Venture Design Crash Course Solving The Right Problem

Venture
Design
Crash
Course
Solving the Right
Problem
COWAN+
Copyright 2014 Cowan Publishing
ABOUT ME
Entrepreneur (5x)
Intrapreneur (1x)
ALEX COWAN
AlexanderCowan.com
@cowanSF
ABOUT ME
ALEX COWAN
AlexanderCowan.com
@cowanSF
ABOUT ME
www.alexandercowan.com
ITS A PROCESS
Some techniques are more effective than others.
Personas
But they all require substantial, consistent exertion.

SCALE-FRIENDLY VS. INNOVATION-FRIENDLY

Scale
Friendly
Innovation
Friendly
!?
Copyright 2014 COWAN+
SCALE-FRIENDLY VS. INNOVATION-FRIENDLY
Learn First
Scale Second
DOUBLE DIAMOND MODEL OF DESIGN

Finding the Right
SOLUTION
alternatives
Finding the Right

PROBLEM
divergence
convergence
divergence
time
convergence
source: adapted from The Design of Everyday Things

CRASH COURSE?
More Explanation vs. Workshop

More Homework vs. Workshop
THE VENTURE DESIGN PROCESS
Scale?
Who?
THINK
FEEL
SEE
DO
What?
What if?
Tell me?
How?
/
Pivot?
PERSONAS
PROBLEM
VALUE
CUSTOMER
USER
PRODUCT &
SCENARIOS &
PROPOSITIONS DISCOVERY & STORIES &
PROMOTION
ALTERNATIVES & ASSUMPTIONS EXPERIMENTS PROTOTYPES
THE VENTURE DESIGN PROCESS (IN REVERSE)

Do we
understand this
person? What
makes them
tick?
THINK
SEE
FEEL
DO
PERSONAS
Is problem
relevant? Is the
proposition
better vs.
alternatives?
Was the
How did the
implemented
customer/user
story relevant to react?
the proposition?
Did the implementation

deliver on the story?
PROBLEM
VALUE
USER
CUSTOMER
PRODUCT &
SCENARIOS &
PROMOTION
Scale?
Who?
THINK
FEEL
SEE
DO
What?
What if?
Tell me?
How?
/
Pivot?
PERSONAS
PROBLEM
VALUE
CUSTOMER
USER
PRODUCT &
SCENARIOS &
PROMOTION
WHY IS DESIGN THINKING HARD?
Then
Now
Survival
Design Thinking
ALEX COWAN
AlexanderCowan.com
@cowanSF
DESIGN THINKING
Empathy
Creativity
DESIGN THINKING- APPLICATIONS
ALEX COWAN
AlexanderCowan.com
@cowanSF
Empathy
Entry
Urinate as they go
Edges preferred
Speedy
PB > cheese
ALEX COWAN
AlexanderCowan.com
@cowanSF

Check & Repair
UV Validation
Relevant Placement
A Better Mouse Trap
Powered by Better Bait
Creativity
ALEX COWAN
AlexanderCowan.com
@cowanSF
DESIGN THINKING- PERSONAS
Personas
Problem Scenarios
Alternatives
Your Value Propositions
Foundation in
Design Thinking
ALEX COWAN
AlexanderCowan.com
@cowanSF
ALEX COWAN
AlexanderCowan.com
@cowanSF
NOT A GOOD PERSONA
Women
Age 28-45
Has kids
Socialize with other moms
Online with Facebook
86% said theyd like to be more
organized
70% said theyd use an
application that organizes them
NOT A GOOD PERSONA

This is a huge
population- not exact
These responses are fake

actionable- survey responses
like this are unreliable
Women
points are almost
Age 28-45 Bullet
never vivid or detailed
Has kids
Socialize with other moms
Online with Facebook
86% said theyd like to be more
organized
70% said theyd use an
application that organizes them
Stock photo- not real

THE ART OF CUSTOMER DISCOVERY
02 DIAGNOSING USER NEEDS & PROBLEMS
The twin anti-poles of design failure

S
Doing precisely
what the user asks
P
A
N
Assuming you know whats

best and ignoring the user
A BETTER PERSONA
Mary the Mom

Mary is a mom by choice. She had a successful career in accounting,
but welcomed the opportunity to be a stay at home mom. She loves it.
But its not like having kids purged her creative, social instincts. She
wants to connect, she wants to learn, she wants to interact. Being a
mom is a job and she wants to do it well. That means corresponding
with other moms on child education and keeping track of what works.
She posts to Facebook at least twice a week and responds to other
moms items more often than that.
She has a few blogs and publications she reads regularly
A BETTER PERSONA
the use of a first name helps
w/ vividness (a little)
Mary the Mom

