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3 Assumptions We Got Wrong With Our Startup

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I’ve been speaking a lot at events, in articles and in conversations about customer validation. The point of customer validation is to understand exactly who your customers are, and what they want your product to do and achieve for them.

So it’s fairly ironic that I did close to zero customer validation with my own recent startup, the employee six question pulse survey system, called 6Q.

In my defense, we were building it for ourselves first, with the hope that someone else may want to use it. The very first vision was pretty well just that; built something we would use and find useful, and maybe others will dig it too.

Hence the lack of customer validation.

Sure, I asked a few other business owners I knew if they would use it, and sure enough, they all said yes. That’s all I needed to do, right?

Well, it turns out there were a number of assumptions I made, which turned out to be totally wrong. That’s the fun thing with tech startups; changing the product, or pivoting entirely if you have to.

So, rather than another article on the web about some great idea and then sudden fame and fortune, I want to share with you a few of our failings, to drive home the need for customer validation no matter what you’re building.

Where 6Q came from

First, let me paint a picture for you. The main business I’m in as a digital agency based in Perth. I founded Bam Creative back in 2002 with a napkin sized business plan. It pretty well said;

  1. Have work/life balance
  2. Make money
  3. If you hire, be a good boss

So, in keeping with point three, I’ve spent the last 14 years building the right kind of culture with the team. We’re 14 people in an open plan office, who are professional yet transparent with each other and our clients.

So transparent, in fact, that I often get given feedback that I should be unhappy about. I’m not though; it’s important to know how the team are feeling, so we can address it.

One of the things we do is have a weekly face to face individually. The managers (two of us) meet each team member, and find out what’s going on with them; how their productivity is, what their happiness is like and how we can help them hit their goals.

So this is where 6Q is borne from; the idea of scaling a weekly face to face with a team of dozens makes this an impossible feat; perhaps a survey tool could emulate much of this (it’s impossible to replace the body language, etc with a survey though).

So, knowing all this, and assuming this was typical in most Australian businesses, we set out to build 6Q. There were three assumptions out of the many we made, that totally didn’t hit the mark. On reflection, we should have known, but our lack of customer development meant we believed these to be true;

  1. We assume our main customer base will be small to medium companies
  2. We expect most customers to be Australian
  3. We assume most employees will be happy to complete non-anonymous pulse surveys

So, how are they wrong? Let’s look at each of these assumptions, and show what was wrong about them, and what we’ve done to adapt.

Assumption 1: We assume our main customer base will be small to medium companies.

Small to medium organisations care more about their employee happiness and feedback, right? The big companies already have their enterprise 100 question heavyweight survey systems, and don’t need ours.

Turns out that’s wrong. Whilst SME’s do care about employees, the big guys do as equally. In fact, the majority of signups for 6Q have been in the hundreds or thousands of employees, and they see 6Q as a compliment to their other surveys.

How we fixed this

Our original plans and pricing page, had various plans running from 20 employees to 200. We quickly adapted, by changing the ‘Enterprise’ plan name to company, and adding plans for 500 – 3,000 employees, and a message if you have more employees, contact us for custom pricing.

We never had any form of team segmentation; the system just showed all employees. That’s great up to 50, however more than that, it became burdensome. We since launched segments, so they can break organisations down to location or teams, and added employee search and pagination, so you see 20 employees per screen.

We expect most customers to be Australian

We have contacts and clients mostly in Australia, so why would someone on the other side of the world be interested in our humble startup? Wrong.

We did a soft launch to gather some customers in small amounts, before opening to a wider audience. The first 100 customers rolled in within a fortnight, and represented 25 countries. In fact, Australia came in as fifth most common place.

How we fixed this

We made sure we tweaked the messages throughout the UI and emails, to not include Australian slang or local terms, and we did a lot of navel gazing if we should change our system and blog from British English to American English (British English eventually won, because we’re proud to be based in Australia).

We also more recently added the ability to use other languages. Turns out, English of any variant, is only the third most popular language, with 5.52% of the globe speaking it natively. Mandarin (14.1% of global population) and Spanish (5.85%) are much bigger.

We assume most employees will be happy to complete non-anonymous pulse surveys

This was the biggest assumption of ours, which drove the product. I enjoy an open honest workplace, so surely everyone else does too, right? It’s just common sense.

I was very, very wrong.

Sure, managers and leaders in every country believe their employees will speak up, because they asked them to. It’s far from it though; without the right culture, employees are reluctant to speak openly. Our culture works, many others don’t.

How we fixed this

We added an option within days of launching last March, to choose between individually identifiable responses, and anonymous. To further the aim of protecting employees, we also added a message on the first screen of the survey, to highlight if the survey is anonymous or individual, and we won’t share any identifiable information, should the survey be set to anonymous.

Conclusion

No matter how many assumptions you make, do your best to test them all in your customer validation stage. Ask prospective customers exactly what features they want, and explain how you imagine your product working, and ask for brutal feedback.

