Customer Interviews: Spend an Hour to Save a Minute

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, 3 Early Customer Stage, Customer Development, Lean Startup, Rules of Thumb

For customer interviews we have a rule of thumb that if an hour or research saves a minute early in the conversation it’s a good investment.  When you look at the list of questions you have prepared to learn about the prospect’s business and their needs, it’s easy to say to yourself, “I am really busy I can just ask these at the start to ‘set the table.’” But there are significant risks with this approach.

Preparations Cuts Risk Of Customer Interviews Ending Prematurely

While the interview may be nominally scheduled for 15 minutes or a half-hour and may run an hour if it goes well the first six minute or so  are critical to communicating that you have done your homework on their situation and their needs. If you start to ask questions that are already published on-line you can appear lazy or unprepared. If you can do research on a prospect in advance, it’s worth spending an hour to save a minute in the conversation. You can even start the conversation by saying “when I prepared for this conversation here is what I learned about your firm” and give a brief summary of what you know about their situation.

It’s OK to say “I see on your website that you have hired four people in the last three months, how has that impacted …” or “I read a profile of your firm in the San Jose Business Journal Book of Lists, have you grown beyond the 12 people listed in February?” This shows that you have done your homework and don’t want to waste their time but need to confirm some of the key facts that may bear on their needs.

Information Sources To Consult Prior To Customer Interviews

  • Do a thorough review of the prospect’s website.
  • Search for any articles in the last two years at least to see what kind of press coverage they have received.
  • Review the Linkedin profiles for the firm, the person you are talking to, and anyone with similar titles or in the same department.
  • Review on-line postings in relevant forums for the industry.
  • See if they have a blog, a twitter account, a YouTube account, and similar social media sits that are often used for business purposes.

Six Questions That You Normally Have to Ask In The Conversation

  1. Prospect’s description of the problem in their own words. This is rarely more than a sentence or two and capturing the essence in their own words is key.
  2. High level description of current work process or work flow in their own words. This forms the basis for any delta comparison or differentiation of your solution.
  3. Any constraints they mention: if you hear the same ones multiple times you will more than likely have to satisfy them.
  4. How they will tell that a new solution will leave them better off: this is different from asking them to specify the solution, it’s asking for “future state” or the end result they would like to achieve.
  5. What else they have tried to do to solve the problem: probe for why they were not satisfactory.
  6. Key metrics or figures of merit they would use to evaluate a new outcome.

Closing Thoughts

“A month in the laboratory can often save an hour in the library.”
F. H. Westheimer

Entrepreneurs seem to divide into two camps:

  • those who want to have a conversation immediately, and
  • those who are quite content to research for months as long as they don’t have to talk to strangers.

Striking a balance is the key to maximizing your learning from a customer interview. Effective research prior to the customer interview allows you to

  • Ask better questions
  • Provide evidence of your commitment to developing a mutually satisfactory business relationship
  • Detect when your prospect is leaving something out or perhaps coloring the situation too much. You are not a stenographer there to capture whatever they say without reflection, but if your only source of information is what they tell you then you risk “garbage in, garbage out” in your product plans and MVP.

Related Posts

David Binetti On The Mind of the Entrepreneur

Written by Sean Murphy. Posted in Customer Development, skmurphy

In the mind of the entrepreneur the future is obvious and imminent. This  “reality distortion field” can be useful for making a better future possible, but it inclines the entrepreneur to minimize adoption risk–people will see the benefits of my product immediately and adopt it–and to be impatient. Customer development techniques allow you to identify expensive false positives for potential markets and to refine your approach.

I have been reviewing the presentations from Startup Lessons Learned 2010 and 2011 again and realized that I had never blogged about 2011 presentation “Lessons Learned Pivoting Votizen” by David Binetti (@dbinetti). His key take-away on the value of a customer development is that is helps the entrepreneur avoid expensive false positives, in particular the kind that can happen when you fall victim to your own reality distortion field and are overoptimistic about market risk.

Clip For The Mind Of the Entrepreneur

This clip starts at the 5 minute 40 second mark in David Binetti’s presentation at Startup Lessons Learned 2011 and gives a little context before “Phrenology of the Entrepreneur” slide shown below.

Slide For Phrenology Of the Entrepreneur

Here is the deck starting at the “Phrenology of the Entrepreneur” slide (19).

Related Posts

Update Aug-21: Source of the Phrenology Image this blog post from July 29 2008 on BzzAgent blog: Phrenology of the Entrepreneur

Having worked with several entrepreneurs throughout my career, I’ve noticed precisely nine common traits that unite them together and distinguish them from the rest of us. But what’s particularly interesting is this: just as these characteristics unify entrepreneurs into a discrete group, so too do they corral those who work for them into a community of their own. You see, entrepreneurs inadvertently create a culture in which the staff that survive bond over the realization that it is not each of them that is crazy.

Enter Exhibit A: This post. I wrote this post because our entrepreneur/leader constantly complains that too few blog posts are being submitted. I decided to write minimal text, and instead let the image speak for itself. After reviewing the post, our entrepreneur/leader informed me that “we” (another baffling entrepreneurial habit is to use plural pronouns when assigning tasks to an individual) need to add more text to make this post more about “the business” (code for “the entrepreneur,” himself?). So that’s what I am doing. And, in doing so, I have found myself reconsidering the image, itself. Perhaps the size of the rearmost lobe (labeled “self-esteem,” which was polite for “ego”), should be, err, adjusted.

 

Direct link to image http://www.bzzagent.com/blog/wp-content/uploads/2008/07/phrenology-of-the-entrepreneur.jpg

A Conversation With Tristan Kromer on B2B vs. B2C Customer Acquisition Challenges

Written by Sean Murphy. Posted in Audio, Customer Development, skmurphy


Direct download from http://traffic.libsyn.com/skmurphy/Tristan_Sean_6-13-14b.mp3

Here is a rough transcript of the first five minutes or so to give you a flavor, I think you will find it interesting if you are wrestling with customer development or customer validation in an early market:

Sean: I am sitting here today with Tristan Kromer, we are going to talk about the differences between B2B an B2C customer acquisition methods.

