Darren Moffatt (00:00:11):
Hi there and welcome to the nerds of business podcast. My name’s Darren Moffatt. I’m a director of Webbuzz, the growth marketing agency. And I’m your host. It’s great to have you with us. I’m excited to announce that the classic format is back today. We begin season two in our mission to problem solve the entrepreneurial journey. Regular listeners will recall that in the first series we tackled the topic of branding. Well, now we turn our attention to the challenge of product development. If you’re an entrepreneur, the products or services you sell are at the very heart of what it means to run a business. But how do you come up with that innovation? That’s good enough to take you from struggling venture to multi-million dollar enterprise. And that’s just the beginning. Even if you do have a great idea, how do you then develop that into a scalable product and implement a go-to market strategy over the next 10 episodes?
Darren Moffatt (00:01:10):
These are the questions to which we’ll find the answers. Now, if you run as to the space business, you might think that product development isn’t directly relevant to you. But just to clarify here, the term also applies to all the experiences you create to deliver a service that customers want. In fact, product development is important for all types of businesses and it’s something that should never actually stop because the nature of market is inherently dynamic to give the content of this series, the widest possible application, I’ve curated entrepreneur guests from the field of hospitality, electronic device manufacturer, real estate, healthcare, financial services, venture capital human resources, and of course technology and the world of startups. One of our nerds even worked in product for Uber when they had just 20 employees together, this panel of nerds, and I will attempt to solve the key product development challenges that all businesses must overcome. One problem at a time, but perhaps the true stars of this series are our two product design experts who you’ll meet in a minute. They reveal the frameworks and techniques that global brands use to power, exponential value creation. Best of all, they’ll show you how you can apply these to your business, to no matter how large or small your company is. But first as usual, we start with a story, a trip back in time that shows how the principles of product development have changed remarkably little since even before the birth of rock and roll
Speaker 1 (00:02:59):
Darren Moffatt (00:03:05):
The year is 1953 and a small guitar manufacturer from the U S West coast called Fender has been going for seven years with limited success. Its founder, Leo Fender is not much of a guitarist, but he’s an avid electronics tinkerer and saxophone player with a keen ear for melody at the time electric guitars are bulky cumbersome instruments, mostly used for rhythm accompaniment in bands. It’s hard to imagine now, but the idea of lead guitar or a guitar solo has yet to arrive the post-war popular music of the early fifties features mostly saxophone for the melodic solo breaks, Leo fender. However can imagine new possibilities for the guitar. He sees a future where guitar electrifies audiences with melody, uh, to achieve this. He knows that guitar design needs transformational change. Working with several players and designers, he fashions a radical new ergonomic shape contoured to the human body.
Darren Moffatt (00:04:09):
Another innovation he introduces is the presence of three pickups instead of two, which provides wider tonal variety to the sound. And perhaps most famously, he introduces a vibrator unit in the guitar bridge with a whammy bar that produces a sound effect known as tremolo by 1954, the offender has gone through several prototypes to finally release his new model, which he called the Stratocaster. It’s a complete game-changer. Like many genuine innovations, it’s so far ahead of its time that people initially don’t know what to make of it. It takes a while to catch on, but soon early rockers such as the shadows use the Stratocaster to create the famous surf guitar sound
Speaker 3 (00:05:07):
Darren Moffatt (00:05:07):
Buddy Holly and the beach boys follow before the Stratocaster is finally immortalized in the mid sixties as the guitar of choice or the legendary Jimi Hendrix. Since then Fender Stratocasters have become iconic. They’re played by the best guitarists in the world, including Eric Clapton, Jeff Beck, and The Edge. They become a collector’s items. And in 2017, a single Stratocaster sells for $2.7 million. And what happens to the founder Leo Fender? He actually sells his company in 1965 for a cool $13 million, a massive profit in today’s terms, much of it due to the product development and design of the Stratocaster model.
Darren Moffatt (00:06:01):
Now I must confess. I’m a huge Fender guitar fan. I’ve been playing their guitars for years. And in fact, I recently purchased my first ever Stratocaster, which obviously got me thinking about this story. It’s a story that perfectly illustrates the power of product design. The fact that fender is still shipping millions of units of essentially the same product. 65 years later is no fluke. Although every product journey is unique. It usually starts with the diagnosis of a problem that current market offerings can’t adequately solve. The tricky part is that sometimes just like with the Stratocaster, the market doesn’t even know they have the problem yet. There’s a famous quote from the inventor of the motorcar Henry Ford, that addresses:
“If I had asked people what they wanted, they would have said faster horses. ”
Darren Moffatt (00:06:53):
If you’re thinking about improving your existing product range, or maybe you’ve identified a new problem that needs to be sold, then it all starts with ideating a potential solution. So what can you do to come up with that breakthrough idea that will catapult your business into the big time.
Darren Moffatt (00:07:43):
We’ll styart the show in a minute, but first a word from our sponsor.
Ben Carew (00:07:51):
Hi everyone. It’s Ben Carew here. I’m a director at Webbuzz, the growth marketing agency. I work alongside the host of this podcast. Darren Moffatt. If you’re a business owner who wants to grow, but you don’t have the spare funds to invest in marketing right now, you’re not alone. Since COVID hit, we’ve noticed more clients suspending campaigns or delaying their marketing altogether due to cashflow issues. In response to this, we developed a solution called buy. Now pay later digital marketing. It provides eligible small businesses with nothing to pay on SEO, digital marketing, and website development for up to three months, we think it’s perfect for entrepreneurs who need a helping hand getting sales flowing. Again, I’ll be back later in the show to explain how it works, but if you can’t wait, you can download a free info pack. now at webbuzz.com .au/BNPL, that stands for buy Now pay later that’s webbuzz.com.au/bnpl.
Darren Moffatt (00:08:56):
So the title of episode and the problem we’re trying to solve is product ideation. How to think your way to a billion dollar business idea. It’s a big show today, and we’ve got some truly amazing guests up soon. You’ll hear from a Norwegian bar baron, a PropTech founder. Who’s worked for Uber and Google and will completely nerd out with our two product design experts. But first here’s just a quick reminder that if you’re enjoying Nerds of Business, to please hit the subscribe button on your podcast player, it means you’ll automatically receive each new episode every fortnight, and it makes it easier for us to stay in touch.
