Startup Early Days and beyond, it is all about Testing!

And more advice from Manuela Zoninsein, CEO and Founder of Kadeya. Kadeya is waste-free vending for workforces. Grab your Infinite Bottle with your drink of choice, then return it to any Kadeya kiosk, where it will be autonomously cleaned, sanitized, and refilled for reuse. Their goal is to eliminate plastic from the beverage industry.

1. Don't Leave Your Day Job!

Don't leave your day job until you have potential customers telling you that they want to buy your product. You've got to be confident that there might be some revenue on the other side of quitting your nice salary job.

2. Test, Test, Test!

If you have an idea, start the customer discovery work and product testing right away. One way to do that is to understand the mechanics by buying a round of drinks for some friends, sitting around the table at the bar, and asking everyone to help you come up with an exhaustive list of every single assumption you are making about your business. If they are not true, your business will not succeed. Let's say there's a nuclear war tomorrow, we enter an authoritarian regime, terrorists completely upend the supply chain, or a pandemic. Think of every single thing, every single possible crazy thing, but also the tiny little things that you're going to assume that your health continues, and that you can show up every day and put in the hours.

3. Rank the Variables

Rank the variables on a scale of 1 to 3. You don't have to get super precise, but categorize what is most critical and urgent for your company. Put a number next to every single one of those items. That will guide you in understanding the key risks and assumptions that you need to test immediately. And so, for the immediate risks, we went out to test sequentially: Will people return our bottles? How is it feasible to wash and sanitize bottles autonomously? Where will people consume? I had to test my hypothesis that our go-to market would be white collar offices. Then Covid hit, and no one was back to work. Immediately, I had to think about a new go-to-market strategy. And I was fortunate that the pandemic struck, as it led me to a highly defensible beachhead market: industrial workplaces. And that's what we're targeting, and that's where we're achieving massive success.

And we update it quarterly. And we then regrade the risks or rerank them. And then we choose which ones we have to test immediately that quarter. Which ones are the new critical, urgent risks for the business

I was fortunate because I was pursuing my MBA when I had this idea. And so I took the MBA program as my little accelerator for Kadeya. We had a startup innovation class, and I pitched the idea for the class. As a result, my idea was selected as one of the top five. Then I had a team that, for their course requirements, had to meet with me every week. We went through the list of assumptions. The most urgent and critical assumption to test was how the bottles would come back. And then they helped me design an experiment-a very lean, minimal viable experiment.

4. Be Cheap!

Consider the cheapest, rough way to start validating or testing your assumption. Write a hypothesis that can either be proven true or false, and then design an experiment around it that is as cost-effective as possible. And run the experiment. At worst, you realize that your experiment was badly designed, and now you know how to go back and correct it. At best, you either prove or disprove your hypothesis statement and may even walk away with some people saying, "Oh my God, I love that experience. I love that product. Where do I get it?"

The experiment we designed underwent many iterations, and it improved as I refined it. So I stood outside the classrooms at MIT with glass water bottles that I had filled with filtered water. And then I was testing the different forms or incentives I need to use to get my bottle back. And so, I conducted three key experiments in that area—one thing I just said to people. Hey, enjoy your delicious bottle of water. Please bring it back when you're done. And in that case, we got about a third of our bottles back. That was a great experiment, in the sense that we learned that a verbal conversation alone wasn't sufficient. Okay, then the second version was I Sharpie numbers sequentially on the bottle. Then I put out a printed piece of paper with those numbers on the left and a line to the right of each number, and I asked, Hey, take a bottle of filtered water. Please write your name, your email address, or your phone number next to your bottle number. And when I did that, I got 99% of my bottles back.

We went and created a third version to see if we can take a deposit. Since this was a school project, I didn't want to charge money for the bottles yet. So I tried a few different problems. And the one that I think ultimately works the best was, Hey, leave your student ID. I'm going to be right here outside of your classroom. And when you come out, bring your bottle back. However, in that case, the adoption rate dropped to 50%. So, learning that the best approach to maximize bottle returns AND adoption was to ask for self identification, but not ask for a deposit – that was a great takeaway.

5. Be Loud!

Start immediately. If you have an idea that keeps you up at night or is bothering you while you're brushing your teeth, consider discussing it with your partner or friends. And they're like, okay, okay, I get it. And they're getting annoyed with you. Once you reach that point, you need to start testing it. And you need to, and testing doesn't necessarily mean running these experiments. It can also mean simply telling people and talking about it, and hearing the questions people ask. What doesn't make sense? Just very logical conversations that force you to examine in a certain way. Pitch your idea repeatedly—your ability to ultimately test the concept. Put together a pitch to present to an investor. An angel investor in the beginning is going to be contingent on how many repetitions you've gotten under your belt of telling the story.

We lucked into identifying our beachhead market, which includes industrial worksites and construction. Fulfillment centers. Manufacturing and military bases. Additionally, we're considering other options, such as oil and gas refineries and mining operations. That has been the case for us since I moved to Chicago four years ago. And it has been incredible. We constantly question the right beachhead and continuously validate that it is the right one for us.

We previously thought we would target offices and university campuses. I did over 200 customer discovery interviews for those two environments. And then Covid hit. What is fascinating about industrial workplaces and frontline workers is that they must physically show up to work every day.

My solution is a physical product. We're giving you a packaged beverage. I'm not going to build a business delivering bottles of water and soda around the city. That makes no sense. So, we knew we had to be in a fixed location where a predictable number of people would come through every day.

With Kadeya, the companies are basically putting a micro factory, a bottling plant, at their fingertips. It will never run out of water and other products. The workers will feel valued. It's delicious water. They'll feel you're taking care of them. And you no longer have to think about the logistics of packaged beverages, which is a big headache that no one wants to deal with. Kadeya is a perfect solution.