Mary is a mom by choice. She had a successful career in accounting,
but welcomed the opportunity to be a stay at home mom. She loves it.
these full sentences look like a

good start towards something
vivid and detailed
But its not like having kids purged her creative, social instincts. She
wants to connect, she wants to learn, she wants to interact. Being a
mom is a job and she wants to do it well. That means corresponding
with other moms on child education and keeping track of what works.
She posts to Facebook at least twice a week and responds to other
moms items more often than that.
this is a real photo of a

relevant person taken with an
iPhone in the real world
She has a few blogs and publications she reads regularly
V ivid
A ctionable
R eal
I dentifiable
Exact
D etailed
EXERCISE- PERSONA CREATION

List at least 3 personas
Mary the Working Mom
Susan the Stay-at-Home Mom
Douglas the Dad
Nathan the Nanny
Ivan the Infant
use 1 index card/

persona
(4 min)
A LITTLE GAME FOR BETTER PERSONA DISCOVERY
Day in the Life

we look at a few photos for a given persona
(not a full picture, just snippets)
you make some guesses about them
there are no right answers BUT
there is a right process: observe and infer
OBJECTIVE: get a feel for whats real; start to create something vivid
OUR CAST
Miguel the
Mid-Mellenial
WAKE UP!
BREAKFAST & HEAD TO WORK
AT WORK
AFTER WORK
PRE-BED
GEAR
IF I HAD 3 EXTRA HOURS
ABOUT MIGUEL THE MID-MILLENIAL

Whats his favorite kind of music?
Band/composer?
Where did he buy his last pair of shoes?
What movie did he last see?
What did he drink with dinner last night?
If he had a dog, what kind?
Whats his favorite magazine?
OUR CAST
Sally the
Single Mom
WAKE UP!
WAKE UP!
GEARING UP FOR THE DAY
AT WORK
AFTER WORK
PRE-BED
BED
GEAR
IF I HAD 3 EXTRA HOURS
ABOUT SALLY THE SINGLE MOM

Whats her favorite kind of music?
Band/composer?
Where did she buy her last pair of shoes?
What movie did she last see?
What did she drink with dinner last night?
If she had a dog, what kind?
Whats her favorite magazine?

Which are buyers? Users? Both?
Note with a B and/or a U on the Index Card
Mary the Working Mom (B, U)
Susan the Stay-at-Home Mom (B, U)
Douglas the Dad (U)
Nathan the Nanny (U)
Ivan the Infant (U)
(1 min)

Can you think of 5 real examples for each?
Use the back of your index cards
(2 min)
DISCOVERY & LEARNING: THINK-SEE-FEEL-DO
ALEX COWAN
AlexanderCowan.com
@cowanSF
EXERCISE- PERSONA CREATION (6 MIN)

For your top person, complete Think-See-Feel-Do
EXAMPLE: HELEN THE HR MANAGER
Thinks: Helen thinks the hiring process should be so much better- more systematic, fewer bad hires. Professional
development is something theyve identified that they want to do better, but the functional managers arent engaged
enough to get the whole thing started.
Sees: Helen is at the tail end of every bad hire and sees the damage it does to the employee and company, alike.
Helen sees that online learning has rocketed forward in the last few years. If someone wants to learn a specific skill,
theres a number of high quality options online, many of them free. They just need a way to help employees organize
select into these courses.
Feels: Helen feels like crap whenever they have to let someone go. She hates it. The employee hates it. The manager
hates it. Its incredibly destructive and de-motivating for everyone involved. Helen would love to be more involved,
more included in functional skills evaluation and improvement. Shes love to have a success story to talk about. Most
HR departments dont do a whole lot in this area.
Does: Helens relatively responsive to new ideas, particularly if someone knowledgeable is willing to come in and talk
about it. If she likes it, shell bring it to the functional managers, who are usually the ultimate decision makers since
without their support she cant get the system online and working. Post-sale, Helen will help keep the program
organized, moving, and otherwise on the functional managers radar. All this is predicated on Helen being equipped
with the right messages, facts, and best practices to make the purchase and use of Enable Quiz effective.
DISCOVERY & LEARNING: THINK-SEE-FEEL-DO
ALEX COWAN
AlexanderCowan.com
@cowanSF
DISCOVERY & LEARNING: PROBLEM SCENARIOS
PROBLEM SCENARIO
ALEX COWAN
AlexanderCowan.com
@cowanSF
PROBLEM SCENARIO
What job(s) are you doing for
the customer?
What existing need or
behavior are you fulfilling?
ALEX COWAN
AlexanderCowan.com
@cowanSF
PROBLEM SCENARIO
ALTERNATIVE(S)
?
ALEX COWAN
AlexanderCowan.com
@cowanSF
PROBLEM SCENARIO
ALTERNATIVE(S)
If they currently use

spreadsheets, watch them
use it and get a copy of it.
If they currently put notes on the
family fridge, ask about it,
photograph it.
ALEX COWAN
AlexanderCowan.com
@cowanSF

Hiring technical talent is difficult.
(Too Broad, Abstract)
Screening technical talent is difficult.

