision its potential

Through this process, do not forget that every category of customers is independent and your message for each of them should be different in most of the cases. Every time you switch from one group to another, you need to reanalyze your customer target, preferences, objective and try to understand their needs.

But most important, don’t forget to have fun. It’s going to be a very long journey.

This concept is not something new and can easily be found in the 4 Steps to Epiphany book by Steven Balker

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