Phil Argent: Good afternoon. Today, James and John.
James Thorn: Hello.
Phil Argent: It’s Wednesday and this is episode seven of us building our tech start-up. James, today we’ve got a special guest on, and our special guest is John.
James Thorn: Very special guest.
Phil Argent: John was your lecturer.
James Thorn: Yes, my mentor at university. Really, there are two or three people that are backbone of Tenancy Stream. John is one of them. Without John’s initial – well, continuous – mentorship, we wouldn’t be here where we are now. I wouldn’t have given it a go. I wouldn’t have then met you, Phil, and gone from there, without John’s mentorship.
Phil Argent: Okay, so we’ll just try and speed things up a little bit, James. So, basically, John, my understanding of you is that you have been involved in your own businesses. You’ve been involved in Unilever and PepsiCo. You are also lead lecturer in an MBA course at York University. Is that right?
John Park: You can actually replace Procter & Gamble instead of its arch-rival Unilever. You’re right. I don’t lecture. I’m a visiting lecturer, but I basically teach people how to build technology businesses.
Phil Argent: Okay, so you help companies build technology. You help build technology companies.
John Park: Yes.
Phil Argent: That is the reason why we are talking. Today we’re going to be talking for 9 minutes and 50, or maybe slightly longer if you watch us over on YouTube, because the full video is going to be over there. Today we’re going to be talking about planning and assumptions.
Now, keep in mind that we are obviously – myself and James are – attempting to build Tenancy Stream into a solution for the property industry, largely to do with communications in the property industry. We’re learning as we go.
The first question that we thought we’d basically throw out there – and obviously, James and John, hopefully, you can give us some insights – is how do we, be it the collective business designers, how do we design assumptions? How do we think about them?
Do we use lists? Do we use brainstorming? Do we go down the pub, and have a pint and say, “That’s going to be the next big thing”? Do we watch a movie? What do we do? What would you give us an insight to? What do we do to design ideas? What are the assumptions around that? John, do you want to…?
John Park: I’ll start by saying I absolutely hate assumptions because, if you’re assuming something, you are assuming that you know what the person wants. Nine times out of ten, you don’t. I think assumptions are things that are there to be tested.
Two quotes that I love by Eisenhower: “In preparing for battle, I have found that plans are useless, but planning is indispensable.” That really gets it for me. It’s almost like the planning comes up with the assumptions that you think are real. Then, effectively, you need to get out there and test as fast as humanly possible.
James Thorn: Yes.
Phil Argent: Okay. James, so you talk about that we need to test assumptions as quickly as possible, John, right?
John Park: Yes.
Phil Argent: So, James, how do we test things? How do we test them quickly?
James Thorn: I think the first time I met John I went into the room with a whole folder full of ideas and he said, “Who have you spoken to about these ideas?” I said, “Nobody.” “Well, they’re just all assumptions, then. They don’t mean anything,” so getting… I almost [think that 0:03:53] you’ve got to almost start somewhere, at the very beginning of whether it’s a rough idea or a very well-thought-out idea, whatever it is, but, before you even get it anywhere, you need to go out and ask very open questions. Gather the market research. What are they doing at the moment?
John always taught the pains and the gains: “What are your pains? What are your gains, and would you pay for those gains?” Then from there, over time, the more people you talk to, for us now, the more [users we’ve got 0:04:22]. The more users now we’ve got on the platform, that then allows us to… We’re trying to plan out the next two quarters. We’re using that data from our users to help us to plan out the development and the business planning.
Phil Argent: Okay, I understand that. Basically, what we’re going to try and summarise is that assumptions are a bad thing. We don’t assume anything. What we’ll do is we’ll take a nugget of basically understanding, and then we’ll go and chuck it at various people to get feedback.
James Thorn: You’ve got to start somewhere [ ___ 0:04:54]. (Laughter)
Phil Argent: That’s my summary of, basically, how we basically take this seedling of an idea. We just go and chuck it somewhere, follow it, go and talk to a few people.
