Funding for your startup at a $1,000,000 valuation if you do #custdev.
As a #leanstartup mentor and teacher, I tell my startups and enterprises (especially in the beginning) your customers need to have the problem you want to solve, AND KNOW THEY HAVE THE PROBLEM. This theory comes directly from Steve Blank, and it is true from idea to enterprise, b2b to b2c, social good to scaleable for profit startup. IF you want to maximize your chances for success, you MUST START WITH PEOPLE WHO ALREADY KNOW THEY WANT WHAT YOU ARE OFFERING.
Hence the mentor's conundrum - trying to get entrepreneurs to stop building things that no one wants, stop trying to get on the front page of the WSJ, and stop trying to raise money just because. These things are NOT PROBLEMS that entrepreneurs have, instead, they are... well, they just are. It is fun to raise money (and entrepreneurs think they need to), it is fun to build things and it is certainly fun to get press. To make matters even more complicated, these are all things I have done myself and things my colleagues have done too. So how can we preach to startups the contrary?
THE ANSWER? WE WON'T. WE WILL BRIBE THEM FOR GOOD BEHAVIOR:)
If you do "custdev" on early stage entrepreneurs today, classic problems they have are getting into an accelerator and raising funds to build a prototype. Other problems are long sales cycles and a lack of growth. Their problem is not "lack of custdev, wasted resources, or lack of education." The solution to their known problem is simple, funding (with a twist:).
The specific solution is $5,000 to ANY startup in the world who does customer development.
We are now funding any startup (a minimum of $5,000 for 1% equity, with a challenge at the end to decrease the equity by half or double the funding) who invests in themselves by doing what is known as #custdev. What my friend +Justin Wilcox now calls "EA interviews"
Thx @dianakander this thread got me thinking. Calling them EA interviews going forward @TriKro @davidjbland @ThorErnstsson @neight @adamberk
— Justin Wilcox (@Justin_Wilcox) October 29, 2014
Whether you call it custdev, problem interviews, EA interviews, or -- IF YOU FILL THIS IN 100 times we will fund your startup, end of story. We do not care who you are, where you are from, how old you are or what your idea is. The only catch is that you must use the funds to run an experiment to prove your next move.
INEVITABLE QUESTIONS, COMMENTS, THOUGHTS AND FEEDBACK WE'VE ALREADY HEARD
- IS THIS FOR REAL? There is nothing that we love more than proving demand before supply. We need improvement in many things but we are getting pretty good at running experiments. Nothing will kill this experiment faster than not funding a team that finishes the 100 interviews. We will fund EVERYONE who STARTS before the first 5 teams do the full 100 each. At that time we may pause the program so we can see results.
- DO I HAVE TO PAY? We are experimenting on this. Anyone who attends one of our events has the fee automatically waived. Anyone who is willing to share their interviews after a 6 month window with the public has their fee waived. Anyone willing to tweet and blog about the experiment has the fee waived. If you come in cold, do the first interview, and we will talk about it.
- AREN'T YOU WORRIED ABOUT FRAUD? No - we have specific evidence why not. Ask me for it.
- WHO IS YOUR TARGET USER? - Thanks for this Brenden.
- The last 30 interviews SHOULD state the same exact problem for the same customer but that will not affect funding until we change the policy publicly and make it clear. Right now, anyone who STARTS and finishes within 60 days gets funded, as long as the interviews are real. -ab 11/27
- WHY DO THEY HAVE TO BE IN PERSON FOR THE BILVALCHAL and why SHOULD they be in person for this? The same reason the World Series of Poker is decided by no limit hold em. In person interviews are the purest form of customer development and yield the most valuable results.
- WHY do you only need to do 50 if you use this link?
- What is with this #bilvalchal? It is real. Only one winner. If you do not win your interviews still count for the #milvalchal. We believe in #custdev and are willing to do anything to get entrepreneurs to believe in it too.