Darren Moffatt (00:09:35):
It’s well-known that entrepreneurs who conform to the ‘genius founder’ stereotype tend to get all the fame and glory think of Elon Musk or the late Steve jobs. They’re the rock stars for the 21st century, but to technology insiders, product designers are the true wizards of the business world. Conjuring untold riches for shareholders from seemingly thin air. The iPhone is a classic example. I’m sure most people still think that Steve jobs personally invented it, but he didn’t. The iPhone was a work of apples, chief designer, Jony Ive. For this series of Nerds of Business I’m thrilled to be joined by two of his ilk. Carrie Peters is a product design principal at Sydney agency, Us Two, originally from Oregon via New York, where she designed for the likes of Nike and Class Pass. She’s now a leading exponent of human centered design. I began by asking her what exactly is the ideation process.
Carrie Peters (00:10:35):
So, um, ideation process in essence, it’s the process of, um, quickly diverging. So going wide and following that up with converging. So narrowing in, um, there’s a framework called the Double Diamond that people refer to a lot nerdy
Darren Moffatt (00:10:53):
For awakened the, the nerd bot, um, that is very nerdy. Yeah. Yes. Please give us some more detail on that. Okay.
Carrie Peters (00:11:01):
Okay. The Double Diamond. So, um, Double Diamond is, is one name for it. There’s a lot of different iterations, but, um, originally it was a framework, um, developed by, um, I think somewhere in Britain in 2005. Um, and the whole idea is there’s sort of different, um, different moments along the ideation journey where you go wide. Um, so you discover different phases. Uh, I think they start with discover and then define and then develop and deliver. But the idea is that, um, every other stage there you’re going wide on something or sort of exploring something deeper. And then, um, on, on the next level, you sort of, you focus in on it. And I guess the whole idea behind it is similar to, I don’t know if you’ve read Daniel Kahneman’s book before Thinking Fast and Slow. I haven’t read that one. So it’s been a while since I actually read the whole thing, but, um, I, I, I pull from every once in a while, but there’s this key concept in there about, um, just the way that our minds work.
Carrie Peters (00:11:58):
So there’s sort of a fast brain that makes really quick, um, sort of intuiting sort of, um, decisions. And it just knows what it knows or thinks what it thinks. Um, and then there’s the other side that’s a little bit more quiet and slow and rational and it sits back and I feel like this, um, diverge and then converge approach. It sort of mimics that in that what you do when you’re diverging and you’re throwing ideas up against the walls is you’re thinking really fast and you’re kind of letting your ideas, um, spin out quicker than you can even logic. Um, and then when you decide that you need to narrow in, on stuff, you really take your time and you’re really thoughtful about it and you let your rational brain come in and really make some wise decisions. And though the hopeful result, I guess, of all of this, and if you do it right, is that you’ll get to the end of this process.
Carrie Peters (00:12:43):
And it may be that you need to diverge and converge several times before you get to that final sort of thing that you want to build. Um, but the idea is that you’ll come out of something that’s really simple. It seems really simple to look at somebody who would pick it up and describe it as like, Oh, it’s simple, easy to use. It only does, you know, these two things, but it has this sort of, um, I don’t know, like magic ness to it that only comes through really wild ideation, um, which is, is sort of that, that, um, diverging aspect of it. So, wow. Double diamond.
Darren Moffatt (00:13:14):
That’s awesome. That’s a nerds are freaking out as they’re hearing this, that is incredibly nerdy. So Carrie has given us a great introduction there. Now it’s time to dig a bit deeper into the theories and frameworks that provide the how to for product ideation. Ross Gales is a director of design and strategy at Sydney agency. Pollen Ross has designed product solutions for some of the biggest brands in Australia, including Gumtree, which is owned by global giant eBay. But a big part of what Ross does is actually consulting to startups and small businesses who need help with product development. Of course, I’m sure you get people coming to you with a vague idea, product idea, but for those businesses that are fairly mature, are you, are you looking at stuff like different customer segments, um, discovering new types of problems, um, you know, uh, mapping a different type of customer journey and how to solve problems along that journey?
Ross Gales (00:14:09):
Is this all the kind of stuff you guys do? That’s exactly right. So, so a big part of what we do is helping with the strategy up front of determining the Five W’s. So the, who are we targeting? What are we trying to solve? Where is our audience? Um, when is the right time for a product like this and why now, um, what we, what we focus on is that the, how, or the ideation of how do we solve the right problems for those customers? And that’s the creative process. That’s part of our design methodology to help people understand their market and come up with the right solutions to solve the right problems that really add value. And what you’ll hear me talk a lot about is the creation of value for users. So a lot of our processes are designed to ensure that we, what benefits
Ross Gales (00:14:52):
Your customers need and how you best deliver them with the right
Darren Moffatt (00:14:55):
Product solution. Yep. When it comes to, I guess what we call ideation coming up, the process of coming up with the idea, right? This is often where the entrepreneur starts. You know, they, they get a light bulb moment, you know, it’s a real, ah, aha. You know, that wonderful idea. Um, but for you guys, it’s a little bit different. Um, you might like to step us through what the ideation process looks like from the perspective of a product design specialist.
Ross Gales (00:15:30):
So what, so what we do when, when new clients come to us and they typically come to us with an idea, you know, people do, they latch onto something great, or they find a hole in the market. Um, and they come and speak to us first and looking for a design partner and a development partner who can help them bring that idea to life, nothing wrong with having a big idea and coming in and talking about it and unpacking that in more detail. But the first thing I’ll always say is the pragmatic, what is the business model? Who’s your audience? Have you size the demand, really trying to understand some of the critical business problems that this is trying to solve. It’s one thing to have a great idea, but to take it to market requires an enormous amount of effort and investment to get it right.
Ross Gales (00:16:13):
And, and, and without doing the upfront, uh, thinking that that informs that decision to take that product to market. Um, it can be an enormous amount of waste of time and effort. So that’s where we take that idea and we help them to validate that idea in the market, firstly, understand what problems need to be solved. And then we start to come up with the right solutions solutions that the customers will actually want to use. It’s one thing to say, if I build it, they will come. It’s, it’s another thing to do your homework and ensure that there is an audience and a need for what you’re trying to put out there.
