I have previously written about Minimum Viable Product (MVP) and Product/Market Fit (PMF). These are important processes based on the scientific method that can be used to test a value hypothesis. That hypothesis does not just appear via spontaneous generation. Andy Rachleff describes what should be included in a value hypothesis as: “the features you need to build, the audience that’s likely to care, and the business model required […]
1. “The most important thing that we did [at Facebook’s] was I teased out virality and said you cannot do it. Don’t talk about it. Don’t touch it. I don’t want you to give me any product plans that revolve around this idea of virality. I don’t want to hear it.” Chamath Palihapitiya. I have the same concerns Chamath is talking about in writing more about virality than I […]
I have previously written blog posts about (1) growth, (2) product/market fit and (3) minimum viable product. The most logical topic for the next post is: Why does a business need a moat? The answer is simple: even if a business discovers solutions to the value hypothesis and the growth hypotheses without a moat the probability of the business being financially successful over time is remote. Revenue alone is not […]
“It’s only cheap to build 2-3 person companies with sweat equity. The minute you start paying engineers you will realize it is quite expensive.” Bill Gurley. Assume a startup has raised a seed round of ~$2 million. Also assume that what the startup has is a hypothesis that a big market composed of dogs will want to eat the dog food described by the hypothesis. The founders of the startup […]
Why has the level of business competition levels been turned up to 11? Or: Why is the lean customer development process important?
The world has been fundamentally changed by digital networks and software. Businesses and customers which are connected by networked digital systems create amplified network effects which means the velocity of business and the level of competition and innovation are higher than they ever been ever been. To survive in this new environment every business, from the largest enterprises to the smallest sole proprietor, must accelerate and fundamentally change their customer […]
The product/market fit (PMF) concept was developed and named by Andy Rachleff (who is currently the CEO and co-founder of Wealthfront, and is a co-founder of Benchmark Capital). The core of Rachleff’s idea for PMF was based on his analysis of the investing style of the pioneering venture capitalist and Sequoia founder Don Valentine.” Why market matters more than anything “Give me a giant market — always.” “Arthur Rock is […]
A growth team has the “responsibility to measure, understand and improve the flow of users in and out of the product and business. That’s the role of growth.” “A finance team by definition measures, understands and improves the flow of capital in and out of a business. That’s important because it contributes to all sorts of incredibly important business decisions. Finance uses its knowledge to help the business operate. What’s […]