(Probably About Right)
Its hard for the HR manager to send good notes on

candidates to the functional manager.
(Too Detailed, A Feature vs. a Product/Venture)
EXERCISE- PROBLEM SCENARIOS
X
?
Brainstorm Problem ScenarioAlternative-Value Proposition

PROBLEM SCENARIO Trios.
ALTERNATIVE(S)
Problem: Helen doesn't have a software

engineering background, so it's hard for her to
screen engineering candidates. She ends up
sending the functional manager too many
unqualified candidates. .
Alternative: She calls references and mostly
ends up taking their word for it.
(5 min.)
PROBLEM SCENARIO
ALTERNATIVE(S)
YOUR VALUE PROPOSITIONS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PROBLEM SCENARIO
ALTERNATIVE(S)
YOUR VALUE PROPOSITIONS

Are they better enough than the
alternative(s)?
ALEX COWAN
AlexanderCowan.com
@cowanSF
EXERCISE- VALUE PROPOSITIONS
X
?
!
Add Value Propositions to

your top Problem Scenario +
PROBLEM SCENARIO Alternative Pairs
ALTERNATIVE(S)
YOUR VALUE
PROPOSITIONS
Problem: Helen the HR Manager doesn't

have a software engineering background, so
it's hard for her to screen engineering
candidates. She ends up sending Frank the
Functional Manager too many unqualified
candidates.
Alternative: She calls references and mostly
ends up taking their word for it.
Value Proposition: New ability for meaningful
screening of technical candidates, increasing
% of successful hires and lowering Frank the
Functional Manager's workload on recruiting.
(3 min.)
AND NOW THE PRODUCT HYPOTHESIS

A certain PERSONA exists
and they have a certain
PROBLEMS(S)
where theyre currently using

certain ALTERNATIVE(S)
and I have a VALUE

PROPOSITION thats better enough
than the alternatives to cause the
persona to act (purchase, use, etc.).
!
EXERCISE: YOUR PRODUCT HYPOTHESIS

PROBLEMS(S)

and I have a VALUE
PROPOSITION thats better
enough than the alternatives to
cause the persona to act
(purchase, use, etc.).
Enable Quiz example:

HR and functional managers are in charge of
technical hires
and they struggle to effectively screen for
technical skill sets, making the hiring process
slower and more labor intensive and
producing worse outcomes than they should
reasonably expect.
Currently they implement a patchwork of
calling references and asking a few probing
questions.
By offering an easy, affordable, lightweight
technical quizzing solution, Enable Quiz can
acquire and retain these customer personas,
delivering material value.
(4 min.)
THE BUSINESS MODEL CANVAS

(Key
Partners)
(Key
Activities)
(Key
Resources)
(Cost Structure)
(Value
(Customer
Propositions) Relationships)
(Customer
Segments)
(Channels)
(Revenue Streams)
The templates here are made available on the same CC license terms as the original canvas.
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http://
creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
ALEX COWAN
AlexanderCowan.com
@cowanSF
SEGMENT TO VALUE PROPOSITION MAPPING

Partner_1
Partner_2
Partner_3
Activity_1
Activity_2
Activity_3
Proposition_1
Proposition_2
Proposition_3
Relationship_1
Relationship_2
Relationship_3
Resource_1
Resource_2
Resource_3
Cost_1
Cost_2
Cost_3
The templates here are made available on the same CC license terms as the original canvas.
Segment_1
Segment_2
Segment_3
Sort personas
and value
propositions in
priority order for
focal clarity
Channel_1
Channel_2
Channel_3
Revenue_1
Revenue_2
Revenue_3
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http://
creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
ALEX COWAN
AlexanderCowan.com
@cowanSF
RECOMMENDED NEXT STEPS
Homework (details: bit.ly/hi-wslab)

1. Draft a working set of personas
2. Draft a working set of problem scenario-alternative-value proposition trios.
3. Organize the above in priority order on the Business Model Canvas
4. Finish a working product hypothesis and positioning statement.
GOOGLE DOC TEMPLATE: http://bit.ly/venturetemplate

RESOURCES: bit.ly/vdesign
PEER PRESENTATIONS PREP!