Darren Moffatt (00:16:47):
Yes. And to that point, how often would you politely declined to do business with someone that approaches you, you know, like, I mean, it must happen where you get people coming with what they think is a marvelous idea, but you know, it’s actually not, and you’re pretty sure it’s not like, how often does that happen happen? How often do you have to kind of say, look, you know, we’re not sure it’s gonna work or this is this one’s not for us.
Ross Gales (00:17:11):
Yeah. It looks surprisingly quite often, we do get a lot of new business inquiries where either the, uh, the idea is not well formed yet. And we advise them to go and do further homework before we start to engage in that particular product. Yeah. Um, otherwise we can help them with the right model or make recommendations on the right activities to, to get that validation and insights that they need to give the idea some credence and validation.
Darren Moffatt (00:17:36):
Now, as you soon discover, I think Ross was maybe one of the nerdiest people we’ve ever had on the show. I asked him what frameworks he recommends for small business and entrepreneurs who want to try a DIY approach to their product development.
Ross Gales (00:17:51):
Sure. So design sprints at, at the core methodology that we use for most new business inquiries, it’s it’s to quickly unpack the problems, come up with some ideas, potential solutions, just to get a sense of what we can then validate with users. So the ideation phase itself is really focused as I keep saying on the creation of value. So first thing we often do when it comes to an ideation session is what we call a customer value pyramid. Now, the customer value pyramid is a quick exercise. We do to best understand your audience, the types of benefits you want to deliver to that audience. And then the types of product features that are going to help to deliver those types of benefits. And that ideation session is often framed as what we call, how might we statements,
Darren Moffatt (00:18:36):
Ah, nerdy that’s very nerdy. It might be maybe, uh, unpack that a little bit more like, so what happens there?
Ross Gales (00:18:45):
How might we statements or a construct or a sentence where they take the problem that’s trying to be sold and the benefit we’re trying to derive. So we might say, how might we solve a particular problem in a way that delivers a particular benefit, right? I’ll give you an example of that. So we’re working at the moment with a client of ours in the charity sector, and they’ve challenged us to solve this problem. So they say, how might we make giving simpler for our users in a way that creates the sense of belonging with the charity? So the benefit being, we’re trying to get people more connected with these causes and ideas. So that’s the start of a, how might we statement that we can then ideate on? So we can take that challenge and say, well, what are some potential solutions that we might use to solve a problem like giving and community and connection and a sense of belonging to a charity.
Darren Moffatt (00:19:39):
So would I be right in saying it’s kind of like an emotional equation, right?
Ross Gales (00:19:45):
That’s a great way of framing. It absolutely. Is that a fair, fair call? There’s, there’s another way of adding to that sentence as well, to get a desired outcome. So some people say, how might we make giving simpler in a way that creates a sense of belonging so that our users are more connected to our causes. So we starting to see how we can get a lot of clarity on the problem that we’re trying to address, which really narrows the focus of an ideation session. And I think that’s a really important thing when typical brainstorming goes into all sorts of territories and can be a little bit of a time suck in and lead you down some dark alleys from time to time, the, how might we construct just helps to give the session some focus and ensure that you’re solving the right problems for the right users in order to get the right outcomes.
Darren Moffatt (00:20:35):
That’s really, really useful. And, and, you know, I touched on emotions there, like how much of what you do is about human emotion and eliciting
Ross Gales (00:20:48):
A response, and also responding to some emotional state look. All of what we do as human centered designers is about human empathy. It’s about understanding human emotions. It’s about understanding their behaviors, because what we’re trying to do is help to change their behaviors. And in order to do that, we need to understand what is the emotional response we’re trying to do to connect them to what they’re there to the outcome they’re trying to achieve. So that’s a big part of what we do, and I think framing it in terms of, um, tapping into those emotions and designing solutions to elicit those emotions is a really nice framing. So sorry to dwell on this, but it’s fascinating. One more question. Um, do you think it’s possible for someone with low emotional intelligence, for instance, to design a great product? It’s a really good question. It’s something I’ve actually thought quite a lot of bad as, as user experience designers as, as most of my team is, um, it really, it really is about having a high level of empathy and at a high level of emotional intelligence to be able to tap into those things.
Ross Gales (00:21:49):
So when you are validating a product with customers, when you are doing user interviews, um, you really need to tap in and be able to listen and, and work out what’s really happening behind, uh, the pain points that they’re facing with a particular experience. So we come out of a session today talking to home loan customers and trying to really understand what the pain points and the frustrations and where the anxiety levels are high in a Homeloan transaction. And there’s lots of them. Yeah. But unless you really listen and really understand the problems and why those problems exist, it’s very hard to solve them with the right solution. So there are some super useful tips there from Ross into which frameworks are best for small business. I asked Carrie from Us Two to why such frameworks are so important when it comes to product development and design.
Carrie Peters (00:22:43):
I would say I will be the first to admit that my industry just loves jargon. Um, and I think there’s a little bit of a, if know, a piece of jargon that you don’t know, it makes me better at what I do. And I think that that’s not fair. And also it’s not helpful because in essence, all of these frameworks and all of these systems and approaches and, and canvases that we use for these things, they’re all based on pretty simple principles. Um, so when, whenever anyone’s thinking about getting into product design or product thinking in any way, I, I tend to try and let them know, like, just don’t pay attention to the jargon, try to understand the core concepts behind it. It’s pretty simple, like stuff that you probably would have learned if you went to university like that, it’s not that complicated.
Carrie Peters (00:23:26):
So ignore the jargon. But having said that there is a reason to have good frameworks in place. Um, and I like to think of it as, um, if you kind of know your tools or your toolkit, um, and your, and your systems that you can use. It’s like having a good workout schedule, you set the alarm, you know what you’re going to do. You basically just hit play and you’re in, and your body just does what it needs to do, because it knows that that’s what you’ve already planned to do. And the really hard work of actually like making yourself, you know, go a little bit fast or work a little bit harder, but you can put all your energy into that thing. And I feel like when I’m, when, when you’re doing product thinking, um, it’s a lot of work. It’s, it’s really exhausting to toss around a lot of really loose sort of foggy ideas. And you really need to save all your energy to be doing the real thinking. And if you have these frameworks that you just know how they work and you just use them, um, you don’t have to think about how you’re going to think about these things, you know, the how, um, you just need to think. Um, so it’s a bit of an energy saving exercise.
