Solve problems with "why"

In my last post, I talked about the importance of having a "hair on fire, pay anything to solve" problem when you are building a product or business. For a lot of entrepreneurs, this is hard to get to. You'd think it would be easy, but it's not and I get why. Entrepreneurs have passion, they have ideas, they have drive. All important qualities and a great way to start, but those qualities often lead to blinders that keep you from focusing externally on the customer and the problem you can solve faster/better/cheaper.

There is actually a very simple technique to help you find the real problem customer's will pay you to solve. It's a technique that comes from conflict resolution/problem solving. The technique is called "5 whys" and it's the idea of asking why 5 times. The theory goes, within 5 questions of "why," you'll get to the root of the problem or issue.

Let's look at an example that is common is many of your personal lives:

Your significant other (S/O): "I'm mad at you."

You: "why?"

S/O: "Because you didn't take out the trash."

You: "Why does that make you mad?"

S/O: "Because I shouldn't have to ask you to do some of the work around the house."

You: "Why is that a problem now when it hasn't been before?"

S/O: "Because you know I am working long hours this week at work, and the kids started school again this week so there is so much to keep up on."

Based on that interaction, with just 3 questions, you've learned that the problem isn't that you didn't take out the trash, the problem is that you didn't recognize your significant other's need for more help. They don't necessarily need you to take out the trash, they need you to have some empathy, understand the situation and be proactive.

If your significant other was a customer, they wouldn't pay you to take out the trash, but they would pay you to have empathy, understanding, and be proactive. The problem isn't the trash! Had you not asked why, you'd think it was the trash. Had you not asked why 3 times, you wouldn't know the real problem is empathy, understanding, and being proactive.

At this point, you might think I'm a bit crazy with this example, but it does have a direct relationship to you and your customers. The first problem you discuss is probably NOT the problem they'll pay you to solve. The problem they'll pay you to solve is often deeper, and understanding the real problem will lead to significant business and financial success.

The best way for me to drive this point home is to share a real life example. I'm lucky to be called an advisor to an exciting startup named TalentIQ. They are in the big data space, and can be described as a "people intelligence" company. They keep databases about people up-to-date with current and relevant information that can't be easily found, verified, or understood otherwise. They sell this value to talent recruiting, sales, and financial organizations. The product that customers pay for today is not the product the founders started with.

Sean and Henry originally recognized that hiring top talent is hard, in part because the best talent already has a job and isn't applying for a new one. So they built a sourcing tool, a search product that recruiters could use to easily find the best talent based on specific criteria, regardless of employment status. They had success with this product and dozens of customers, some household names, started using the software.

The sales were coming in, but not at the rate they wanted. So they continued to interview their customers, and asked "what makes your job as talent recruiters difficult?" When they got an answer, they continued to ask "why?" They dug deeper. Then they learned that while customers did indeed have a need for their original software, they actually had a bigger problem. They had stale databases with thousands of past applicants, and the perfect candidate for a new role may be in that database. However, the information in that database was likely wrong...if for no other reason than it was old...out of date. Even better, TalentIQ's technology could easily solve that problem, it was an easy shift and was inline with their original vision.

Sean and Henry had their "ah-ha" moment, because they had the perseverance and humble nature to go beyond the surface, and dig deeper. They asked why. Over and over again. The sales started rolling in, at a rate even greater than they had imagined. Today they enjoy a rapidly growing business, with mind-blowing revenues that most companies would envy for the first year of their existence.

What Sean and Henry did may seem simple, but it's hard. Really hard. As entrepreneurs, we have to be open to changing the original product we envisioned, in order to meet our customers needs. We also need to remain unsatisfied with initial traction. It's easy for a few people, a few customers, to say our product is good. Great business aren't built on a few customers, they are built on hundreds, thousands, even millions. You won't get to that level unless you are willing to ask "why," over and over again. Get out of your own way, dig deep, and get to the real problem.

Don't just take my word for it, or the example of TalentIQ. Look at other companies. Uber's most popular product is UberX, but their original idea was town cars/limos driven by professional drivers (Uber Black). Twitter started out as a group text messaging concept, but I doubt anyone uses their text messages features today. These examples go on and on, as do the examples of companies that were never smart enough to dig deeper. Which category will you be in?