Tristan: some consumer startups seem to latch onto a particular technique and apply it regardless of context. I am really interested in the different approaches you can use to find B2B customers and where the differences are between selling to consumer, small business, and enterprise.

Sean: B2B the outreach is tailored / artisinal, where the price point or deal value is above 5-10,000. Consumer startups feel this pressure to move to more scalable methods much earlier due. I know one piece of advice you always offering regardless of whether it’s consumer or business is to have conversations with prospects on an ongoing basis.

Tristan: always start face to face, even for consumer. What the consumer folks may call a “manual process.” Because that’s a much more rapid form of connect. Even if you want to have a highly automated sales process, you believe that consumers will see your hero image and read your FAQ and click on the purchase button, that’s a sales process. Your face to face conversation can be roughly analogous: demonstrate the the value proposition, answer questions and then you have an ask. By doing that face to face, analog vs. digital so to speak, you get a lot more feedback and can see when the prospect smiles, frowns, looks confused, etc.. You can apply that feedback to your digital process. For example, when I use this language consistently  it’s getting a much better response. Let me try that on a landing page.

Sean: there is a desire to create scale, to create the digital process, right away. For me it’s much harder to learn from when you have a lot of unknowns. The odd thing is that B2B stays more personal because above a certain deal size you cannot assume you can avoid a negotiation to be able to get the business. There are going to be several serious conversations and at least one serious negotiating session where the value of the transaction is above $10,000.

Tristan: there is also a bias to a longer term relationship on the large dollar B2B purchase. There is an expectation of support that is often not there in a smaller consumer purchase. There is a sense of “you are going to be guy we deal with when we have problems or renew.”

Sean: yes the salesperson has to be viewed as a point of service and as providing value. Your point about a “bias ot a long term relationship” was a good one: I think the enduring consumer brands pay a lot of attention to that as well. With startup sometimes there is so much focus on the ramp that sometimes unfortunately less attention is paid to reputation, brand, social capitial, whatever you want to call it. It’s not so much “we have cool logo” but “our cool logo represents a promise that people can depend on.”

Tristan: I agree: it’s two different things. It’s esthetics vs. trust. You have repated interactions with the firm and now you can
trust them. I have recently been doing some work with large brands and it’s amazing the impact that a trusted brand has on conversations with customers. There is an automatic assumption that it’s going to be a serious conversation.

Sean: does that work against experimentation? Because they feel that they are carying the brand they don’t want to be “too experimental?”

Tristan: it opens doors and you can have conversations that startups find much more difficult to secure. So there can be a bias towards a false positive. But as least you are having conversations you can learn from instead of trying to have conversations. I think you can be aware of the bias and manage for it. But there is fear of failure, but you can compensate for that with “off brand” tests where you don’t identify the brand.

Sean: we don’t do as much “I am from IBM” as “Charlie recommended that we speak to you” and they can check with Charlie and he will confirm it. Or I am a member of this community, I have presented at this conference, I have taken part in this working group. There is a brand effect for smaller startups, but it’s predicated on prior accomplishments or prior
relationships that can be re-activated or leveraged.


Here are some other interesting interviews with Tristan:

Customer Development Surveys Always Suck For B2B

Written by Sean Murphy. Posted in Customer Development, skmurphy

A customer development survey always sucks for B2B: have a conversation instead.

If you are selling to business and you tell yourself “my time is so incredibly valuable” I need to automate my interactions with prospects you are missing the point. The key challenge in the early market is to establish and maintain trust by listening, making and meeting commitments, and following up to very that your customers are satisfied. It’s not so much about punching the most important item on your task list as cultivating relationships with key customers, partners, and employees: all of these start with conversations and are built on trust

Once you are trying to validate what you think you have learned, start making good faith offers. Don’t start surveying more prospects, see if the firms you have already talked to are willing to buy. And if not,  learn why not in a conversation.

Practical tips for how to conduct B2B Customer Development Interviews

Startup Stages: Survive, Explore, Focus, Refine, Grow

Written by Sean Murphy. Posted in Customer Development, Design of Experiments, skmurphy, Startup Stages

Survive first. Explore second. Build third.

  1. Survive: It’s good to fail small and fail fast. But also make sure to survive the failure. It’s no good to fail if you can’t get up again.
  2. Explore: True exploration feels like zero progress. Everyone around you will tell you to focus. To stop messing around. To get on with it. The problem is, you need to find it first. This takes time and mistakes. In theory, this is all about fail fast, fail small. In reality, this is slow and painful.
  3. Build: Find a great solution to a small pain point. Then use that to grow bigger.

Tyler Michalski in “The Basic Basics

This reminds me of Rob Saric’s “Solvency First, Consistency Second, Growth Third”

2. Solvency First, Consistency Second, Growth Third
If you don’t have enough money to survive you die. [...] focus on ‘Minimum Viable Cash flow (MVC)’. Once you determine what the MVC is for both you and your team, work towards achieving that by whatever means you can. Consistency allows for predictability and the more predictable your business (‘X inputs results in Y outputs’) the faster you’ll grow.
Rob Saric in “Startups Are Hard

I think they are both right, I have tried to put integrate these two insights into our startup stages mode:

  1. Survive / Stay Solvent: This can involve the work/work balance of services and product development, the important thing is to generate enough cash flow to give your team the time to explore the market to find the right opportunity. This spans the “open for business” and “early customers” stages.
  2. Explore: I think you are looking for a fit with your talents, interest, and experience. Any opportunity has to pass the “why you, why now?” test. What is it that your team brings to the problem that will allow you to differentiate your offering? The fastest iteration cycle is to build as little as possible and simply measure (observe) and learn. Always start from measurement and observation so that you understand the problem and the customer before you worry about your solution. This also involves asking the right questions, talking with many people, and taking time to integrate all that you have learned. This spans the “idea and team formation” and early customer stages.
  3. Focus:  This is the first part of the “finding your niche” stage; selecting a candidate niche to focus on.
  4. Refine (Make Consistent and Predictable):  This is the critical step in finding your niche that allows you to leave exploration mode, or at least substantially reduce your exploration efforts. You have enough knowledge of your teams capabilities to build predictable processes and of the customer’s needs to predict their reactions and identify prospects you should focus sales efforts on early in the engagement process.
  5. Grow: now you enter the scaling up stage because you have useful diagnostics and predictable processes.