Darren Moffatt (00:24:26):
Great. I think that’s a wonderful description. Um, and so, so it, it’s about efficiency. It’s about optimizing your ability as a designer, because you’ve got listings to think about, you can sort of put more effort into the actual design thinking. And would you just would just say that another analogy you might use is like a different lens. You can look at the same problem through, does that analogy work?
Carrie Peters (00:24:52):
Yeah. Cause sometimes you’ll, you’ll, you know, put it through one framework and you didn’t quite get the thing you wanted and you put it through another one. Um, yeah, I think that’s a great
Darren Moffatt (00:25:01):
Now I’m no product designer myself, but one of my favorite frameworks is called Jobs To Be Done. This theory is explained in the book Competing Against Luck by Clayton Christensen. And this jobs to be done framework is really massively popular in the tech world. Um, and it also provides a powerful insight into consumer psychology and motivation. I can tell you that here at our agency Webbuzz, we’ve had great success applying it to principles, to marketing, not just product development, but we actually use the same principles for client campaigns. I asked Ross when he uses the jobs to be done framework. Yeah, look, I recommend jobs to be done when you have an established product. And you’re really looking to identify pain points and the existing processes, I think early on in the piece. Um, it, it, unless you’re assessing it against site competitors and understanding what they do well, and don’t, it’s a really good framework for saying, well, these are the jobs and these are the tools that they’re employing to get those jobs done already.
Darren Moffatt (00:26:03):
Okay. Now how do our tools differ and compete and make it less anxious and experience that that’s kind of where it’s kind of useful for a smaller business. And there is a lean way to do it as with most of these models. Obviously it can be done rigorously, but there’s always a lean, um, quick way just to get some quick insights into what problems are worth solving, uh, jobs to be done as also a kin to say a customer journey framework. So, and in its simplest form, it really is just understanding everything from awareness to acquisition, to ongoing user retention, et cetera. Um, it can just be mapped in a bit more granular detail and that becomes the jobs to be done framework essentially. Brilliant, brilliant.
Darren Moffatt (00:26:47):
And now for the first of our entrepreneur guests, Mina Radhakrishnan is the founder and CEO of PropTech different.com.au. Mina was amazing to talk to she herself has a design background and was a product designer for Google and also Uber when they had just 20 employees, any real estate investors out there will know that property management can be an incredibly painful experience. Mina has bought design thinking to solve this problem for investors by creating a platform solution that manages properties for just $100 a month. They’ve raised millions in capital already, and they’ve got some really big names on the share register, including leading VC firm square peg capital. Listen to what Mina has to say about the ideation process. So, I mean, for those listeners hearing about a different for the first time today, can you share the Genesis story and the mission of the business with us?
Mina Radhakrishnan (00:27:46):
Yeah, so I think, um, to get into that a little bit is around sort of setting the frame of mind where I was when I started to, to do different. So I, I had, um, I left, you were about kind of a year ago at this point. Um, you’re, you’re a year and a half, and I had gone and done a bunch of different things, working with venture capital firms, try and get a sense of what it was like to be an investor, whether or not that was the path that I wanted to follow. And after doing it for a year, I learned a lot, um, work with some really amazing, um, VCs, but, um, just was really ready and excited to get back into the world of like building again. And my husband was in a very similar place as well. Um, and our skillsets are quite complimentary and we thought, Hey, well, you know, let’s, let’s go build a business together.
Mina Radhakrishnan (00:28:25):
And so we were founders looking for an idea, right. And, um, we’d just gotten married as well at this point. And so we actually took a year off to travel and we sold our houses and like put our stuff in storage and packed a bag and of went traveling around the world. And the plan was the end of this year. We’re going to figure out what it is we want to build and where we want to do it and how it’s going to work. Um, and so we didn’t, we didn’t have some clear path in mind. It wasn’t like, Oh, here’s this problem that I’ve been like dying to sell all my life. And now I finally have time to work on it. It was more like who I really want to go do something. I want to build a business. I know the kinds of things that matter to me.
Mina Radhakrishnan (00:28:56):
I want to build a business that has th that can only be built better with technology. Um, I want to build a business that has a very real way to be profitable. You know, it’s not like we’ll figure out the monetization strategy later. Um, and I want to build a business that is also affecting real people like on a day-to-day basis, not just people of a certain, not, not just people at a certain wealth level, but just like really kind of everyday ordinary people. Um, and ideally I’d love for it to have some operational or like physical connection to the real world versus just building pure software. And so, you know, these, these were just sort of very like dully formed ideas in our head. And we have a sort of Google doc that we’d been like updating throughout the course of our travels. Uh, most of which they’re like really, really bad startup ideas that nobody should ever do.
Mina Radhakrishnan (00:29:42):
But, you know, I think this is the key year out is you have to sort of start with quantity before he can get to quality. Um, and at some point through the process of coming up with all these really bad ideas, um, we had gone, we’d come to Australia to, um, to visit my father-in-law and my mother-in-law. And, um, and they of course have an investment property, like a lot of ordinary, everyday Australians. And we were chatting with them, just, you know, finances going, are things all set up. He was telling us about your property manager now frustrated. He was, and we started to dig into it. And it was like, Whoa, here is this industry that fits all of these check boxes that we’ve been looking for. And I think we have a real opportunity to make this better, and that’s kind of where it really started from.
Mina Radhakrishnan (00:30:19):
So we, we spent, um, a couple of months just kind of digging in and trying to understand like what some of the concerns were from owners, from tenants, from property managers to try and get a sense of it. Um, did some market research around getting the state, the, the scale and scope of the business and what are some of the things we might need to build in order to make it better understand kind of software landscape as well. And, uh, and then we just really felt like we had a good start. And so we just don’t start in building.
Darren Moffatt (00:30:45):
Oh, brilliant. Yeah. Well, um, obviously you’re from the States originally and you’ve, uh, you’ve moved out with, with, with your husband. Uh, at what point did you sort of, did it Dawn on you that property was the kind of the greatest Australian obsession like, uh, fairly quickly or
Mina Radhakrishnan (00:31:03):
Pretty early on? I think I remember coming to Australia for the first time, it was like 2014 to visit, uh, you know, it is my like future in laws and, uh, and my, my other best friends. And it was like crazy. People are just obsessed with property, you know, I think of the newspaper and I was just like, Oh, okay. When do we get to the news? Can we pass the property listings? So yeah, definitely, definitely can see that.