The startup problem

Recently, I had the rare and exhilarating opportunity to meet with 7 different startups in a single day. I heard seven product pitches. Seven teams of entrepreneurs so passionate about their companies, they are wiling to risk it all. Do you know what I didn't hear? Seven problem statements. Seven reasons the world needed what they were building. Seven reasons that the risk was worth it.

Its not that none of the seven were solving a problem, its that some of them didn't (or couldn't) articulate it. Instead, they focused on the solution. The cool new thing they were building. The software that would make something happen. Frequently jumping right into the what and how, without the why.

If you are a startup entrepreneur, your #1 job is to passionately and convincingly explain the problem you are solving. Can't do that? Stop everything you are doing, and obsess over this requirement. Your goal should be a 1-3 sentence problem statement. So clear that someone not familiar with the industry you are in, can understand it. I don't care if you are in the nuclear physics or open source software industries, you should be able to clearly explain the problem to the average person you encounter in your life.

Why does it matter? Because as an entrepreneur, you are always selling. Not just selling to your customers, selling to everyone. Selling the opportunity to investors and potential employees. Selling board members, mentors, and advisors on helping you. Selling your spouse on why its worth the risk to put it all on the line for this. Sell your friends on the reason you haven't seen them in ages. Selling the stranger at the cocktail party on the fact that you actually do important work, and aren't crazy.

Now, if you are a high growth startup entrepreneur, knowing the problem you are solving and passionately telling everyone about it is just the first step. The next step is to make sure you are solving a 10x problem. A 10x problem is one you can solve 10 times better than the alternatives, or solve the problem for 1/10th the cost of your competitors. You sell your product for 20% less than the competition? So what, thats not enough. Your product is 30% faster than the competition? Get out of here, not good enough.

Your customers have an alternative to your product. Maybe its not a direct competitor, but at the very least the alternative is the status quo. Doing nothing or continuing the way they've always dealt with the problem.

Now, you are asking them to make a change, to switch to your product instead.  The price of your product isn't the only cost to the customer. There is a switching cost. Not just the real costs to switch, but the inferred costs as well. The cost associated with taking a chance on you, the risk that you'll actually deliver on what you say you will. That you'll be around in the future and be able to grow with them. That you'll be the partner they need.

Customers won't switch to a startup for 20% cheaper or 30% faster. You need to be 10x better.

In my next post, I'll share with you a crazy simple technique to help get past the surface an opportunity, and down to the 10x problem.

Build better products by vacationing more

Throughout my life, I've been lucky to do a moderate amount of travel. In the last couple years, my travel has increased significantly, including international destinations for work and play. In fact, over the past 12 months, I've traveled to Spain, Switzerland, Germany, Thailand, Mexico (x2), and even a small town on Canada's Vancouver island (via float plane, of course!).

While traveling, I can't help but notice the differences in the lives of the locals compared with mine back home. I'm talking small things, not the obvious things like income or weather differences. Lately, I can't stop thinking about these differences and how they should change the way I build products. They should change the way you build products. They should change the way everyone builds products.

Below are some of the small observations I've made while traveling this year and thoughts on how they might impact how products are built.

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Transportation

Do you have a manual or automatic transmission vehicle? If you are reading from the US or Canada, you likely have an automatic transmission. About 95% of new cars sold in the US have an automatic transmission. An automatic sure makes it easy for us to do other things in the car, like pull up Waze and get directions to our destination, or accept a new passenger in the Uber Partner app for those of you that drive for the transportation company.

However, outside of the US and Canada, I've observed manual transmissions dominating markets. From old, beat up, compact taxis to large, luxury, 10 person vans, manual transmissions are the norm in many countries (Thailand, Mexico, etc).

Now, think about using Waze, Uber's Partner app, Spotify, or any other mobile app you use in the car. Think your usage would be the same if you almost always have 1 hand on the stick shift? I bet not.

