How Fast Is Fast Enough? Understanding Speed in Startups

Do you know the advice to tell people what you are up to so it gets you committed and gets things done? It’s a great one that I use a lot, but there is one area where it hasn’t worked for me (at least so far).

I’ve been talking about writing a product leadership book for a while now. I mentioned it in my blog, to my academy alumni, to my friends, to industry leaders, and even to Marty Cagan and his partners at SVPG. I found an editor I like and understood what it takes. But years go by, and my progress is far from impressive.

Regardless, as part of the work on the book, I have interviewed product leaders in successful companies we all know. I focused primarily on those who were there from the get-go and could tell the full story of the product and the company (since it’s always a journey and no product is successful on day one). Most people I talked to mentioned speed as a crucial factor in their success. I heard quotes like “We knew what we needed to do, and we needed to do it fast,” or “Speed was one of our core values.”

On one hand, it sounds trivial — everyone knows that a startup needs to move fast. But I needed to dive deeper into it: why is speed actually that important? To answer this question, we need to first understand what people really mean when they say ‘speed’ because not all speeds are alike. Here are four types of speed that are important to startups — each in its own right.

Speed of Insight

The whole idea behind lean and agile is that you can’t know everything on paper, and you have to meet the market to truly understand what’s going on. I couldn’t agree more and have seen it numerous times — there are so many things you learn when you let the rubber meet the road. Assumptions that you made turn out to be wrong, or at least not 100% accurate. There are new obstacles that you couldn’t have foreseen but must overcome to succeed. Not to mention market trends and competition from angles you didn’t think of.

All of that exists in the market and in your work with your potential and current customers. However, the fact that the information exists out there or in people’s heads doesn’t mean you have access to or understand it. To truly move fast, you must ensure that you get these insights as quickly as possible and not just when they land on you.

To do that, make sure you understand the assumptions that you were making and get back to them regularly (at least monthly for strategic ones) to see if they still hold. Note that many times, they won’t be wrong, but they won’t be entirely accurate either. Accuracy is essential here, especially when it is in foundational areas, such as the value proposition of the product and how your customers perceive and experience the problem it comes to solve.

Speed of Decision

Once you have new insight from the market, you need to decide what to do with it. This also takes time, and some companies make decisions faster than others. In a world with so many unknowns (and that’s the nature of almost every decision you need to make in the product world), eliminating this uncertainty can take a long time, and usually, it doesn’t really go away. It can only be reduced. There is a fine balance between making the right decision, having it backed by data, and moving fast enough so that you don’t pour the baby with the bathwater.

The key to making faster decisions is to remember that not deciding has its cost, too. It often seems like delaying the decision has no implications, but it is rarely so. Note that it doesn’t mean that you must make your decisions without waiting for anything or anyone. In many cases, due diligence or a deeper analysis are truly needed. The idea here is to understand that you are constantly managing risk, and risk resides on both sides of the equation: there is risk in deciding too fast, and there is risk in deciding too slow. When you see it like that, it is much easier to find the sweet spot where the marginal certainly that will be gained by additional research isn’t worth the wait.

Some companies have a culture that fosters decision-making only in consensus. This is generally a bad practice, but there is only so much you can do about it as an individual. A great start would be to communicate the decisions in the language of risk management. If done right, it can allow you to still involve everyone in the decision, but you can get people to agree that it’s not worth delaying the decision anymore, even if they don’t agree with the decision itself. It usually is a specific part of it that they don’t agree with, and if you create the proper mechanisms to eliminate the risk in case you are wrong, it will be much easier for people to agree to move forward.

Speed of Delivery

This is often the most common interpretation of speed simply because it is the easiest to see and measure. It is the most tangible form of speed and is usually the heavier part of the process, so focusing on improving it should yield great results.

When you look at the speed of delivery, I encourage you to go beyond the plain speed at which R&D delivers high-quality software. While there is usually much to do there, I want to take you to the next level of it: how fast can you deliver the right product? Of course, to do it well, you must master all three types of speed mentioned up until now: you must deliver your product into the market (or conduct other forms of real-life research) so that you can gain quick insights, make your decisions quickly and deliver the next version of the product accordingly as fast as possible, to learn and fine-tune it again.

You can improve each and every one of those speeds separately, but if you focus on the speed of delivery of the right product, there are also other things that you can do: trade-offs between scope and speed would be made differently if you understand that your goal now is to learn, not to sell, for example. The clearer the goal is for everything you do, the more ways you will have to make sure your goal is intact while other constraints are also met.

Speed of Impact

This is the trickiest form of speed but perhaps the most important one. All the types of speed mentioned above are focused on how fast you can move. It focuses on your effort. This one focuses on your impact or how fast you can deliver results.

By results here, I mean business results first and foremost, although this point of view can also be applied to other types of results. Speed of impact can be seen in how long your sales cycle is, how big and healthy your pipeline is, and how fast the business grows in its bottom line.

If you think about how the stock market evaluates companies, it always comes down to sustainable growth. The same goes for funding rounds — VCs look at your revenue as well as the time it took you to get there and how healthy it is.

In the early stages, the impact is not limited to revenue alone. In most cases, you can’t focus on revenue before you prove you are valuable to your customers. That’s also a form of impact. Getting happy customers who love your product and use it regularly and would be very disappointed if it goes away is an important step along the way and is a meaningful form of impact in and of itself.

There are two things you can do to increase the speed of impact: the first one is to have a solid product strategy that clearly articulates your product’s unique value proposition and business viability. This is important not only for product development but also for marketing and sales to be able to bring the right customers, and many of them.

The second thing you can do to increase your speed of impact is to start thinking about it in larger orders of magnitude since it would reveal other modes of operation. For example, let’s say you are able to sell to your target audience repeatedly, but each sale takes a few months. With this in mind, you might set a stretch goal of 50 new customers for this year. To challenge yourself, ask what it would take to get to 500 new customers instead. You might find out that there are ways to get there that you didn’t think of previously, and even if you don’t get to 500 new customers, you might break barriers and do more with less. It is a great way to force yourself to think backward from the goal into actions and not vice versa.

Where are you at? How fast is your company at each of these types of speeds? Do you want to move faster? With our help or on your own, it’s time to get going, as that’s the only way to gain speed.

Our free e-book “ Speed-Up the Journey to Product-Market Fit” — an executive’s guide to strategic product management is waiting for you at www.infinify.com/ebook

Originally published at https://ganotnoa.com on March 10, 2021.