Value Proposition – How to Build a Startup
On today’s lecture, we’re going to cover value proposition. What is it you’re building and for who? What pains and gains are you creating for what customer segments? And more importantly, what’s the minimum viable product that results from all this knowledge? So you’re all familiar with the business model canvass and hopefully by now you’ve actually taken a shot and tried to fill out the canvas for your own idea and your own startup. But today, we’re going to talk about the first box, value proposition. Value proposition is just a fancy word in the business model canvass for what is it that you’re building. What product or service are you building? And by the way, we’re going to ask later for who are you building it and what exactly does it solve for those people? So let’s take a look at value proposition. As I said, it’s not just about your idea or product. One of the things that’s hard for founders to realize is there’s actually a customer at the other end and so while you’re thinking this is the greatest thing since sliced bread the whole idea about customer development is to get you out of the building and tell me whose need or problem you’re solving.
It’s about satisfying a customer need and not just you thinking what a great idea. And that can’t be repeated enough. So today, while we’re talking about value proposition, value proposition works hand in hand with who your customers are, which we’ll be talking about in the next lecture. Understand that this relationship between what you’re building, the value proposition, and the customer is what makes startups succeed or fail on day one right there. And we give those two boxes, those two relationships, a special name. We call that product market fit. And when you hear the phrase product market fit, just simply visualize the canvass and go, “Oh that’s another fancy word that says is what I’m building needed or wanted or passionately desired by a set of customers on the other end? And if I don’t have that, then the good news about the customer development process is it allows us to keep searching without going out of business and so what you’ll find is we’ll be iterating back and forth doing things called pivots and iterations as we kind of discover what customers really want versus what we think we’re building for them.
As found on Youtube