Differences in transportation go beyond that. I noticed in Barcelona and Bangkok, scooters and motorcycles are everywhere! Its possible that there are more scooter riders than car drivers in these cities. Knowing that, if your product was used for or during transportation, would you build it the same for scooter riders as car drivers? I wouldn't.

Also in Thailand, Tuk Tuks are the way to get around! Scooters modified to have seating for 2 behind or next to the driver! However, for those that do drive cars in Thailand, they all have these small, sharply curved mirrors at the very front corners of their hoods. What for? Turns out, Thai's drive through some VERY tight spaces, and this mirror helps the driver know how close they are to hitting another car, a wall, or a tree. They drive within centimeters of obstacles on a regular basis. If you are a car designer who's product will be sold into Asia, you probably should think about this before adding that bubbly fender design!

Finally, while Uber has made getting around a breeze in most cases, I experienced a problem recently that doesn't happen to me in the US. While in Mexico City earlier this month, I relied on Uber to get where I needed to go. It was easy, specific, cheap, and crossed the language barrier. There was one problem though: many of the destinations I wanted to go to where not in Uber's mapping database. I've taken for granted that every business or home that I want to go to in the US can be looked up quickly in the Uber app, pinpointing my drop-off location. Not true in Mexico City. Want to go to that great taco stand you read about on TripAdvisor? Don't expect to type the name into Uber and have a pin dropped in the perfect location! This happened to me about 3 times on during my long weekend there and appears to be common. Time to brush up on my Spanish!

Phones & Communication

If you live in a major metropolitan area in the US, especially on the west or east coasts, you are surrounded by iPhones. About 64% of American adults own smartphones, and about 47% of them use an iPhone. Now zoom out and look at the entire world. Less than half of mobile phone users around the world use a smartphone, and of those that do, Android dominates!

In fact, on a trip to Mexico City recently, I don't think I saw a single iPhone in the hands or vehicle of a local. Samsung/Android phones were the norm. In Thailand, outside of Bangkok, it was rare to see a smartphone at all. What the industry calls Feature Phones were the norm (in-between a basic phone with no advanced features, and a full on smart phone with fast web browsing, apps, etc). Building a mobile product for use outside of the US? You better think about these numbers and make sure you are building a product that your intended user can actually use.

Paying for things

Until I began traveling more internationally, I took for granted my reliance on credit/debit cards. At home, I almost NEVER have cash or change on me. This habit had to change when I began traveling internationally more. Go ahead, try to pay for something with a credit card on an island in Thailand. Almost impossible.

Cash is king in many destinations outside of the US, Canada, and Europe. In fact, even in Europe I am required to us cash more often than in the US. Most cabs in Barcelona have credit card machines, but some literally don't! Its nice to know that before you take a ride somewhere :)

In Thailand, I found that many cab and Tuk Tuk drivers didn't have change! Don't try to take a 30 baht ride and try to pay with a 1,000 baht bill. I did this once, and the Tuk Tuk driver had to take me to a 7-11 where I bought a water bottle and got change in smaller bills.

Even when you can pay with a credit/debit card, there are differences. Until recently, none of my debit/credit cards had chips in them. When paying for something in Europe, I found myself having to show the cab driver or restaurant employee how to run a credit card with a stripe instead of a chip. Seriously, it was foreign to them! Think about this if your product accepts physical credit cards and you want to sell your product outside of your home country/region.

This knowledge isn't just valuable when conducting a transaction. If you make wallets, pants and other personal items, remember that in some countries, your user is typically caring around currency. Paper bills, often pockets full of coins. What can you do to make their lives easier? Reinforce pant pockets to handle the change people carry? Provide more room for cash and less room for credit cards in a wallet? These are obvious ideas, I bet one of you out there has a much more brilliant idea!

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These are just a few of my observations, and while small, they could make or break the success of your product. So, what differences have you observed while traveling? What have you done to make your product more accessible to users in regions outside of your own? Let me know on Facebook or Twitter using the links at the bottom of this page!

The time I made a better Twitter and foreshadowed Slack

Most tech entrepreneurs start out with a side-project. A project that scratches their own itch, that they build outside of their normal daily work. Sometimes these side projects are a way for an entrepreneur to cut their teeth, before moving on to the real deal. Other times the side project becomes the startup. Either way, side projects play an important role in the birth of an entrepreneur.

