I backed a project last week on Kickstarter – Gameful: A secret HQ for Worldchanging Game Developers by Jane McGonigal. I think it’s quite an exciting project that is going to take place, as McGonigal builds a network around people who want to create games with outcomes for social change.

In her recent TED talk, McGonigal reveals some pretty amazing stats. At the moment, we (the citizens of planet earth) play about 3B hours a week of online games each week. McGonigal theorises that if we had people around the planet, playing a combined 21B hours of online games each week that were rigged around creating social change, then we could achieve some amazing outcomes. I agree. Talk about a cognitive surplus! Gameful will create a place for game designers to come together and create more of those types of games. In McGonigal’s words – “To make is as easy to save the world in real life, as it is to save the world in games.”

The importance of using a hypothesis to drive your project development progress is something that is becoming more and more widely used today. Thanks to the work of Eric Ries and Steve Blank, we now have the lean start-up methodology of managing projects to use. Whilst the theory is wide and covers a lot, I’d like to focus on one key area of the methodology, using a hypothesis based approach,  because I’ve found it useful in gaining traction in projects I am working on.

What is a hypothesis?

A hypothesis, in the lean start-up sense, is simply a question you have about your project that you would like to answer. It’s a key part of the Customer Discovery process. It might be something like”More people would catch the train if they got an SMS message 15 minutes before they needed to leave.”

A hypothesis is a statement that you can prove, or disprove, to signify that there is a market present that values your idea. It is a proposed explanation for an observable phenomenon. This is the key. In the above example, you can see that it becomes easy to find ways to prove that this might be the case.

 

How do I set one?

Setting a hypothesis is both easy and hard. First of all, it’s important that the majority (if not all) of your team have a stake in the creation of the hypothesis. It’s no good running out and proving there is a market for an early train catching SMS service, if half the team believe starting a bar that serves people who have missed their train is a better idea.After that, just start throwing questions out there that speak to your base assumptions. Why did you think this was a good idea in the first place? What makes you think people will value it? How do you know this?Once you have found what you think is your hypothesis, you can begin thinking about how to answer it.

How can I answer it?

This is where the rubber hits the road. Make sure you keep your approach simple – don’t over think it. Couch your thinking in the following ways.

“What is the simplest thing we could do here to prove our hypothesis?”…

Once you have this, then go and do it. For the above example, it might just be a Wufoo form that you spread around to your friends where they can sign up (for $10) to receive an SMS from you (personally!) 15 minutes before their train. Make this simple to do, and just get started doing it. Also, importantly, make sure you charge something of value. There is no point testing that people want a FREE train-SMS service. Who WOULDN’T want that? You need to test that people will actually value what you do enough to part with their hard-earned cash.

What then?

You’ve now successfully run the first version of your project. Some call this a Minimum Viable Product (MVP).

Now what? Can you positively answer your question? DO people want a train SMS service? Why? Why not? What lessons did you learn? What features do your potential customers really want? Which ones didn’t they use? How hard was it to sell?

Now, after taking a hypothesis and customer development driven approach, you’ll have some real insights into your idea and how people value it. And the beauty is, the hypothesis method doesn’t just have to be relevant for start-ups. I think there is a huge opportunity for people everywhere to use a hypothesis driven approach in their own slow projects, or even in their large companies. It’s important not to lose sight of the fact that this is a management methodology and as such, can be used to manage anything.

Dave McClure wrote this post on Moneyball investment and it sparked some thoughts for me.

Moneyball was all about looking for new metrics in an old game. Instead of looking for strong traditional results in potential recruits – like pace, arm or home runs hit – the Oakland A’s General Manager, Billy Beane, looked for subtle stats that indicated greater chances of team success, such as: ave balls faced/at plate, on base % and the number of walks a batter averaged. They would then model those stats and find the statistical probability that their team would score more runs than their opponents over a season. They did this, because instead of ‘investing’ in talented youths with potential they recruited proven players from the minor leagues, with history and data that pointed to strong performance accross their metrics. Previous performance pointed to strong continued performance, even in the Majors.