For [target customer] who [statement of the need or opportunity], the
[product name] is a [product category] that [statement of key benefit/
key reason to buy]. Unlike [primary alternative], our product [statement
of primary differentiation].
EXAMPLE
For [hiring managers] who [need to evaluate technical talent], [Enable
Quiz] is a [talent assessment system] that [allows for quick and easy
assessment of topical understanding in key engineering topics]. Unlike
[formal certifications or ad hoc questions], our product [allows for
lightweight but consistent assessments of technical talent].
(4 min.)
EXERCISE: PEER PRESENTATION
As
Presenter
1) What is this? (Use positioning
statement)
2) Who is the persona? What kind of shoes
do they wear?
3) What problem scenario(s) are you
looking at? What alternatives does the
persona use now?
4) Whats your value proposition?
5) Whats your product hypothesis?
6) What do you need to learn more about?
As
Audience
- Focus on the process; avoid editorial
- Ask a lot of questions
- Think about it like an investor
(5 min./ each)
STORYBOARDING: ORIGINS
copyright Fred Moore & Disney Pictures
ALEX COWAN
AlexanderCowan.com
@cowanSF
STORYBOARDING EXAMPLE
Personas
STORYBOARDING EXAMPLE
Personas
ENABLE QUIZ: EXAMPLE PROBLEM SCENARIOS

PERSONA
Helen the HR Manager
Frank the Functional Manager
PROBLEM
SCENARIO
Its hard for me to screen on

technical skill sets and I end up
sending Frank unqualified
recruits.
I have limited time and I dont

want to be a jerk. Its hard to
screen for all the relevant
technical skill sets.
ALTERNATIVE(S)
- Call references
- Take their word for it
- A few probing questions

- Take their word for it
VALUE
PROPOSITIONS
New ability for meaningful

screening of technical
candidates, increasing % of
successful hires and lowering
Franks workload on recruiting.
Less time doing interviews, and

better hires sooner.
?
!
Copyright
Cowan
Publishing
Copyright
20142014
Cowan
Publishing
STORYBOARDING A PROBLEM SCENARIO

BEFORE
BEFORE
(using the
Alternative)
AFTER
AFTER
(with the Value
Proposition)
Trigger?
Before
+
How does the
After
problem scenario
initiate?
Action?
How is the
alternative
executed?
Reward?
How well is the
persona gratified?
1 Panel
Optional notes here to

supplement your storyboard
}
}
Storyboard
Area
Notes
Area
EXERCISE: BEFORE AND AFTER BOARDS

Using the squares, create a before and then after
storyboard- 3 panels each
BEFORE
(using the
Alternative)
AFTER
(with the Value
Proposition)
(10 min.)
DESIGN THINKING- USING PERSONAS
MAKING
STUFF
What does the

user (most) want?
SELLING
STUFF
What does the

user actually do?
Who are we
selling to?
Whos buying?
Where do we
reach them?
Where?
With what
proposition?
Personas
Problem Scenarios
Alternatives
Your Value Propositions
Why?
Foundation in
Design Thinking
4 TYPES OF LEAN HYPOTHESES
PERSONA
HYPOTHESIS
PROBLEM
HYPOTHESIS
VALUE
HYPOTHESIS
CUSTOMER CREATION
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PERSONA HYPOTHESIS
Does this person exist?
Can you identify them?
Do you understand them really well?
What do they think-see-feel-do in your area?
ALEX COWAN
AlexanderCowan.com
@cowanSF
PROBLEM HYPOTHESIS
Have you identified a discrete problem/need?

How important is it to the target persona(s)?
What alternatives do they use today? How?
ALEX COWAN
AlexanderCowan.com
@cowanSF
VALUE HYPOTHESIS
How much better than the best alternative is your

product?
How obvious is that to the customer?
ALEX COWAN
AlexanderCowan.com
@cowanSF
VALUE HYPOTHESIS
We tried a few things with AdWords and landing

pages, but the results werent great.
What happens when you try the
same thing out in the real
world? Search is a good way to
connect with existing demand
but not necessarily learn about
its fundamentals.
ALEX COWAN
AlexanderCowan.com
@cowanSF
CUSTOMER CREATION HYPOTHESIS
How will you get the customers: attention, interest,

desire, action, onboarding, retention?
How will you know if its working?
ALEX COWAN
AlexanderCowan.com
@cowanSF
CUSTOMER CREATION HYPOTHESIS
Most of these results are pretty

definitive.
ALEX COWAN
AlexanderCowan.com
@cowanSF
Scale?
Who?
THINK
FEEL
SEE
DO
What?
What if?
Tell me?
How?
/
Pivot?
PERSONAS
PROBLEM
VALUE
CUSTOMER
USER
PRODUCT &
SCENARIOS &
PROMOTION
THE STARTUP: THEN AND NOW