Be prepared to shift with the customer needs. If we hadn’t done the changes required, to overturn my idealistic assumptions above, we would have had a tough time selling our product to anyone.

Most of all, learn from your lessons, and share them with others. This is what I’m doing in this article – I would be keen to see your mistakes and lessons learned as well, as I’m sure many other founders would be.

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About the Author

This article was written by Miles Burke of IdeaHoist, a website with the aim of building a community that can learn from each other’s experiences and promote each other’s ideas. Miles is the Co-founder and Managing Director at 6Q – a Perth based startup creating tools to empower organisations across the globe to improve communications across their team and their team culture through simple 6 question polls.

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Andrew Schorr, Founder of Grata

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Taking a different route throughout his life, Andrew Schorr ended up in China and started several businesses.

What’s your story?
I moved to China after I graduated from college in 2004. English teaching was the easiest way to get there, so I looked on a map and picked a small town in Hubei, because it looked to be more or less in the middle of China. I was the only foreigner there.

Back then, everything was about the upcoming Olympics in Beijing, so I moved to the capital after my year of teaching. Pretty soon after arriving, I met the co-founder for all three of my companies. We decided to start a company together the first day we met. He has now moved back to the US and builds flight software at SpaceX.

Our first company, an online city guide, was re-purposed into our second company, GuestOps, a web concierge platform. We sold GuestOps to most of the major international hotel brands in China and still operate it. The genesis of our latest company, Grata came from looking at the intersection of hotels and WeChat in 2012, when WeChat was just starting to blow up. Grata expanded from hotels into a live-agent customer service console.

What excites you most about your industry?
Our thesis with Grata has always been that what is happening with WeChat in China is the future of messaging platforms globally, and as an international team building on WeChat, we would be well-placed to capitalize on that trend. It’s taken longer than we expected for the industry (and us, for that matter) to get there, but finally, we’re starting to see messaging as a platform to get better traction in other markets.

What’s your connection to Asia?
I’ve always been a bit of a contrarian. I grew up in Texas, where all my friends studied Spanish in school. I studied German for no reason in particular. I took a similar path in college: Chinese and Japanese seemed like languages that not a lot of people who look like me studied. I was one of only two students in my third-year Chinese class.

Concur conference in San Francisco, Calif., Wednesday, Oct. 2, 2013. (Photo by Paul Sakuma, Paul Sakuma Photography) www.paulsakuma.com

Favourite city in Asia for business and why?
Shanghai. I should live there, but Beijing has been home for so long. I take the night train down to Shanghai every two-three weeks to meet with clients. Domestic flights are way too unreliable here.

What’s the best piece of advice you ever received?
Don’t plan too far ahead; otherwise, you plan yourself out of good opportunities.

Who inspires you?
Has anyone said “Elon Musk” yet? Barack Obama would be another.

What have you just learnt recently that blew you away?
The gravitational waves recently detected from neutron stars colliding, were so subtle as to only affect the distance from earth to our closest star, Alpha Centauri (4.24 light years away) by the width of a human hair. Perhaps in another life or in the future, I’ll be an astronomer, but a telescope doesn’t do me much good in Beijing.

If you had your time again, what would you do differently?
When I give advice to students looking to get into entrepreneurship, I advise them to work for a post-Series A startup first and learn from a company that’s already doing things well. I learnt everything on my own, which is slower and you pay for your own education. If you work for a startup that’s small in the beginning, you risk learning bad habits.

How do you unwind?
I Hash! The Hash is a drinking club with a running problem. The Hash attracts good people from all walks of life and doesn’t take itself too seriously. It’s a great way to meet fun-loving people all over the world. It’s also how I met my co-founder, our first lawyer, and my girlfriend.

Favourite Asian destination for relaxation? Why?
Pulau Perhentian, Malaysia. A fantastic beach and where I first learned to scuba dive.

Everyone in business should read this book:
For business in China, Tim Clissold’s, Mr. China.

Shameless plug for your business:
Grata does WeChat contact centers for many top-tier brands in luxury retail, travel, financial services and hospitality. We started developing on WeChat before they even had an open platform. Grata provides the most value for large enterprises with complex routing and content demands for their contact centers.

How can people connect with you?
Check out www.grata.co or email me: [email protected]

Twitter handle?
My personal handle is @andrew_schorr and we tweet about messaging from the company handle @grata_co.

This interview is part of the ‘Callum Connect’ series of more than 500 interviews

Callum Laing is an entrepreneur and investor based in Singapore. He has previously started, built and sold half a dozen businesses and is now a Partner at Unity-Group Private Equity and Co-Founder of The Marketing Group PLC. He is the author two best selling books ‘Progressive Partnerships’ and ‘Agglomerate’.