Darren Moffatt (00:31:24):
Yeah, it’s a national obsession, so it’s a great market to get into. And of course, um, I know a lot about this particular, um, space. Um, you know, the, the investor market here in Australia is highly fragmented. You know, there’s a, there’s a lot of very small investors, which is very different from overseas markets where there’s more sort of institutional, um, property investors, um, and, and so on. Um, so, um, yeah, this is a slight digression, but, um, I’m, I’m interested to get your thoughts like that. Fragmentation, did that make the business case more compelling or did it make it more daunting for you guys?
Mina Radhakrishnan (00:32:00):
Yeah. I mean, you don’t look like anything, Darren. I think that there’s, there’s good and bad sides to it on the one hand, right. It’s um, you right. And that, like, Australia’s really quite unique. And a lot of that relates to negative gearing. Um, the 75% of Australians are one investment property, 15% on two and the remainder on three or more, which is very, not at all common, every sample in the U S you see much more than sort of multifamily, like multi landlord thing where it’s like people have, um, you know, small buildings with one or two properties anywhere from six to 20 properties. So I think one thing that is really good about it is that it is this, we have an incredibly fragmented market like that. There’s a lot of opportunity to pick people. Those people are looking right. They can’t get, um, they can’t get, um, price bargains or anything like that because they don’t have the, to be able to do it.
Mina Radhakrishnan (00:32:40):
So they’re always looking for new things. Um, you’re, you’re dealing with kind of one person, you can go really deep intimate relationships, but on the other hand, there are challenges to it because you’ve got to pick up, you’ve got to pick up customers one by one. It’s not like you’ve been signed a deal and pick up a thousand customers at a time. You have to go out and literally win these customers one by one, like hearts and minds. Um, and so I think that there’s both good and bad sides too. I think we learned a lot from building cause that is hard to do. It is hard to win customers one by one, and we’ve spent three years doing it now. And I think we have a really good sense of what matters to people, why it matters to them, how we create a business that actually is unique and impactful for each individual property investor. It makes them feel like they’re the one.
Darren Moffatt (00:33:17):
Great. And you know, when it comes to product development, obviously it’s been an iterative process for you, uh, over that period of three years, but you know, what approach or frameworks, um, you know, did you sort of use initially, like once you, once you sort of set upon this as the area that you wanted to work in, what, what approach did you use for ideation? So, you know, and, and, and most specifically, how did your experience at Uber and Google shape that?
Mina Radhakrishnan (00:33:45):
Yeah, I mean, so you have to think about, so, you know, I’ve worked at big companies like Google and Goldman Sachs or just smaller companies. Like, um, you know, Uber’s an interesting one because I got to start like, you know, as their first product manager or companies, 20 people, like we were literally nothing. And like I started, I started a new role at a time when people would still ask you the question so whatsoever. Um, so, you know, like, you know, from that to what, what her role is, and as he came in and I didn’t really small companies to where people actually went, where we would ask the question, Hey, what’s your company. And like, nobody ever really found out about it after a certain point. So I think the approaches that you have to take are very different, right? And they’re much more along the lines of like, kind of what you do in a, in a very early stage company.
Mina Radhakrishnan (00:34:23):
Cause that’s what we were, we were nothing we didn’t have anything to begin with. Um, I think some really, for me, really good parallels with Uber around this idea that Uber is a tech company. There’s no question, but Uber is also an operations company. There’s a massive logistical piece to it. And so you really have to think about how technology plays to the whole operations piece as well. And you’re obviously building one product. It’s not like you’re just building an app for an owner or out for a tenant. Yes. You build those things. You have to build an interface for an owner. You have to build an interface for a tenant. You have to build an interface for a tradie, but you also have to build an interface to make all of that stuff work together. That’s internal that like connects all the dots behind those things and access the platform for it.
Mina Radhakrishnan (00:35:00):
So the way that I tried to think about this is, you know, like one, I think very, what somebody told me to all the time, um, is, think about building horizontally, right? Versus building vertically where a building vertically is like, you go down deep on like one specific product. And then like, by the time you’re done that, one’s really good. But what we build and what we, what we sell our business is about selling a service and experience the service experience. You have to think about all of the people that, that touches, um, and find out what is the, what is the, what is the basic set of stuff that we need and actually build a little bit for each one. So that, that one experience is really good. Now look, the vast majority experiences aren’t built yet, but the one that you have, you build it it’s strong.
Mina Radhakrishnan (00:35:38):
It does what it needs to. Right. And that’s really the key thing around where it’s supposed to go. And so I think that sets it. That’s a really important, um, thing for me that I’ve learned from Uber. It’s like, you can’t just make the tenant. You can’t just take the driver better. You just make the, the rider app better. You actually have to do the whole thing. You’ve got to build the internal stuff that no one sees. It actually runs everything behind the scenes. Um, and so when we think about kind of roadmaps and what we need to do, it’s like, okay, what are the core experiences that we want to build? That’s where we really start. And we say, okay, well who do those things touch? And if they touch them, then we start digging into how, how, where they go and, and you tend to build, um, you know, there’s a balance between simple experiences and complex experiences and necessary experiences in less necessary experiences to like where the ideal is, you know, on a sort of two-by-two matrix, as you want to get simple, necessary experiences built first. But a lot of times you have the necessary experiences are complex. And so you have to find the balance between simple and necessary and complex and necessary
Darren Moffatt (00:36:35):
As you might guess producing nerds of businesses is pretty thirsty work. So occasionally I like to unwind with a refreshing beverage on one such recent Sojourn. I discovered the Viking inspired whiskey bar Mjolner in Sydney, Australia, that’s spelled M J O L N E R. Now this place is something else. If you can imagine a venue from modern day Viking hipster, then you’re getting close. It’s a complete sensory overload that utterly unique . It’s the brain child of Sven Almenning, who’s the founder of the speak easy group. Spin is originally from Norway and is now the CEO of a hospitality business with eight venues across Australia. He brings a real product design ethos to the service industry and is a master at designing experiences. I asked him how he came up with the idea of a Viking bomb and he’s answer will surprise you, you know, I’m really super interested in your, um, what I would call the ideation process. So, um, you know, you, you guys have got, um, uh, I, I pass, um, and you’ve got within that sort of, I think about three or four discrete kind of brands like there’s Eau de Vie there’s Mjolner. Uh there’s um, the other one,
Sven Almenning (00:37:54):
Yeah, it’s just five brands, I think, in the eight menu.
