5 mental models to apply in your Startup

Santiago Lopez

May 9, 2022

7 Minutes


Some time ago I came across Henry Ford's historic phrase again:

"If I had asked people what they wanted, they would have told me faster horses."

It made me think about people and the direct relationship between the solutions we create and the "for whom we create them. "who we create them for".
Henry Ford's phrase may have been iconic (or ironic) but it was leveraged on certain preconceptions.

1) People don't know what they want.

2) People know what they want but do not know how to express it correctly.

3) People have a vague idea of what they want. But they don't know how.

In reality, at the end of the day, it's all about problems and better ways to solve them.

If you are thinking of creating a startup, the best thing to do is to start with a problem-oriented approach to the problem you are looking to solve.

People know their problems better than anyone else, but you, as an industry expert, explore alternatives to provide them with the best possible solution. the best possible solution.

In Ford's case, it would be something like, "So my customers' horses aren't fast enough, huh? What will I be able to do for them?"

Before writing this article, I spent a lot of time reading and researching about mental models that are useful when setting up a Startup and creating an amazing product that solves your potential customers' problem.

Shall we start?

1. Jobs to be done: 🌼

This framework will help you understand why a customer would want to buy your product.

The central idea of this methodology is to explore the motivations of your users in order to contextualize their actions. You must start from the premise that the customer does not buy the product itself, but rather the solution that the product provides.

Clay Christensen explains it incredibly well in this video where he tells how McDonalds used this framework to improve the sale of their milkshakes/smoothies.

The story goes that McDonalds was looking to innovate with its new product: milkshakes.

In order to increase sales, they undertook the task of collecting data that allowed them to design the User Persona of the "milkshake buyer". of the "milkshake buyer".

Once they identified the characteristics of this profile, they invited those people who fit these characteristics into a room to ask them questions about "how to improve the product".

Questions such as, "What do you like about milshakes?" "What would you add to the product?" "What don't you like and what would you modify?"

Customers answered these questions and in return received free milshakes. Win-Win.

The problem was that, after applying the feedback from the feedback, sales did not increase at all...

That's when Clay and his team decided to try something different. They went outside McDonalds to "intercept" customers who had purchased the milkshake to ask them "What did they want to achieve when they bought the milkshake?".

The focus is on the problem. In that specific activity that the client wants to solve when hiring your solution.

If you are thinking of starting a Startup, first identify the problem you want to solve with your product or service.

Jobs to be Done is about putting on "special glasses" to look at your product from the point of view of, "What is it for?" "What specific task is your customer trying to accomplish with the solution you are going to build?"

Apple's famous iPod ad was not notable for listing features. It focused specifically on what it solved: "1000 songs in your pocket."

2. Product-market fit: 🔗

Does the market want what you are building?

This is perhaps the most important mental model for creating a startup.

If you are an entrepreneur, you are probably familiar with the term. It was popularized in Dan Olsen's book The Lean Product Playbook, although Marc Andressen and Steve Blank had already mentioned it in the mid-2000s.

The Product-Market Fit is about focusing on the GAP between the customer (target) and their needs with the features of your product, having the UX at the top as the synthesis of everything behind it. That is what your users will see when they use your product.

According to this model, the first thing you should focus on is understanding your customers. They are the ones who know their problems better than anyone else and that is why they are at the base of the pyramid.

"It's not just about being in a good market, you also have to develop a product that can satisfy that market."

You can also read our article Product-Market Fit: how to know if my startup has made it?

3. Activation Energy: ⏳

In chemistry, the activation energy (Activation Energy) is often used to denote the minimum energy required for a given chemical reaction to occur.

For a reaction to occur between two molecules, they must collide in the correct orientation and possess a minimum amount of energy.

Bearing in mind that creating a Startup is replicating the scientific method (observation ➝ hypothesis ➝ experiment ➝ measure ➝ iterate), this mental model will help you to eliminate initial frictions and get down to work.

