Ask David Cohen: Developing an MVP and Reaching Investors

We recently held an AMA with Techstars’ Co-CEO, David Cohen, where he answered commonly asked questions from founders about topics such as forming a team, developing an MVP, and applying to an accelerator program.

This post is the first in a series of five which includes a transcript of David’s answers to these questions in this AMA. To sign up for our next AMA, check out the schedule here!


Any advice to founders who need more resources to develop an MVP or a presentable prototype? What’s the best method of getting investors to hear out the idea/plan when you don’t know anyone in the community?

These are kind of different questions so I am going to go at them separately. I’ll tell you a quick story of a company called Everlater that sold to MapQuest, AOL and came through Techstars. When I first met Nate and Natty, they were Wall Street types and loved to travel. We funded them, but we only funded them after watching them try to learn how to program.

They were so passionate about this idea coming out of their minds into the world that they actually taught themselves how to code – they were terrible at it, not very good at all. But later on, they got better, but it was still a crappy prototype and a crappy MVP. So step one is, having something is better than nothing.

If you can’t find somebody to do it, my question is, why can’t you do it? Do you think that writing a little software code is something that you have no ability to learn? It tells me something about you, that you are not willing to try. You could find a friend who does know how to program to spend a couple hours with you and show you how to get going.

You could say look, this is what I am talking about, it doesn’t work yet, but it’s what I’m talking about.

I believe great entrepreneurs do stuff.

If you can’t do that and you are allergic to keyboards and computers and you’re just never going to code, that’s cool too. Some of these languages, by the way, are very easy to learn now, it’s not like learning a foreign language, you can get a lot of help from the editor, and there are various simple languages out there that you can learn how to prototype things quickly.

There are lots of coding classes available online, so my first question is, why aren’t you doing that? If you can’t get somebody in the world who has those skills excited enough about what you are doing, or you can’t make friends with somebody who can help you with that, that is also a red flag for me as an investor.

The answer to the question is like anything else, just do it. That’s why it is Nike’s slogan, it’s so great and really the easy answer to a lot of things. Plus, I’m an early stage investor, I don’t care if the prototype is presentable, it doesn’t have to blow me away. You just have to start the meeting and say look, I hacked this together myself, we need funding to hire engineers and obviously the user experience is terrible. You know it is terrible, but that’s okay. You’re self-aware, it doesn’t have to be beautiful and great.

I think doing attracts investors. Talking about doing makes me think maybe you’re not an entrepreneur.

For the second part of the question, I would take a quality over quantity approach. I would find someone who does know the investors that you are targeting and I would figure out how to spend time with them. For example, I would go to someone that they funded or someone that they have worked with and mentored before and say, will you help me with this? They are likely more available than the investor and I would use them as a way to create an introduction to the investor.

I would also suggest you read my blog post on DavidGCohen.com called Small Asks First. It’s about the idea of not over-asking, which is really important in entrepreneurship. You are trying to get to a resource, it is very busy, so get an introduction from somebody they know – it’s not that hard, and just ask them for something small.

Let me give you an example of something big – lunch. Lunch is very big – you’re asking them to go spend time with somebody they don’t know for an hour, which is an awkward situation, especially if they’re an introvert like I am. That’s a big ask. I know it feels small to you but it’s a really big ask to me. Coffee – huge ask. I have another blog post called Coffee or Lunch? that I wrote on this topic. They would have to go out of the office, meet you somewhere, and the biggest thing is, I don’t know you… it’s a big ask for a first ask.

Here’s a small ask – send me a paragraph or two of why I can be helpful to you, and the one really simple thing I can do to be helpful to you. I have another blog post that is called The Perfect Email. Somebody wrote me out of the blue, not even introduced, with enough context that I thought it was the best email I ever read and so I reacted to it. I ended up having an exchange of dialogue with that person; I even blogged about it. I don’t know what happened there, probably nothing huge, but hopefully I was helpful in some way.

I think the context of why you’re reaching out to me and asking for something that is easy for me to do is great, because going to have lunch is actually not easy to do – I’m busy, I’m introverted, etc. What is easy is asking me to click on a link and tell you what I think of the messaging on your website, the primary tag line or whatever. If I don’t respond to that, I’m just an ass. That takes ten seconds for me to do. It’s a small ask, it creates engagement, I can just click on the link, see what you’re doing, have to think about it for a second and then respond. Now, you’re actually starting a dialogue by making a small ask of something that is very easy for that investor to do. That is a great way to build a relationship and you go from there. You can do that at scale to figure out who is interested and engage more with those people.

Eventually, you’ll end up having lunch and a meeting.

Interested in meeting other entrepreneurs and getting a head start on your own entrepreneurial journey? Check out a Startup Weekend near you or apply to an accelerator program.

At Techstars, we fully believe in the idea that no one is “too far along” for Techstars. Inversely, nothing is too early. Techstars has a program for every step of the entrepreneurial journey – from startup programs like Startup DigestStartup WeekStartup Weekend and Startup Next to later stage offerings, including the accelerator program and venture capital for add-on funding.








