The Right It : Why So Many Ideas Fail And How To Make Sure Yours Succeed

204 Pages·2019·2.87 MB·English

by  Alberto Savoia

Dedication
To the Beast of Failure.
You taught me a few lessons, now it’s my turn.
Epigraph
It waits. Patient.
Confident that it will soon get its prey—it always does.
Few escape its bite, none its tentacles.
One way or another, the Beast of Failure gets us all.
Contents
Cover
Title Page
Dedication
Epigraph
Prelude
Book Overview
Part I: Hard Facts
1: The Law of Market Failure
Failure Is Not an Option—Not!
The Law of Market Failure
Market Failure and Success Defined
Market Failure Statistics
The Success Equation
Too Smart to Fail?
Failophobia
FLOP
2: The Right It
The Wrong It
Thoughtland
Hocus-Pocus Focus Groups
The Four Trolls of Thoughtland
Thoughtland and False Positives
Thoughtland and False Negatives
Escape from Thoughtland
3: Data Beats Opinions
Other People’s Data
You Must Get Your Own DAta
Quick Recap
Part II: Sharp Tools
4: Thinking Tools
Market Engagement Hypothesis
Say It with Numbers
Hypozooming
5: Pretotyping Tools
The IBM Speech-to-Text Example
Pretotyping
In Search of Pretotypes
The Mechanical Turk Pretotype
The Pinocchio Pretotype
The Fake Door Pretotype
The Facade Pretotype
The YouTube Pretotype
The One-Night Stand Pretotype
The Infiltrator Pretotype
The Relabel Pretotype
Pretotyping Variations and Combinations
What Makes a Pretotype a Pretotype
6: Analysis Tools
The Skin-in-the-Game Caliper
The TRI Meter
Part III: Plastic Tactics
7: Tactics Toolkit
Tactic 1: Think Globally, Test Locally
Tactic 2: Testing Now Beats Testing Later
Tactic 3: Think Cheap, Cheaper, Cheapest
Tactic 4: Tweak It and Flip It Before You Quit It
8: Complete Example: BusU
Thinking Clearly About Our Idea
Time to Test
Analyzing and Iterating
A Lucky Break
A Few Notes About the BusU Example
9: Final Words
The Right It: A Recap
What to Build?
Acknowledgments
Glossary
About the Author
Copyright
About the Publisher
Prelude
It was 3 a.m., but I was too agitated to fall asleep. In six hours I would be sitting
in the final board meeting for the company I had cofounded. After five years of
hard work and several attempts to make our business work, we had no options
but to accept a fire-sale offer—pennies on the dollar—for our award-winning
technology and assets. Dozens of people I had hired, people who had put their
trust in me and my vision, would be out of a job. The three world-class venture
capitalists who had entrusted us with not only a $25 million investment but also
their time, connections, and advice would be staring angrily at me, my
cofounder, and our executive team. I had been bitten by the Beast of Failure, and
it hurt like hell.
What hurt the most was that I could not figure out where I had gone wrong.
Failure was something that only affected other people: less experienced, less
competent, and less well-prepared people. Until then I had a perfect record with
startups and entrepreneurship. I was an early employee and had a great career at
two fledgling companies that eventually became industry giants (Sun
Microsystems and Google). I had also cofounded a venture capital–backed
company that managed to turn a $3 million investment into a $100 million
acquisition in eighteen months. My record was a perfect 3 and 0, and I was sure
that win number 4 was just a matter of time. The formula was easy: identify an
idea for a new product or service that solves a big problem, assemble a strong
team, get venture funding, build the idea, launch it, and then go public or—worst
case—get acquired for a pile of money.
And we had done all that. We had an ambitious idea for a product that
addressed a major software engineering problem in a very innovative way. All
our due diligence and market research confirmed that companies needed,
wanted, and would buy our product for their developers. We had assembled a
team of amazing people who worked incredibly hard for five years. We had a
great business plan and plenty of funding from the best venture capitalists (VCs)
in the world to execute it—and we executed it, just as planned.
So, WTF? Why The Failure? Where did we go wrong?
Unable to sleep, I got out of bed and stared out the window thinking of all
the other people who were, had been, or would soon be in a similar predicament.
It was a sobering thought.
At this very moment, millions of people around the world are working hard to
bring to life new ideas that, when launched, will be successful. Some of these
ideas will turn out to be stunning successes that will have a major impact on our
world and our culture: the next Google, the next polio vaccine, the next Harry
Potter series, the next Red Cross, the next Ford Mustang. Others will be smaller,
more personal, but no less meaningful successes: a little restaurant that becomes
a neighborhood favorite, a biography that does not make the bestseller list but
tells an important story, a local nonprofit that cares for abandoned pets.
At this very same moment, many other people are working equally hard to
develop new ideas that, when launched, will fail. Some of them will fail
spectacularly and publicly: like New Coke, the movie John Carter, or the Ford
Edsel. Others will be smaller, more private, but no less painful failures: a home-
based business that never takes off, a children’s book that neither publishers nor
children have any interest in, a charity for a cause that too few people care
enough about.
If you are currently working to develop a new idea, whether on your own or
as part of a team, which group are you in? Or if at this moment you are still only
thinking about investing to develop a new idea, which group will you be in?
Most people believe that they either are or will be in the first group—the
group whose ideas will be successful. All they have to do is work hard and
execute well. Unfortunately, we know that this cannot be the case. Most new
products, services, businesses, and initiatives will fail soon after they are
launched—regardless of how promising they sound, how much their developers
commit to them, or how well they execute them.
This is a hard fact to accept. We believe that other people fail, because they
don’t know what they are doing. They are losers who have no business being in
that business. Somehow, we believe that this does not apply to us and to our idea
—especially if we’ve experienced victories in the past: “I am a winner. I was
successful before. I will be successful again—just watch me!”
That is how I used to think. And I believed I had good reasons for my
smugness, because I had experienced a string of successes with only a few
relatively minor setbacks. Failure was something that only affected other people.
And then, just as I had reached new heights of confidence and hubris, the
Beast of Failure wrapped its tentacles around me and bit me in the ass. A good,