Distilling Rules of Thumb From Entrepreneurial Experience

Here are some additional blog posts on distilling rules of thumb from entrepreneurial experience:

More From Rob Saric

More from Rob Saric’s (@RobSaric) blog, his core beliefs linked to relevant articles on his site:

We Help Teams of Experts Find Leads and Close Deals

Written by Sean Murphy. Posted in Customer Development, Sales, skmurphy

To get acquainted join us at a Bootstrappers Breakfast in Silicon Valley or sign up for Office Hours. We offer public and private workshops and Mastermind groups in addition to consulting support.  If they can identify a budget we can find a way to work with them.

The model we follow is here our “Startup Stages”  which spans from the pre-incorporation idea stage to scaling. We have helped  a number of teams come together and assisted them from idea stage to open for business stage to finding and focusing on a niche.

We are very comfortable helping teams refine their product concept with discovery conversations, probes, and experiments. We help them make sense of the information they have, build models, and craft a plan of action for next steps. In particular we help with lead generation and negotiation to close of early reference accounts for new products. A typical client has a goal is to sell to businesses in a subscription or long term relationship model where the three year value of a new customer is at least $25K. Initial deal sizes may be less but their goal is that value or higher.

We look for teams that have demonstrated domain knowledge and expertise and at least a plan for having a significant impact on a customer problem, even if the solution they plan to offer is discontinuous with current practice. We often see a progression from service to system integration to stand-alone product: this allows them to explore the market with MVP’s earlier in the development process in a way that allows for rapid iteration on features.

Tristan Kromer: You Can Tell a Good Advisor by Their Questions

Written by Sean Murphy. Posted in Customer Development, Lean Startup, skmurphy

Three interesting answers from Tristan Kromer’s interview with the folks at Startup Commons

Startup Commons: What’s the best way to get started?
Tristan Kromer:  Find someone you really want to help. Someone in pain. That’s your vision. Helping someone and solving a real problem. Find team members with complementary skill sets who are able to challenge your perspective and add their own. Go talk to customers.

I think this is the best anchor for starting a new firm: focus on a need or  a pain experienced by a particular  customer. Pick a problem you are willing to work on for a while because nothing new ever works and it’s going to take a while to figure out all of the elements of a successful business. A few firms with a serious problem are a better start than many firms with a small problem, although the latter may be easier to find, the former are far more likely to take action.

Startup Commons: How to find a good mentor for your startup?
Tristan Kromer: Look for someone who doesn’t give you their opinion but instead challenges you with questions that makes you think.

I agree with Tristan it’s in the questions but like Conor Neill’s formulation: it’s “80% Diagnosis and 20% Prescription.” A good mentor will suggest some courses of action to consider after they have helped you to explore the constraints and implications of the situation–or insurmountable opportunity–you are wrestling with.

Startup Commons: Who are your mentors?
Tristan Kromer: My team is my mentor. The customer is my mentor. My friends are my mentors. I rely on other people to challenge my perspective. People like Sean Murphy, Spike Morelli, Laura Klein, Nick Noreña, Zac Halbert, Janice Fraser. People who are willing to question me or tell me I’m wrong.

I think this is the next step in the evolution of the Lean Startup movement, it has to become a community of practice where entrepreneurs at differing skill levels can compare notes , challenge each other and hold each other account.  It’s a mistake to look at the early writing by Eric Ries and Steve Blank as scripture, it’s a good start that we will be refining and extending for decades. There is also earlier work by Peter Drucker, Edward McQuarrie, Rita McGrath, Saras Sarasvathy, Mark Leslie, Clayton Christensen, Russell Ackoff, Dave Snowden, and Gary Klein–just to name a few–that for the most part is not as well appreciated by entrepreneurs as it should be.

“A prudent question is one-half of wisdom.”
Francis Bacon

Related Posts:

Here are four checklists we often take entrepreneurs through

What is Lean? Lean Innovation 101 on May 27, 2014

Written by Theresa Shafer. Posted in Customer Development, Events

Linked-CXO-Forum-LinkedInSean Murphy is honored to speak at Linked CXO Forum on Tuesday, May 27th, 2014 at Haworth Showroom in San Francisco, California. Linked CXO provides networking for senior executives – “Bosses Need Professional Development, Too.”

“Lean” provides a scientific approach for creating a product and developing new businesses. Teams can build products or services to meet the needs of early customers by adopting a combination of customer development, business-hypothesis-driven experimentation and iterative product releases.

Tuesday, May 27th, 2014

11:30am-1:30pm, San Francisco, California

RSVP is required.  SIGNUPbutton

Key Takeaways:

  •     Why more and more companies are using Lean
  •     What is Lean; What it is Not
  •     Rules of thumb for successful lean innovation

Key concepts:

  •     Get out of your BatCave
  •     Use an initial product (MVP) as a probe to explore the market
  •     Build-measure-learn
  •     When and how to pivot

Speaker: Sean Murphy, CEO of SKMurphy, Inc., offers customer development services for technology entrepreneurs. SKMurphy’s focus is on early customers and early revenue for startups. Sean is an early and active member of the Lean Startup group and has been a workshop presenter and mentor at Lean Startup Conferences. SKMurphy’s clients have offerings in electronic design automation, artificial intelligence, web-enabled collaboration, proteomics, text analytics, legal services automation, and medical services workflow. Sean holds a BS in Mathematical Sciences and an MS in Engineering-Economic Systems (Management Science) from Stanford University.