James Thorn: And be prepared for it to change.
Phil Argent: Yes, be prepared for it to change. Okay, so let’s just explore that question just in a little bit more detail. You don’t like assumptions, John, but let’s say you’ve also said that comment you said about the battle, is that, sure, when you go into battle, there are far too many variables. Say like building a new business idea is full of variables, is that you have to make some assumptions of what you want to see happen and what you think might not happen.
I guess I think that assumptions are really good, but maybe I’m just the pint half-full kind of guy where I, sort of, think, “I’m going to give it a go because I think it’s going to happen,” where you’re, kind of, saying, “Actually, I completely disagree with that principle. I think you should empty out the pint, start with an empty glass, (Laughter) and do it that way.” The question being, basically, John, explain to me more why, therefore, do you hate assumptions, when I think they’re great? I think [assumptions are great 0:06:11].
James Thorn: I’ve read so many business plans from MBA students it’s beyond belief, and by some… It’s almost by magic that every business plan seems to break even between years two and three. They all seem to contain all of the same assumptions. They all, although they could be in different businesses and different sectors, they all look the same. The only thing they have in common is that the business plan is out of date the moment the last full stop has been put down on the piece of paper.
James Thorn: Yes.
Phil Argent: Okay, so, hang on. Therefore, what you’re saying to me, because obviously I’m in dispute with you about this, I think assumptions are great, but actually the other thing that I will honestly say to you: that I operate in a 12-week cycle. I have done since I worked at Virgin, probably in my early 20s. Everything was built on 12-week cycles.
The thing I know is, the moment I’ve completed my quarterly plan, I might as well just go and put it on the toilet wall, (Laughter) because it’s a picture of, basically, fantasy and understanding.
The thing that I also learnt about the assumptions within my 12-week planning, which is the same for Tenancy Stream, is that the best thing about those assumptions is, if I overachieve, I can get most of the assumptions answered by week 8. Therefore, I’ve got this, like, push ambition to knock out the… Actually, interestingly, talking to you, John, I’ve got a 12-week period to find the ‘no stupid idea’ pieces [right. I get your point 0:07:42].
James Thorn: [What you’re saying is] for you, Phil, those assumptions will be still based on data.
Phil Argent: It’s interesting.
James Thorn: [Based on what has] happened in the last quarter and the quarter before. [You’ll probably say that] a lot of those assumptions are based on data and what we see at the moment, or just increasing what we’ve got at the moment, setting out the targets, based on what we’ve seen so far.
Phil Argent: Okay, so, look, on that point, John, you think assumptions are bad. Okay, and you think they’re bad because, largely, as soon as you’ve made your assumptions, those assumptions are wrong.
John Park: Yes.
Phil Argent: Okay, because it’s all infinite. It’s all based around time. Okay, but I think assumptions are great because I’ve been built, within my business mind, to work in 12-week periods. The whole thing about the 12-week cycle is, largely, you have to introduce someone to the idea. You then have to educate them of the idea, and then you have to report on the idea.
There’s the old saying in marketing: “Tell them what you want to tell them. Tell them, and then tell them what you told them.” Yes? [You have 0:08:42] heard that one, yes? So, let’s just say, for the benefit of the audience, is that the academic and the [meddler] will basically disagree on the question of, “Are assumptions good?” because they are good and they are also bad. I completely agree with you.
Okay, now here’s the best question. We are nine minutes in, so we’re just going to do the little piece here that basically says, “Look, if you want to watch the full video,” because this might go on for a few more minutes, “There is the full, unedited video of us talking to John about building our tech start-up, over on YouTube.” You’ll find that if you go searching for Tenancy Stream.
Anyone, so back into this question. The last question is – and, God, I wince and I love this question, and I cry, and I mourn this question – when do you kill an assumption, because the way I’ll explain that, in my experience, is that we all have…? We’re talking in the context of building tech businesses, and we’re talking in the context of, like, how did any business start? How did Facebook start? How did WhatsApp start? How did Slack start? How did any property tech company start?
