Seite - 74 - in Digital Entrepreneurship - Impact on Business and Society

not be required at all.ACBInsights (2018) analysis of startup failures shows that a majorityof startups fail becauseofamissingmarketneed.Assuring that thismarket need exists is central to the first levels of the venture pyramid (e.g., customer segments, problems value proposition). Whenever we work with the build–mea- sure–learn iteration, it is very important to understand the big picture and to be as precise as possible with the hypothesis because sometimes small changes in the details lead to averydifferent result. For example, if youwant to validate a feature or attribute of your product or service, just changing the customer segment gives a completely different result. Think about developing a bike. If you change the customer segment from a 23-year-oldmale athlete to a 34-year-oldmother of two children, the bike looks completely different. Sure, one could argue that this is common sense but as entrepreneurs, we do not want to work based on common sense but on validated knowledge. And exactly, this is the reasonwhy the build– measure–learn iteration is so useful and appreciated bymany entrepreneurs. After having identified the demand at a particular price point, startups can test the experienceof their valuepropositionbyofferingaminimumviableproduct.At this level, the product is handed to customers, and startups can validate/invalidate whether the product gets traction through continuous revenue, retention, and referral (McClure 2007; Croll and Yoskovitz 2013), which we see as product-market fit (Dennehy et al. 2016). With achieving a business model fit, startups (in)validate theoperationsofabusinessmodel.Here, it is central to identify incrementalprofits for everynewuser (action).At the scaling level, startupsneed to validate/invalidatewhatelementsof theirbusinessmodel requireadaptation to local contexts andwhat elements can be standardized (Göcke 2016). There are multiple options for an entrepreneur at every level of the venture pyramid to choose and to validate/invalidate.Manypotential customer groupswith agreat varietyofproblemsexist in thefield.And there aremultipleways to solve a customer’s problem. A startup’s aim is to identify the solution that is not only a localmaximumbut a globalmaximum (Sommer et al. 2009), so the best possible solution for the customer group that generates the highest willingness to pay. The same is true for the product. A startup will choose to develop aminimum viable product out of a number of alternatives, again aiming to globally maximize the return identified alternative. We suggest illustrating the different levels of the venturepyramidwithvarious circles that illustrate thepossible alternatives at every level (Frederiksen andBrem 2017). The decisions are path-dependent and limited by a startup’s capabilities (Frederiksen andBrem 2017) (Fig. 3). With every new build–measure–learn loop at the different levels of the venture pyramid, a startup runs through the process of identifying and validating themost attractive alternative at a particular level. A frequently used approach to structure this creative process is the framework “DoubleDiamond” (DesignCouncil 2019). The double diamond is originally split into a problem space/idea space (left dia- mond) and the solution space (right diamond). Both diamonds follow the same structure: one divergent thinking phase (the left side of each diamond) and one convergent thinking phase (the right side of the diamond). Divergent thinking requires a startup team to think about getting as many alternatives on paper as BusinessModel Development and Validation… 77