1. Customer Discovery
   1. NOT-TO-DOs
      1. Understand the needs and wants of ALL customers
      2. Make a list of ALL the features customers want before they buy your product
      3. Hand Product Development a features list of the sum of all customer requests
      4. Hand Product Development a detailed marketing requirements document
      5. Run focus groups and test customers' reactions to your product to see if they will buy
      6. Instead, you are going to develop your product for the few, not the many.
      7. You are going to start building your product even before you know whether you have any customers for it
   2. Earlyvangelists
      1. Has a problem
      2. Is aware of having a problem
      3. Has been actively looking for a solution
      4. Has put together a cobbled up solution
      5. Has or can acquire a budget
   3. Phase 0: Get buy-in from all stakeholders
   4. Phase 1: State hypotheses
      1. Product hypothesis
         1. Product features
         2. Product benefits
         3. Intellectual property
         4. Dependency analysis
         5. Product delivery schedule
         6. Total cost of ownership/adoption
      2. Customer & problem hypothesis
         1. Types of customers
            1. End-users
            2. Influencers
            3. Technical buyer
            4. Recommenders
            5. Saboteurs
            6. Economic buyer
            7. Decision maker
         2. Customer problems
         3. A-day-in-a-life of your customer
         4. Organizational map and customer influence map
         5. ROI justification
         6. Minimum feature set
            1. A very small group of early visionary customers will guide your follow-on features
            2. Less is more, to ship earlier
            3. What is the smallest, least complicated problem that the customer will pay us to solve?
      3. Distribution & pricing hypothesis
      4. Demand-creation hypothesis
         1. Creating customer demand
            1. The further away from a direct sales force your channel is, the more expensive your demand-creation activities are
            2. You need to understand HOW your customers hear about new companies and products
            3. Trade shows?
            4. Magazines?
            5. Analysts
         2. Influencers
            1. Analysts?
            2. Press?
            3. Visionaries?
      5. Market type hypotheses
         1. Type of Startup Markets
            1. 1. Customers
            2. Existing
            3. New
            4. Existing
            5. Existing
            6. 2. Customer needs
            7. Performance
            8. Simplicity and convenience
            9. Cost
            10. Perceived need
            11. 3. Performance
            12. Better/faster
            13. Low in "traditional" attributes; improved by new customer metrics
            14. Good enough at the low end
            15. Good enough for new niche
            16. 4. Competition
            17. Existing incumbents
            18. Non-consumption, other startups
            19. Existing incumbents
            20. Existing incumbents
            21. 5. Risks
            22. Existing incumbents
            23. Market adoption
            24. Existing incumbents
            25. Niche strategy fails
         2. Existing market
            1. Ask
            2. Is there an established and well-defined market with large numbers of customers?
            3. Does your product have a better "something" that existing competitors?
            4. Brief
            5. Who are the competitors and who is driving this market?
            6. What is the market share of each competitor?
            7. What is the total marketing an sales dollars the market share leaders will be spending to compete with you?
            8. Do you understand the cost of entry against incumbent competitors?
            9. Since you are going to compete on performance, what performance attributes have customers TOLD YOU are important?
            10. Wat percentage of this market do you want to capture in years 1 throuth 3?
            11. How do the competitors define the market?
            12. Are there existing standards? If so, whose agenda is driving the standards?
            13. Do you want to embrace these standards, extend them or replace them?
         3. Resegmented market
            1. Ask
            2. Is there an established and well-defined market with large numbers of customers and your offering is lower cost than the incumbents?
            3. Is there an establshed and well-defined market with large numbers of customers and your product can be uniquely differentiated from the existing incumbents?
            4. Brief
            5. What existing markets are your customers coming from?
            6. What are the unique characteristics of those customers?
            7. What compeling needs of those customers are unmet by existing suppliers?
            8. What compelling features of your product will get customers of existing companies to abandon their current supplier?
            9. Why couldn't existing vendors offer the same thing?
            10. How long will it take you to educate potential customers and to grow a market of sufficient size? (What size is that?)