Darren Moffatt (00:37:58):
Um, can you step us through, you know, how did you come up with the concept for instance of your wonderful Viking bar restaurant? Like what, what, what, what was the process for coming up with that, the seed of that idea, and then starting to take that forward?
Sven Almenning (00:38:14):
Yeah, I mean, that was a really weird, uh, concept and kind of project. Um, for us process normally have come either from like a, we’ll have a business idea that you want to try, or there’s a venue that we found. Um, and in this case we found a venue in Redfern in a basement. It was
Sven Almenning (00:38:36):
Not in the best condition, um, and had been just vacant for, for years, used to be a, I think a Chinese, uh, apparel, uh, import kind of, uh, thing, eight BS before we took over. Um, but it had this really dark and moody feel and you want to put a whiskey bar in there and boilermaker house in Melbourne, but it didn’t fit. Boilermaker house has more space. It’s a more of a CBD thing. And, and to be honest, the concept came after the name. Okay. So we started what names would work with us. So we threw around, God knows we spent months on the name. Um, and then when I landed on middleman, which is the name of Thor’s hammer, the power of his, like, you know, the, the source of his power, if you like, and at least in Marvel, it’s not so much in mythology. Um, then from there, when we liked the name, we then decided to run with a Viking inspired venue. Initially it was going to be a bar, but then as we started working on the origin story, it’s the only venue that has an origin story that we’ve created because you know, why not have an origin story?
Sven Almenning (00:39:48):
I love it. Yeah.
Sven Almenning (00:39:50):
So let’s be clear this origin. So it was quite kind of detailed. Um, it became clear that it was not about drinking as much as it was about feasting. And that of course is food. We stand led to the idea of, uh, of a restaurant. Um, and the origin story, should I tell you already?
Sven Almenning (00:40:07):
So the origin story is the Avengers are real.
Sven Almenning (00:40:13):
So Hulk, our man, black widow, captain America, these boys are out there and girls are out there kicking . And, um, and Thor of course is part of that part of the policy, right? And Thor’s here on earth or mid goddess as we call it then and mythology. And he misses home. He misses Asgard. He misses the feasts in Valhalla. And, um, but because he’s here protecting earth and conquer home, he decides to build a feasting hall, um, in mid God, we can bring his friends and kind of relive the measurements of, of, of Odunsi symbol. And, and that basically meant that we’re not trying to recreate what the Vikings were eating a thousand years ago. I mean, it’d be a lot of fish and potatoes, right. Um, and that’s not really what he wanted to do. It became more a question of what would Vikings eat today if they were here. And then we start asking questions about what would they drink? You know, we’ll they’d drink whiskey. You know, I don’t care if Aquavit is in a region that would , we Vikings would drink whiskey
Darren Moffatt (00:41:19):
Period. There’s no question. There’s no question. The y’re hard men and women, they’re going to drink the hard stuff.
Sven Almenning (00:41:27):
That’s right. And they drink smoky whiskey. And can we swear on this show?
Speaker 1 (00:41:32):
Uh, we can now. Yeah.
Sven Almenning (00:41:34):
So, and then I’m Norwegian so I learnt English watching Eddie Murphy’s stuff so it’s kind of how it works. And then, and so, you know, so, so they would drink whiskey, right? And then we looked at the food and what would they have? We’ll have meat on the bone and bone marrow. And of course it had like traditional things like Roblox, et cetera. So it allowed us to get, have a lot of freedom with the, with the brand and make it really fun. And we can incorporate things like when you sit down for dinner, we bring out a letter. Um, I kind of satchel with a bunch of hunting knives in them that I’ve been handmade just for us. I sourced them from all over the world, like Pakistan and Russia and Canada and Iceland. We find these craftsman, they make these knives for us and you choose your weapon before you go into battle with the main dish kind of thing.
Sven Almenning (00:42:27):
Um, and we toast the Viking gods when you sit down for dinner and, and you can make it an experience. So the process for us is it’s really organic. Nothing is really scripted. There’s not a certain way we do it. Um, but we have to take inspiration from, from something, right. And start off somewhere in the case of me on that, it was, it was the vent is the space. And in case of boilermaker house, it was the name. Um, and, but the name drove both of the, of the concepts, if you like, but you got to start with something and then figure it out as you, as you go. Does that answer the question?
Darren Moffatt (00:43:04):
No, it’s, uh, that’s a great, um, insight into the process. And I mean, I think what’s really notable there for our listeners is the creativity, you know, like the lateral thinking, you know, running well, if, if X then Y like, okay, if we’re going down this path, then, well, then these other things would naturally occur. And for instance, to your point on the knives, which are a definite highlight of the experience, you know, cause I remember picking up, they’re really heavy now, if you don’t go, wow, this is, uh, you know, this is sensational and it’s, it’s remarkable, but it’s on brand. It fits the experience. It fits the product. Yeah. So I mean, how long did all that stuff take you to put together a spin? Like what, how, what was the, you know, the length of time for the ideation?
Sven Almenning (00:43:55):
Oh, I think, I mean that, one’s a bit hard. I mean, from the, that space came and went out of our mind. It was there for a long time. Once we found the name from coming up with a name to opening the venue, it would have been less than, less than nine months. And what the full creation of the concept would have been only probably six, eight weeks. Wow.
Darren Moffatt (00:44:17):
That’s pretty fast. That’s, that’s, I’m sorry.
Sven Almenning (00:44:20):
Very fast. But then again, my sons are Odin and low-key and so I live in green, this whole mythology thing in many ways. So it’s very easy to take all that history. I grew up with a staff, I learned about it in school. It was very easy to take that stuff and distill it into a FMB concept. Cause that’s what we do. Um, and the design and everything just flowed. So naturally it was a once, once it’s become something, that’s your, I think a core strengths you’ve got solid domain expertise. It’s easier to develop if you don’t have demand expertise then much longer.