While many of you know about the first and only startup I founded, you may not know that I have a few side projects in my past. I am lucky to have a good friend, who I've known since high-school, that shares the same passions for entrepreneurship and technology. From around 2007 to 2010, Jeremiah and I worked on 3 different web applications, which overlapped each other for some period of time and earned more than 50k combined users in our best month.

One of those projects was called CitySpeek, and it was born out of a frustration that Jeremiah and I both had. In 2007, Twitter was just starting to gain notable usage after being launched in 2006. Jeremiah and I were both early adopters and saw a game-changer. Then, we started experiencing an imbalance of signal to noise. We had to deal with a lot of tweets we didn't care about, to read the ones we did care about. Going the other direction, we wanted to send out tweets to, say Portlanders, and not anyone else, because we knew that the content wouldn't be interesting to anyone outside of the selected region. In other words, we loved the concept of Twitter and wanted to improve it by offering rooms, or channels, where users could opt to view only the tweets about a subject or region they cared about. We also added image/video uploading (at the time, Twitter just linked to an image/video) and message translation (again, something Twitter didn't yet offer).

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Now, with the popularity of chat programs for communications both at work and for communities outside of work, I am reminded of how CitySpeek foreshadowed the world we live today. Popular apps like Slack and Hipchat organize communities around channels or rooms. Public but contained spaces where people can discuss specific topics, without adding too much noise to the main stream of information. I'm a member of 4 Slack "teams" (there definition for a group/community/company), 2 of them being groups that represent a community of people that all come together to communicate in a central place. In the case of the PDX Startups Slack, just like we used to do on Twitter. Only now, instead of a single noisy stream of tweets, I can go to a specific channel in Slack, like the #product_management room, to talk only about product management, with people who also only want to talk about product management.

CitySpeek didn't take off. We had a whole bunch of problems, the least of which included being rookies at building, launching, and marketing web apps. That said, the experience building CitySpeek, along with ThePortlander.com (Community curated news aggregator for Portland, OR) and Goboz.com (a better Yelp), is what prepared me to start CPUsage, which while it ultimately failed, was a real company that allowed me to pursue my dreams. Its fun to fondly look back on the past and say "hey, I had a good idea! I may not have executed well on it, but it was a good idea, ahead of its time!"

What fun side-projects have you done? What did you learn? Glad you did it? Let me know over on Twitter or Facebook, using the social media buttons below!

The data behind communication & collaboration apps at work

Recently, I blogged about some products and services that I wish existed, things I'd pay for if they were available to me. One of those ideas seemed to be rather popular and many of you have the same problem: Too many communication and collaboration tools at work, and its hard to find the information you are looking for.

I was intrigued by all the interest in this idea, so I decided to dig in a bit more. Shortly after publishing the original blog post, I started a survey. I listed nearly 40 business communication, collaboration, and file storage tools. I simply asked for people to check a box next to all of the tools they use at work, and in a second question, tell me the top problem them have with these tools.

The results were fascinating! As of this writing, I've had 58 responses. There is a whole lot of data to sift through and make sense of, which I'll be doing over the next few weeks. That said, I've gotten started and wanted to share what I have learned so far.

Before i jump into it, please note that I am not a professional pollster, nor am I a data scientists. The data I present is likely tainted in a variety of ways, and I am sure that the questions and answer options could have been better presented. One way the survey and data are tainted is that I advertised my survey through my networks on Twitter, Facebook, LinkedIn, and an industry Slack channel. Thats a whole lot of built in bias! So, you get what I am saying? Good.

The Apps

There are some clear winners and losers when it comes to the apps you use at work. For starters, 85% of respondents use a chat app, and 75% of those people use Slack. I knew that Slack was hugely popular, but I had no idea it was that pervasive among my network. I also figured that other apps like MS Communicator/Lync and Gtalk were lightly used, but I had no idea that Hipchat would be such a small player at just 8% of chat users.

