Using Research As Your Secret Start-up Weapon

If you want your start-up to blow the lights out, you need to become a student of your own company. There is nothing more valuable to success than actionable data.

You're reading Entrepreneur South Africa, an international franchise of Entrepreneur Media.

Vital Stats

​​​​When you launch a business, research is key. Unless you have a deep understanding of the challenges you’re solving, chances are you’re creating a product or solution that might interest people, but isn’t enough to get them to open their wallets.

Sarah Schäfer

An idea is all fine and well, but unless you have hard data, it’s very difficult to execute that idea in a meaningful way.


Collecting data

Jamie Rood and Jonathan Kingwill learnt this lesson the hard way. They had an idea, and they spent months working on it. They then attended a bootcamp run by Ignitor through the Standard Bank Business Incubator, and they were told that they had nothing. 

“The foundation of the lean start-up method (which is the basis of Ignitor’s bootcamps) is that you get out there and do your research, which requires approaching individuals and companies,” says Jamie. 

“Initially we felt completely unbalanced by the suggestion that we didn’t have a business. We’d spent seven months devising this idea, and now we were being told that unless we got out there to prove the concept, it had all been a waste of time. It was a very frustrating process. Had we wasted our time, or were we wasting it now?”

The situation Jamie and Jonathan found themselves in isn’t unusual for start-ups. Entrepreneurs can become so focused on their idea and the problems that they’re solving that they end up working in a bubble.

The problem is that real, useful market research is tough — it’s time-consuming and requires an inordinate amount of perseverance. The number of ‘nos’ you get can be incredibly demoralising. 

“You have to play the percentages,” says Jonathan. “You need to make 200 phone calls to get 14 people to agree to a survey. Of our sample, one third sat down with us, and the rest requested tele interviews, emails, Google Forms — we had to find a number of different ways to connect with people.”

But the data that they collected proved to be invaluable, and even precipitated a shift in their business model.

“When you’re told that you’ve been operating in a bubble, and you have to go out and prove a concept that you already believe is the right solution, it’s easy to decide you’re right and they’re wrong, and I think a lot of entrepreneurs do just that. You can easily get lost in an ego-centric attitude when you’re founding a company. Luckily, Ignitor wasn’t the first time we’d been exposed to the foundations of lean start-up methodology,” says Jamie.


Do your research

“As soon as we realised we wanted to start a business — and what our product would be — we set out to learn as much as we could about starting a business. We researched the business model canvas, Y-Combinator, watched Start Up School videos on YouTube — we were so busy learning about start-ups that we didn’t do enough research on the actual product, which was what Ignitor highlighted for us.”

“The bootcamp wasn’t isolated,” agrees Jonathan. “It was a reminder that we hadn’t made a point of getting into the field and researching our target audience.”

The experience taught them a valuable lesson: “If you draw on knowledge and advice from people more experienced than yourself, you’ll go far further than people who switch off,” says Jamie.

“You need to keep an open mind throughout your journey. You can never think you know more than someone else. Draw on every new data point you come across. Take a pinch of salt from everyone you meet.”

The research sample gave Jamie and Jonathan new insights into their business and the problems they were trying to solve.

“We wanted to create an instant recruitment platform for the unskilled, intensive labour market,” explains Jonathan.

“We want to make a difference to unemployment rates in South Africa by creating a product that helps labourers find work, and gives them a vetted, online identity that takes the place of a CV. That was the initial idea. We knew there was a need, and we believed that this was the solution.”


Find the real problem

Getting out into the market revealed that there was a much bigger market problem however, one the founders hadn’t fully explored.

“We started out trying to figure out what quantifies good performance amongst labour intensive employees. We thought we’d use this information to create better CVs and to ‘score’ people on the app. 

“But the process of collecting the data revealed something else — we were taking a deep dive into the inner-workings of a company, and the link between employee productivity and the bottom line. And what we realised is that even though this link is strong, companies don’t measure efficiency, punctuality and productivity.

“This in turn led us to the realisation that an app that helps companies track these vital components will assist employers to boost their bottom lines, and employees to become more efficient and effective at their jobs — which then feeds into our original idea of creating a labour marketplace that’s monetised by the companies whose bottom lines we are boosting.”

Getting the app developed is another challenge, but Jamie and Jonathan have partnered with a company that holds equity in ClockWork and is developing the platform for them.

“There’s a process that builds up to your final goal. We have a product in the market that solves a need, and is gathering data that will help us create a more sophisticated product that will work towards solving the manual labour and unemployment need in South Africa,” says Jamie.

“Building a business is done in stages — you can’t jump straight to your end product. You need to get something out into the market that will help you prove your concept, build a reputation and generate cash flow. This can then fund the next stage of your development and even attract investors. It’s a continuous process, and we’ve learnt that data is at the core of building a strong, sustainable start-up.”