v1 Who decides what to build?

The question every founder and every Start-up face is "what to build". I've heard directly from founders who have raised money and existed the companies successfully said "The first couple years, we spent the time and money to figure out exactly what to build."

Who decides what to build?

There are three types of Start-ups categorized by who decides what to build. I've observed first handedly in the start-up world including my own founder journey.

Top Led: Founder or executive team tells Tech team what to build.

Engineer Led: Tech team decides what to build.

Product Led: Product tells Tech team what to build.

Today, I will share one analogy and two quick stories with you around this topic.

One Analogy

The best analogy that I can use for how Start-ups decide "what to build" is Party Planning. Why I choose this analogy?

1) It's easy to understand and simple to grasp. Not everyone has been part of Start-ups, but everyone has planned a party before or seen how others do it.

2) The ultimate results that both Start-ups and Party Planners are seeking is great
"User Experience".

How do you tell if it's a good a party or not? The one and only criteria: are all guests having a great time?

How do you tell if Start-ups are building product people want? High Net Promoter Score (NPS) sends strong signals of Product-Market-Fit (PMF).

Top Led Start-ups

Usually Top Led Start-ups have a visionary Founder/CEO and/or a strong opinionated Executive Team. What motivate them is that they want to build what they believe in. They constantly have very creative ideas, sometimes track records of extensive experience. However, they often rely only on gut feelings or past experience. Now enters the party planning analogy. A Top Led Start-up's whiteboard could look like this:

Theme: Multiple Themes. All-white Party. Hawaii Party. Costume Party. Pool Party.

Audience: Multiple segments of audience. People will find something they enjoy since it's a multi-themed party.

Priority: Prioritize Founder/CEO or Executive Team's preference over the guests' experience.

How to Plan: Let's build things for All-white Party. Let's build things for Hawaii Party. Let's build things for Costume Party. Let's build things for Pool Party.

How to Optimize: Founder/CEO or Executive Team' opinions.

When you want to plan a party to cater to multiple segments with distinctive needs, it takes more time and more $, but reduce focus and depth. You have four distinctive different themes means four distinctive user journey to consider.

What often happens is Top Led Start-ups are always in building mode. It seems there are always new creative ideas to be added, and new direction to be taken. Times goes by, Top Led Start-ups end up making little and slow progress for Product-Market-Fit (PMF).

Engineer Led Start-ups

Typically Engineer Led Start-ups have extremely talented Tech leader and passionate tech team. What motivate them is that they want to build the coolest thing ever. That's how they thrive and that's how they change the world.

Theme: Let's build the coolest party in the planet.

Audience: It doesn't matter who comes. People will come when the party is cool enough.

Priority: Prioritize tech team's preference. Care little about guest experience.

How to Plan: Let's build the worlds biggest chocolate fountains. Let's have the best DJ. Let's have hour long fireworks. Let's have a virtual reality station. Let's... The list goes on and on. With the best intention, often technically challenging and fun.

How to Optimize: Tech Team's opinions.

You can imagine Engineer Led Start-ups could get expensive. Hours and hours spent on things that are very interesting, but not necessarily on the critical path of Product-Market-Fit (PMF).

Product Led Start-ups

True Product Led Start-ups have very customer centric culture. They often led by Founder(s) and/or Product Leader(s) who want to build the best experience for a very specific user segment.

Theme: Let's throw a birthday party for a 5 years-old.

Audience: Similar age children and their parents.

Priority: How can kid have the most of the fun while parents enjoy spending time together as well.

How to Plan: For the kids - let's have a bounce house with slide, couple outdoor games, and cupcakes. For the parents - let's have some chairs, couple outdoor games, and mimosas.

How to Optimize: Ask kids and parents' opinions.

The difference here comparing with Top-Led Party Planning track is even though there are two difference audience but both have the same needs: have fun at the 5 years-old birthday party. It's much easier to serve a smaller and more defined audience for a specific need. The chance of creating a product/service makes this group of audience happy is much higher. The secret sauce here is when you incorporate constant user feedback loop, you are not building a product in the vacuum. Hence it's a fast track to Product-Market-Fit (PMF).

If you are a founder, which type of Start-ups would you like to build?

Personally, I love the Product Led Start-ups. They are on an mission to create something extraordinary for very specific target audience with specific needs. It will have Product Market Fit (PMF) much faster than build something for everyone or for multiple segments audience all at the same time. This is especially true for early start-ups. What start-ups don't have is unlimited time and unlimited money. With limited time and resource, the quickest path to PMF and revenue is becoming a Product-Led company and building a very specific set of features for a very specific audience.

Now, here are two stories that I want to share.

Story #1: Founder Learnings

The very first business idea that I worked on when I fired up to build was a parenting app. While I was working through the ideation and validation, my hubby quickly pointed it out "what are you trying to build? A community? A knowledge course? Or an AI product?". Of course, I responded "all of them".

I didn't realize at that time, I fell into the trap of a "Top-Led" mindset, I prioritized my personal preference. I didn't have the "Product-led" mindset, build-measure-test in small batches and let your users give you feedback if you are truly building something they need. After I realized how important it is to have the "Product-led" mindset as a Founder, I started to immerse myself with product leaders, communities and books. 

Luckily instead of spending long time building things in the vacuum based on my preference, I spoke to dozens of parents. Quickly validated my assumptions were wrong, there's no needs to the types of parenting app I thought parents need.

Story #2: Start-up Learnings

My full-time job is the Chief of Staff to CEO at a Series A company. I've witnessed how the company benefits from transforming from an Engineer-Led org to a Product-Led org recently. The change was quite extraordinary and inspiring. Here is an example from this week.

• Better Product: 
  • Our product onboarding time has cut down significantly (65%) to provide a smoother onboarding experience. It used to take 20 mins to complete onboarding, now it only takes approx. 7 mins to do so!
  • We introduced a major new feature bluetooth pairing that could improve user experience greatly into the onboarding process. 
  • It is amazing to see how the team is able to incorporate a major feature to the onboarding while cutting down the overall on boarding time.
• Faster Iterations: The changes we made in the past few weeks were more than the changes we made in half an year before we transformed into a Product-Led org.
• Higher Morale: Morale is at an all time high. Team are more focused on what to build, and how to address user pain points. When the team saw the delights from users with the new improved flow, they became more motivated to continue to ship better products.

How did we make the changes?

All these can't be achieved if not every level of the organization understands who makes the decisions on what to build.

On CEO level, CEO not only emphasizes the message of "we are a product led organization" at all team meetings, he actually firmly believes it and lives up to it. His opinions about the product are still considered and valued as anyone else on the team, but he is NOT the decision maker about what to build.

On Executive Leadership Team level, we created a pod structure, assigned Pod Leaders and specific team members dedicated to certain pods.

On an individual level, team members understand each Pod Leader makes the decisions on what to build. For the consumer app, our Head of Product is the Pod Leader. 

After we switched to Pod structure, the team instantly had increased productivity, better collaboration, improved creativity and enhanced problem-solving. Some would even say higher employee satisfaction.

What Now?

For me, now I focus on my energy and time to delight the first 100 customers of anything I build. Take this "Journey with Swings" newsletter as an example. What matters to me is not only documenting/creating content, but also makes sure my early-audience enjoy the content. Yes, that's you. Thank you for signing up!

If there's any thing you'd like me to know, please reach out at JourneyWithSwings@gmail.com.