Venture Design Crash Course

VENTURE DESIGN CRASH COURSE DRIVING TO VALUABLE OUTCOMES Alex Cowan © 2015 COWAN+

WARM UP: POSITIONING STATEMENT For [target customer] who [statement of the need or opportunity], the [product name] is a [product category] that [statement of key benefit/key reason to buy]. Unlike [primary alternative], our product [statement of primary differentiation]. EXAMPLE For [hiring managers] who [need to evaluate technical talent], [Enable Quiz] is a [talent assessment system] that [allows for quick and easy assessment of topical understanding in key engineering topics]. Unlike [formal certifications or ad hoc questions], our product [allows for lightweight but consistent assessments of technical talent].

© 2015 COWAN+

THE VENTURE DESIGN PROCESS …

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S HO

IF AT

W

WH

M

E

CUSTOMER DISCOVERY & EXPERIMENTS

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PRODUCT & PROMOTION

VALUE PROPOSITIONS & ASSUMPTIONS

WH

PERSONAS

WHO?

AT

SC

PIVOT?

AL

E?

USER STORIES & PROTOTYPES

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PROBLEM SCENARIOS & ALTERNATIVES

© 2015 COWAN+

THE VENTURE DESIGN PROCESS

PERSONAS

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THE PRACTICE OF DESIGN THINKING The Twin Anti-Poles of Design Failure


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Doing precisely what the user asks

P NA

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Assuming you know what’s best and ignoring the user © 2015 COWAN+

THE PRACTICE OF DESIGN THINKING Finding the Right PROBLEM

alternatives

Personas Problems Alternatives

Finding the Right SOLUTION

Value Hypothesis & Assumptions Product Hypothesis

Experiments on Motivation User Stories

Field Discovery

Prototypes Software

divergence

convergence

divergence

time

convergence

source: adapted from ‘The Design of Everyday Things’

© 2015 COWAN+

DESIGN THINKING: EMPATHY & PERSONAS

bit.ly/2persona

ALEX COWAN alexandercowan.com @cowanSF

© 2015 COWAN+

DESIGN THINKING: EMPATHY & PERSONAS

bit.ly/2persona

ALEX COWAN alexandercowan.com @cowanSF

© 2015 COWAN+

PERSONA: BAD • Women • Age 28-45 • Has kids • Socialize with other mom’s • Online with Facebook • 86% said they’d like to be more
 organized • 70% said they’d use an application that organizes them © 2015 COWAN+

PERSONA: BAD This is a huge populationnot exact

• Women • Age 28-45 • Has kids

Bullet points are almost never vivid or detailed

• Socialize with other mom’s • Online with Facebook These responses are ‘fake actionable’survey responses like this are unreliable

• 86% said they’d like to be more
 organized • 70% said they’d use an application that organizes them

Stock photo- not real © 2015 COWAN+

PERSONA: BETTER

Mary the Mom Mary is a mom by choice. She had a successful career in accounting, but welcomed the opportunity to be a stay at home mom. She loves it. But it’s not like having kids purged her creative, social instincts. She wants to connect, she wants to learn, she wants to interact. Being a mom is a job and she wants to do it well. That means corresponding with other mom’s on child education and keeping track of what works. She posts to Facebook at least twice a week and responds to other moms’ items more often than that. She has a few blogs and publications she reads regularly…

© 2015 COWAN+

PERSONA: BETTER the use of a first name helps w/ vividness (a little)

these full sentences look like a good start towards something vivid and detailed

this is a real photo of a relevant person taken with an iPhone in the real world

Mary the Mom Mary is a mom by choice. She had a successful career in accounting, but welcomed the opportunity to be a stay at home mom. She loves it. But it’s not like having kids purged her creative, social instincts. She wants to connect, she wants to learn, she wants to interact. Being a mom is a job and she wants to do it well. That means corresponding with other mom’s on child education and keeping track of what works. She posts to Facebook at least twice a week and responds to other moms’ items more often than that. She has a few blogs and publications she reads regularly…

© 2015 COWAN+

EXERCISE- PERSONA CREATION List at least 3 personas Mary the Working Mom Susan the Stay-at-Home Mom Douglas the Dad Nathan the Nanny Ivan the Infant

use 1 index card/ persona

…

(4 min) © 2015 COWAN+

A LITTLE GAME FOR BETTER PERSONA DISCOVERY

Day in the Life We look at a few photos for a given persona (not a full picture, just snippets) You make some guesses about them There are no right answers BUT There is a right process: observe and infer

OBJECTIVE: Get a feel for what’s real; start to create something vivid

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OUR CAST

Sally the 
 Single Mom

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WAKE UP!

