Prototype Your Solution First

Introduction

What does every new startup need as soon as possible? Funding? Snazzy board of directors? Industry leaders extolling how wonderful your approach is? Well, all of these sound good but before you get to dessert, you need to eat your salad- make a functional #prototype. My definition of a functional prototype is a version of your proposed product that demonstrates enough functionality of the key selling points for the customer. You need to be able to demonstrate the basic functionality on a small or limited scale and show how it would be manufactured before you get noticed by the venture community or the industry experts. My claim is that a functional prototype is worth 1000 business plans. Put another way, it will be extremely difficult (this phrase means “no” in Japanese….) for you to make any meaningful progress by simply offering potential investors or customers a paper based idea. But most of all- there many ways to get to a functional prototype without mortgaging your home or taking a loan from your retirement fund.

The Main Idea

Prototyping is step one for a new venture

Prototyping Step 1- Problem Solving

Prototyping is a type of problem solving. Step one is clearly understanding what problem you are going to solve. This is not as trivial as it sounds. Remember all the problem solving training you received in industry? Now is your chance to apply it to your own venture. The challenge you will have in building your prototype is translating what the customer wants to see into some functional capabilities. Fortunately today there are a great many tools that have been developed. One skill you will need is your understanding of the entire ecosystem where your proposed product will operate. This normally requires a skill called logical or system decomposition[1]- a practice that requires you to breakdown any large task into smaller bits that can be completed by a small group.

Ok, so you are not a systems engineer or a former software development team leader. Get out your scratch pad and start sketching out all the functions and components that might be in the system. I use Lucid Charts for this (basic version is free). Try to get gain an understanding of how these components interact. You can use this sketch or system drawing to help gain an understanding of the customer problem you think is worth solving. I also mentioned “design thinking” in other posts. Now would be a good time to review the design thinking approach and see if you can use it to get to the core of the customers' concerns.

There are several methodologies that have been developed for solving problems in the tech industry. Two basic approaches are: the 5 “whys” and fishbone diagrams. If you’ve had enough of this training to teach it, then skip this section. If you are not familiar with these then, stop what you are doing and learn these basic skills and a few others- it really is that important. Other methods include the #8D method of problem solving. This is a very formal method for investigating internal problems that results in the identifying the root cause of a problem and a solution. I like the 8D process because of its thoroughness, but its very time consuming. Finally, there is quality function deployment (#QFD). A broadly taught and used tool for defining what needs to go into the product and identify potential ways (how) of doing this.

Prototype Step 2- What does the customer want to see in a prototype?

Don’t be surprised if the customer says I don’t want a prototype, I want a solution. Be careful here as the customer may be implying that a possible solution is already in hand. Here is where you need to be careful about potential customers for your idea. Some of these folks may simply be unable to work with an early stage company for many reasons. Some may just pump you for information. Others only know that the existing solutions won’t meet their needs. You will need to find a potential customer that is not concerned about working with an early stage company. Once you engage with a potential customer at this stage, we are hoping that they will be willing to spend some of their time, or money, or expertise to investigate possible solutions. If they won’t or refuse, move on to another customer.

Prototype Step 3- Check the patent database

Hmm… this would seem out of place. But in my limited experience, this is essential. When we started AirAdvice, I knew what I wanted to build and figured out how to build it. I also realized that I would never get the appliance to market if I did not find a way to measure airborne particulates. While I solved that problem, I found one that was a potential show stopper.

I went to the patent database and began searching for patents in my field. I found a patent that could impact our current business model. I used the classes assigned to this potential challenge to find other patents. Once we had studied this patent and many others, we identified immediately a short coming in the existing competitive patent. This short-coming led us to a real innovation- that the indoor air quality was modulated by the outdoor air quality. Further, by combining the indoor and outdoor air quality, we would be able to integrate all types of of data sources to provide advice to our customers. So- do you homework! It will pay off.

Prototype Step 4- Build that sucker

Now we can have fun! Hopefully you have figured out what your device or system needs to do and we can define what goes into the prototype. For software apps, you need to develop a number of use cases that explain what the code should be doing and how the users (users can be people or other systems) interact with your app. Not to worry- use cases are normally written in the plainest of language so everyone on your team can understand what is going on. The use cases also serve another goal- providing very detailed “whats”[2] to the person or team that will be developing the code.

