Picture yourself sitting at a conference. One of the speakers asks the people in the audience to raise their hand if they prefer electricity from solar over electricity from coal, oil or natural gas. Chances are, you would raise your hand – of course, “greening” our energy system is important. The question is: does this rational decision lead to a change in your behavior?
Last weekend, I participated in Lean Startup Machine Rotterdam. The goal of the weekend was for participants to rapidly test possible business ideas, by relentlessly interviewing potential (i.e. hypothetical) customers. Many gifted programmers or engineers have spent months, if not years, to build beautiful, detailed websites or airplanes, only to find out that nobody wanted to buy their “solution” once it was completed. To reduce time wasted on undesired products, the “Lean Startup” methodology was created by Eric Ries, as a process to test what people want to pay for, before you start building. Following the “Lean Startup” methodology, my goal for the weekend was to identify groups of people who were willing to invest in renewable energy. I was joined in my quest by Jaap Ruoff, Raffi Balder and Daniël Muller.
Looking at your monthly expenses, how do your purchases reflect the things you say you care about? The first thing I learned this weekend was that although many people say renewable energy is important, few care enough about the topic to allocate money to it. We asked 8 parents whether they cared about the societal impact of the money they were saving for their children. Unanimously, the parents shared horror stories about their investments the past years, and that the only thing they cared about was to have a secure, very-low-risk place to store their money.
Retrieving our confidence, we went out again into a wealthy neighbourhood to ask people whether they felt engaged to invest in solar panels on a school. Only 3 out of 19 people answered positively – all three had interpreted the question as if it were the school of their children, unlike many of the other respondents.
This response provided us with a hint: the desire to contribute to sustainable energy projects may be related to a direct social connection to the location. Based on the fact that only 22% to 27% of US citizens have a roof suitable for solar, we decided to develop a solution for a new (hypothetical) customer and pain: one of the lucky quarter of Dutchies that have a solar panel-fit roof, but can’t finance a solar panel system alone. We tested our customer and problem hypothesis in two ways: we built a landing page for an early adopter (someone with his own roof and 3,000 twitter followers) and we started calling friends around a proposal to invest in a local school.
Sure enough, data started pouring in. The landing page we built attracted 255 unique visitors. None of the visitors left their information to buy a “solar share” – our name for the €50 investments visitors could make in the early adopter’s rooftop solar system. From our calls, we learned that our friends were willing to invest a small amount of money (e.g €50) in a private solar panel system, but a larger amount of money (e.g. €200) if the solar panels were installed on a school.
Most importantly, I was reminded how great it is to work with smart people on a challenging project, utilizing an unfamiliar process whilst operating far out of your comfort zone! Approaching people on the street, asking them about their needs will always instill fear initially, but it is such a rewarding experience! Thinking back of similar environments (specifically 3DayStartup in Amsterdam & Social Good Hackathon in Cambridge), these are the kind of environments that foster very rapid learning.
I noted earlier the learning that a societal need is not always equal to an individual pain or desire. If educational institutions can transform their high-level need for innovation to a burning desire, the Learn Startup Machine model can be a medicine to their pain.