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Something else interesting, but not surprising, is the popularity of Google. Gmail, Drive, and Hangouts all have better than 50% usage across the survey's respondents. The only Google product that doesn't fair well is Google Talk (Gtalk), with just 17% usage. I suspect that 3-5 years ago, Gtalk would have come in at between 25%-50%, capturing most of Gmails users. However, a few years back, Gogle released Hangouts and began to merge some of their communication tools. A bigger impact on Gtalk was probably the growing popularity of Hipchat and then Slack, which offer much better functionality.

Also popular is video conferencing software, with 83% of you using some sort of tool in the category. Google Hangouts and Skype are the most popular, with every other option a distant 3rd. The least used type of software was in the Customer Service/Sales category (as defined by me), with only 33% of respondents using one of them (Salesforce, Zendesk, etc). Also unpopular is the collaboration category, with tools such as Quip, Jive, and Confluence (again, defined by me). Only 48% of you use a tool like this. A surprise, based on my quick view of the data in the above graphic, was project management tools (Asana, Trello, JIRA...my definition). I expected that nearly no one was using these tools, but it appears that as a group, they are popular, with 60% of you using one or the other. Of course, the category is dominated by JIRA (49% of PM tool users) and Github (54% of PM tool users), which are both more about software development than they are general project management, so my organization of the data and integrity of the survey are likely playing an outsized role here.

Digging into the stats

What I was really excited to learn about was the usage trends and patterns beyond the individual apps. Do people use a lot of different apps? Do they use more than 1 app to accomplish the same thing? I was not disappointed!

For starters, respondents on average use 6.7 different communication and collaboration tools at work. The media is 7, which means half (29) use 7 or more apps! In fact, the respondent with the most apps used in their work was someone with 14 different apps. You use these apps across 4-5 different categories (4.7 mean, 5 media).

With a median of 7 apps across 5 categories, its clear that no only are people using many apps, they are frequently using multiple apps to accomplish the same thing. A vast majority of you are using multiple apps in at least 1 type of communication/collaboration tool category. Just 26% of you are using only 1 app for 1 type of communication/collaboration, across all categories, leaving the other 76% of us double-dipping in at least 1 category.

The most common category where people use multiple apps to accomplish the same thing is in the video conferencing space. The average is 1.7 different apps, with many of you using 3 (17%) and commonly 2 (39%). While that means that the most common was just 1 (44%), this is misleading because the majority of you actually use more than 1 (56%).

Of the 7 different types of apps we looked at, 67% of you use at software from at least 5 categories. Not a huge surprise is the 9% of you that use at least 1 tool across all 7 categories, its just not that common to have to communicate and collaborate in EVERY way possible. After all, certain tools like JIRA and Salesforce are focused at specific functions within an organization (software development and sales, respectively).

What sucks about communication & collaboration software

You'll recall that my second question asked what was wrong with the tools available to you. A whopping 62% of respondents (36) said there was something they didn't like about the tools available to them. Based on the content in those responses, I categorized them into 6 different types of problems: Too many, Distracting/Noisy, Compatibility issues, Usage levels, Finding things, Application quality.

The most common complain? Too many, said 58% of the feedback comments. The second most common problem, which turns out to be very tied to the first, was how hard it is to find things (33%). Many of you, 31%, said that getting usage was a big issue, either on-boarding to these tools or getting the right people, using the right tool for the job. I didn't expect 19% of respondents to have compatibility issues....apps not talking/syncing with each other. That one never occurred to me. Five people said that low quality apps were an issue (14%) and 17% said that noise and distraction were a problem, a number I thought would be much higher.

Since my analysis is part qualitative in addition to quantitative, here are a sampling of a few interesting comments:

“So many choices, what’s the right platform for the message at hand?”

“I have two sets that don’t work well together- Google tools vs. Microsoft. I have a Mac and the MS tools are uniformly terrible. Syncplicity is required, but is one of the worst drive applications I’ve ever seen.”

“Too many of them! Don’t know where to post information. Don’t know where to find information.”

“This information is shared in so many places. There isn’t one place where all the data lives.”

Interesting stuff! I'll continue to dive deeper into the data and report back as I make new discoveries. If you'd like to discuss my findings or get access to the raw data, drop me a note by using the contact form on this site, or mention me on social media!