They started with a load of assumptions, and there is evidence that some companies or some ideas have been given far too much investment and far too much time. Or the owner has gone for it for too long and [it has cost and it has hurt 0:10:20].
James Thorn: [Crosstalk].
Phil Argent: So, a question, John. We’ll ask you first, unprepared: when do you kill an assumption? When do you kill it? When do you get your big knife out? (Laughter)
John Park: If you have an assumption, test it with a customer. If they like it, great, the assumption is right. If they don’t like it, try it with another customer. If they don’t like it, either give up or move on before you make an arse of yourself.
Phil Argent: It’s as simple as that? You’re going to give it to two-?
John Park: Yes.
Phil Argent: Blimey, that’s brutal. God, okay.
John Park: Because if I-
James Thorn: [I’d probably 0:10:57]-
John Park: Go, James.
James Thorn: I’d probably say it’s what you always taught me at the beginning, is it all depends how you present the idea to the consumer, the customer. If you present the idea based on all the assumptions, like we’ve just spoken – “You want this, you want that, it should look like this” – they’re going to go, “No.” But if you go there with open-ended questions of, “What do you use at the moment? What are the problems you experience at the moment? What can solve those problems?” you’re going to get feedback from them, which is going to point you in the right direction.
I think it’s the way you present it. If you just go, you lock yourself behind a closed door, based on your assumptions, get a developer to build out a glorified app, take it to the market, it’s a million-in-one chance that someone is going to like it. But you build it the other way round, based on open-ended questions.
But then going back to what you said, John, I think when you kill an idea is that’s when you just don’t listen to the feedback. You stop listening to the feedback. You keep going down the same route. Before you know it, you’re completely in the wrong direction. There are no customers, investors, nothing, but you’ve missed out steps before.
Phil Argent: I think there’s-
James Thorn: [Crosstalk 0:12:20] [that point you] rewind.
Phil Argent: Sorry, go on.
James Thorn: Or you-
Phil Argent: I think there’s an interesting point around assumptions and the pace at which you kill them. Obviously, particularly within the tech industry, the one thing is that… I’ve been involved in digital technologies for 20 years, and one of the things that I’ve seen is sometimes good ideas, which are good ideas, you can bring them to the market, let’s say, too soon.
When is too soon, because I had an idea in 2004, at the same time as Facebook, and I know that that idea has only successfully been launched two years ago in America? It has taken sixteen years for that idea to actually be a decent idea. When would you have killed that idea, John?
John Park: I guess what we were missing when you asked me the question is when is the point at which you have to make that decision about whether to kill an assumption?
Phil Argent: Yes.
John Park: I have a common philosophy, and James described it really well, which is I don’t actually go off and try and sell anything. I try and get people to engage in conversations with customers that draw out from the customers the things that they need and desire or want, so that the product is then built around that so that when you do… If you then go do the testing part, if you’ve done it properly, you are doing the final confirmation that you’ve done that first bit right. If you then do the testing and it’s wrong, you’ve messed up because you haven’t done the open-ended questioning that James was talking about.
I think I’m testing all along, but it’s almost like [what you said: the test, or, “When do 0:14:07] you give up?” For me it’s in the context of that final validation when I’m taking it back to them with my new, shiny thing that says, “Hey, there you go. Would you like it?” That’s the point at which, if I don’t get an instantaneous response and I have to push it down people’s throats, that’s the point I kill.
You’re absolutely right that a lot of ideas take a hell of a long time because the market isn’t ready for them. They don’t understand that they need it. That’s one of the common things. Here’s a classic example: I’ve been trying to convince the world that education should be virtual and digital, for nearly eight years now. (Laughter)
Phil Argent: It is now.
