Sitting in the “Entrepreneur talk” session held at the Sauder Business School, I hear from the CEO and co-founder of Shoeme.ca, one of the Vancouver’s fastest growing e-commerce website, – “large chunk of your investment should be spent on marketing. Technology and product quality can always be concentrated later on.” This statement leaves me astray as it disrupts the fundamental ideology I had developed over the years as a software developer. As an engineer, my focus has been optimizing product quality. What my bachelors education and work experience taught me is there exists a positive correlation between product quality and customer satisfaction. Better customer satisfaction, higher the generated revenue.

But is it really true? I thought digging deeper and study few more startups development models to better understand how they modelled their investments. In this process, I came across the book “The Lean Startup” by Eric Ries. This is a brilliant book that talks about the list of techniques and agile development model that a startup should follow as it grows from inception to a physical product. One of the pivotal advice that the author gave was to reduce the development time by introducing a Minimum Viable Product (MVP) as soon as possible and utilize it collect customer feedback. Use these customer feedback and requirement to add new features and weed-out features that customers find useless.

By just listening to customers, startups can ensure market penetration with minimum investment in media advertisements and promotions. One such example is OTT product – Whatsapp. Founders of Whatsapp are believed to have spent less than 1% of their annual revenue on media advertisements. All efforts have been channeled in creating a product that caters to a large segment of customers by constantly analysing the customer’s feedbacks and behaviour patterns. This close to 50 employee start-up has workforce mainly compromising of developers and customer service representatives. Whatsapp relies majorly on Word-of-mouth kind of advertisement and coincidently it has worked very well for the company. With 300million users it is in top buy list for both Facebook and Google.

So far my conclusion- startups rather concentrate on deciphering product acceptance and feature list that will attract customers rather than developing a complete, high quality product. Releasing in batch iterations by constantly including new feature that customers demand. Product quality not be completely neglected, and should be the managers responsibility to decide the degree of quality and associated development time.

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