Then
Now
Five Year
Plan
Lean
Management
01 IDEA!
45,000,000%
40,000,000%
02 HYPOTHESIS
35,000,000%
30,000,000%
25,000,000%
Revenue%
Expense%
20,000,000%
EBITDA%
15,000,000%
6.a PIVOT
experiments
03 EXPERIMENTAL DESIGN
disprove
hypothesis
04 EXPERIMENTATION
10,000,000%
5,000,000%
0%
2012%
!5,000,000%
2013%
2014%
2015%
2016%
2017%
2018%
2019%
2020%
05 PIVOT OR PERSEVERE?
6.b PERSEVERE
experiments prove
hypothesis
EVIDENCE-BASED INNOVATION VIA LEAN STARTUP

Do I have real evidence from my buyer
that this is compelling?
01 IDEA!
What are the key assumptions required

to make this business work?
02 HYPOTHESIS
How do I definitely prove or disprove the

assumptions with a minimum of time
and effort?
Am I reacting or am I focused on
validating my pivotal assumptions?
Pivot or persevere?
6.a YES
results
disprove
hypothesis
04 EXPERIMENTATION
05 REVISE?
6.b NO
we appear to
have a valid
hypothesis

01 IDEA!

02 HYPOTHESIS
6.a YES
results
disprove
hypothesis
04 EXPERIMENTATION
05 REVISE?
6.b NO
we appear to
have a valid
hypothesis
THE PRODUCT HYPOTHESIS

PROBLEMS(S)

and I have a VALUE

PROPOSITION thats better enough
than the alternatives to cause the
persona to act (purchase, use, etc.).
!

01 IDEA!
02 HYPOTHESIS

and effort?
6.a YES
results
disprove
hypothesis
04 EXPERIMENTATION
05 REVISE?
6.b NO
we appear to
have a valid
hypothesis
ASSUMPTIONS: ORGANIZED AND PRIORITIZED

Priority
Key Assumption
Needs Proving?
Experimentation
[A key assumption about the [Whether it needs

proving
business]
[Experiment to
prove or disprove]
Hiring managers would

prefer a lightweight quiz app
Yes
over calling references and
ad hoc probing.
* Customer interviews on problem

scenario
* Value testing through minimum
viable product
Managers want to be able to

Yes
add their questions as well
* Show prototypes with choices

* Test in beta
Parents have smart phones
n/a
No
Focus on strategic,
pivotal assumptions
FOCUS AND THE LEAN STARTUP
Crossing ts
Dotting is
Doesnt matter unless it
helps prove (or disprove)
your pivotal assumptions
FOCUS AND THE LEAN STARTUP
Subject
all your
activities +
metrics to
that litmus
test.
PERSONA
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PERSONA
HYPOTHESIS
PROBLEM
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PERSONA
HYPOTHESIS
PROBLEM
HYPOTHESIS
VALUE
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PERSONA
HYPOTHESIS
PROBLEM
HYPOTHESIS
VALUE
HYPOTHESIS
CUSTOMER CREATION
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PERSONA
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PERSONA HYPOTHESIS- CHECKLIST

Hypothesis
Experiment
This persona exists (in non-trivial

numbers) and you can identify them.
- Can
You understand this persona well.
- What
you think of 5-10 examples?

you set up discovery interviews with them?
- Can you connect with them in the market at large?
- Can
kind of shoes do they wear?

you hearing, seeing the same things across your discovery
interviews?
- Are
Do you understand what they Think in

your area of interest?
- What
Do you understand what they See in

your area of interest?
- Where
How do they Feel about your area of

interest?
- What
Do you understand what they Do in your

area of interest?
- What
do you they mention as important? Difficult? Rewarding?

- Do they see the work (or habit) as you do?
- What would they like to do better? To be better?
do they get their information? Peers? Publications?
- How do they decide whats OK? Whats aspirational?
are their triggers for this area? Motivations?
- What rewards do they seek? How do they view past actions?
do you actually observe them doing?
- How can you directly or indirectly validate thats what they do?
EXERCISE: WHOS YOUR EARLY MARKET?

Answer each as best you can: ~ 1 min/each
1) How do they differ within your existing persona definitions?
Example: At Enable Quiz, theyre startups doing lots of hiring
2) How will you locate them?
Example: At Enable Quiz, theyll read tech rags to see who just got funded.
3) How will they help you transition to your next segment?
Example: At Enable Quiz, via case studies, references, and incented posts on LinkedIn.
(4 min.)
EXERCISE: PERSONA DISCOVERY QUESTIONS (5 MIN)

Question Form
Examples Questions (Enable Quiz)
Tell me about [yourself in the role of the persona]?
- Tell
Tell me about [your area of interest]?
me about being an HR manager?

