Case Study: Mentive's Lean Project

Case Study: Mentive's Lean Project

This is a guest post by Mentive - a company that has supported us in creating Playing Lean 2.

Mentive is a Mexican startup that builds Digital Solutions focused on the e-commerce industry and provides services to boost sales for small and medium businesses. Its main purpose is to develop and grow in-house projects to create new sales and marketing channels. In Mentive the team is the most important asset, that's why our employees are always our first customers.

Mentive has been working on a project named Kiwiik, which comes from the Mayan word “market”. Its second version is about to be launched in Mexico City. This case study explains how Mentive has grown into a reliable and structured startup focused on developing its organizational culture, and always strives to learn more about the Mexican market.

History and Setbacks

Raul Alonzo, a businessman who provided advisory, consultancy and sold  insurance services offline, noticed there was an increasing demand of his services online. He realized that he needed a platform to sell his services through a digital channel. At first he thought it was going to be easy because everyone he knew told him of some tech company or person who could build his online solution. First he hired a tech company to develop his idea, but the time he had to invest explaining his idea and the expenses of doing so, forced Raul to end this relationship early on. Later he was contacted by a former colleague who had a digital company and had developed some tech products. Raul thought that acquiring a small established digital company could work for his project, but the culture and structure of the digital company was in such disarray, with no real company culture or real proprietary products that Raul soon abandoned the idea.

While on a business trip, Raul met someone with similar objectives and they started talking. Raul recounted all of the setbacks he had suffered trying to build his platform. The man told Raul he had a small team of developers and that he was looking for a partner to expand his insurance services.  They partnered up. Raul would procure the initial investment and offices, and his new partner would provide the developers and proprietary technology.

The Real Challenge

After four months of meetings, trips and planning, the new company wasn't anywhere near where it needed to be to start developing the insurance platform. While both partners had the same goal, each one had different views of how to reach it. One was focused on the product development, the other on the going-to market strategy. With little time to spare in meetings and two different views, expenses were building up and no communication was achieved. 

The partnership dissolved almost a year after being created. Soon all developers left the project and no real progress was made, with Raul already having spent a lot of money in building a developer division.    

Solution

An intern of Raul ́s IT staff, whose name is also Raul (we will call him The Intern) heard about the unused developer area and proposed an ecommerce project. The Intern explained the Lean Startup methodology to him as a way to reduce cost, obtain quick insight of the market, see real progress and improve product development, getting the most out of the  investment already made. Raul approved the idea and gave the Intern four months to see results and two conditions - he could only hire one person to help him out, and if the methodology was successful the Intern had to develop the insurance platform.  

The Intern found help and they started working on the ecommerce platform. They named the renewed developer division Mentive. The name Mentive is a union of the Mayan word “Ment” (create, elaborate) and the English word “creative”, so Mentive relates to Creativity.

The Prototype 

The first step was to create a prototype of the idea. They knew what a prototype was, but neither of them knew how to build a digital prototype. They decided to start with a simple drawing of what would be the prototype with its functionalities, but friends and family found it confusing because they couldn ́t understand the flow and general idea - they definitely wanted to see this prototype on a digital screen. The Intern and his partner learned that a physical drawing or (physical prototype in this case) was hard to understand, so they created a second prototype that was made on Powtoon and had the basics. This prototype let the potential customer better understand what the idea was, and gave real feedback of the wants, needs and behaviour of users with the “product”. The third prototype was made on Sketch, it had a minimal UX design and some additional features, so Mentive´s team decided to test it in a focus group.  Since then, each prototype was tested by Mentive´s team and by potential customers through different methods such as focus groups, testing events and beta testing. Testing became the first pillar of Mentive's work and culture value.

This image is part of the prototype V2  presentation, which was made with Powtoon.

This image is part of the prototype V2  presentation, which was made with Powtoon

Pivot and Minimum Viable Product

The V1 Prototype was not successful because it was an unclear drawing,  unable to communicate the essence of the idea. V2 Prototype was better because it was shown on a  digital screen. V3 Prototype was ready for a bigger test. In V3 focus groups, people had different opinions about design and functionality,  but they all agreed that the name was not at all attractive, easy to pronounce nor related to the idea. So Mentive´s team realized that the name was not working and didn't relate to the product at all. Although Mentive´s team knew the idea could be good, something wasn't working and it needed further changes. 

The first real Pivot for Mentive´s team was changing the brand’s name to a clearer and easier one. They filled a whole board with ideas and chose three names. They did a small  survey to find the name that potential customers consider the best one. This change brought benefits for Mentive and its culture. The team understood the importance of pivoting and was willing to keep making changes. This was one of the biggest steps for Mentive´s newfound culture and structure, “not fearing change”.

First logo and name of V1 Brand / Current logo and name of the brand

First logo and name of V1 Brand / Current logo and name of the Brand.

After a period of numerous iterations, prototyping and testing, Mentive´s team created its Minimum Viable Product. They made the MVP an integral part of their go-to-market strategy. It was a simple beta launch, but they focused on testing their hypotheses by observing the customer's behavior with the real product.

Once the Minimum Viable Product was on the market, the second and very important part of Mentive´s culture and structure was formed, Build-Measure-Learn.  For every feature Mentive´s team created a hypothesis and tested it. With actionable metrics they evaluated the hypothesis, and whether it was wrong or right they always had a feedback meeting to ensure continuous learning

Every characteristic of Mentive´s ideas has had changes and a process of Build-Measure-Learn, from the market segment and pricing to the features and Mentive`s structure itself. For example, after the basics (name, design, functionality) were developed, a need for a sales team started to grow. The product was on the market, but someone had to offer it directly. At first Mentive started with a face to face sales team strategy, but it wasn’t working as expected. Follow ups and feedback were difficult to get, and everything related to the product was digital or remote, so the sales effort of a face to face visit didn ́t match with the product core value proposition. Costs were also high and sales were really low. At that moment Mentive´s team designed a new strategy to affiliate customers: a telemarketing campaign. It was unbelievable that the sales of one person were the same as the sales of four face to face salesman and at a fraction of the cost, roughly 5% of a face to face salesman. 

That is how, thanks to this Build-Measure-Learn practice, Mentive has its own proven sales team with a defined process for approaching the customers and a very clear objective of expanding Mentive`s project scope. Mentive is now trying a top-bottom strategy to get the desired critical mass.

Results

Thanks to the Lean Startup Methodology, Mentive has raised brand awareness and has captured the attention of hard-to-reach partners. That's why Mentive is currently working on a second project which is Raul´s initial dream of providing his insurance services through an online channel (code name Piix) and also continue scaling Kiwiik, both focused on e-commerce and digital solutions. 

Mentive has a strong talented team, with its own developer, commercial and sales area. Thanks to its structure and methodology, even hiring people is easier and faster, with high quality candidates, which were really hard to find at the beginning. 

Mentive just received the investment of more than $500.000 USD and the space to create new headquarters in order to scale its team force (which at this moment is around 30 employees). A defined process for approaching potential customers, retaining current ones and new prospecting partners that align with the objectives of scaling Mentive´s vision, a company of creators and believers.

Image taken from the 3.0 Version Prototype

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