Startup Weekend Day by Day Breakdown: Saturday

Startup-Weekend-2013-1

 

Its Saturday morning. You are sipping on your coffee/tea while eating your bagel and wondering, “OMG WHAT DO I DO NOW?!?!?!”. Don’t worry! Here are some suggestions on where to go from here.

Business Model Canvas

The Business Model Canvas allows the startup to document the 9 key areas of a business model. Rather than writing long paragraphs, each of the boxes is filled in with short notes to document the hypotheses associated with the specific sections of the business model. This approach allows the initial business plan to be documented in a couple of hours rather than months. Here is a great breakdown and explanation of the canvas along with some examples: http://www.slideshare.net/esaife/business-model-canvas-101

You should have your first version completed by lunch time so you can move onto customer validation.

Customer Validation

As Steve Blanks says all the time, “GET OUT OF THE BUILDING”. Steve has a set of videos that really cover this topic well: http://vimeo.com/user2776234. It’s really important to talk to your potential customers. They may be in the same room/building, they may be across the street. They may be on Twitter/Facebook. Go find them and ask them the right questions so you can get the feedback that you need.  Some sample questions are:

  • Do you suffer from this problem? What apps/services do you use now?
  • Would you use this idea/product? No? Why not?
  • Would you pay $X.XX per month/year/one-time to use? No? What is an acceptable price?
  • What features would be most important for you?
  • Can get your email so we can keep you up to date with our product?

If you are collecting information via the Internet, you should create a form to collect your feedback. Google Docs allows you to create surveys on the fly: http://www.google.com/google-d-s/createforms.html

Take as much time as you need to work on your validation. You can’t accomplish everything you need in an afternoon.

Based on the feedback that you get, your assumptions will either be proven to be true or false and you will discover things you didn’t think about. Make sure to update your Business Model Canvas to reflect your new findings. (eg: “We discovered through our customer validation that our target audience is not really women, but men!” OR “Monthly subscription was too much. People preferred a pay-as-you-go model. )

Coaches/Mentors

The coaches and mentors will start to arrive at around 2PM. They will walk around the building and interact with all the teams. Feel free to chat with them see how they can help you. They were here to help you so make sure you take the time and chat with them. The mentors range from developers, designers, product, marketers, PR, founders and much more. There is bound to be someone that can help you with what you are trying to do.

For a full list of mentors/coaches: http://www.up.co/communities/usa/new-york-city/startup-weekend/4419

Startup working on your MVP (Minimal Viable Product)

Based on the feedback that you have gotten from customers, you should have an idea on what to build and what not to build. Here is a great article talking about different types of MVPs: http://scalemybusiness.com/the-ultimate-guide-to-minimum-viable-products/

If you have people on your team that can help start building it, then great! By all means, start laying your code. But if you don’t have the developers or designers that you need, don’t worry, you can still use plenty of tools out there to help you prototype your app/idea without laying out code.

http://proto.io/

http://www.justinmind.com/

https://moqups.com/

https://wireframe.cc/

https://www.fluidui.com/

http://www.hotgloo.com/

WARNING: If you decide to go and only make wireframes/mockups, they had better be the best mockups/wireframes that you can produce in a weekend. Don’t draw a box on a piece of paper and say its your mobile wireframe. Bring your “A” game this weekend.

You only have 54 hours. We don’t expect your app to be scaleable to 1MM users. It doesn’t need to hook into every social network platform out there. Your MVP needs to show us (the judges) that you put some thought and effort into app. They know you only had 54 hours to work on it, do the best that you possibly can.

-Andrew Young

Startup Weekend NYC
https://twitter.com/overworkedasian
https://twitter.com/nycsw








Managing Exceptions: Launch and Learn (Comic)

#entrepreneurfail Launch and Learn

 

Tick-tock, tick-tock.

I have timely news for you. Your launch may take you twice as long and cost double what was expected, and that’s the best-case scenario. The bottom line is that it’s tough to deliver when and what you intend to. Schedules are shifted, budgets are rebalanced and the original scope is tweaked, prodded and pivoted. However, you are in good company – even our favorite fruit company had delayed their phone shipments in the past.

When I first decided to pursue one of my business ideas – I couldn’t wait to tell every person I met about the upcoming launch date and plans for growth in order to generate some future buzz.  I naively believed that 2-3 months sounded like a fair benchmark – even though I never actually sat down to calculate the possible timelines, nor assess all the tasks required.  As I started working, minutes swirled into weeks. As I approached nearly 4 months after my initial rants, I sheepishly shared a defunct prototype with just a few people.  Everything took longer than I expected, and the output looked much more different than what was in my head.

To keep assess actual timelines and things on track, I recommend BaseCamp and Trello. Both have a free trial period, and are cloud-based solutions so you can use either immediately. Allocate tasks to your whole team, check on the status in real time and keep track of a lot more in order to avoid an #entrepreneurfail. These are all baby steps to delivering on your launch date.

 

Have you ever missed your launch deadlines? Tell us about your experiences in the comments below.

This comic was adapted from #entrepreneurfail: Startup Success.