Don’t Ask Your Next Question Before You Learn From the Last Answer

Written by Sean Murphy. Posted in Customer Development, Sales

Interviewing Tip #5: Run An Interview, Not A Conversation
“I once listened as one of my colleagues conducted and interview that made me cringe. It sounded more like two old friends catching up more than anything. “Aren’t you suppose to be gathering information?” I thought, but his mistake is not uncommon, especially in our climate of approachability and human business. But, as the interviewer, your job is to lead the conversation, not participate in it.”
Garret Moon in “How to Interview Your Users and Get Useful Feedback

If you find yourself talking with a prospect for a few minutes and you are not getting any questions back from them then your discovery conversation may have deteriorated into an interrogation.

My goal in a discovery interview is to have a serious conversation about issues, needs, constraints, and goals. There is a risk an interview can become a casual conversation, but casual conversation is a very useful method for establishing rapport: context matters.

I work in B2B markets where my key objective in a discovery conversation is to understand the other person’s situation in a manner that also lays the foundation for a potential business relationship. If you “gather data” using an interview style that leaves the other party without any desire to do business with you then you will not succeed in a B2B market.

Moon includes a pull quote:

“Interviews are different from conversations. We’ll use a relaxed tone, but we are purposefully guiding the interaction, often thinking several questions ahead.”
Steve PortigalInterviewing Users

While it’s a good idea to think several questions ahead, I worry that too much focus on getting your pre-planned questions answered may suppress learning: you may be following a track laid down before the customer said something surprising that merits an improvised exploration.

Here are some related blog posts on customer interviews and discovery conversations:

Q: How Much Attention Should I Pay To Potential Competition?

Written by Sean Murphy. Posted in 3 Early Customer Stage, 4 Finding your Niche, Customer Development, skmurphy

Q: When I introduce the idea for my business a lot of my friends are quick to ask: “are you sure there is no one else doing this?” In today’s fast and disruptive business world, I think it is very hard to come up with a business idea that is 100% unique, and utilizes a completely new set of technology features. I constantly find myself arguing that it doesn’t matter if someone else also has the same startup or business idea, it’s how you go about executing your business idea that matters.

What are your thoughts on competitors and how put off should I be when I find out another company has a similar product and mission to my startup?  

Your friends are trying to help you but you may be asking them to comment on a problem where they have little expertise. Evaluating a new business idea is challenging even for professional investors and firms already in the target market–how many times have new entrants been underestimated or new technologies view as far more promising than they turned out to be. It’s a hard problem.

You are being encouraged to look left and right at potential competition, I would try and walk around the table and look at the situation from your prospect’s perspective.

Perhaps a more important set of of question for  B2B are:

  • What is your prospect doing now to solve the problem?
  • Are they satisfied with their current solution or do they still view this a critical business issue?
  • What other solution options are available to them?
  • Which of these other options have they also evaluated and rejected and why have they done so?
  • Are you providing a capability or solution for what they consider a critical need.

Execution only matters in the context of a particular category of customer with a distinct and identifiable problem or need.

Working to develop new capabilities when it’s not clear who will pay for them may give you the illusion of progress for a while but ultimately won’t let you build a business.

My suggestion is to pay close attention when prospects ask you to explain why your product is superior or at least different in some useful ways from what they are currently using or have available to them.

My question is why are you talking to your friends instead of having serious conversations with prospects? What are your prospects asking for or telling you?

Without A Revenue Hypothesis Your Business Model Is a List of User Activities

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, Customer Development

Q: I am building an app that helps people build nearby interest groups (e.g. local model railroaders, quilters in your town, etc…). I am trying to establish a baseline for my value hypothesis testing and am considering the following metrics:

  • Registration rate of those who come to landing page
  • Rate of registered users who join or create an interest group
  • Rate of interest group members who interact (post etc) in a group
  • Rate of interest group members who log in again after a month

Even if I estimate the each of these rates at 50% I cannot tell what this would mean in terms of validating my business. Also I cannot determine how to use these metrics to determine the features to put in my MVP.

Any advice for where to start in a minimum set of metrics and features for an MVP for this service?

A: For the sake of an initial model let’s accept your estimate of a 50% rate for those four metrics. There are two key sets of hypotheses that you are missing:

  1. What are your hypotheses for how you generate revenue? What will your customers pay for and why? 
  2. What are your hypotheses for the cost of acquiring and servicing a paying customer? How much will it cost to get them to the landing page and to maintain the service?

Your answers to these two sets of hypotheses interact to tell you how long you can stay in business.

Q: Those are great questions but I feel like they are related to growth, something I think I should explore once I have figured out the value testing.

A: Getting paid is proof of your value hypothesis. You need to map your path to revenue. Once you can do that then planning how to do it in a repeatable scalable way is your growth hypothesis. Given that you are zero revenue you need to grow to at least break even to keep running experiments.

Q: OK I understand the importance of the monetization strategy in the hypothesis testing, but I don’t think it’s relevant to my original question. Suppose I added a another metric:

  • Rate of interest group members who convert to a premium account (e.g. for unlimited messaging)

And I assume it costs me $1 to get new visitors to my landing page. So now I have six hypotheses:

  • It costs $1 to get a visitor to the landing page
  • 50% of visitors register
  • 50% of registered users join or create an interest group.
  • 50% of interest group members interact in a group.
  • 50% of interactive group members login after a month.
  • 50% of persistent interactive group members upgrade to a premium account

What does that tell me? I still cannot tell if I have a  good starting point.

