The Product Discovery phase is about determining that you’re solving the right problem, along with starting to validate and de-risk your solution.
This phase of effort is arguably the most difficult of your product’s lifecycle. Each day can be an emotional rollercoaster of extreme excitement and frustrating lows.
Staying laser-focused, remaining flexible enough to change, and keeping the faith are the keys to progressing through this phase.
On our Startup Product Roadmap, the Product Discovery phase has four steps. You must answer the key questions in each step before moving on to the next one.
Step 1 – Problem Statement
This is a step that many entrepreneurs overlook. Sure, they have a great idea. But it probably makes a lot of assumptions and may have other flaws, as well.
At this stage, start by divorcing yourself from your wonderful idea, and instead fall in love with the problem that you’re solving for your customers. This is difficult to do, but it’s healthy. When you’re not in love with the solution, you can neutrally evaluate feedback and make the best possible decisions for your future customers.
Key question
What is the problem?
Activity/experiment
Draft a problem statement. Identify the issue that needs to be fixed and the people who benefit.
Budget
A little bit of your time.
Outside involvement
None.
Step 2 – Problem Validation
Now it’s time to dig in and really validate the problem. That’s best done by talking to and observing people…a lot of people.
If a problem is real, it’s likely that people are currently solving it in an inefficient manner. Find out how they’re solving it. Ask a lot of questions. Without disclosing your solution, try to get an idea of what someone would be willing to exchange with you (e.g. money, time, something else) for making the problem go away.
Key questions
Is the problem real? How painful is the problem?
Activity/experiment
- Identify the people that struggle with your problem.
- Figure out how they currently solve the problem. If they haven’t tried to address the problem, it really isn’t that painful.
- Take a lot of notes. Synthesize the notes for key themes and takeaways.
Consider researching potential competitors with a site like Startup Competitors. It could save you a lot of time and effort.
Budget
A bunch of your time and ~$X00. (You’re likely self-funding this step.)
Outside involvement
The people you observe.
Step 3 – Market Validation
At this stage, it’s time to start sharing your solution and testing people’s appetite to engage. This usually means validating the market with supporting materials that make the product seem real, then meticulously tracking how much it costs to generate real interest.
Create a simple website that describes the product and entices the viewer to learn more by clicking a button. If the user clicks the button, the site communicates that the product is in development and asks the user to share an email address so they can learn more as the product matures. This type of simple site creates a conversion funnel that you can track with Google Analytics.
Driving traffic to a site like this will also likely require purchasing ads on Facebook or Google. Track how much it costs to get people to the site, and then monitor the funnel fall-off. Continue to tweak the marketing message if things aren’t resonating at first.
If you hit a wall and still can’t get traction, consider whether your target audience is the right audience for your solution. It’s possible that your solution is the right one for the problem, but your initial target customer isn’t correct. If this is the case, re-run this step and target the new customer.
Key questions
Does your solution resonate? How much will it cost to acquire a customer?
Activity/experiment
Build a realistic market validation test.
Budget
~$X,000 (You’re likely self-funding this step.)
Outside involvement
Hire a design-savvy independent contractor to help. Insist that they take advantage of pre-existing tools to help. You could also try to piece it together yourself using an existing SaaS product like ClickFunnels.
Step 4 – Prototype and Testing
Now you’re ready to create a workable solution that helps a select group of customers. Be scrappy, cut corners, and use off-the-shelf components and systems where possible. Your goal is to test the solution, not provide the final, polished product.
If the problem is real, customers will tolerate a less-than-ideal solution. Pay close attention to the customer feedback that you get, and quickly rev the solution to address concerns. You should ultimately plan on throwing away the prototype if your tests are successful.
Key question
Does your solution solve the problem?
Activity/experiment
Partner with a developer, and deploy a working prototype.
Budget
~$X0,000
Outside involvement
Raise money from friends and family to fund this step. (This can be tricky. Here’s some advice from Forbes and more from Entrepreneur.com.)
Hire an independent contractor who has experience prototyping solutions. Avoid sharing substantial equity if possible. It’s highly likely that the independent contractor will be a wonderful fit for building and testing a prototype, but a poor long-term development partner fit.
A Word of Warning
Entrepreneur communities are great places to learn, share ideas, and be excited for each other’s products. They can also be echo chambers of optimistic encouragement instead of confirming real proof-of-product market fit. Leverage the good from these communities, but also force yourself out of your comfort zone.
The Startup Product Roadmap
Read more about the software startup journey:
Need a reference? We’ve summarized the Startup Product Roadmap into an infographic:
You can also download the Startup Product Roadmap infographic as a PDF.