At this very second, somewhere in the world, there are 3 new high tech startups opening up for business . At that very next second, there are 3 that are waving goodbye. Every day 3 new high tech startups open for business and another 3 wave goodbye Click To Tweet To a tech insider this is hardly breaking news but to the casual observer it’s scary business. Everyone knows that “starting-up” is extremely risky, so imagine what it would be like if everyone suddenly had the ability to bring their “big idea” for changing the world to market in the shortest possible time, with the least amount of staff and at low cost. Even better, what if you could speak to an “advisor” that could definitively tell you within a few short weeks/months of being in business whether you were riding a “unicorn” or you were feeding a potential “money pit”. Imagine if an advisor could tell you whether you're riding a unicorn or feeding a money pit Click To Tweet This is the promise of the cognitive era, and that future is right around the corner.
In the story of Pinocchio, Jiminy Cricket acted as both his spiritual advisor and sage. Although it can’t mimic his personality (at least not yet), a cognitive computing system will be able to come close. It has the ability to listen to your questions, quickly sift through massive amounts of information to give you relevant answers, and continuously learn from the decisions you make so that its next answer is better. Imagine the power of having a “partner” that has access to every lesson learned by all the startups that ever existed. Lessons that they used to give you insightful advice at every stage of your building process. Your partner will help you evaluate your big idea, validate the need in the market, let you know if your idea can scale, and finally help you graduate to a fully functional enterprise.
Sound like a Tony Stark invention from the last Iron Man movie? The fantasy is not so far from becoming a reality. Very soon now, a well-designed enterprise cognitive system will be able to accomplish this and more.
It is common for most startups to stumble for months or even years trying to build the perfect product, identify their target audience and find the ideal business model, while simultaneously burning through mountains of cash and time as they go. There are many published “how to” manuals advocating a structured approach to creating a viable startup. One of the best is put forward by startup strategy specialists Steve Blank and Bob Dorf in the their tremendous reference guide “The Startup Owners’ Manual: The Step-by-Step Guide for Building a Great Company,” These guides offer an excellent methodology and terrific insights, but it’s extremely difficult to both absorb and leverage 1000’s of pages of detailed and actionable content while also executing a business in real-time. Consider the sheer volume of information involved, the expertise required to determine the veracity of the information, the variety of actions you could potentially pursue, and the velocity of change you would be required to manage, This is a key area where cognitive systems will clearly add value.
There are four phases that every startup must manage and navigate through in order to achieve success:
Customer Discovery: In this phase the business is not only trying to test the founder’s vision but also identify markets, customers, channels and pricing. Is there a market?
Customer Validation: A business model is identified and a startup sees whether it can actually sell its product or service. Is it repeatable and scalable?
Customer Creation: Once the business model has been tested, it’s time to scale. This involves building end-user demand and converting sales. What is the potential?
Company Building: Once a valid business model is found it’s time to graduate into a fully-fledged company. How can the operation scale?
The goal of a cognitive system is to proactively gather massive amount of information, offer active business insights and offer a clear path for a “founder” looking to quickly build a successful company.A cognitive system can provide a clear path for a founder looking to build a successful company quickly Click To Tweet
As defined by Sue Feldman, founder and CEO of Synthexis, cognitive computing “allows people and machines to work together in easy, intuitive ways.” Cognitive systems learn at scale, reason with purpose, and interact with humans naturally. With massive amounts of information available at our disposable in structured and unstructured formats, cognitive computing enables people to effectively interact with and leverage that data.
In order to be effective in the startup world, a cognitive system must exhibit and offer four key capabilities:
It must be Adaptive: Being able to pivot your strategy as necessary to respond to rapidly changing market conditions is key to a startup. A cognitive solution will be able to monitor and predict these external changes and offer real-time advice on how to adapt.
It must enhance Interaction: There are many stakeholders (both people and technology) that must interact seamlessly in order for the business to grow. Being able to absorb and translate feedback in real-time is a key capability.
It must offer Iterative and Stateful feedback: By helping to identify operational business problems, proactively seeking supportive data to determine impact, and applying lessons learned from past actions to recommend “tweaks” in business strategy, it will significantly increase the chances of success for your enterprise.
It must provide Contextual Information: Being able to able to intuitively judge how complex elements could impact your business. For example, being able to understand how the use of certain words by internal and external stakeholders may affect your operations or how a seemingly simple change in government regulations could derail your expansion plans. These are the real actionable insights a startup needs to survive and thrive
The end goal is to translate these “capabilities” into an active support system for a founder seeking to build a solid and scalable organization. It must be able to act as an insightful “expert advisor” capable of successfully shepherding them though all four phases of the Blank and Dorf startup life cycle.
In the future I see cognitive systems capable of either producing the next “unicorn” or, even better, letting a founder know when it’s time to “turn out the lights” and say goodbye as soon as possible.
Over the course of the next four posts, I will expand on my vision on how cognitive systems will transform the high tech startup industry beginning with how to determine if there is a market for your idea.
Welcome to the cognitive era. Are you ready?
Blank & Dorf, “The Startup Owners’ Manual: The Step-by-Step Guide for Building a Great Company.”