Speed to Market: How Rapid Learning Drives Venture Success
Ventures face very high uncertainty and many unknowns. Fast learning is the only principle that works reliably in such an environment. Yet how can we implement this into the creation and inception processes?
Rapid learning is a critical factor for success in the highly competitive world of startups and corporate ventures. In this dynamic environment, the ability to learn quickly and adapt accordingly can be the difference between success and failure. This means that product development and strategy should go hand in hand and that learning what works and what doesn’t should be done as fast as possible. In many ways, those who learn and act on that learning the fastest will succeed.
While this is well-known, it is often not implemented in practice or only in parts of the practice, leading to sub-par results. Especially in corporate venturing, with ventures spawned out of organisations not exactly known for learning and pivoting quickly, implementing strong learning loops is vital to progress. It is easy for a venture-in-the-wild to move very fast, so what can we learn from them for our approach?
Fast Learning in Venture Practice
One of the most important things to keep in mind when building a new venture is the importance of speed. The faster your venture can learn and adapt, the better it can stay ahead of the competition and capture market share. Quick learning and implementation not only saves resources but also keeps your venture agile, enabling it to pivot when necessary. This is crucial for the success of your venture, as it allows you to make adjustments and improvements in real time rather than waiting until it’s too late. When building our ventures, proof of concepts and minimum viable products follow each other up quickly. Trying to get to a product-market fit as soon as possible, validated by real users.
Product development and strategy should be closely linked, as one of our fundamental principles is to make profitable ventures that bring value. We define and redefine what success looks like during every part of building the venture. Therefore we have daily standups between the product and commercial teams to ensure that learnings are shared as soon as possible. This results in small and big pivots during any time of the journey. It is easier and cheaper to pivot early on in the venture if learning is documented and verified.
You can adjust your product and strategy accordingly as you learn more about your customers and their wants. This helps to ensure that your product is meeting the needs of your target market and that your strategy is aligned with your business goals, and that it is in line with the success criteria we have defined or that we need to adjust it based on the new learnings.
Another essential aspect of quick learning is the ability to fail fast. Not every idea or product will, and it’s important to recognize this early on. By failing fast, you can move on to the next idea or iteration more quickly rather than wasting time and resources on something that isn’t going to work.
Tactics for Implementation in the Process
So, how do we implement quick learning in our product development and strategy? Here are a few ways:
- Use Data and Analytics: Collect data on customer behaviour, preferences, and feedback as soon as possible. Use this data to inform product development and strategy decisions.
Our approach: We quickly look to have a focus group with potential customers and run a paid pilot as quickly as possible (often within the first 3 months of the venture build). We have also set up websites and questions to do AB testing and other quantitative evaluation of the approaches we wanted to take.
2. Implement Agile Practices: Agile development is a methodology that prioritises rapid iteration and learning. This approach allows for quick adjustments based on customer feedback and data.
Our approach: Pivoting is part of the DNA of venture building. Hence, we look at a value chain approach (vs. A single idea) and assume that pivots will happen. We have switched from downstream to upstream before or completely changed the venture approach all within the scope of the initial engagement. Note that agile is not only for a product sprint but rather for commercial as well, and we structure all of our work in 2 week sprints.
3. Conduct Reviews and Retrospectives: Set up regular meetings with customers to review progress and reflect on what’s been learned. Use these meetings to identify areas for improvement and make adjustments accordingly.
Our approach: Collecting implications of new information that comes to light is paramount to ensure learning and continued improvement. These retrospectives are important whether they are about successes (what made us successful and how can we replicate for the future) and failures (what has gone wrong and how can we remedy that).
3. Encourage Experimentation: Create a culture of experimentation and encourage team members to test new ideas and approaches. This fosters a mindset of learning and growth.
Our approach: In our agri ventures, we farm, in our financing ventures we lend money quickly. We often risk our fees as part of the paid pilots (which is the main way for getting the right decisions by us and the right reactions by paying customers of the pilots) and assume that some of our work will fail. Our junior teams are empowered to ensure that they see what is on the field or in the venture and experiment with what they encounter.
4. Focus on Customer Discovery: Understanding the customer’s problem, needs, and pain points. By doing this, you will be able to develop a product they are looking for.
Our approach: Interviews are key, and are much more useful with paying customers (vs. Industry experts who can “opine” about what the customer wants, but often are not paying customers themselves. The interviews are constant from early on in the venture build process and throughout the process and onto the build phase.
5. Embrace Failure: Recognize that not all ideas will be successful and have a process for quickly identifying and abandoning those that aren’t working.
Our approach: We take risk together with our corporate partners, we run our business like a startup and we invest further in areas within the venture build we think are worthwhile. We understand that failure will happen, but we focus on ensuring that the overall momentum for the venture is maintained.
By implementing these tactics, corporate ventures can accelerate their learning and improve their chances of success in the competitive world of startups. The faster you learn, the quicker you can iterate, and the faster you can grow.
Conclusion: Moving Fast and Breaking Things (with Intention)
New ventures need to learn fast to succeed. Every market interaction, whether through interviews, surveys, prototypes, customer surveys, etc., is a chance to learn more about the nature of reality as perceived by the customer. These data points need to flow through the organisation, and teams need artefacts and rituals that help embody and incorporate that learning at a high pace to make rapid progress.
Corporates looking to build such ventures should learn from ventures in the wild and adopt their best practices. This will allow them better success through their corporate unfair advantage while not losing pace for some of the corporate mindset.
By leveraging, e.g., the described tactics, corporates can help their ventures implement best practices from startups in the wild to help them move faster and iterate sooner.
Authors:
Sebastian Mueller, Co-Founder, MING Labs
Arnold Egg, Founding Partner, Wright Partners
Ziv Ragowsky, Founding Partner, Wright Partners