- How did you choose that line of work? Why?
- What do you most, least like about the job?
- What are the hardest, easiest parts of the job?
- Ive heard [x]- does that apply to you?
- Do you do screen new candidates? If not, who?
- Can you tell me about the last time? What was the trigger?
- Who else was involved? What was it like?
Tell me your thoughts about [area]?
- How
What do you see in [area]?
- Where
How do you feel about [area]?
- What
What do you do in [area]?
- Would you show me your interview guide? Example notes? - What

the vetting process was like on the last few candidates?
should it ideally be done?

- How is it actually done? Why?
do you learn whats new? What others do?
- Who do you think is doing it right?
- How did you make your last decision?
motivates you? What parts of it are most rewarding? Why?
Tell me about the last time?
- What would it be like in your perfect world?
KEY TO GOOD PERSONA DISCOVERY
1) Create a level of person-ability and comfort

2) Acclimate them to the idea that youre not just
wondering about the general picture
PERSONA
HYPOTHESIS
3) Assure them by demonstration that youre not

selling anything or advocating a point of view
ALEX COWAN
AlexanderCowan.com
@cowanSF
PERSONA
HYPOTHESIS
PROBLEM
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
PROBLEM HYPOTHESIS- CHECKLIST

Hypothesis
Experiment
Youve identified at least one discrete

problem (job, desire, etc.)
- Can
The problem is important
- Do
You understand current alternatives
- Have
you describe it in a sentence? Do others get it?

- Can you identify current alternatives?
subjects mention it unprompted in discovery interviews?
- Do they respond to solicitation (see also value and customer creation
hypotheses)?
you seen them in action?
- Do you have artifacts (spreadsheets, photos, posts, notes, whiteboard
scribbles, screen shots)?
EXERCISE: PROBLEM DISCOVERY QUESTIONS

Question Form
Examples Questions (Enable Quiz)
What are the top [5] hardest things about [area of

interest]?
- What
How do you currently [operate in area of interest- if

you dont have that yet]? OR Heres what I got on
[x]- is that right?
- How
Whats [difficult, annoying] about [area of interest]?
- Whats
What are the top 5 things you want to do better

this year in [general area of interest]?
- What
Why is/isnt [your specific area of interest on that

list]?
- Why is/isnt screening for technical candidates on that list?
are the top 5 most difficult things about making good tech
hires? Why?
do you currently screen for technical skill sets?

- Who does what?
- How does that work?
difficult about screening technical candidates?
- How do you validate they have the right skill set?
- How are the actual outcomes? Examples?
are the top 5 things you want to do better in technical
recruiting and hiring?
(5 min.)
KEY TO GOOD PROBLEM DISCOVERY
1) Avoid prompting, progressing to it only as a

last ditch effort
2) Get them in storytelling mode- focus on
specifics and details
PROBLEM
HYPOTHESIS
3) Focus on just getting them talking- mind the

time but be careful about interrupting for course
corrections
ALEX COWAN
AlexanderCowan.com
@cowanSF

01 IDEA!

02 HYPOTHESIS

and effort?
Pivot or persevere?
6.a YES
results
disprove
hypothesis
04 EXPERIMENTATION
05 REVISE?
6.b NO
we appear to
have a valid
hypothesis

01 IDEA!
02 HYPOTHESIS
6.a YES
results
disprove
hypothesis
04 EXPERIMENTATION
Pivot or persevere?
05 REVISE?
6.b NO
we appear to
have a valid
hypothesis
PERSONA
HYPOTHESIS
PROBLEM
HYPOTHESIS
VALUE
HYPOTHESIS
ALEX COWAN
AlexanderCowan.com
@cowanSF
VALUE HYPOTHESIS- CHECKLIST

Hypothesis
Your product is better enough than the

alternative to make sales (traffic, etc.)
Customers will readily perceive this

superiority if you [x]
Experiment
- You
successful execute a (paid?) concierge MVP
or
- You successfully pre-sell the product
or
- You successfully drive drive sign-ups online
- (see above)
TESTING YOUR HYPOTHESIS VIA MVP
Minimum
V
P
What is the fastest,

cheapest way to
validate or
invalidate this
option so we give
ourselves more
options on future
success?
Minimum
Viable
Will it give us a
definitive result?
What are the
actionable metrics?
Minimum
Viable
Product
Does it really
require actual
product? Can we
use alternative
brands, channels?
Minimum
Viable
Product
is not necessarily actual software/product

(see concierge MVP)
is a first and foremost learning vehicle
vs. a project plan
vs. a product development project
(OK to do those things but always
subordinate them to the learning mission)
THE MVP LITMUS TEST
output !=
outcome
Is your MVP driving an
extraordinary outcome?
Or is it a vehicle to create output
as usual?
CASE STUDY: DROPBOX

OPPORTUNITY
Underlying demand and supporting
infrastructure ready for a great file sharing
app.
CHALLENGE
Building a great cross-platform app.
required VC funding. VCs saw a space
with lots of existing competitors struggling
to get traction.
CASE STUDY: DROPBOX

Persona
Tom the Techie- early adopter who works on projects that require swapping a lot of files between a
shifting network of collaborators.
Problem
Scenario
Its difficult to share files between a network of collaborators, particularly if theyre: big or numerous or
change a lot.
Alternatives
Many existing products, but none of them super compelling and widely adopted.
Also, custom setups which work but are cumbersome to set up and maintain.
Value Prop.
A file sharing service that truly feels transparent to the user across all major platforms- OSX, iOS,
Windows, etc.
What Minimum Viable Product (MVP)?

