Build a business, not a product.

images-20I read a very good TechCrunch article today called “3 pitfalls that can sink any crowdfunded hardware startup“.  This article is focused on Kickstarter campaigns but it is great advice for all new product development ventures.  It focuses on 3 key points:  your supply chain (how you’re going to make your product), your Kickstarter campaign (how you’re going to fund your product), and your product itself.  I especially like the 3rd and final piece of advice, “Build a business, not a product”.  In a way, this sums up the core of my product development strategy, and I often say that business development and product development go hand-in-hand (don’t worry, I never say this at parties).

The article goes into some good detail around this 3rd point, but I’d like to zoom out a little bit to talk about the “build a business not a product” mindset more generally.  What does it mean to “build a business not a product”?  What does it require you to consider?  How does it change your decision-making?  It ties into the “begin with the end in mind” way of thinking, made famous by Stephen Covey and blogged about by me, as well as others.  You could also talk about it as “gadget” thinking versus “business” thinking.

If you start with the premise that you want to make a cool gadget (product),  you will be necessarily focusing on the “what’s”–what does it look like, what does it do, what is in it, etc.  For a business, however, you need to focus on the “why’s”–why do people want to use it, why is my company the right one to make it, why is now a good time to release it, etc.  Asking “why” questions are, depending on your position, either amazing or terrible, because they naturally lead to more “why” questions.  “What” questions simply don’t do this.  Think about a conversation around politics.  If you ask “What candidate/position do you support?”, there is an answer and then you’re done.  Only when you start asking “why” does a conversation get going.  If you have kids, or remember being one, you know that “why” questions can continue endlessly, especially on a long car ride!

In a business sense, this “why” thinking, brilliantly spoken & written about by Simon Sinek, causes you to start thinking longer term.  It naturally creates such followup questions as “Why am I making this decision?”  This might then lead to “Why do I think this product is the right thing to do right now?” and eventually “Why am I doing this business?”, and voila!, like magic, you are beginning with the end in mind.

To be clear, for product development you do need to end up asking a lot of “what” questions, but the point I’m making here is that those should be the tail of the dog, not the head.  It can be hard to focus on the intangible, non-urgent “why” questions when the tangible, urgent “what” questions are looming so large right in front of you, but if you don’t, you’ll end up (to mix metaphors) putting the cart ahead of the horse.

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