Note to Candidate Companies:
I have recently become a big fan of using the "Customer Development Process" advocated by Steve Blank in "Four Steps To The Epiphany," and I would recommend you a) learn about it and b) seriously consider following the steps in this process. "Customer Development" is a methodolgy which is used in parallel with product development to ensure "product / market fit" and a firm foundation for a scalable business.
The book is $40 on Amazon; it is not for the faint of heart, so I'm linking to a zip file of some preview materials I found on the Stanford site. In those materials, Chapter 1 shows why the normal "product development process" isn't sufficient for success, and Chapter 2 provides an overview. I'm also including two slide decks because the diagrams show a great summary of the customer development process.
Here is a link to a presentation that Blank gave to Stanford entrepreneur's class (listen to the podcast, not just the video snippets), along with the slide deck, in the materials attached above.
The rest of the book takes each step and suggests concrete methods for doing "Customer Development" -- how to do interviews, how to score and assess things, how to iterate, etc. It's very good. And every investor in Silicon Valley has read it and has embraced the concepts Blank has advanced.
I have some hypotheses for some new features that will resonate with your market. You do too. Everyone you talk with will suggest different positioning and new features. The key is to recognize that these are just guesses about what broader market needs actually are. Read Eric Reis' blog post on this subject, word by word -- and look at the links. Venture Hacks has a good summary, too. Trust me, Customer Development will be very, very helpful to getting your business into a shape to be funded.