You can see this scenario already playing out in very simple ways in the investment arena. The rise of methodologies such as #leanstartup and the success of the Rework book by the guys at 37signals (and their blog, Signal vs. Noise) demonstrates a growing appreciation for the ‘minor leagues’ where businesses are built for revenue and the priviledge of their founders. If you look through the upcoming AngelList, you’ll see many of the people involved there are investing in many projects NOT for the returns alone but because they are happy to win at different metrics. Matt Mullenweg would like to invest in seed/early stage companies that Automattic may be able to buy later. What better way to prove a good buy, than see it play in the minor leagues first?

Dave’s artcle is great, and his contention that investment companies should invest earlier and in smaller tranches is good. People are keener to invest in smaller lots because they’re happy not to be playing in tbe Major leagues. The game is changing towards one of survival (in an existential sense) and sustainable cash flow. Investment will change towards not backing companies until they have proven business models, or in need of funds to continue customer development finding it. Perhaps investors will possibly even move to recieving something more like ‘dividends’ from companies they strategically admire than being in the game of exits

In one of my last posts, I briefly discussed the idea of cognitive surplus, which has been coined by Clay Shirky. Cognitive Surplus is the idea that we are unleashing more and more of our collective abilities as we choose to do different things with our time. The classic example is Wikipedia, which has been created from upwards of 100M hours of human effort.

Time is currently still a finite resource. What people chose to do with their time is always an interesting decision. Increasingly, we’re seeing that people want to do something that matters, for themselves and their community. From this desire, we are seeing more and more slow projects emerge – people choosing to do amazing and interesting things, because they really want to do them.

But how do you chose a project to work on? How do you decide what you’re going to plough your most precious resource, time, into? There are lots of great ideas out there – how do you judge which one you will be able to make happen?

To me, choosing something to work on is largely based on the resonance I feel for the idea.

“In physics, resonance is the tendency of a system to oscillate with larger amplitude at some frequencies than at others.” – Wikipedia.

 

I think this definition is beautiful, because it describes the extra energy created when you align yourself with an existing energy pulse. You know this feeling. It’s like there is this intuitive tuning fork inside you that knows whether you will actually make something happen rather than just let an idea fizzle out. You can see how you would make the idea happen. You know who to speak to first. You can feel the first conversation or the first sale. It’s easy. And these projects are often the ones that happen with the best results and the greatest satisfaction. This is a really interesting topic to me, which I’m looking forward to discussing more this weekend.

This weekend, I’ll be at the Social Innovation Bar Camp Sydney (@sibsyd) and am going to run a session discussing this idea of slow projects. @sibsyd is something I’m really looking forward to as it promises to provide a place for a number of ideas, thoughts and people to come together and amplify each others intentions. If you want to come along, you can register for free here: https://s.eventarc.com/event/view/1045/entry/social-innovation-barcamp

I’m lucky enough to be working with the very talented Bruno Mattarollo, from Pollenizer, at the moment. He often says the following sentence…”…of course we can do that…it’s 2010″

Technology is progressing at a phenomenal pace – we all know this. There is Moores Law, which states that processing power on computers doubles every 18 months or so. Karim Temsamani, at ALR last year, mentioned that the internet had grown 270 times since 2005. Email is something you can access anywhere and if you want to put up a website today, you can using any one of a number of tools like WordPress, Blogger or Posterous.

More importantly though, is our attitude towered this pace of development and how we will make political, societal and organizational decisions based on this.

Eric Schmidt, the CEO of Google, is a great person to listen to for some ideas about this – this short video from a recent presentation is indicative of his thoughts on where technology is going, and how we might make these kinds of decisions.

Realise that no matter what happens tomorrow, it is 2010 today and that for WHATEVER you’re doing, there is a way to make that happen right now. It’s 2010, after all.