Cover Background Image by Vishnu Mohanan on Unsplash
Particular molecular movement (results) from particular volition.
– Kaṇāda (कणाद)Life is a matter of choices, and every choice you make makes you.
– John C. Maxwell
Pathfinding is the procedure for finding the shortest and lowest-cost path from a starting point to the destination. In Computer Science, standard pathfinding algorithms produce effective results for a static graph.
Unfortunately, A deep tech startup focused on innovation does not enjoy the luxury of standard algorithms. So, in effect, we needed to employ innovative methods to connect our products to market needs and deliver the best value to our customers.
We adopted a scientific approach to business model innovation. Through our customer development process, we tested our business model assumptions (hypotheses), identified their validity or invalidity and made several pivots to reach the model that would maximize the value delivered to our customers.
Below is an account of the outcomes of our pathfinding efforts. The data points are for the period starting 2021 through 2022.
Hypotheses
We tested well over a hundred big and small business model hypotheses in half a dozen areas of interest through our customer development experiments. Many of these hypotheses and their validation or invalidation affected our overall business strategy to a great extent.
The above stats represent the number of hypotheses tested in each business area of interest. These stats also reflect our efforts allocation in those areas and give an intelligent clue about the nature of our business operations.
Validation
Of all the tested hypotheses, we found less than one-third of them to be valid that could contribute towards making a high-performing startup business model. For the ‘Customer Problems’ and ‘Channel & Pricing’ categories, we could find as low as only one-fourth of our hypotheses to be valid.
The above image represents the valid hypotheses stats. The validation process compelled us to make the right choices that define our current business model. It has also been humbling because, being a team with high industry experience, we were wrong more than twice as often as we were right.
Pivots
We made most – over three-fourths of all – pivots in specific categories solely to increase our products’ desirability to the customers. The most pivots were for ‘Customer Segment’ followed by ‘Value Capture’ and the others. There were none for the ‘Technology’, ‘Product Zoom-in’ and ‘Growth Engine’.
The above image represents the pivots’ stats. The concentration of pivots in the specific categories reflects our seriousness and commitment towards delivering the best value to our customers through our products and services.
The entire process has been very challenging but also so much rewarding. We needed to make tough choices based on the validation or invalidation of our hypotheses and hence, several pivots. Of those, a significant number were quite gruelling. Yet, it ensured we have all three critical business elements—product feasibility, their desirability for customers and overall business viability.
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