Founders who don’t understand th

While studying at Harvard Business School, Sunil Nagaraj had an idea. He’d make software that matched potentially compatible singles based on behavioral data gleaned from their internet use – things like the TV shows they watched or the music they listened to. He’d license this software – which he called Triangulate – to dating companies, who’d offer it at a premium rate as an advanced form of matching.

To find out if behavioral data could indicate romantic compatibility, Nagaraj ran a test with 100 volunteers. Unfortunately, the software he used didn’t work on most of the volunteers’ computers, so the results were skewed. Undeterred, Nagaraj plowed ahead and started engineering his software. But without market insight, he was flying blind.

Nagaraj was impatient to build his matching software, and this enthusiasm led him to commit a common mistake – the false start. He invested time and money into his product before he even knew if there was consumer interest. Instead of conducting market research, he made assumptions about his customers, like assuming they’d be willing to pay a premium to be “triangulated.”

In reality, people don’t find algorithms useful when they’re deciding which dating profiles they like. It’s not the same type of decision as choosing a financial service provider, for example, where they might not have any intuitive knowledge or experience to guide them.

Nagaraj also failed to consider whether people would be OK with their internet usage being tracked so they could be triangulated – something many of us would consider a breach of privacy. This meant his idea – a crucial opportunity of his startup – was flawed. If Nagaraj had surveyed people using online dating services, he’d have realized this much earlier in the game. And armed with that information, he could’ve reconsidered his product before investing in it.

To avoid false starts, it’s crucial to resist the impulse to act prematurely. Like someone caught up in that first flush of romance, it’s easy for a founder to rush into making their first minimal viable product, or MVP, before they’ve done their homework.

An MVP is a functioning prototype that gives investors and potential customers a feel for your final product. But creating one is the second-to-last step before making a fully realized product – not the first! It can only happen once you’ve understood everything about your intended customer so you can workshop ideas and thoroughly design with their needs and preferences in mind.