One problem that is not talked about too much concerns prototypes that may reveal some serious technical innovations. If you have not filed a patent yet and you show this prototype to too many people, you could give them ideas on how they can beat you in the market place. So how do you demonstrate functionality without putting the product into the hands of a customer? IBM did something very clever with their non-contact wafer measurement technology. Rather than installing a $200,000 machine at the customer site, they simply told potential customers to send them wafers with known problems but also told the customer not to say what the problem was. The IBM team would then test the wafer and send it back to the customer with their analysis. Customers were astonished- no marks on the wafer and analysis was extremely detailed and even uncovered problems that the customer was unaware of. Perhaps your product is actually a service, initially, for testing wafers and not a big production test machine.

One technique that might work for you is 3D printing technology. The printers are getting much cheaper. The real expense is probably capturing the 3D design in Autocad™ or other design software. You don’t really need to buy a printer- you can send your design to a printing shop and they will fabricate one or more of your prototypes for a fee. But the fee may be too steep for your budget at this stage.

One of the most time consuming and frustrating experiences in this step can be working with a university fabrication center to make a key component for you. Some of these centers allow paying customers to get components fabricated using the machinery owned by the university.- you just buy time on the machines. Like commercial vendors or fabrication shops, these university centers have a whole layer of administrative overhead that must be navigated if you want to work with them. But remember- we are still at the idea stage here. Once you receive funding, then working with a University can be a lower cost method to building something using other organization’s equipment.

Prototyping Step 5- Internal Testing and Design Validation

Before you show anything to a potential customer, generate as much test data as you can. You need to be careful here. Many experienced engineers and marketers will be quite skeptical of any claims you make about your prototype. Just like in academia, your results need to be validated by a third party. Do you have a list of goals or performance objectives that your final product needs to meet? If yes, then you need to get this data yourself before talking to customers.

Prototyping Step 6- Customer Testing

As we go through this simple process the stakes get higher and the risk to your venture also increases. Once the customer has seen your prototype they may get very interested and the next questions could include: a) How long to get to production, b) How does the system scale, or c) how much will it cost me to operate this. You are probably way ahead of me- you need to have a business model fleshed out before you do this and be prepared to answer the customer obvious questions. I will spend a bit of time on an excellent tool called the “business model canvas” in another post.

When you ask a customer to test your prototype you are also asking them to begin spending money on your idea. Even if they have meetings with you or ask one of their production teams for room to test your solution, they are stopping what they are doing to help you. This requires that there be a level of trust between you as the entrepreneur and potential customer. Trust is currency- difficult to acquire and easily lost through careless behavior on your part or your team. Or as I was told my NCOs in the Army after a particular painful ass-chewing by our commanding officer (I deserved it BTW), one “aw sh*t” wipes out 10,000 atta-boys.

As I am writing this, I am preparing for the “prove it” moment for a new product that Tailwater has been developing for the past 18 months. The problem we are trying to solve for the customer has been plaguing them for years. All prior suggestions were in $4 to $10M range and contained no innovative solutions. The customer is a global player in the food market so we need to be extra cautious on making every aspect of this project successful for the customer, as we many not get a do-over.

Prototyping Step 6- Using your successful prototype to launch the product

If your prototyping is successful, you may have a window to move your product forward in a major way. This is a major transition point for your idea. Next steps could put you in business and force you to develop a financial plan, hire staff as necessary and really start spending money. Now is the time to slow down your decision making and ignore the hype or platitudes that may have come your way. You are going into business with your new venture!

Summary

Prototyping is one of the most important steps in validating your product/business idea. I don’t believe in “one way” to create a prototype. The most important takeaway- a successful prototype can be turning point in converting your idea into a business or cause you to stop and re-evaluate your approach.

[1] The folks at NASA are masters at this discipline- see https://www.nasa.gov/seh/4-3-logical-decomposition [2] “Whats” and “Hows” refer some of the basic ideas that underpin Quality Function Deployment (QFD) methodology