June 3, 2013 by startupengineering .

Watch this first:
[youtube=http://www.youtube.com/watch?v=-4EDhdAHrOg]

This hilarious video is a bit of a Rorschach. Lots of people see it as a gender comment – men are practical, women are all about feelings – that sort of thing. Another view concerns our inability to see the obvious. The woman is laughable, blind to the simple solution to her problem.

There’s another view too, one that brings this little parable into the realm of startup engineering.

There’s a fantasy we have when we imagine new companies. It’s the fantasy that drove traditional economics, and got upended by Kahneman and Twerski. Economists took as given that transactions are the results of individuals with some level of relevant knowledge busily maximizing utility. I bought these shoes because they were sturdy and handsome and the right price. I do this job because it’s the correct solution to an equation balancing income and skills and location and availability. Traditional economics looks hard at scarcity and apportionment of resources and distortions in the marketplace caused by imperfections in knowledge; it averts its eyes from distortions caused by the fact that the business of living just isn’t centered on making rational judgments about utility.

Entrepreneurs do too. When we fantasize about new companies, we imagine a world without human friction. We try to solve the equation for product. What is the product, it’s features and functions and price, that people will buy? The lean movement adds value by lowering the cost of solving that equation. Lean entrepreneurs build minimum viable products and talk to lots of customers in order to look for matches without breaking the bank. “Let’s be lightweight and agile and efficient about ripening the lemons early” say the lean entrepreneurs.

But what if we’re all like the woman with the nail in her forehead? Trying to solve the equation for product for her, even in the lightest weight, minimum viable product way imaginable, is a titanic waste of time. No matter what you do, you’ll end up with some way of getting that nail out. And she’s just not in the market for a nail remover.

Startup Engineering starts with an attempt to solve for customer. This word, customer, just like the phrase “maximize utility,” misdirects us. They sound like constants, but they’re really variables, and for new companies trying to do new things, they’re mysterious as hell. The first phase of a startup is group of spelunkers in a dark cave feeling around, not for product, but for customer.