April 2011 Customer Discovery Day

If you read through this post, you’ll see some sweet pictures and figure out a potential new way to get cookies and brownies.

I got together with Alex Toumey, Kyle Shipley and Wes Winham on April 16 for an event practicing lean startup concepts.

We started off by pitching ideas that we thought were interesting and needed some validation. At one point, we riffed on one of the ideas by coming up with “Etsy for baked goods.” The idea seemed kind of hokey at first, but the more we talked about it, the better it seemed. We put aside the other ideas for future exploration, and talked about our thoughts on the idea. We came up with a quick description to make sure everyone was on the same page: a marketplace for people to buy and sell local baked goods. Seemed good. What better time to test this idea against cold, harsh reality? :)

Brownies, or bullshit?

Next, we sketched out some basic hypotheses and some questions to test these hypotheses, and contacted friends and family to get some feedback. Someone took pictures of these, I’m sure, but I can’t seem to find them, or I’d post them.

Two keys that I thought we did quite well at this point were:

  • not sticking to a set script
  • and asking for references at the end of the conversation

At this point in the process, asking for too specific of feedback would have hampered the quality of learning that we were getting. This is something I learned when doing Lean Startup Machine Boston, and Ash Maurya also references this in Running Lean.

By asking for references, we expanded the number and quality of people that we were able to contact in a short period of time. It was a bit surprising how well we did just by calling people we thought might know a lot about baking.

  • Person 1
    • Left voicemail
  • Person 2
    • Tried to start up a basic Christmas cookie selling business – ran into VA licensing issues and didn’t pursue further
    • Researched commercial kitchen rental opportunities – too much hassle
    • Some temporary licenses available in VA
    • farmer’s markets have vendor licensing
      • produce vs. baked goods difference?
      • produce can be sold easily; processed food is regulated
    • Recommended checking our local county web sites
  • Person 3
    • Had read about a tangentially-related case study involving South American women selling baked goods that were shipped to America
    • Feels like cookies are more of an impulse buy item
    • Warmed up to the idea of “ethnic food in your neighborhood”
    • Has a sister who is a pastry chef if further research needed/desired
  • Person 4
    • Will contact again later – some hearing issues over-the-phone
    • Has been encouraged to sell at farmer’s markets, but hasn’t taken the plunge
  • Person 5
    • Liked the idea
    • Wasn’t very worried about food safety, going to someone’s house
    • Liked the idea of local food that was not going out to eat, seemed healthy and would save her time (no preservatives)
    • could see using night-time meals as well
    • wonders about FDA or other regulators
  • Person 6
    • Thinks she would have been excited about the idea when she was a stay-at-home mom
    • Would only consider participating if she could pre-fill orders (guaranteed purchases before she started baking)

After lunch, we worked on a business model canvas for the idea. This is something that I had wanted to do for awhile, so I brought my Business Model Generation book and we took a crack at it. I thought that the process gave us good insight into the challenges of the business.

After fleshing out a couple of sections

The “finished” business model

If we were to continue working with this idea, a solid next step would be to take the most risky assumptions on the business model canvas and start testing them for validity. In my mind, getting a little more perspective on the demand from buyers and sellers for our chosen idea might be a good plan. I’d probably label the riskiest hypotheses with hot pink sticky notes to make them stand out a bit.

In the process, we came up with a few directions that we could head with the baked goods idea that were slightly different (ingredient label maker, targeting more professional services), and also have a list of other backup ideas that seem useful.

I had a really good time going through the process with everyone. I thought we got a lot done in a day going from just an idea to getting a lot of thought on the problem, and building up our customer discovery skill.

Afterwards, we played some Halo 3 and it was a ton of fun! :)

Our next time doing this will be Sunday, May 22nd, 2011. Contact me at panozzaj@gmail.com for more details.

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