How to Use Experiments to Scale
This article is written by Munira Hussein, a Contributor Author at Startup Istanbul.
Adam Berk is a lean entrepreneur, lean teacher, and Serial Entrepreneur. He is one of the more intrepid experimenters. He is currently an Implementation Coach at Pearson and Entrepreneur-In-Residence at The Entrepreneurial Science Foundation.
When you are starting up, the definite intention is to scale. But you cannot start from scaling, you have to build steps towards it. These steps are found in doing the little things. Improving your product, building customer relations, building traction, retaining customers, advertising, raising capital. There is a channel of things you have to go through in order to scale.
Start small, prove it once and then grow. Run experiments that will come to an end. Pick on an aspect of your business, decide that it should be quantifiable by a certain day. That’s when experiments end. Don’t make the mistake of running experiments for too long without any usable data. Set a hypothesis of what you intend to find out and record your results. Use those results to scale, build traction, raise funds and most importantly, improve your product.
Most people want to just start and grow. This cannot happen if you have no grasp on your market and product. You must go fast. Test things quickly by getting in front of real customers. Test the riskiest things first. You are going to get there anyway in six months or after 200,000 thousand dollars in investment and hit a rock that you would have moved in the beginning. Isolate to the end and test things independently so that you can hold some variables constant. Use those constant variables to build.
Test the things that are least known. There are ways to test the riskiest thing, it could be retention, revenue or scalability. The data never lies. Test payments for your product if it is an online business. Test the pricing as well. Conduct an experiment to find out if people are willing to pay and how much they are willing to pay. With that, you can manage your costs and investment in your product. Design experiments that you want to learn the most about. Think. Test. Prove. Your job is to make a sustainable company grow, not to make everyone happy. Your job is not to piss people off for the sake of pissing them off either. Your experiments should be aimed at learning and finding answers and solutions.
You might have the urge to go straight into creating a product because all these seems like too much work. But what is the essence of investing in a product that no one will want to buy or even use? Since you are selling to people, talk to them first, conduct interviews. Find out their challenges and problems and let your product be a solution. After all, your first aim should be to create value and make people’s lives easier.
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