I used to believe that running a business was an art, not a science. There was no rulebook. You try lots of things, and you fail at many of those things. Sometimes, some of those things work.
I’m not sure I believe this anymore. I think you can be taught the fundamentals of building a business.
This is not to say it will guarantee you a successful business - far from it. But I do believe that learning the fundamentals will raise your likelihood of long-term success.
The scientific approach
Starting TCLA at 23 has been a good and a bad thing. Naivety helps at an early stage; had I started the business later, there is a possibility that I would have talked myself out of it. Looking back, I think you need an almost-foolish sense of optimism to keep yourself going before you have traction.
But it also means that I do not have the benefit of knowing how things work in established businesses. Every week, there is something new that makes me realise, ‘So that’s why businesses do X!’
These past two weeks I have been deep in the weeds of the Lean Startup methodology. It’s one of those books everyone tells you to read when you start your business, and yet you decide you’re better off watching a 5-minute YouTube summary. I’m speaking for myself here: there is no replacement for reading the full thing.
Here’s a (very) simplified explanation:
Suppose I have spotted a ‘gap in the market’. I have an idea for a new business.
Option A is to keep my head down for six months, invest my savings into building the product and then go for a ‘big’ launch. I think this is what most people are tempted to do when they start a business. You build the product, and then you sell.
Option B is to realise that your idea is just a hypothesis. You have a theory, which is upheld by a series of assumptions that you have about the way the world works. In Option B, rather than spending six months building the platform, you spend one week building something very minimal to determine whether your assumptions are correct. You then measure the outcome of your experiment by observing the data and speaking to customers, which informs how you proceed with your product. You go through this loop over and over again.
Which option do you think is better?
You never stop testing
The problem with Option A is that it’s very common for nothing to happen at the end of your launch. And it’s too late. You spent six months and your savings only to discover customers aren’t willing to pay for your product because they don’t believe it solves their problems. You were content in those six months because you could still believe that your idea could be a good idea, but you never actually tested it.
What I found most eye-opening about Option B is that it’s not only applicable to the launch of your idea, it applies to every step of the journey. You keep conducting small experiments and you keep going through the loop: building, measuring and learning. Because you keep talking to customers and you keep iterating, you are tightly focused on building a solution they actually want.
This idea of applying the scientific method to building a startup is also comforting. I have many unanswered questions, and I haven’t answered some of those questions because, quite frankly, I wouldn’t know where to start.
I now realise I need to keep undertaking small experiments to answer my questions and to prove or disprove my assumptions. With the data I receive from those experiments, I then have a better understanding of what to do, which ideas to double down on, and when to pivot.
I still have a long way to go…but week-by-week, we’re getting there 😃.