Background
Testing the method of finding your way to a start-up.
Start-ups are an important part of the economy. They create jobs, drive innovation, and help businesses grow. However, according to some studies, about 80-90% of start-up founders fail within the first three years. According to statistics from the data service CB, the three most common reasons for failure are lack of demand, problems in the team, or too limited financial resources.
Lean Start-up
With the concept of the “Lean Start-up”, Erik Ries has popularised a method that helps to better evaluate the demand of the market and thus minimise the most common reason for failure. In this method, the business hypotheses are tested in experiments by using prototypes and continuously developed – until a marketable product is created. Through testing, the process, and the investment of valuable resources, can be reduced to a minimum.
Experiment
The Lean Start-up method is a very practical method, which has a lot in common with Design Thinking and can therefore be combined with it. As part of my Master’s degree in “Intermedial Design”, we tested the “Lean Start-up Method” in a small group. The aim was to find out whether designers have the skills needed for the method and can develop a marketable product.
The test was set up in one-week “build-measure-learn” cycles, in which we were supposed to change and test only one parameter in each cycle. In our group meetings, we then discussed the results from the experiments and identified further questions for testing. The time between the meetings was free for the development and “testing” of our prototypes.
Process
Repeated adjustment of the business hypothesis.
Business Hypotheses Rodeo – from a museum app to a voice-based social network
The course began with an introduction to the concept in the first week, the handing out of a special Canva for support and the generation of initial hypotheses. I started with the following four business hypotheses:
- Envelopes against Racism – You can reduce Racism by taking the fear of the unknown
- People are bored of museums and would like to be part of it. Why are we going to museums, when it is all around us?
- People would buy less and be more aware when they would hear sound feedback, which connects them to their emotions.
- People would like to shop for 3D models of clothes online, which are produced on-demand and tailored to their measurements
We were free to choose the hypothesis that appealed most to us, but the second hypothesis received the most support from the group. Because of the global approach, it promised a potentially very large target group and various possibilities for funding. Because of the response, I decided to continue with the second hypothesis and continue with the goal of “To turning the whole world into a museum”.
Turn the whole world into a museum
After it was clear that I was going to continue with this hypothesis, I reformulated it into “People are bored of museums – Why do we even have to go to a museum, when we are already living in one? In this way, I wanted to make the idea more tangible for others. In order to keep my business idea as cost-effective as possible and to be able to offer it globally, I wanted it to be a digital application in the form of an interactive augmented reality app. I imagined an app that would allow any user to leave something for their fellow human beings anywhere in the world using geo-based data.
To make the test as realistic as possible, I gave the idea the name “Timesurfing | Origin – Geobased AR App for Historical Information” and a funky design to attract attention. I then wanted to test this idea through social media posts, for which I created mockups of the app and prepared them for Facebook and Instagram. However, the result after 24 hours was rather disillusioning. Instead of reactions to my idea, I received personal comments under my posts in which my friends were happy to see a post from me after a while.
Making places tangible for strangers through the eyes of locals
The following week, we analyzed the results and deduced that people are perhaps less interested in the already well-marketed sights than in the less popular attractions. Therefore, I now changed the approach from the well-known contents that can be found in every tourist guide to the unknown, perhaps hidden stories. So I developed the hypothesis of an app that can tell you something about graffiti or the bar around the corner. The goal shifted to “Let the people see through the eyes of the natives” and the hypothesis became “People want to share and discover the hidden culture of places”. I changed the title of the app to “Timesurfing – Geobased AR App for the hidden interesting culture” and prepared it for new social media posts. However, the result after 24 hours was again rather disappointing.
Making places come alive for strangers through told stories
From the results, I deduced again that the idea might not be as well-received as I thought. This was quite frustrating, so I lost faith in the whole concept. We analyzed the parameters and, based on frustration and intuition, I decided to change several parameters for the next test. I replaced the visual component with sound, as current trends showed that people want to look at screens less. This changed the hypothesis to “People want to discover places and their stories through sound.” In addition, I also changed the appearance with a video also the format of the test instead of the social media stills. I changed the name of the app to “Timesurfing – Geo & Soundbased App for the hidden interesting culture”. So the new goal was “Let the people listen to the stories of the places”.
The result of this test was that my video rather confused people than communicated the idea. Some people had the feeling that it was more of a dating app. In other words, I had missed the target with the test material I created. The new look, on the other hand, was very well received.
Sound-based communication without a screen
Due to the many changes I made from the previous round, the last round felt like a reorientation of my hypothesis. The freedom to work according to my intuition lead me to no longer completely stick to the method and the single changes. Because of the better result, I decided to rely on my intuition again. My intuition told me that it might be worthwhile to further develop the hypothesis and remove the geodata-based function. Convinced, I changed the hypothesis to “People want to communicate screenless via voice notes”. I changed the name to “Stime – Sound-based social media”. An app that aims to enable a more natural form of communication through technology.
There wasn’t much time to test this idea, which is why I decided not to use the social media version, but to do a test with two Alexas and a few friends. This test showed that the test persons first had to overcome a small learning curve when learning the voice commands, but then felt that the idea was very natural and practical. For visualization, I created new mockups of the corresponding app. My idea was very well received at the final presentation and I was encouraged to pursue it further. I then presented the idea outside the competition at the Start-up Safari in Halle, where I also received further encouragement and the first people offered to be test subjects.
Result
Finally, I know how to test my business ideas to find out if they are worth continuing.
Conclusion
There are a number of challenges that need to be mastered on the way to a successful lean start-up. As a designer, it’s easy to generate ideas – but most of the time they end up in a drawer somewhere. For example, I have failed so far because of the question of whether an idea is worth pursuing. Or should I rather invest my time in something else? With the Lean Start-up Method, I got to know a method that enables me to answer this question and makes founding and developing start-ups clear and tangible.
However, as with some design methods, I am not always convinced that one should always follow the most exact procedures, as intuition and common sense are also justified. As described above in my process, it also took me a complete reorientation of the hypothesis until I found a business idea that might work.
For a short time, I considered pursuing the concept further. However, when I did some more research, I came across the app Clubhouse, which was winning the race at the time. Twitter announced a similar feature a few days later, so I finally gave up on the idea. The results confirmed the trend towards audio-based platforms, which I consider a success for the method and also for the concept itself. After all, with the method, I ended up at the current status quo.
I am sure that I can use the method again. Also, I can confirm that designers have the best qualifications for implementing this method and that a good aesthetic plays an important role when it comes to convincing investors.
