Venture Design
The swiss army knife of an Entrepreneur
What is Venture Design (and Why Does it Matter)?
First, let's understand why it matters. Entrepreneurship is all about risk, but one of the best ways to mitigate that risk is with good design. The problem many entrepreneurs face is that they don’t know where to start when it comes to design. This is where the term Venture Design comes in handy.
Without good Venture Design, Entrepreneurship can waste a lot of time, resources, and savings chasing the wrong problem with the wrong solution using the wrong team.
Venture Design is an agile and human-centered method to take a high-risk idea and iteratively de-risk the idea until we end up with a viable business model. To de-risk iteratively, we need to find 8 things and we need to find them successively.
So what are the 8 things to find in good Venture Design?
- 1. A problem worth solving
Yes, you've noticed the 9th element in our list of 8! At variant work, we also help entrepreneurs find a way to tackle at least one of the Sustainable Development Goals so we include the 9th optional element.
Completing each element involves answering key decision-making questions in the form of a yes or no.
A problem worth solving
Is there a problem?
Is the big enough to solve?
A good understanding of the competitor landscape
Can I find 5 other companies, processes, or people solving the same problem?
Can I have a competitive advantage over all of them?
A motivated target user
Is my target user motivated to use and re-use the solution?
A feasible way to deliver value
Can I deliver the value?
Do I understand the cost implications?
A compelling reason for your customer to buy
Do I know my revenue stream?
Do the benefits exceed the cost to the customer?
A team that drives execution
Is my team strong enough to execute?
Will my team stay together long enough to execute?
A memorable brand
Is there a problem?
Is the big enough to solve?
An impactful pitch
Can I pitch in 8 words or 14 seconds?
Does it capture an audience?
An SDG Impact Target
Is related to an SDG goal?
Can I measure the impact my venture has on this target?
Understanding the questions to answer is the simplest part of Venture Design. Getting the evidence to answer those questions requires the specific skill of Experiment Design to help you:
- Formulate a hypothesis
- Choose an experiment type
- Define pivot metrics
There is also another priceless skill involved. Most hypotheses the first time around will result in a negative result, as in the answers to our questions will be no. Knowing how to read the data you collected and come up with a plan B is key to keeping the idea alive. This is where most ideas die or go around in circles until the money runs out.
Venture Design gives you a lot of structure, contains a lot of tools, and goes anywhere an entrepreneur goes - just like a swiss army knife. And just like a swiss army knife, where there is that one particular tool that you need sharp fingernails to get out, you will find a similar tool in Venture Design where you need sharp wits and experience to get right.
Every entrepreneur starting up a new venture should go through Venture Design. The intensity and duration depend on the assessment of risk and the level of financial investment required to launch the venture. For example, opening up an ice cream shop will require very little Venture Design but launching an intergalactic cruise company will need lots of supporting evidence. Whatever the venture remember these 5 key points
- 1. Velocity is Everything
Next Steps
If you are thinking about a new business idea and feel like it's a daunting task to get going, use Venture Design to break down your journey into these key milestones and apply a proven systematic approach to getting your business off the ground.