Startups are often advised to iterate quickly and that they should fail fast. The commonality of the two pieces of advice is that success for startups requires quick adaptation.
Many startups operate in an area that overlaps with a larger, better resourced competitor. Thus one of the key ways a startup can gain advantage is to compete in a way that places their competitors at a disadvantage. Large companies are pressured by shareholders to chase growth and seek products that can be larger than their last hit product. Consequently the cost of failure for these projects are even higher leading these companies to spend more time on analysis and research which slows down product development. For startups, the cost of failure is low and they can develop their products at a far faster rate. Part of the low failure cost is that a startup’s user base is also more tolerant of unpolished products especially if the product is new and cutting edge.
A startup’s user base is also usually far more active than regular customers in terms of wanting to communicate with the startup. This is why leveraging your user base as part of your product development process is a viable tactic. This idea of quick adaptation ties in with my previous post about optionality, as quick adaptation can be further enhanced by designing in flexibility in your products.
Adapted from “Iterate Again’” and “Fail Fast” by Colin Angle, CEO & founder of iRobot and Alex White, CEO of Next Big Sound.