That you can bootstrap?
That doesnt require software at all?
THE WIZARD OF OZ MVP @ DROPBOX

Created a synthetic demo
tailored for early market
(techies), promoted it, and
measured email sign-ups.
Result: Excellent traction and
conversion to sign-ups.
Strong validation signal.
EXAMPLE: ENABLE QUIZ

OPPORTUNITY
Hiring quality technical talent is critical for
many companies, but screening for skill
sets is time consuming and awkward.
CHALLENGE
The founding team wants to bootstrap
without external funding so they need to
focus on a specific technical domain, one
that will get them strong early traction.
EXAMPLE: ENABLE QUIZ

Persona(s)
Helen the HR Manager- responsible for sourcing and screening job candidates
Frank the Functional Manager- hiring manager responsible for acquiring and managing talent
Problem
Scenario
Helen: hard to screen for technical skills

Frank: never has enough time for recruiting and doesnt want to be a jerk during interviews
Alternatives
Helen: call references, take their word for it (on skills)

Frank: ask a few probing questions
Value Prop.
A lightweight quizzing app that has Helen can use to do quick, effective screening.

THE CONCIERGE MVP @ ENABLE QUIZ

Create paper quizzes by hand
for positions that subject HR
managers have open. Give the
quizzes to the HR managers to
use.
Target Outcome:
- They use them
- They want more
- It improves hiring outcomes
CASE STUDY: LEONID SYSTEMS

OPPORTUNITY
Major disruption and new product
opportunities among telecom providers
with introduction of voice-over-IP and cloud
communications.
IT systems need to be rethought.
CHALLENGE
As a one-person startup, Leonid had
actionable ideas but not enough resources
to execute an end-to-end solution.
CASE STUDY: LEONID SYSTEMS

Persona
Chris the CTO- has funding and mandate to transition the business towards hosted services; many
bases to cover
Problem
Scenario
IT is the most expensive, most risky area when making changes to the business.
Alternatives
1) Place large, risky bets on major new system upgrades. 2) Make small incremental updates (but risk
not keeping pace).
Value Prop.
Leonid will offer modular, integration-friendly applications in two critical areas: 1) services provisioning
and 2) end user self-service portals.

THE CONSULTING CONCIERGE MVP @ LEONID

CONSULTING
Started with consulting as a

concierge vehicle to create
tactical solutions, evolving to
full-fledged product.
PRODUCTIZED
CONSULTING
PRODUCTS
Result: Steady step-wise

growth with consistently better
understanding of key customer
problem scenarios.
CASE STUDY: ZAPPOS

OPPORTUNITY
An observed problem scenario around the
difficulty of finding the right shoe at local
retail and a giant (but nascent) market in
online retail (1999).
CHALLENGE
Consumers still in the early stages of
adopting and habituating to online retail.
Founder (Nick Swinmurn) wanted to
bootstrap.
CASE STUDY: ZAPPOS

Persona
Sam the shoe-hound- knows what he wants but not where to get it.
Problem
Scenario
Sam is unable to find the shoe he wants at local retailers, wasting time and getting frustrated.
Alternatives
Possibly mail order or wait until hes in a bigger market to go to the store.
Value Prop.
Make the shoe Sam wants accessible online and make sure he has a great experience so hell come
back and not have to think about where to find the shoe he wants anymore.

THE SALES MVP @ ZAPPOS

Photographed shoes and put
them online to observe
whether anyone bought them.
Result: It worked and the rest
is history.
CASE STUDY: STEALTH PHOTO-SOCIAL STARTUP

OPPORTUNITY
Lots of exciting things happening in the
photo-social space.
CHALLENGE
The team had several ideas but few
resources.
CASE STUDY: STEALTH PHOTO-SOCIAL STARTUP

Persona
Existing poster of photos. Personas: Martha the Mom, Pat the Party Planner, Teresa the Teen Social
Butterfly
Problem
Scenario
[I want to do something interesting with my photos so that my social graph rewards me with interest and
acclaim]
Alternatives
Manually enhance photos, use alternative enhancers/amplifiers like Instagram
Value Prop.
[This is something users can do with photos that will generate engaging content for their social graph]
USER JOURNEY: PHOTO-SOCIAL