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WAKE UP!

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GEARING UP FOR THE DAY

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AT WORK

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AFTER WORK

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PRE-BED

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BED

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GEAR

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IF I HAD 3 EXTRA HOURS…

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ABOUT SALLY THE SINGLE MOM… What’s her favorite kind of music? Where did she buy her last pair of shoes? What movie did she last see? What did she drink with dinner last night? If she had a dog, what kind? What’s her favorite magazine?

bit.ly/daynthelife

ALEX COWAN alexandercowan.com @cowanSF

© 2015 COWAN+

PERSONAS- THINK SEE FEEL DO

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PERSONAS- THINK SEE FEEL DO Example: Helen the HR Manager Thinks: Helen thinks the hiring process should be so much better- more systematic, fewer bad hires. Professional development is something they’ve identified that they want to do better, but the functional managers aren’t engaged enough to get the whole thing started. Sees: Helen is at the tail end of every bad hire and sees the damage it does to the employee and company, alike. Helen sees that online learning has rocketed forward in the last few years. If someone wants to learn a specific skill, there’s a number of high quality options online, many of them free. They just need a way to help employees organize select into these courses. Feels: Helen feels like crap whenever they have to let someone go. She hates it. The employee hates it. The manager hates it. It’s incredibly destructive and de-motivating for everyone involved. Helen would love to be more involved, more included in functional skills evaluation and improvement. She’s love to have a success story to talk about. Most HR departments don’t do a whole lot in this area. Does: Helen’s relatively responsive to new ideas, particularly if someone knowledgeable is willing to come in and talk about it. If she likes it, she’ll bring it to the functional managers, who are usually the ultimate decision makers since without their support she can’t get the system online and working. Post-sale, Helen will help keep the program organized, moving, and otherwise on the functional managers radar. All this is predicated on Helen being equipped with the right messages, facts, and best practices to make the purchase and use of Enable Quiz effective.

© 2015 COWAN+

EXERCISE- DISCOVERING WHAT THEY DO Question Form

Examples Questions (‘Enable Quiz’)

Tell me about [yourself in the role of the persona]?

- Tell

Tell me about [your area of interest]?

- Do

Tell me your thoughts about [area]?

What do you see in [area]?

How do you feel about [area]?

What do you do in [area]?

me about being an HR manager? - What do you most, least like about the job? - What are the hardest, easiest parts of the job? - I’ve heard [x]- does that apply to you? you do screen new candidates? If not, who? - Can you tell me about the last time? What was the trigger? - Who else was involved? What was it like? - How should it ideally be done? - How is it actually done? Why? Where do you learn what’s new? What others do? Who do you think is doing it right? How did you make your last decision? Tell me about the last time? What motivates you? What parts of it are most rewarding? Why? What would it be like in your perfect world? How many new openings/quarter? How many interviews/position?

© 2015 COWAN+

THE VENTURE DESIGN PROCESS

Do we understand this person? What makes them tick? PERSONAS

WHO?

PROBLEM SCENARIOS & ALTERNATIVES

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PERSONAS & PROBLEM SCENARIOS

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PERSONAS & PROBLEM SCENARIOS PROBLEM SCENARIO

X

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PERSONAS & PROBLEM SCENARIOS PROBLEM SCENARIO What job(s) are you doing for the customer? What existing need or behavior are you fulfilling?

X

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PERSONAS & PROBLEM SCENARIOS PROBLEM SCENARIO

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ALTERNATIVE(S)

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PERSONAS & PROBLEM SCENARIOS PROBLEM SCENARIO

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ALTERNATIVE(S)

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If they currently use spreadsheets, watch them use it and get a copy of it. If they currently put notes on the family fridge, ask about it, photograph it.

© 2015 COWAN+

PERSONAS & PROBLEM SCENARIOS ‘Hiring technical talent is difficult.’ (Too Broad, Abstract)

X

‘Screening technical talent is difficult.’ (Probably About Right)

It’s hard for the HR manager to send good notes on candidates to the functional manager. (Too Detailed, A Feature vs. a Product/Venture) © 2015 COWAN+

PERSONAS & PROBLEM SCENARIOS PROBLEM SCENARIO

X

ALTERNATIVE(S)

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© 2015 COWAN+

PERSONAS & PROBLEM SCENARIOS

X ?

