with Product
with Product
From an economic perspective, a healthy business likes to go for more when times are good. Founders tend to ask whether they could add new components to their business to attract more customers: new ambitions, new projects, new teams. According to Des, this is a fallacy! "The problem is," says Des, "you start to dilute your product. For no actual reason, you add unnecessary complexity to something that simply works, and you start building an unhealthy business. Every measure," adds the Irishman emphatically , "that you add simply increases complexity, and that will kill your productivity."
«Complexity creeps up on you without you realizing it and slows everything down.»
To simplify something that grew complex, you must ask yourself: What works in the startup and focus on that! What revenue is healthy? "Find out who your focus customers are. Who loves you? Who are you unique to? The customers you acquire sustainably and for whom you differentiate yourself in the market with your product are your best customers."
The unique selling point is that these customers often use the product and need help finding something like it. Check whether the acquisition costs are worthwhile, whether there are enough customers to acquire, whether the product is critical or simply "nice to have", and whether it represents a market differentiation. Des recommends only proceeding with a product once each question has a YES.
«Find out who your customers are and optimize your business for them!»
"Of course, nobody in good times thinks 'Hey, now let's ruin our business and add complexity'," says Des, provocatively, "but that's exactly what happens insidiously. Every new service added won’t make a good product any better." The costs and consequences of complexity are often underestimated, the gut feeling ("We should do this!") wins out over the proof of data, and you end up adding things to your product that it simply doesn't need. Also, that isn't useful for anyone, not for the startup or the customers. "The golden rule you should stick to is," Des emphasizes from his experience: "Whenever you add something to your product, something else suffers."
- Friction is exponential, not linear.
- What causes friction limits the adoption of the product.
- Complexity kills productivity and reduces the usability of the product.
- A simple architecture is the most significant lever for growth and innovation.
Once a healthy business has been established and everything has been simplified accordingly, this - and no other path - must be followed. If you reduce your product to what is good at its core, you will gain a leading position in the market.
"To do this, you must be very disciplined,” Des admits. "You have to focus completely on what maximizes the experience of your target customer. Don’t do anything else! Everything you do has to be the most important thing - no exceptions here."
Des emphasizes: "Your healthy business will grow if you stifle everything else that doesn't support your strategy." One crucial point people should consider about figures is that these activities will probably look misleading because while the healthy business grows, the income from the added complexity – the old business - shrinks accordingly. Overall, it will look like a loss. "But it's not," Des says emphatically. "These are exactly the figures that investors want to see. A healthy business and sustainable revenue."
«Be something special for someone and not something for everyone!»
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