What MVP?
That you can
bootstrap?
That doesnt require
software at all?
ASSUMPTION
Users social network
will like and share the
apps output
THE CONCIERGE MVP @ PHOTOSOCIAL STARTUP
MVP
Create the target output
by hand (concierge
style)
Does anyone care?
ASSUMPTION
Users social network
will like and share the
apps output
ABOUT MVPS AND PRODUCTS IN GENERAL

You have to put the magic in
the software.
(Not the other way around)
Concierge and other nonsoftware MVPs can be pretty
magical.
Find 100 people that are really
into it and you can probably
grow.
THE ARCHETYPES
Archetype
Notes
Wizard of Oz
Show the experience.
Concierge
Hand create the user experience.
Sales
See if you can sell some.
EXERCISE: YOUR (CONCIERGE) MVP

Component
Notes
What is the experience you want to provide?
- What
What measurable outcome would validate

your value proposition?
- How
How will you find participants and what are

the core screening/qualification criteria?
- How will you know if the subjects are relevant to your

core hypothesis?
are the preconditions and general steps?
will you know if its delivering value?

- This could be: a) measurably better outcomes b) activity
levels c) follow-on interest
(5 min.)
CLASS PRESENTATIONS
As Presenter
1) What is it? Use pos. statement.
2) Who is it for? What shoes do they
wear?
3) What problem does it solve?
4) What are your ideas for an MVP?
As Audience
- Focus on the process; avoid
editorial
- Ask a lot of questions
- Think about it like an investor
POINT OF EMPHASIS
You are
the most
important
part of the
experiment
Make sure
youre
learning
RECOMMENDED NEXT STEPS
Homework (details: bit.ly/hi-wslab)

1. Draft a working set of personas
2. Draft a working set of problem scenario-alternative-value proposition trios.
3. Organize the above in priority order on the Business Model Canvas
4. Finish a working product hypothesis and positioning statement.
5. Finish a working interview guide to validate your persona and problem hypotheses.
6. Complete at least 5 customer interviews.
7. Draft a working set of assumptions
8. Design your experiments and execute.
GOOGLE DOC TEMPLATE: http://bit.ly/venturetemplate

RESOURCES: bit.ly/vdesign
FINI
Hypothesize
Learn
Experiment
View this deck
bit.ly/hi-wslab
Check out
Venture Design
bit.ly/vdesign
Use Customer
Discovery Handbook
bit.ly/playent
Twitter!
@cowanSF
Get in touch
acowan@alexandercowan.com
Copyright 2014 COWAN+

Venture Design Crash Course Solving The Right Problem

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Venture Design Crash Course Solving The Right Problem

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Venture

Some techniques are more effective than others.

But they all require substantial, consistent exertion.

SCALE-FRIENDLY VS. INNOVATION-FRIENDLY

Copyright 2014 COWAN+

SCALE-FRIENDLY VS. INNOVATION-FRIENDLY

Copyright 2014 Cowan Publishing

DOUBLE DIAMOND MODEL OF DESIGN

Finding the Right

source: adapted from The Design of Everyday Things

More Explanation vs. Workshop

Copyright 2014 Cowan Publishing

THE VENTURE DESIGN PROCESS

THE VENTURE DESIGN PROCESS (IN REVERSE)

Did the implementation

THE VENTURE DESIGN PROCESS

WHY IS DESIGN THINKING HARD?

DESIGN THINKING- APPLICATIONS

DESIGN THINKING- APPLICATIONS

DESIGN THINKING- APPLICATIONS

A Better Mouse Trap

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DESIGN THINKING- PERSONAS

Copyright 2014 Cowan Publishing

DESIGN THINKING- PERSONAS

DESIGN THINKING- PERSONAS

NOT A GOOD PERSONA

NOT A GOOD PERSONA

These responses are fake

Stock photo- not real

THE ART OF CUSTOMER DISCOVERY

Copyright 2014 Cowan Publishing

02 DIAGNOSING USER NEEDS & PROBLEMS

The twin anti-poles of design failure

Assuming you know whats

Copyright 2014 Cowan Publishing

Mary the Mom

Copyright 2014 Cowan Publishing

Mary the Mom

these full sentences look like a

this is a real photo of a

She has a few blogs and publications she reads regularly

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

EXERCISE- PERSONA CREATION

use 1 index card/

A LITTLE GAME FOR BETTER PERSONA DISCOVERY

Day in the Life

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Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

BREAKFAST & HEAD TO WORK

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

IF I HAD 3 EXTRA HOURS

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ABOUT MIGUEL THE MID-MILLENIAL

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

Copyright 2014 Cowan Publishing

GEARING UP FOR THE DAY

Copyright 2014 Cowan Publishing