PROBLEM SCENARIO

ALTERNATIVE(S)

Brainstorm Problem Scenario +Alternative Pairs. 
 Problem: Helen doesn't have a software engineering background, so it's hard for her to screen engineering candidates. She ends up sending the functional manager too many unqualified candidates. . Alternative: She calls references and mostly ends up taking their word for it.

(4 min) © 2015 COWAN+

PERSONAS & PROBLEM SCENARIOS PROBLEM SCENARIO

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ALTERNATIVE(S)

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YOUR VALUE PROPOSITIONS

! © 2015 COWAN+

PERSONAS & PROBLEM SCENARIOS PROBLEM SCENARIO

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ALTERNATIVE(S)

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YOUR VALUE PROPOSITIONS Are they better enough than the alternative(s)?

! © 2015 COWAN+

PERSONAS & PROBLEM SCENARIOS

X ? !

PROBLEM SCENARIO EXAMPLE: ENABLE QUIZ

ALTERNATIVE(S)

Problem: Helen doesn't have a software engineering background, so it's hard for her to screen engineering candidates. She ends up sending the functional manager too many unqualified candidates. . Alternative: She calls references and mostly ends up taking their word for it.

YOUR VALUE PROPOSITIONS

Value Proposition: New ability for meaningful screening of technical candidates, increasing % of successful hires and lowering Frank the Functional Manager's workload on recruiting.

© 2015 COWAN+

CAN YOUR PERSONA DO THIS? Capture Attention
 via Google AdWord

Secure the infamous
 ‘click through’

Engage Interest, Desire on landing page

Action, onboarding, retention

() © 2015 COWAN+

CREATING AN ADWORD AD

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EXERCISE: CREATE AN ADWORD AD: THINK ANGLE Create at least one Google AdWords ad on the paper template- specifically using the ‘think’ angle on your persona

1. Select keywords (put in Notes section) 2. Draft ad copy How does the draft follow from your problem scenarios? Are you speaking in the language your customers use? Are you connecting with the problem scenarios you identified?

(5 min) © 2015 COWAN+

AND NOW THE ‘PRODUCT HYPOTHESIS’ A certain PERSONA exists… … and they have a certain PROBLEMS(S) …

X

… where they’re currently using certain ALTERNATIVE(S) …

?

… and I have a VALUE PROPOSITION that’s better enough than the alternatives to cause the persona to act (purchase, use, etc.).

! © 2015 COWAN+

AND NOW THE ‘PRODUCT HYPOTHESIS’ A certain PERSONA exists… … and they have a certain PROBLEMS(S) …

… where they’re currently using certain ALTERNATIVE(S) … … and I have a VALUE PROPOSITION that’s better enough than the alternatives to cause the persona to act (purchase, use, etc.).

Enable Quiz example: ‘HR and functional managers are in charge of technical hires and they struggle to effectively screen for technical skill sets, making the hiring process slower and more labor intensive and producing worse outcomes than they should reasonably expect. Currently they implement a patchwork of calling references and asking a few probing questions. By offering an easy, affordable, lightweight technical quizzing solution, Enable Quiz can acquire and retain these customer personas, delivering material value.’ © 2015 COWAN+

THE VENTURE DESIGN PROCESS

Do we understand this person? What makes them tick? PERSONAS

WHO?

PROBLEM SCENARIOS & ALTERNATIVES

© 2015 COWAN+

THE VENTURE DESIGN PROCESS CUSTOMER DISCOVERY & EXPERIMENTS

Was the implemented story relevant to the proposition? WH IF AT ?

VALUE PROPOSITIONS & ASSUMPTIONS

Do we understand this person? What makes them tick? PERSONAS

WHO?

WH

AT

?

PROBLEM SCENARIOS & ALTERNATIVES

© 2015 COWAN+

THE ART OF CUSTOMER DISCOVERY

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WORKING YOUR VALUE HYPOTHESIS

CUSTOMER CREATION HYPOTHESIS

PERSONA HYPOTHESIS VALUE HYPOTHESIS

PROBLEM HYPOTHESIS

USABILITY HYPOTHESIS © 2015 COWAN+

SYSTEMATIC DRIVE TO VALUE VIA ‘LEAN STARTUP’ Do I have real evidence from my buyer that this is compelling?

01 IDEA!

What is our ‘value hypothesis’ and what are its key assumptions?

