There Will Be Wrong Assumptions

Last week I met with a friend who recently joined an early startup. We talked about product and the struggles of discovering what customers really want. This discussion reminded me of challenges at PlayHaven a few years ago. Every startup goes through the incredibly painful/exciting journey to answer the question, “WTF are we building!?”

One of the tactics I’ve found extremely effective in helping answer this question is assumption testing. Here’s how it works…

Step 1: Identify Your Assumptions

Once you’ve identified your potential customer and problem definition, brainstorm all of your assumptions. All of them. Write them down on sticky notes and then ask yourself, “which is the riskiest assumption?” Which assumption must be true and has the highest likelihood of being false. The sooner you invalidate that assumption, the faster you can pivot toward the right customer and problem.

Step 2: Test Your Assumptions

After you’ve identified your riskiest assumption, the next step is to test it quickly and cheaply (with enough confidence). Customer interviews, landing page tests, market data, competitive research, and other low-cost methods can deliver insights faster than you might imagine.

Step 3: Learn and Iterate

In the (less likely) event that your assumption is correct, move onto the next riskiest and test. If you find your assumption was invalid, take your learnings and pivot toward a different customer (e.g. audience niche, industry, user role) or problem, repeating steps one and two[1].

Assumption Testing at Lean Startup Machine

For example, at my second Lean Startup Machine experience[2], we had the brilliant idea of offering a service to enable coffee customers to pre-order and skip long lines at the cafe.

Our riskiest assumption: coffee shop owners have a problem with long lines.

So we left the building, confident in our assumption and spoke with over a dozen coffee shop owners and managers to see if this was problem. Their response…

BIG FAT NO

They did not perceive long lines as a problem. In fact, some even preferred long lines as it signaled high-demand and quality to potential customers.

After invalidating our riskiest assumption we returned to the drawing board.

Speed (or a lack thereof) Kills

The key point is that it took only a matter of two hours to find out our idea sucked. Far too many startups invest months building products before validating their assumptions. And most of your assumptions, especially for pre-product/market fit startups, will be wrong.

Since you don’t have infinite time, find out which assumptions are correct or incorrect as quickly as possible to discover a real problem worth solving.

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[1] Review Lean Startup Machine’s Validation Board for more details on this process.

[2] Lean Startup Machine is an awesome weekend-long learning opportunity. I highly recommend it and if you’re interested, you can read about my last two experiences here and here.