At the heart of what we do is The Hypothesis. Getting the hypothesis right is the first key to validating (or invalidating) our assumptions underlying our entire startup. If you get out of the building with a bad hypothesis, you won't hear anything valuable from your customers.
Team Byoyo learned this lesson last weekend when the Lean Startup Machine workshop arrived in Shanghai, China for a sold-out event. The team – Yawen Hsu, Jack Wang, and Chen Ying – won the competition after a dramatic transformation in how they talked to their customers during the course of the 2.5 day event.
Before the workshop, the team read the Lean Startup book and understood the theory but only in a theoretical way. Yawen, the Byoyo team lead, said, "I thought I was practicing the methodology but I was struggling to put the theory into practice."
Yawen's vision is to provide parents with a safe online community to share information about raising children. "Especially after the cultural revolution, a lot of Chinese parents no longer know how to convey values to their kids. And they don't have the opportunities to learn what Western culture has to offer…. people don't have as high a moral standard as what we see elsewhere." While parents in China commonly use Renren, which is similar to Facebook, they don't feel that's a private place to post intimate information about their children, and there's no domestic equivalent of BabyCenter. The potential opportunity is tremendous.
YES ladder to invalidation
After discussing their assumptions and forming their initial hypothesis, the team got out of building to talk to parents at a local mall. But the trip was fruitless. The team asked "Yes/No" questions about whether their interviewees would use the service, to which their polite interviewees usually answered "Yes." A "yes" answer might sound reassuring, but it hardly counts as validating your hypothesis. It just means people are being nice to you. As Jack put it, "If you don't ask the right question, you will always get the wrong answer."
When the team returned to the workshop venue, Ray Wu, the New York City-based Lean Startup Machine facilitator, did not spare the criticism. Ray pushed the team very hard to get organized and understand what really counted as validation and challenging them to improve. The team was shocked. Yawen was literally speechless, later admitting, "it was extra dramatic for me to see it differently and throw away my original thoughts and build something new." The team had limited time to focus on their riskiest assumptions and turn them into working hypotheses.
The 21 mentors at the workshop helped. Hailing from companies as diverse as Appconomy, IDEO, and Baidu, the Byoyo team had plenty of input and guidance to turn things around.
The team also used the Validation Canvas to record their assumptions explicitly and facilitate an honest discussion among the team members. Yawen says, "We realized that it's very important to find that one single most important hypothesis, and... which is the single riskiest assumption we need to identify."
Discovering target behaviors
Team Byoyo got out of the building again, this time discarding their useless "Yes/No" questions in favor of probing "Why?" and "How?" questions that illuminated how parents capture information about their children and how they want to share it. The team discovered many vital, nuanced offline customer behaviors and the barriers to translating them into online ones. For example, parents organized their print photos, but couldn't easily do that online. Jack says, "We could help them structure their child's history, turn it into a book, and so on."
The team returned to the workshop with a new concept of what to build. For example, they originally wanted to create a web-based social network, but realized a monolithic platform would be harder for their target audience to adopt. Instead they decided to start with a mobile app that could highlight emotional interactions, like immediately sharing smartphone photos of their children.
Ultimately the team won the workshop competition after validating and invalidating the most assumptions and pivoting based on validated learning. Chen Ying concluded, "The workshop definitely helped me learn more tools and methods to start my own business."