Nail It Then Scale It
SyncDev started in 1984 as ‘Market Validation’ with the success of the Biomek life-science lab robot. Another engagement came in 1985 for Harris Corp, then one in 1989 for Citrus Systems which became Citrix years later, then Toshiba and AMD in the early 1990s. Over 30 years, SyncDev, Inc. has worked with 400 product teams at 250 companies.
Market validation evolved into synchronous customer and product development because, by either name, it’s more a course of action than it is a method of study. It’s a sales process for concept-stage products that unify a team and motivate swift pivots to a better product and business model. It produces customers who are ready to buy when the company is ready to release. See Massacre at IBM.
If SyncDev were to reveal a fatal flaw in the product, business model, or business case it results in fast failure, a far better option than slow failure.
SyncDev is a way to ‘Nail it then scale it’, a term coined by client Financial Engines, Inc.’s CEO and EVP Marketing long before Goldman Sachs took them public in early 2010 despite being in the midst of recession.
In early 1984 a venture capital firm invested in Silicon Valley-based Infinitek to produce the Biomek, a laboratory robot for use by biotech and pharmaceutical companies.
“I want you to validate the market for the Biomek: Is the market real? How big is the market? Does the product fit the market? and What are the sales costs?,” the General Partner of IGSB said. “Mainly, I want you to demonstrate and test-sell the pre-production prototype to 35 companies. Today is May first. You’ve got 60 days.”
A Harvard post-doc molecular biologist and a Brown University PhD candidate in physics, Dale Pfost, founded Infinitek. Neither had business experience and no one at Infinitek knew a customer. IGSB wanted answers to help them recruit a CEO.
On the Right Track in 75 Days
Our first task, on May 1st, was to form an ad hoc sales team that began researching California biotech companies. There were 78. The team began calling each one to qualify them for meetings.
By June 30th, Infinitek’s sales and development team had met in person, in the customers’ labs, with their instrument procurement teams to assess application fit, price, and unit potential at 35 companies. Twenty eight were in California including early biotech leaders, Genentech and Amgen. Seven were large east coast drug companies including Merck, Pfizer, and Bristol, Myers, Squibb. Of the 35, thirteen were solid prospects and two of them paid money down to secure their position.
The team realized the product needed two more years to develop key features. Based on the effort it took to build the sales funnel, number of worldwide prospects, revenue per customer, and number of competitors, the team deduced 5th-year revenue would be $35 million, not the $100 million target that justified the initial investment.
By mid-July the business model and business case were clear: More work and slower growth were at hand. IGSB decided to sell the company. By virtue of now knowing the market, the SyncDev coach cold-called the general manager of a leading, nearby life science instrument company, Beckman Coulter.
Exit in 60 Days
On September 15th IGSB inked the sale of Infinitek to Beckman by virtue of the team’s deep, newly-acquired market and product knowledge. In the fifth-year, Biomek revenue exceeded by six percent the $35 million plan. Eventually it became a $100 million-plus global brand.
SyncDev had proved it was a lean development method long before lean was ‘cool.’