John Park: Yes, and overnight, when COVID was announced, I basically went to the university and said, “Do you guys have any problem if I shift everything 100% digital?” It went from 100% resistance to 100% support, but if I’d tried to push that at any other time – and had done for a number of years…
So, there’s a bit around that your assumptions can often be right and absolutely bang-on, but if the world isn’t ready for it and the customer isn’t in that space, you’ve got to be constantly assessing: “Are they in that right space, and are they ever going to get there?”
If the answer is, “They might get there,” then you hold on to it, but, if it looks like they’re never going to shift from their status quo in a million years, then you’re never going to push that down their throats.
James Thorn: [Or you’ve got to pitch it in 0:15:27] a way to get it to the market for them to get it, because we’re not only talking… We’re just, almost, focusing on the development or coming up with an idea [of a] concept.
It’s also looking at feedback, and how can you get them to adopt it? That’s a whole area of listening to the market, learning, and delivering the product that way [to get the right 0:15:51] [Crosstalk].
Phil Argent: Let me summarise what I think I’ve heard from this. I’m, sort of, an ideologist, like business builder, dreamer, entrepreneur. I can be all of those at the same time, but I think what you’ve highlighted to me, John, which actually I think a lot of people need to hear, is that when you build a business, when you’re looking – certainly when you’re building a property tech business in the UK – is that the… One is this is not Silicon Valley, for a start. Therefore, business ideas actually have to be business ideas.
What you’re saying is when do you kill an assumption? You kill an assumption when it doesn’t – when it doesn’t prove itself to be a business idea. It just happens to be an idea. That’s going to make, that’s going to… In itself, that is quite powerful because that’s going to make quite a few dreamers think hard: is their idea actually anything more than an idea? I’d actually say, when Tenancy Stream was first conceived, it was an idea. It did-
James Thorn: When I first went to John, it was a basic assumption.
Phil Argent: I think-
James Thorn: [Crosstalk 0:17:10] an idea, borderline idea/assumption, I’d say.
Phil Argent: Yes, I think [you’re]-
James Thorn: [Because I was basing it] on my experience, as well, from the property industry, but obviously… So, I knew there was a problem somewhere, but I hadn’t actually gone and trialled and tested my assumption to fix the problem. I started off with: “I know there’s a problem.” That could have been the assumption that’s [Crosstalk 0:17:36].
John Park: But give yourself credit, James. It was more than an assumption because you came in with an original idea that quite quickly I got you to give up within the first 30 seconds of the conversation.
James Thorn: Yes, I think [that’s fair].
John Park: I was left with a problem: “How do I help this guy when I’ve just, basically, destroyed his initial idea?” (Laughter) I just said to James, “Tell me something. What do you do?” “I work in property.” “Tell me something you’ve seen in property where there’s a significant problem that causes people real problems and pain that no-one has solved that, if you solve it, could lead to something.”
That’s where Property Stream came from, is James’ knowledge through being in the property industry in London for five years, being primarily selling property but seeing what was going on with the issues over residential letting. It wasn’t assumptions. It was he had a lot of data in his head that was turned into an assumption that he then literally jumped on a train down to London, and went and tested very, very quickly.
Phil Argent: Okay. Look, so in conclusion, basically, the whole thing about assumptions is, if guided properly by the dearest John, if there are people around us, the mentors and the makers, is that-
James Thorn: Break it down, and go and test it.
Phil Argent: Breaking down the assumptions as quickly as possible, and becoming realistic about the idea and producing a business plan that allows it to become real sounds like a process that a lot of people don’t do fast enough, in my experience, having done iterations of business plans every quarter, at least. Anyway, look, so, guys, that’s the end of our chat with John.
James Thorn: That was good.
Phil Argent: Thank you very much. It has been [an absolute 0:19:18]-
James Thorn: Thank you, John. We’ll have to do another one of these. It was good – really good.
Phil Argent: I think there’s some really good stuff in there and we shall put it live on YouTube, under the channel of Tenancy Stream. Hopefully, we’ll get some people lurking around it.
James Thorn: [Likes 0:19:33] [Crosstalk] comments.
Phil Argent: Anyway, I’m going to stop.