Having 100 million users and a billion in revenue is a pretty good validation of an idea. However, Rome was not built in a day. Validating an idea and the subsequent products/ startups is best done in stages.
The progression:
  • Idea – Validating an idea requires initial feedback and feel amongst a select group of potential buyers. This can be done via surveys either in small verbal groups or large online surveys. This can also be through the first 10-20 customers where many may be friendlies.
  • Product/ Service – This is the long sought-after “product-market” fit stage where validation comes from the first cohorts of buyers – scaling from 20 to 100 inorganic customers. Depending on the product/ service, engagement metrics may also provide validation.
  • Company – Let’s call this stage the growth stage for a company. At this stage, validation comes from lower customer churn. In many cases, competition will be fiercer here, so churn could be a problem.
  • Category/ Market – There are clear market leaders with more niche players taking the smaller 20% of the market. (Follow the 80-20 rule.)
I overheard a discussion between two execs recently about the idea of working closer together. One exec was pitching another way to earn incremental revenue from existing customers. Except, the conversation stopped there – regarding more revenue anyways. Instead, the execs shifted focus to discussing how working closer together could add “delight” to customers.
It’s hugely telling when an entrepreneur pauses a discussion to shift the focus away from “more money” to “more delight”. Here, the entrepreneur understands the importance of thinking about the customer-first. Here, the entrepreneur understands the importance of creating emotional value.
Thinking revenue-first means thinking about the company first. However, the company does not exist without its customers. Thinking customer-first puts the company on a path to bringing customers in and retaining them [especially against competition].
When thinking about the services and products you can’t live without today, think about the ones that you wouldn’t leave the brand. Think about how delight surrounds your decision to use that service or product. Think about the people you surround yourself with, and how your interactions together are delightful. Think about how driving customer deliver shifts how employees engage with the company mission.
Think about delight. Think about customers first.