A: I think it makes all of the difference in the world, now you are optimizing for revenue in your experiments. The others are all vanity metrics if you don’t have hypotheses for their relationship to revenue and impact on cost.

You can enter whatever you think your conversions will be a priori, and now you can construct a hypothetical business that is profitable.

Without that you don’t have a (profitable) hypothetical business, you have a list of activities that users are engaging in.

Discovery Kanban Helps You Manage Risks and Options In Your Product Roadmap

Written by Sean Murphy. Posted in Customer Development, Lean Startup, skmurphy, Tools for Startups

I came across this presentation from LLKD13 (#LLKD13  / storify) by Patrick Steyaert (@PatrickSteyaert) of Okaloa on Discovery Kanban after following some links off a Kanban discussion group last year:

Slides

Video

It’s a complex and challenging presentation that connects a number of different concepts–including fitness landscape models, the Cynefin framework  and its concept of probes, the OODA loop, optionality–into a coherent synthesis: Kanban models can be used not only for managing execution or delivery flow by minimizing the amount of work in progress, but also for managing the discovery process of curating a portfolio of risks and options.

At a high level an execution focus yields a prioritized network of interdependent tasks; exploration yields a portfolio of risks and options.

I had the good fortune to meet Arlette Vercammen of Okaloa a the Lean Startup Conference 2013 and we had a conversation that has sparked an ongoing collaboration around helping Okaloa evolve their Discovery Kanban model both for startups and change agents in larger firms.

Patrick will be providing an updated version of the presentation June 16 in Leuven, Belgium:  “More Agility and Predictability with Visual Management and Kanban.”

Related blog posts and articles

Plant Acorns With A Customer Development Interview

Written by Sean Murphy. Posted in Customer Development, skmurphy

A customer development interview should be treated as a conversation that may enable a future business relationship. The best outcome for an initial interview is that you can summarize what you have heard about their needs and constraints on possible solutions and they are interested in another conversation or can recommend others to talk to.

Here are some related blog posts on customer interviews and discovery conversations:

Lean Startup Conference 2013 Roundup

Written by Sean Murphy. Posted in Customer Development, Events, skmurphy

Update Thu-Jan-23: more articles and blog posts are coming out so I will continue to update this for another month or so, I am also adding a section for the workshops as many presenters are publishing their slides.

This post curates content and commentary related to the 2013 Lean Startup Conference: videos, blog posts, slides, articles, etc.. I will continue to update it until about mid-February 2014 as videos, slide decks, blog posts and articles related to the 2013 Lean Startup Conference are published. If I have overlooked a post or other content you found useful or insightful please leave a comment or contact me. Here are my roundups for the last three years of Lean Startup Conferences:


Main Program Mon-Dec-9-2013

State Of The Lean Startup

When Lean Startup Arrives in a Trojan Horse–Innovation in Extreme Bureaucracy

Experimenting on Experiments–Bringing Lean Startup to Scientific Research

Using Lean Startup to Do Plenty with Very Little

How You Can Start the Next Zipcar

An Interview with Matt Mullenweg

What Works in Silicon Valley Doesn’t Work Everywhere–Why Localizing Lean Startup Strategies Is Critical for Your Community

Build a New Product, Infect a Whole Organization

Toyota: From Lean Manufacturing to Lean Startup

Jazz Engineering

Risk, Information, Time and Money (in 20 Minutes)

Interview With Reid Hoffman

Jazz Engineering–the Deep Dive

How Two Startups Used a Google Doc to Plan Their User Interface

Rapid Iteration for Mobile App Design

Make More Meritocratic Decisions

Beyond Landing Pages: Five Ways to Find Out if Your Idea Is Stupid

Running a Successful Innovation Center at a Fortune 50 Company

Engaging Your Team in Continuous Improvement

Evolving and Growing with Lean Startup

Overcoming Biases to Make Better Decisions

How Validation and Vision Co-exist

Institutionalizing Innovation

Keep Your Executives Close to Your Customers

The Biggest Implementation of Lean Startup on Earth

Main Program Tue-Dec-10-2013

Acquiring Your First Users Out of Thin Air

How to Build the Product When You’re Not the User–and You Don’t Even Know Anybody Who’s the User

Building a Technology Company with No Engineers

Funding for Lean Impact

Preparing for Catastrophic Success

Evidence-based Entrepreneurship

Using Kickstarter to Run an MVP

Learning to Be an Organization that Pivots

Continuous Change at Scale

Lean Startup–From Toyota City to Fremont to You

The Medium Is the Message

Lean Leadership Lessons

Integrating Development, Design and Product Management to Deliver Great Products

Frame Before You Build, Measure, Learn

Seriously Advanced A/B Testing

Alleviating Poverty One Iteration at a Time

The Big Ideas Behind Lean Product Development

Getting Customer Feedback When Your Product Doesn’t Live on the Web

Working Closely With Customers on the Other Side of the Earth

Jump-starting Product Strategy in a Startup

Transitioning Teams to Lean

Lean Startup in a Regulated Environment

Crossing the Concierge Chasm

Using Lean Startup Principles to Close the Digital Divide

Cultivating Lean Startup Teams When People Don’t Know What It Is (or Are Hostile to It)

Can Lean Startup Advocates and Grizzled Veterans Work Together?

An Interview with Marc Andreessen and Chris Dixon

Workshops Wed-Dec-11-2013

Lean Analytics for Intrapreneurs

Other Roundups and Commentary

If I have overlooked a post or other content you found useful or insightful please leave a comment or contact me.