02 HYPOTHESIS

How do I definitely prove or disprove the assumptions with a minimum of time and effort? Am I reacting or am I focused on validating my pivotal assumptions? ‘Pivot or persevere?’

source: adapted from ‘The Lean Startup’

6.a YES results disprove hypothesis

03 EXPERIMENTAL DESIGN

04 EXPERIMENTATION

05 REVISE?

6.b NO we appear to have a valid hypothesis

VALUE HYPOTHESIS © 2015 COWAN+

ENABLE QUIZ

EXAMPLE: ENABLE QUIZ

ENABLE QUIZ

OPPORTUNITY Hiring quality technical talent is critical for many companies, but screening for skill sets is time consuming and awkward. CHALLENGE The founding team wants to bootstrap without external funding so they need to focus on a specific technical domain, one that will get them strong early traction.

© 2015 COWAN+

EXAMPLE: ENABLE QUIZ

ENABLE QUIZ

Persona(s)

Helen the HR Manager- responsible for sourcing and screening job candidates Frank the Functional Manager- hiring manager responsible for acquiring and managing talent

Problem Scenario

Helen: hard to screen for technical skills Frank: never has enough time for recruiting and doesn’t want to be a jerk during interviews

Alternatives

Helen: call references, take their word for it (on skills) Frank: ask a few probing questions

Value Hypothesis

If Enable Quiz offers companies that hire engineers lightweight technical quizzes that screen job candidates for engineering positions, then these companies would trial, use, adopt, and pay for such a service.

What Minimum Viable Product (MVP)? That you can bootstrap? That doesn’t require software at all? © 2015 COWAN+

ENABLE QUIZ

THE CONCIERGE MVP Work with a set of HR managers to produce position-specific quizzes by hand on paper (or Google Forms, etc.). Metrics: Do the HR managers use them? How often? Do they want one for their next open position? Do the functional managers care?

© 2015 COWAN+

CASE STUDY: ZAPPOS

ZAPPOS

OPPORTUNITY (1999) An observed problem scenario around the difficulty of finding the right shoe at local retail and a giant (but nascent) market in online retail. CHALLENGE Consumers still in the early stages of adopting and habituating to online retail. Founder (Nick Swinmurn) wanted to bootstrap.

© 2015 COWAN+

CASE STUDY: ZAPPOS Persona(s)

Sam the shoe-hound- knows what he wants but not where to get it.

Problem Scenario

Sam is unable to find the shoe he wants at local retailers, wasting time and getting frustrated.

Alternatives

Possibly mail order or wait until he’s in a bigger market to go to the store.

Value Hypothesis

Make the shoe Sam wants accessible online and make sure he has a great experience so he’ll come back and not have to think about where to find the shoe he wants anymore.

What Minimum Viable Product (MVP)? That you can bootstrap? That doesn’t require software at all? © 2015 COWAN+

CASE STUDY: ZAPPOS Photographed shoes and put them online to observe whether anyone bought them. Result: It worked and the rest is history.

© 2015 COWAN+

UNBUNDLING THE VALUE HYPOTHESIS INTO ASSUMPTIONS If we [do something] for [persona], they will [respond in a certain way] MVP Archetype Wizard of Oz Concierge Sales

Example Assumptions (Enable Quiz) If we get HR managers to a landing page with a demo, 10% will sign up for our email product announcements. If we create position-specific quizzes for HR managers, they’ll use them ~100% of the time and, after two positions, be willing to pay. If we offer the service at [x] price with [y] supplemental assistance, companies that hire a lot of engineers will pay [z].

© 2015 COWAN+

UNBUNDLING THE VALUE HYPOTHESIS INTO ASSUMPTIONS If we [do something] for [persona], they will [respond in a certain way] MVP Archetype Wizard of Oz Concierge Sales

Example Assumptions (Enable Quiz) If we get HR managers to a landing page with a demo, 10% will sign up for our email product announcements. If we create position-specific quizzes for HR managers, they’ll use them ~100% of the time and, after two positions, be willing to pay. If we offer the service at [x] price with [y] supplemental assistance, companies that hire a lot of engineers will pay [z].

© 2015 COWAN+

EXAMPLE: ENABLE QUIZ CONCIERGE MVP Component

Notes

What assumption will this test?

If we offer HR managers at companies that hire a lot of engineers a lightweight quizzing app, they will convert to paid subscriptions after an unpaid trial.

How?

We’ll start with custom-built quizzes on Google Forms to assess the basic value of the product to the HR manager.

What is/are the pivotal metric(s)?

1: If we create position-specific quizzes for HR managers, they’ll use them ~100% of the time. Metric: [quizzes administered]/[candidates interviewed].

What is the threshold for true (validated) vs. false (invalidated)?

2: If the HR managers use the quiz, they’ll send through