Darren Moffatt (00:44:57):
Yeah. Well, I, I, the thing that I’m taking out of that and there’s, I mean, you can look at it from so many different perspectives and take different things out of it, but a running theme that comes up again and again, in my talks with top entrepreneurs is authenticity. So, you know, this is part of your world. You know, this is not something that you have just read about five minutes ago and, and developed a passing enthusiasm for, you know, you you’re, you’re in this stuff, you live and breathe it. And I think that, would you agree that that that’s really helped
Sven Almenning (00:45:30):
A hundred percent like we did not. I think when we got the first review, I think a Sydney morning Herald, good food guy, Terry Durack, I came out and he gave us a 15 out of 20 things, a hat. And he came out and said, you know, I’m going to open a, listen, a slow, slow, uh, slow me to slow-roast kind of whole animal restaurant and whiskey bar and Viking thing. Whiskey bar in a basement in Redfern said only one person ever in history of mankind kind of thing. Like he was just like, this is such a weird out there concept. And at no point did we sit down and go, well, Viking seems to coming into trend with the show and came from a place of Viking, semblance of opportunity, FMB space to take advantage of this emerging trend of Vikings. That was not something that we ever did.
Sven Almenning (00:46:19):
Um, I want you to launch so really want to focus on hospitality as an experience, not as a product. Um, I did a lot of consultancy work before opening our menu and I talked to operators and, and they were telling me that their product was pizza, that their product was beers. And I’m like, no, none of those things are the case. Cause I can get pizza at a quarter of the price. So half the price delivered home, I can buy beer to bottle, shop for a quarter, each charge here, um, and enjoy it in a cup. So do you not selling those things? Those things are facilitating an experience. And so when we started a first bar Eau de Vie here in Sydney, almost 11 years ago, um, the entire focus was on beverage and cocktails as, as an experience. Um, and one of the, kind of the, uh, the measurements we’d have is when you, when you walk to a, a top end restaurant or bar around the world, quite often, the photos she come away with are of the view and the decor and funky uniforms or some chandelier. Right. Um, and we were like, we just want photos of people celebrating together with awesome drinks, like photos of the cocktails, photos of friends. That’s what you want to go for. So our entire business is shaped around delivering great experiences for, for people that go out and creating kind of lasting memories there, the a B one part of people’s lives. Um, and that’s really kind of what the, what the business is all about.
Darren Moffatt (00:47:49):
Yeah. Fantastic. And I mean, I can attest to that. Uh, I’ve uh, I’ve been a, uh, a very satisfied customer at, at many of your venues over the years. And in fact, I recall going to Eau de Vie in Darlinghurst, um, the, the first time, uh, uh, geez. Yeah, it must be about sort of nine, 10 years ago now. And, um, and just being bowled over by, uh, the whole experience and the thing that really stood out, you’ve got drinks where you’re using, is it sort of nitrogen or what is it that’s right. And, and, um, you know, you created these cocktails, um, that are just remarkable because, you know, no, no one was doing this. You couldn’t see this anywhere else. Certainly not in, in Sydney. And of course, yes, the decor, it had a real sort of 1920s look. It was like stepping back in time, but in a sort of a walked futuristic version of the past. Uh, so, so that’s just to paint a picture for our listeners, um, uh, that that’s what the odor VI experience, uh, delivers. And I think what’s so interesting about how you have approached hospitality, um, is, is that, uh, it’s very much, uh, the way a product designer w would, would actually look at it. Um, you’ve obviously got a consulting background. Are you familiar with the book called, competing against luck? I, are you familiar with the, the theory of what’s called jobs to be done?
Sven Almenning (00:49:14):
No, I’m not. I’ve read a lot of business books. I’ve not read that one.
Darren Moffatt (00:49:17):
Yeah. So this is a really sensational book. I’d encourage you to read it, but essentially, uh, you have pretty much, you know, subscribe to that theory in the way that you put your business together. And so the whole concept of that theory is that, um, consumers don’t just want to purchase a beer, or maybe sometimes they do just want to purchase a beer, but when they go out, for instance, to use your, um, your business as an example, uh, the job that they want done is to have an experience and to get out of their everyday life and, and to, you know, maybe get a sense of what it was like, you know, back in the twenties. And so, in a sense, that’s exactly what you’ve, you’ve done. You’ve created a solution, uh, for that job that those consumers want done and drinking is part of it. And that’s obviously the product that you notionally sell, but what you’re really selling is that experience. Uh, if I, if, if I take it correctly,
Sven Almenning (00:50:17):
One thing I really like about that, um, is that no, but I think people don’t necessarily know what they want done either though. So I think when we launched the venue, people know that they wanted that experience. Cause you couldn’t really have it at the time and, and experienced especially, or did, he would be the first time you’d go there, you’d come with a friend because if you found that, uh, heard about it and you tried to find it, you’re not going to find it. So you just give up and you just call us and you leave an angry voicemail. We get that all the time, angry text messages, you guys are too hard to find. This is . Um, so the experience is part of like being led in by a friend and he showed it, lets you in on the secret. And then next time you go part of your experience as being your friends in and letting them in on the secret. So not just a drinks and experience in the venue, but even finding it turned out to be part of an experience.
Darren Moffatt (00:51:09):
So was that deliberate Sven like, cause what you’re talking about there is, uh, from a theory point of view, it’s using scarcity and constricted supply. Was that deliberate?
Sven Almenning (00:51:19):
Yeah. So it’s more about that. So it was more way a discovery model. So the point to it for us was that, um, you know, the, the term pub, you know, comes from the public house and uh, people treat a lot of licensed premises as if they are a public space, not a private environment or private business. And they think they can do whatever they want in there. Um, and they tend to do as well. Um, but when people go to pubs in Australia, if you go back 20 years ago, even 10, 11 years ago, you expected the same stuff everywhere. And so our theory was if people were out in a good night walk, past a venue and Hey, let’s pop in there for a drink. They wouldn’t have a good time because they would come in for bourbon and Coke, Coke, or Pepsi or any cola, or they would come in for a teenage VB.