MVP Clinic for Social/Community Apps Wed-Oct-23

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, 3 Early Customer Stage, Customer Development, Events, skmurphy

If you are planning a new service offering, involving technologies and social interactions between customers, this clinic on minimum viable service can help you learn your way out of conflicting assumptions, lack of relevant data, difficulty understanding service value, and resource constraints. This is especially the case if you need to get adoption by a newly forming or an existing community, that may be contained within one firm or span many.  Drawing on their experience in new product introduction and communities of practice, Sean Murphy of SKMurphy and John David Smith of Learning Alliances, will demonstrate the value of a “walking around the problem” technique for early service design that they have developed individually and together over many years.
Webinar: Minimum Viable Product Clinic for Social or Community Applications

Our two panelists:

  • Dixie Griffin Good is director of Shambhala Online, a global learning community connected by the meditation teachings of Sakyong Mipham Rinpoche. For 15 years she consulted with local, state and national education organizations on the educational use of technology. She has a masters in Future Studies and enjoys managing and studying change processes.
  • Terry Frazier is Principal and Senior Competitive Analyst at Cognovis Group. He has been studying, writing about and consulting on competitive and industry issues since 1998 and his work has been used by both Fortune 1000 businesses and international analyst firms. Today he writes at CompetitiveThinking.com.

Each panelist will outline a significant growth challenge related to the social/community aspect of a new offering, describe hypotheses they plan to test, and explain how they will assess the impact.

John and I will ask clarifying questions about the learning happening in target market/ community of interest and suggest experiments / probes. The audience is also welcome to take part in asking questions or making suggestions.

8 Tips For Interviewing Experts

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, 3 Early Customer Stage, Customer Development, Rules of Thumb

As a part of our efforts developing KnowledgeFlow Michael Domanski and I have interviewed a number of experts. We collaborated on this blog post, originally published October 2 on April Allen’s KnowledgeBird blog as “How to interview your experts.”


What’s the most unnerving thought when interviewing a high profile expert?

Just imagine how depressed you would be after securing an interview with a subject matter expert and then conducting an interview that is a mix of stuttering and banal questions. I had tons of angst myself when I started conducting interviews. It’s not easy to interview an expert, mainly because of the depth of their knowledge. It gets even harder when you realize just how precious their time is. To make my experience even more stressful, I knew at some point some of those people may become my customers. Thus, I not only needed information, I also needed to make it look as if I knew what I was doing.

Since there’s little information (very little) about this subject on the Internet, I decided it would be a good thing to share some lessons learned. Let’s jump in.

8 tips to guide you through interviewing your experts

  1. Research the subject matter and people you want to contact: your interview always should have a main subject. E.g. if you were to talk to a SEO expert on the matter of recent changes to Google algorithms, research as much as possible on your own. This background will enable you to ask questions that are informing to your readers and provide new or niche insight into the subject. Pay attention to the background of the person you interview. Ideally you want to have a list of people to interview that you have almost personal relation to.
  2. Rules of engagement: I usually contact people via email. But most experts get a ton of email every day. At this stage you should understand them well enough to write an email that will interest them enough to contact you back. If you don’t think you can write a good email, read “Writing That Works” by Kenneth Roman (make sure it’s the 3rd edition). Write a personal email: for example, when I wrote to Adii Pienaar from WooThemes, I’ve included a small personal hook, which got a brief discussion over email and a comment: “Nice email, got my attention.”
  3. Draft an interview agenda: you know the subject, you know the person you’re going to interview. Now, with your target length of time for the interview in mind, draft an agenda of the key items that you want to discuss. I usually write it and then review it with my co-interviewer. We discuss it and then send it to the interviewee in advance so that they can prepare. My advice is to always have someone have a look at it.
  4. Have a co-interviewer: there are several the benefits to having a second interviewer.
    • Fluidity: if you are out of questions for the moment he can take it from there.
    • Notes: I added tip on taking notes and having help makes it much easier. One of you asks the questions, one analyzes the answers and takes notes.
    • Brief and debrief:  you can discuss the agenda and discuss what you have learned.
  5. Prepare the environment: there are two types of settings for an interview.
    • In person: has the obvious benefit of you seeing the person you’re talking to. This gives you more clues about the feelings someone can have about the subject. On the other hand, those types of interviews are expensive. They require you to secure a proper space and time to get there. You should never do an interview in a space not private enough. I personally don’t believe in ”coffee shop” interviews. The list of distractions in such places is very long and you want the undivided attention of the person you’re asking questions.
    • Remote: Skype and gotomeeting are two most used tools for this kind of interviews. While the interview can be much harder, you can only hear the other person and see facial expressions or body language, it has some logistic advantages. The whole setup is dirt cheap and the time spent on getting there is exactly 0 seconds. It’s also very useful when interviewing people over long distances.
  6. Take notes: capture key words and phrases that your interviewee uses and pay attention to any term they repeat. Try to write down things as they’re being said. You can draw your conclusions later. This is easier if you work with a partner. That way, you won’t have to worry about losing the thread of conversation (believe me, it’s hard to take good notes and follow the conversation at the same time, pay attention to how a good lecturer structures their presentations).
  7. Keep it on course: if you said the interview is going to take 30 minutes, be ready to end a few minutes before. A good guide is the subject’s energy and engagement. If they seem happy, you can go over the promised time. If they’re showing fatigue, try to wrap soon. It’s important to avoid data overload. If you ask too many questions, it can be hard to process them coherently. Having a planned agenda, with some questions and a general thread of thought will help you a lot.
  8. Summarize: in case you got something wrong, at the end of the interview be ready to show or read a short summary to your subject. While this is not as good as a thought-out follow up, it gives you the confidence, that at a high level, you have the same view of the problem as the expert you’re interviewing. This is the end of the interview, but this is not the end for you and your partner. After the interview you debrief on the situation, what you have learned and what you think is important to take note of. I also try to mention any conclusions that seem obvious to me and that I drew based on the interview.