Along these lines you can ask yourself: What is the minimum amount of time and effort needed to achieve the result I want?

Example: If you want to start writing blog articles, start knowing that it usually takes (at least) a year for your content to rank on Google.

4. First Principles Thinking: 💡

First principles thinking is the act of reducing a process to the fundamental parts that you know to be true and building from there. It is a mental model that comes from physics.

And it is Elon Musk's favorite mental model for solving any problem.

But it is not a "natural" system, since reducing a learned concept to its principles requires a lot of mental effort. On a normal day, our brains run on autopilot for a lot of routine decisions that require relative cognitive ease.

In Thinking Fast and Slow, author Daniel Kahneman talks about two systems that inhabit the human brain, to which we resort in different situations. System 1 is fast, instinctive and emotional. System 2 is slower, more logical and we use it when we need to make a greater mental effort.

System 1 is not prone to doubt. It suppresses ambiguity and spontaneously constructs stories that are as coherent as possible. Unless the message is immediately denied, the associations it evokes will spread as if the message were true.
System 2 is susceptible to doubt, because it can maintain at the same time incompatible possibilities.
System 2 is more an apologist for the emotions of System 1 than a critic of those emotions, a sponsor rather than an enforcer. Its search for information and arguments is limited primarily to information that is consistent with existing beliefs, not with the intention of examining them. An active, consistency-seeking System 1 suggests solutions to an undemanding System 2."

Going beyond our own reality is hard and requires attention and effort. First principles thinking requires expending much more mental energy to break the trap of the natural way of thinking.

To start applying this method, you can break it down into 3 simple steps:

Step 1: Identify and define your current assumptions

The next time you are faced with a problem or challenge, simply write down what you assume at the moment you face that problem.

For example: "I find it impossible to make time to exercise and achieve my weight loss goals".

Step 2 Break down the problem into its fundamental principles

What are these fundamental principles? Elon Musk explains it very clearly in this video:

Step 3: Create new solutions from scratch

Once you have identified and broken down your problems or assumptions into their most basic truths, you can start creating new solutions from scratch.

Assumption, "I find it impossible to make time to exercise and achieve my weight loss goals."

First Principles Thinking: What do I really need to achieve my goal of losing 20kg?

I need to exercise more, preferably 5 days a week for an hour at a time.

Is there a possibility of losing weight by exercising less frequently? If so, how?

Maybe I could try 15 minute workouts, 3 days a week.

They could be fast, high intensity workouts that will accelerate my fat loss in less time.

If we go back to the case of the iPod, the perfect example would be the following:

Fact: People love to listen to music. In fact, the Sony Walkman had already been on the market for many years.

They started from that "Fact" to create a product that would go down in history.

AssumptionPeople prefer to listen to their favorite songs, not the whole album. People will be willing to pay per song. Up to this point, people listened to music by buying records, or cassettes.

Apple was uncertain whether people would pay for individual songs.

The solution created, and its great success, is known to all...

5. Total Quality (Mercadona Model)

I met this last framework at LanzaderaJuan Roig's accelerator, while talking to startup founders working in the offices located in La Marina de Valencia.

Since 1993, Mercadona has based all its decisions on its "Total Quality Model", which seeks to satisfy equally the five components of the company: "The Boss", "The Worker", "The Supplier", "Society" and "Capital".

But... Who is "The Boss" in this model? The Client.

Mercadona believes and promotes that innovation means constantly thinking about the customer in order to be able to offer new solutions, always adapted to their needs.

Returning to Lanzadera, its objective is clear: inspire entrepreneurs to generate innovation by creating sustainable and scalable companies.

In this constant commitment to innovation, they use this transversal and collaborative model that promotes innovative decision making, always identifying first and foremost the needs of customers.

The idea is that you can get to know these models, learn more about each one of them and be able to apply them when setting up your Startup. Are you ready to put them into practice?

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