Sven Almenning (00:52:06):
We wouldn’t have that role for crown. It wouldn’t have that. Um, so we would be disappointing, a large portion of people who just came for their normal experience, but hiding the venue and making it difficult to find, but completely unpretentious, you could wear shorts and t-shirt, there’s no dress code. Um, but by hiding it, the people that came came for what we did and they would have a great time, um, or they’d come with someone who came, what we did and their friends would slowly but surely, you know, leave the beers behind and moving to the cocktail space. Um, do you feel kind of awkward? You sit there, you know, a hundred ton of people in there, you’re the one guy with a bottle of beer and you’re going, okay, I’m going to move until these other people are having. And then by doing that, we could exceed their expectations. And I think that’s always been the, the, the trick, if you can create a product that is better than the person expected, that’s when you’re winning. Um, if you just meet their expectations, there’s no encouragement for them to leave a five star review online. There’s no cars room for them to write to you and thank the staff cause they paid for it. You delivered it. It’s a transaction. Right. But when you get something more than you expected, that’s when you go, Whoa, and you start telling your friends
Darren Moffatt (00:53:18):
So that talkability factor. Yeah. Brilliant. Yes. I certainly did everything I was supposed to do. I, I, I told friends about it and I took people there and uh, and um, so it works well done. And now another word from our sponsor.
Speaker 1 (00:53:42):
Ben Carew (00:53:42):
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Darren Moffatt (00:54:48):
So the problem we set out to solve in this episode was product ideation. How to think your way to a billion dollar business idea, our product design experts, Carrie Peters from us too. And Ross Gales from Pollen revealed the theory behind great product ideation and why it’s so important for the trajectory of any new product. And we’ve also heard some really interesting real life stories from our entrepreneur, guests Mina at Different and Sven from the speak easy group. I hope their wisdom and insights have given you ideas to crack the code to growth in your own business. In fact, I think there’s so much value in this episode that for once I would actually recommend rewinding and listening back to some of it, especially the stuff on frameworks. But if I had to summarize, here are three key takeaways we can all learn from. Number one.
Darren Moffatt (00:55:41):
Research is key. When it comes to product design, don’t just rely on your intuition or your own experience. You need to get out and talk to real customers. Ideally you need a mix of qualitative and quantitative data to use the right tool for the job. There are dozens of theories and frameworks out there for product design and development. But as Ross said, the customer value pyramid and the five W’s are probably the best place to start. If you’re trying a DIY approach to product design and number three, you get clarity on the problem you’re trying to solve. It helps to narrow the focus of the ideation process. If you’re not clear on this, any solution is unlikely to be effective. Designing a product is essentially a series of super important decisions. You need to get as many of these, right, as possible, a bad product that no one wants can kill your company.
Darren Moffatt (00:56:36):
Stone cold, dead. On the flip side, a great product is one that gets all of these key decisions, right? I loved what Sven said. If you can create a product that is better than the person expected, that’s when you’re winning, it’s in the fender Stratocaster story. At the top of the episode, it’s in what Mina is doing to property management at different. And if you look around, you’ll see it in all the successful brands you deal with every day. This should be your touchstone to both in the ideation phase, but all through the product development cycle. If you can design a product that produces an experience that’s five or even 10 times better than what the customer is currently getting elsewhere, you will break through and build a truly awesome business that customers love. And in the end, that’s what it’s all about. We’re coming to the end. But before we go, it’s time for our regular segment nerd under pressure where a guest has to share one killer hack or tip they recommend for you. Our listeners let’s find out who our nerd under pressure is today. Now Ross we come now to a, uh, a famous recurring segment here at nerds of business called
Speaker 9 (00:57:52):
Darren Moffatt (00:57:54):
It’s nerd under pressure and, uh, Ross Gales of pollen. You today are our product design strategist nerd. Um, uh, so our listeners are going to be very interested to hear, uh, one killer hack or tip you could recommend for the ideation phase. And I’m going to give you five seconds thinking time
Speaker 9 (00:58:21):
I have it to you.
Ross Gales (00:58:23):
So, so one great little tip that we use at Pollen, uh, when, when a client comes to us with a problem and we’re looking for a quick solution is it’s a hack called crazy eights. As you know, we didn’t coin the term. This is actually, I believe it’s coming out of the Google design sprint methodology. And what you do is you take a piece of A3 paper. You fold it in half, fold it in half again, open it up. You’ve got eight squares on the page. Okay. Get a few people around the table, get them all to participate in this exercise and spend eight minutes, one minute per idea, take a square and just scamp up a bit of an idea, a bit of a sketch, write it out. You don’t need to be a great drawer. It could be little stick figures, or it could be a piece of UI from your website or functionality from your app, eight different ideas of how you might solve that problem.
Ross Gales (00:59:11):
Think quick, you’ve only got a minute on each one. Then take turns, go around the room. Everybody present their eight ideas and build on them. Yep. If want you can, I’ve seen it done where you can swap those pages around and people can draw over the top or just take the time to discuss it. It’s just a quick way of getting good solutions on the table to solve a problem and an abundance of ideas that can then be built on you. Start to see synergies. People will have the same ideas and they can build on it and refine that. And ultimately you get some good stuff out of it.
Darren Moffatt (00:59:42):
Crazy Eights. Well, I love that. That’s a, that’s a really great concept and that sounds like it’s really quite easy for even quite a small business to have a go at that.
Ross Gales (00:59:53):
Absolutely. It’s it’s, it’s it’s I do it with my clients in the room and as many people as they want to bring along to these exercises, um, it’s just a quick way of generating ideas, but keep it focused, try and solve one problem at a time. I think people tend to go too broad and think about too much in ideation sessions. I think the trick is, um, leveraging something like the, how might we frame work just to focus on what are the top problems you’re trying to solve?
Darren Moffatt (01:00:19):
So thanks for listening to episode 13 of the nerds of business podcast. If you’ve enjoyed it, please leave a review on Apple, Spotify, Google, or wherever you listen to your podcasts. It helps us climb up the ranks and become more visible to other people. Just like you remember, we want to help as many entrepreneurs and businesses as possible. So please spread the word. If you’ve got a question or some feedback we’d love to hear from you, you can engage with at webbuzz.com.au/nerds. That’s webbuzz.com.au/nerds. So feel free to reach out and say hello. I want to thank all of our guests and the team at web buzz for helping me put this show together. We’ll be back in two weeks with our next episode on product development, which is how to validate your product idea and avoid creating a money pit that destroys your life. So watch out for that one until then I’m your host, Darren Moffatt. And I look forward to nerding out with you next time. Bye for now.