After the debrief I work on the formal summary of the interview. This may seem like a lot of work (and it is) but it’s key:

  • It enables you to confirm your conclusions with the expert.
  • It makes you think hard to create a coherent picture and wrap it into words.

Personally, I believe this is a step you should never omit. Even if you eventually end up not using what you have learned, you will have a good notion of why it’s not useful. You will also be able to follow up with your subject and, if you collaborate on it with your partner, you’ll be confident you haven’t overlooked obviously important information. Fear of missing important information or the nuance of an insight are two reasons why I always email the summary to the interviewee. Most experts are used to not being understood completely right away. Because of that, most of them will read and correct what you got wrong. This is very similar to taking an exam and submitting your answer. It’s crucial to perform this step, since you are going to base your action, or lack of it, on the conclusions you deduced from the interview.


See also

Preserving Trust And Demonstrating Expertise Unlocks Demanding Niche Markets

Written by Sean Murphy. Posted in 3 Early Customer Stage, Customer Development, Rules of Thumb

Q: We are preparing to enter a B2B  market where the potential buyers are high-value but relatively few in number and close-knit. I am concerned that they will have a low tolerance for a minimum viable product (MVP) approach; much less pre-MVP research that misses the mark. How do we preserve our credibility but take a scientific approach?

We work primarily with bootstrappers who have deep domain knowledge, typically a team of 2-5 engineers, scientists, or other experts. Our focus is on B2B markets with a hundred to a few thousand thousand firms. If you are solving a hard enough problem or just talking about a need that’s a real pain point they are more than willing to have a conversation and consider an your MVP.  Here are a few rules of thumb for preserving your social capital in B2B niche markets:

  • Actively Manage Expectations With Clear Communications
  • Always Assume Everything You Do Will Become Public
  • Listen For What Isn’t Being Said
  • Predictable Behavior Inspires Trust
  • Trust Doesn’t Scale, It’s Knit by Aligning Actions With Prior Commitments

One example of a product we are helping a team launch is BeamWise, a design and simulation too for biophotonic systems that may have a total market of a 250-500 organizations that might purchase it.

I like these markets because they often have an expertise barrier that makes them harder to penetrate. If you act in a trustworthy manner, are easy to do business with, and deliver value these customers tend to be loyal–they don’t treat your offering like a commodity but look at you more as a partner than a supplier.

These niche B2B markets require more discipline that consumer markets. You have to approach each customer in a way that you preserve your ability to do business with them: you cannot do anything that communicates a lack of respect or indicates you are merely using them as an experimental subject or “target practice.” People in these markets know each other, reference each other’s purchase decisions, and a poor reputation can travel faster than your ability to message.

This does not mean that your product has to be perfect, only that you are committed to acting with integrity and providing value. Seth Godin had a great blog post on “A Hierarchy of Failure”  that’s relevant to your market exploration and MVP strategies. Here is his hierarchy:

  • FAIL OFTEN: Ideas that challenge the status quo. Proposals. Brainstorms. Concepts that open doors.
  • FAIL FREQUENTLY: Prototypes. Spreadsheets. Sample ads and copy.
  • FAIL OCCASIONALLY: Working mockups. Playtesting sessions. Board meetings.
  • FAIL RARELY: Interactions with small groups of actual users and customers.
  • FAIL NEVER: Keeping promises to your constituents.

I think he gets it exactly correct. And I think a number of entrepreneurs, in particular in the early market, get it almost exactly backward by

  • Putting up a landing page that promises a capability or extra feature that doesn’t exist.
  • Focusing more on a potential solution when talking with prospects–using them to prototype– instead of ensuring that they really understand the prospect’s perspective on the problem.
  • Looking for funding before they look for customers, using investor interest as validation for their business concept.

Godin concludes:

Most organizations do precisely the opposite…They rarely take the pro-active steps necessary to fail quietly, and often, in private, in advance, when there’s still time to make things better.

Better to have a difficult conversation now than a failed customer interaction later.

The foundation of a successful business is the ability to make and meet commitments to customers, partners, employees, suppliers, and other stakeholders.  If you inform them in advance, “we are going to try the following experiment” they may or may not take part, but  they can offer informed consent. I see too many instances where founders undervalue a relationship with a customer based on mutual trust and commitment.


Here are some related posts on managing trust and expertise:

MVP: What’s Really Under Your Control

Written by Theresa Shafer. Posted in 3 Early Customer Stage, Community of Practice, Customer Development, Lean Startup, Workshop

An MVP is an offering for sale

We use this definition in our “Engineering Your Sales” and “Validating Your MVP” workshops and our MVP clinics. Our focus is on developing and selling products to businesses so that biases the definition a little bit but it’s important to remember what’s under your control in crafting your MVP:

  1. The particular type of customer: you can select who are you targeting and messaging. In many B2B markets the best message is a dog whistle: highly appealing to your target and of little interest to those who are not.
  2. The specific problem or need your focus on: it’s better to pick a very narrow pain point initially so that you maximize your chances of providing value.
  3. What you provide: the feature set and packaging of your offering.

These are normally the three areas that you tinker with during marketing exploration and MVP introduction. It’s also important to understand what’s not under your control: 

  1. The customer decides if the need is important enough, or the problem severe enough, to devote any time to conversation or learning more about your offering.
  2. The customer decides if your solution offers enough of a difference over the status quo and other alternatives available to them to actively consider. Value is in the customer’s mind and it’s created in the customer’s business when they successfully deploy your offering. Your MVP is not valuable in the abstract; it must always be evaluated in the context of a particular customer. It does not matter how much time and expense you have invested in creating it, it’s the effect it will have on the customer’s business.
  3. The customer decides the nature and size of the initial purchase. You can decide not to pursue an opportunity that is “too small” but if the customer wants to pilot in a team or one department before deploying your solution more widely it’s often better to take that deal and get started than continue to argue for a larger initial deal. Breaking your offering into phases and smaller components will always make it easier to digest.