            11. How will you educate the market?
            12. How will you create demand?
            13. Given that no customers yet exist in your new segment, what are realistic forecasts for year 1-3?
         4. New market
            1. Ask
            2. Is there no established and well-defined market?
            3. Are there no existing competitors?
            4. Brief
            5. What are the adjacent markets, closest to the new one you're creating?
            6. What markets will potential customers come from?
            7. What compelling need will make customers use/buy your product?
            8. What compelling feature will make them use/buy your product?
            9. How long will it take you to educate potential customers to grow a market of sufficient size? (What size is that?)
            10. How will you educate the market?
            11. How will you create demand?
            12. Given that no customers yet exist what are realistic forecasts for years 1-3?
            13. How much financing will it take to soldier on while you educate and grow the market?
            14. What will stop a well-heeled competitor from taking the market from you once you've developed it?
      6. Competitive hypothesis
         1. Existing market
            1. The basis of competition is all about some atribute(s) of your product.
         2. State of market
            1. Fragmented: all players have 30% or less of the market
            2. Monopolized: a player has 80% or more of the market
         3. Ask
            1. How have the existing competitors defined the basis of competition? (features? service?)
            2. Why do you believe your company and product are different?
            3. What makes you think that customers will care about your new, unique "killer" feature? performance? channel? price?
            4. If this were a grocery store, which products would be shelved next to yours?
            5. Who are you closest competitors today? in features? performance? channel? price?
            6. Where do customers go today to get the equivalent of what you offer?
            7. What do you like most about each of your competitor's product? What do customers like most?
            8. If you could change one thing in your competitor's product, what would it be?
            9. Who uses the competing product today, by title/function? How do they use it?
            10. Describe the workflow/design flow for an end-user
            11. What percentage of their time do end-users spend with your competitor's product?
            12. How mission critical is it?
            13. For lack of your product, what do people do today without it? Do they simple not do something or do they do it badly?
   5. Phase 2: Test problem hypotheses
      1. Friendly first contacts
         1. Make a list of 50 potential customers you can test your ideas on
            1. Get referrals
            2. Prepare a "reference story"
            3. Paragraph 1: describe your company
            4. Paragraph 2: describe what you're doing
            5. Paragraph 3: what's in it for them
            6. The goal is to get 5-10 visits lined up
         2. Start an innovators list
            1. Advisory board candidates
            2. Industry influencers
         3. Network your way up the "food chain of expertise" in your space
            1. "Who's the smartest person you know in this space?"