Connect with Callum here:
twitter.com/laingcallum
linkedin.com/in/callumlaing
Download free copies of his books here: www.callumlaing.com

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Benjamin Kwan, Co-Founder of TravelClef

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Making music to create a life for his family, Benjamin Kwan, started an online tuition portal and his music business grew from there.

What’s your story?
I am Benjamin and I’m the Co-Founder of TravelClef Group Pte Ltd, a travelling music school that conducts music classes in companies as well as team building with music programmes. We also run an online educational platform which matches private students to freelance music teachers. We also manufacture our own instruments. I started this company in 2011 when I was still a freshman at NUS, majoring in Mechanical Engineering.

I was born to a lower income family, my father drove a taxi and was the sole breadwinner to a family of 7. I have always dreamed of becoming rich so that I could lessen the burden placed on my father and give my family a good life.

After working really hard in my first semester at NUS, my results didn’t reflect the hard work and effort I put in. At the same time, I was left with just $42 in my bank account and it suddenly dawned on me that if I were to graduate with mediocre results, I would probably end up with a mediocre salary as well. I knew I had to do something to gain control of my future.

During that summer break, I read a book “Internet Riches” by Scott Fox and I knew that the only way I could ever start my own business with my last $42 would be to start an online business. That was how our online tuition portal started and after taking 4 days to learn Photoshop and website building on my own, I started the business.

What excites you most about your industry?
Music itself is a constant form of excitement to me as I have always been an avid lover of music. As one of the world’s first travelling music schools, we are always very eager and excited to find innovative ways to a very traditional business model of a music teaching.

What’s your connection to Asia?
I was born and raised in Singapore and I love the fact that despite our diversity in culture, there’s always a common language that we share, music.

Favourite city in Asia for business and why?
Hands down, SINGAPORE! Although we are currently in talks to expand to other regions within Asia, Singapore is the best place for business. I have had friends asking me if they should consider venturing into entrepreneurship in Singapore, my answer is always a big fat YES! There’s a low barrier of entry, and most importantly, the government is very supportive of entrepreneurship.

What’s the best piece of advice you ever received?
I have been blessed by many people and mentors who constantly give me great advice but right now, I would say the best piece of advice that I received would be from Dr Patrick Liew who said, “Work on the business, not in it.” This advice is constantly ringing in my head as I work towards scaling the business.

Who inspires you?
My dad. My dad has always been my inspiration in life, for the amount of sacrifices that he has made for the family and the love he has for us. He was the umbrella for all the storms that my family faced and we were always safe in his shelter. Although my dad passed away after a brief fight with colorectal cancer, the lessons that he imparted to me were very valuable as I build my own family and business.

What have you just learnt recently that blew you away?
You can not buy time, but you can spend money to save time! With this realisation, I was willing to allow myself to spend some money, in order to save more time. Like taking Grab/Uber to shuttle around instead of spending time travelling on public transport. While I spend more money on travelling, I save a lot more time! This doesn’t mean that I spend lavishly and extravagantly, I am still generally prudent with my money.

If you had your time again, what would you do differently?
I would have taken more time to spend with my family and especially my father. While it is important to focus our time to build our businesses, we should always try our best to allocate family time. Because as an entrepreneur, there is no such thing as “after I finish my work,” because our work is never finished. If our work finishes, the business is also finished. But our time with our family is always limited and no matter how much money and how many successes we achieve, we can never use it to trade back the time we have with our family.

How do you unwind?
I am a very simple man. I enjoy TV time with my wife and a simple dinner with my family and friends.

Favourite Asian destination for relaxation? Why?
Batam, it’s close to Singapore and there’s really nothing much to do except for massages and a relaxing resort life. If I travel to other countries for shopping or sightseeing, I am constantly thinking of business and how I can possibly expand to the country I am visiting. But while relaxing at the beach or at a massage, I tend to allow myself to drift into emptiness and just clear my mind of any thoughts.

Everyone in business should read this book:
Work The System, by Sam Carpenter. This book teaches entrepreneurs the importance of creating systems and how to leverage on systems to improve productivity and create more time.

Shameless plug for your business:
If you are looking for a team building programme that your colleagues will enjoy and your bosses will be happy with, you have to consider our programmes at TravelClef! While our programmes are guaranteed fun and engaging, it is also equipped with many team building deliverables and organizational skills.

How can people connect with you?
My email is [email protected] and I am very active on Facebook as well!
https://www.facebook.com/benjamin.christian.kwan

This interview is part of the ‘Callum Connect’ series of more than 500 interviews

Callum Laing is an entrepreneur and investor based in Singapore. He has previously started, built and sold half a dozen businesses and is now a Partner at Unity-Group Private Equity and Co-Founder of The Marketing Group PLC. He is the author two best selling books ‘Progressive Partnerships’ and ‘Agglomerate’.

Connect with Callum here:
twitter.com/laingcallum
linkedin.com/in/callumlaing
Download free copies of his books here: www.callumlaing.com

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