The following chalk talk illustrates this last point in more detail:

See “Chalk Talk on Technology Adoption” for a transcript.

Customer Discovery Conversations While Driving Are Not a Good Idea

Written by Sean Murphy. Posted in Customer Development

Q: I want to make maximum effective use of my time. I have an hour of commute most days and have been listening to podcasts but I have been considering using the time to make customer discovery or sales calls. Do you have an recommendations on the best way to do this?

I think it’s a not a good idea to initiate a customer discovery conversation when you cannot be fully present and cannot take notes. That does not mean that you have to be face to face (although you learn a lot more from a face to face conversation) but I think it’s difficult to catch the nuance of the conversation when you are driving–even it you are just waiting for the light to change.

If you have a purely informational message and are looking for a simple yes/no/number answer (e.g. calling your spouse to ask if you need to pick up anything at the store on the way home) then a quick call saves everyone time and disappointment. But I can see this calling while driving approach going awry quickly if you get a new question from a prospect that you cannot give your attention to because someone is trying to change lanes in front of you or a pedestrian may or may be about to step off the curb or there may be a child chasing that ball that bounced across the road two seconds ago.

In my experience B2B sales conversations are expensive to arrange and difficult to “do over” if you don’t fully engage. You often hear about how it’s a numbers game but most markets are small towns where there are not that many folks you can call at a given time that are ripe for making a change. It can be difficult to recover from a poor first impression; if you follow up when they are considering making a change.

For any successful and most educational–and by educational I mean “those things which hurt also teach”–discovery calls I am taking notes contemporaneously. I understand how a headset can make the conversation hands free but how do you take notes about important issues, questions, or commitments that you need to address in a follow up?

Seth Godin offered this advice in “Texting While Working

You’re competing against people in a state of flow, people who are truly committed, people who care deeply about the outcome. You can’t merely wing it and expect to keep up with them. Setting aside all the safety valves and pleasant distractions is the first way to send yourself the message that you’re playing for keeps

If you are competing against a team that’s not making calls while they are driving, who is more likely to learn something and to win the business?

If someone I am already doing business with calls with a quick update while driving that’s one kind of communication, but if someone I don’t know is clearly calling from a car or appears distracted or disinterested (whether or not I can tell they are driving) it’s much less likely I am going to go forward to explore a potential business relationship.

Don’t fall into a common trap of an  entrepreneurs focusing on trying to save time at trust building activities and not focusing on increasing their chance for success. Even though sales can be a “numbers game” thinking about it purely in those terms tends to minimize the amount of learning that takes place (trying the same tactics and approaches over and over again because everyone knows its a “numbers game”) and lessens the focus on building rapport and listening carefully to questions and objections (looking instead for “smarter prospects” by talking to more people because its a “numbers game”).”

The paradox of B2B selling is that it’s about people and relationships, not numbers. People think of consumer markets as more personal than business, but it’s the reverse. If you cannot make the time for a phone call when you are at your desk or somewhere that you can be fully present in the conversation, calling prospects from your car is unlikely to be well received.


We explored the implications of “Texting While Working” in a panel discussion with three entrepreneurs

Also “Talking On Your Cell Phone While Driving May Be Hazardous to Your Close Relationships” offers some additional reasons why a cell phone conversation while driving may work against improving trust in a relationship. Summaries available at

Use E-Mail Like a Walkie-Talkie, Not A Bullhorn

Written by Sean Murphy. Posted in Consulting Business, Customer Development, skmurphy

I don’t think it’s a new trend but one new service that I recently signed up for asked me to take a short survey about how I felt about their product and what I planned to do. They E-Mailed it from a “no-reply” email address and I realized that an answer I had stuffed into the “Any Other Comments” box would make for a good short blog post.

Please don’t e-mail me from a “no-reply” address: if you don’t want a real conversation, or even an e-mail exchange, I don’t have the sense you are interested in a business relationship. If you only want me to answer your multiple choice survey questions and are not interested in my questions I think you are limiting how much you can learn from a real interaction.

While the 2 minute explainer video is helpful what I would find more useful–and what’s missing from your site–are real examples: please offer more examples of example configurations and more customer stories about how they used your product to change their business. Since I am a consultant I would find stories from other consultants particularly helpful.

You have sent me a number of reminders and updates in the last three weeks, included this latest that links to an automated survey. But none of them come from a named person or an e-mail address that can be replied to. While I can appreciate this is very efficient for you it may not be having the effect you are hoping for.

Your approach reminds me of when I was a child playing with walkie-talkies and someone in the group would keep their thumb on the transmit switch the entire time they held the handset. Although the rest of us got a running account of what he thought and was doing, there was no way to have a conversation.


Update Aug-8-2013: Brad Pierce (@learningloving) e-mailed a response this morning:

Hi Sean,
See “We’re Terrible Listeners — And Here’s Why” by Susan de la Vergne; her conclusion: “Why don’t we listen well? The person we’re listening to isn’t important. Change that perspective, and you fix the problem.”

And the corollary is true, when you don’t listen, or worse remove the possibility for listening, you communicate to the other person that they are not important. Here are the last three paragraphs from We’re Terrible Listeners — And Here’s Why by Susan de la Vergne

In technology, when we find a problem with a product, we pursue its root cause. What’s really making this happen? Then we fix the root cause. We know we could just tinker with things so the symptoms stop appearing, but without getting at what’s really wrong, it’s only a matter of time before the problem shows up again.

Same thing applies here. When we’re trying to listen, we could count to seven before speaking or remind ourselves not to interrupt, but those are just symptoms. Becoming a better listener requires taking a deeper dive into the problem. We need to get at the root cause.

Why don’t we listen well? The person we’re listening to isn’t important. Change that perspective, and you fix the problem.

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