      2. "Problem" presentation
         1. Present problem(s)
            1. What do they think the problems are?
            2. Are we missing any problems?
            3. How would they rank-order the problems?
         2. Existing solutions
            1. How do they deal with the problem today?
            2. How do they think others address it?
            3. Who else shares these problems in the company?
         3. Our solutions
            1. Describe the "big" solution (not specific features)
            2. Do they understand what the words mean?
            3. Is the solution evident enough?
      3. In-depth customer understanding
         1. How does the workflow/design flow happens?
            1. How to customers actually spend their day?
            2. How do they spend money?
            3. How do they get the job done?
         2. Will they pay for your solution?
            1. What would make customers change the current way of doing things? Price? Features?
         3. If you had a product like this... ?
            1. What percentage of your time could be spent using this product?
            2. How mission-critical is it?
            3. Would it solve the pain you mentioned earlier?
            4. What would be the barrirs to adopting a product like this?
         4. How do they learn about new products?
            1. What analysts do they follow?
            2. Who they they trust in the press?
            3. What magazines do they read?
            4. What orgranizations they belong to?
            5. Do they get their news from Twitter?
         5. Spot talent
            1. Can these customers be helpful in the future?
            2. Could they help the next round of conversations?
            3. Could they contribute in an Advisory position?
            4. Could they become a paying customer?
            5. Could they give you referrals?
      4. Market knowledge
         1. Meet with
            1. Potential customers
            2. Peers in adjacent markets
            3. Key industry influencers and recommenders
         2. Gather quantitative data
         3. Attend industry conferences and trade shows
         4. Ask
            1. What the industry trends?
            2. What are key unresolved customer needs?
            3. Who are the key players in this market?
            4. What should I read?
            5. Who should I know?
            6. What should I ask?
            7. What customers should I call on?
   6. Phase 3: Test product concept
      1. First reality check
         1. Reality check your customer hypothesis
            1. Gather all customer data
            2. Build a workflow map of typical customer
            3. Diagram who works with whom
            4. Compare to original customer hypotheses
         2. Product Dev/Customer Dev sync meeting
            1. Adjust assumptions
            2. Adjust specs
         3. Reality check the "problem" assumptions
            1. What problems do customers SAY they have?
            2. How painful were these problems?
            3. Where on the "problem scale" were the customers you interviewed?
            4. How are they solving these problems today?
         4. Draw the customer workflow with and without your product!
            1. Was the difference dramatic?
            2. Did customers say they would pay for that difference?
            3. What did you learn about customers' problems?
            4. What were the biggest surprises?
            5. What were the biggest disappointments?
         5. Given all this, how close were out assumptions? spec?
            1. Do we talk to a different set of customers?
            2. Are we building the wrong product?
            3. Should we continue building it and hope for a miracle?
            4. Do we change the product?
         6. If product addresses part of the problem
            1. Review the feature list
            2. Prioritize the features in terms of importance to the customer
            3. Can we match each feature to an explicit customer problem?
            4. Which features did customers not care about?
            5. Can any features be deleted or deferred?
         7. Review and get agreement on the delivery schedule
            1. All features beyond the first version are up for grabs
            2. Features spec'd in release 1.0 are subject to change/deletion to get the product out as early as possible
         8. Review your other Phase 1 hypotheses
            1. Which market type are you in?
            2. Why are you different?
            3. What will be your basis for competing?
            4. Do your pricig and delivery channel assumptions hold up?
            5. What did you learn about influencers?
      2. Prepare product presentation
         1. Goal
            1. Test revised product assumptions
            2. Validate your product features
         2. Cover the five (no more!) key product features
         3. Describe the customer's live "before" and "after" your product
         4. A day-in-a-life with and without your product
         5. LEAVE OUT ALL THE MARKETING, POSITIONING AND FLUFF
         6. Present the product roadmap
      3. More customer visits
         1. This time, you do want to present to the people/roles who will be involved in the purchasing decision.
         2. Create introductory email, reference story and sales script
         3. Restate the problem your product is designed to solve
         4. Describe why it is important to address this problem
         5. Get agreement on the value of solving this problem
            1. If you don't get agreement, go back to Phase 2
         6. Describe your product
         7. Demo as many of its key features as you can
         8. Draw customer workflow with/without your product
         9. Describe who else in the customer organization your product may affect
         10. Shut up and listen
      4. Second reality check
         1. Reality check your customer hypothesis
            1. Gather all customer data
            2. Build a workflow map of typical customer
            3. Diagram who works with whom
            4. Compare to original customer hypotheses
         2. Product Dev/Customer Dev sync meeting
            1. Adjust assumptions
            2. Adjust specs
         3. Reality check the "problem" assumptions
            1. What problems do customers SAY they have?
            2. How painful were these problems?
            3. Where on the "problem scale" were the customers you interviewed?
            4. How are they solving these problems today?
         4. Draw the customer workflow with and without your product!
            1. Was the difference dramatic?
            2. Did customers say they would pay for that difference?
            3. What did you learn about customers' problems?
            4. What were the biggest surprises?
            5. What were the biggest disappointments?
         5. Given all this, how close were out assumptions? spec?
            1. Do we talk to a different set of customers?
            2. Are we building the wrong product?
            3. Should we continue building it and hope for a miracle?
            4. Do we change the product?
         6. If product addresses part of the problem
            1. Review the feature list
            2. Prioritize the features in terms of importance to the customer
            3. Can we match each feature to an explicit customer problem?
            4. Which features did customers not care about?
            5. Can any features be deleted or deferred?
         7. Review and get agreement on the delivery schedule
            1. All features beyond the first version are up for grabs
            2. Features spec'd in release 1.0 are subject to change/deletion to get the product out as early as possible
         8. Review your other Phase 1 hypotheses
            1. Which market type are you in?
            2. Why are you different?
            3. What will be your basis for competing?
            4. Do your pricig and delivery channel assumptions hold up?
            5. What did you learn about influencers?
      5. First advisors
   7. Phase 4: Verify
2. Customer Validation
3. Customer Creation
4. Company Building