The [[customer development]] process begins with creating [[business model hypothesis|hypotheses]] using a business model canvas. These hypotheses are visually displayed and iteratively tested. The process involves a search stage and an execution stage. The search stage includes the [[customer discovery]], where hypotheses are constructed and tested outside the building, followed by [[customer validation]], to see if the solution matches the customer's problem. This match is often called [[product-market fit]]. The concept of a "[[pivot]]" is introduced when there is no match and is a crucial step for adapting and saving the business. Once a scalable model is found, the focus shifts to the second stage which is execution, creating customer demand, and building an organization for growth and rapid execution. The [[customer discovery]] and [[customer validation]] consists of four key phases, each essential for refining the business model and achieving [[product-market fit]]: 1. **State Hypotheses**: - Begin by articulating the initial hypotheses about the customer's problem or need. - Create a business model canvas and display it for team collaboration using sticky notes. 2. **Test the Problem**: - Step outside the building to engage with potential customers. - Validate the understanding of the customer's problem or need. - Develop a prototype, starting with low fidelity and progressing to high fidelity, especially for web-based solutions. 3. **Test the Solution**: - Assess whether the solution aligns with customer needs. - Aim to achieve product-market fit, where customers are eager to purchase the product. 4. **Verify or Pivot**: - Determine if the solution addresses a high-value problem and if the business model is ready for test selling. - Decide whether to continue with the current approach or pivot to a new strategy based on feedback. The customer development process is iterative, expecting multiple cycles to refine the product until it meets customer needs. Entrepreneurs should be prepared to adapt and pivot as necessary, ensuring that the product is worth investing time and resources into. ## Activity - Watch the video [Hypotheses Or Guesses](https://www.youtube.com/watch?v=PFlSiHWaaMs) ([[Udacity - How to Build a Startup]], Lesson 4.1) - Watch the video [Customer Development Process](https://www.youtube.com/watch?v=TXj3F5MdHUU) ([[Udacity - How to Build a Startup]], Lesson 4.2) - Watch the video [Customer Discovery](https://www.youtube.com/watch?v=FRzz9JJ6iiI) ([[Udacity - How to Build a Startup]], Lesson 4.8) Next: [[Creating a good business hypothesis]] Back to: [[Testing Business Model Hypotheses]]