Kevin Starr, the incredible Executive Director of the Mulago Foundation, invests $10M per year into social impact organizations tackling the toughest problems in the harshest conditions in the world.
The four most important questions to ask yourself
The way he evaluates an investment is by asking the following four (seemingly) simple questions:
- Is it needed?
- Does it work?
- Will it get to those who need it (and a lot of them)?
- Will they use it well?
Those four questions are not only at the heart of Kevin’s evaluation model — but are the core of every working business. I highly recommend asking yourself these questions when you look at your business and answer them with complete and brutal intellectual honesty:
1. Is your service or product needed?
It’s remarkable how many startups already fail this test. There are so many solutions out there which never get to product/market-fit. Not because the product necessarily sucks — but because they never come to the point where they fulfill a real customer need.
2. Does your product actually work?
As a lot of (tech) companies are built by starting with the product before evaluating the market need, this one seems easier to answer for many. Having said that: Pay close attention to the word actually — a working product doesn’t mean that it succeeds in solving the customer problem.
3. Will it get to those who need it?
This is your distribution strategy. Again it is remarkable how many founders live by the “build it and they will come” principle. Sadly that rarely (if ever) works.
4. Will they use it well?
The last question goes to core of your customer experience. Only products which deliver on this dimension get used again and again and create happy users. In your metrics this will be your retention driver.
Four simple questions with the power to unravel your business model.
What are the questions that you ask yourself? Let me know in the comments below.