The story details the iterative product development process of Thrive Smart Systems, which pivoted from an initial homeowner-focused irrigation solution to a successful, wire-free system for landscapers by rigorously validating customer needs and market viability using the Lean Canvas model.
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so we are thrive smart systems and we
want to share the story of how this
device has begun to revolutionize the
irrigation industry so it all started by
talking with Greg the father of one of
our team team members and we asked him
about the problems with his sprinkling
system he said what frustrates him most
is how the sprinklers over and under
water is lawn
which wastes water and causes swampy
areas in Islam and dead areas so we took
this hypothesized pain and decided to
figure out if this was a problem for
more homeowners besides Greg so we did a
survey of over 51 homeowners asking them
across seven states asking them about
their sprinkler problems and we found
that 52% of them came back saying that
over and under watering of their lawn
was an issue to them and 89% of those
considered water conservation their
number-one priority when looking to
upgrade their current system so based on
this test we figured we should learn
more about water conservationists so we
added them to the customer list and
decided to attend the water now summit
in Salt Lake City Utah with the goal of
talking to water conservation is about
water usage now we spoke with over 60
rep 60 municipality officials from all
over the United States and every single
one of them confirmed that any solution
in the irrigation industry that would
conserve water would have huge market
potential so we felt we had validated
this problem and started a hypothesized
solution which was to make a sprinkling
system they would use moisture detectors
and weather integration to only turn the
sprinklers on when the lawn indicated
that it was dry thus saving the customer
water but we knew that to validate this
proposed solution we needed to talk to
people who use irrigation products on a
daily basis so we took it to irrigation
retailers and landscapers and told them
about this solution and every single one
of them said that they didn't like this
they said products like this already
exist and no one is really buying them
and we also learned that landscapers
install over 75% of irrigation systems
so that means who we thought were our
customers the homeowners and the
conservationists are not the ones with
the purchasing power so even though this
seemed like a failed attempt we had
learned a very valuable lesson
that is that your users are not always
your customers so in three months and
after spending $400 we had completely
invalidated our proposed solution so we
knew we needed to pivot so we decided to
go talk to our real customers the landscapers
landscapers
now the first landscaper we spoke to was
Adam and he said the biggest problem
with sprinkling systems is the wire that
goes from your control box to your
valves and he said that even the most
advanced sprinkling systems on the
market are still using wire that means
that if a wire gets cut or is shorted
which happens frequently
someone has to trench through dirt and
concrete to replace the wire or fix the
short so we took his complaints about
wiring and nailed them down to three
main problems wire cost wire
installation and wire maintenance and
after some research we found that over
200 million dollars is spent annually in
the United States alone trying to solve
irrigation wire problems so we needed to
talk to more landscapers about this not
just Adam so we attended the mid-year
conference in st. George Utah and
personally interviewed over 30
professional landscapers and every
single one of them echoed theirs the
same things that Adam had said about
wire problems so in five days and after
spending absolutely nothing we had
discovered and validated a problem and
just and figured out who our customers
really are so we knew that our Tapani
solutions have a value in our solution
we knew we need to eliminate all wire
and we proposed that we could sell to
landscapers through online sales and our
initial proposed solution was to have a
sprinkling system that would use a
wireless valve beneath every sprinkler
head and communicate wirelessly to a
control box so an existing system would
get rid of your wiring and your valves
and our new system would look like this
with a wireless valve beneath every
sprinkler head communicating wirelessly
to the control box but we knew that
because we were getting rid of wire we
needed to generate power somewhere else
for the valves and so after weeks of
brainstorming we decided to harness
power through local water flow in the
pipes by using a turbine that would
recharge a battery when the sprinklers
were on now we got really excited about
this solution and so we went back to the
canvas and did a cost structure
and after a cost analysis we realized it
would be way too expensive to have a
wireless valve beneath every single
sprinkler head thus invalidating our
solution so we knew we had to go back to
the drawing board and determine a
solution for this and that's when we had
a huge breakthrough
the breakthrough revolved around
realizing that all your vows are located
next to each other and avowed blocks
like the one that you see here and we
realized what if we had one device that
would retrofit to your current vows and
all your vows would just plug into it
now you'd only need one maybe two
devices per property as opposed to 30 or
40 and we also do cut costs we would get
rid of the control panel completely and
just retrofit to the control panel
already there and any wires that you
would plug into it be converted to a
wireless signal now when we change our
solution to this suddenly our cost was
such that we were competing with the raw
wire that this was displacing this was
great but now we had a new unbowed dated
solution that had its own market and
technology risks we decided to tackle
the market risk first because we didn't
want to build something that nobody
wanted so to test the market we
interviewed landscapers about our
solution idea and this is where things
got exciting after interviewing 42
landscapers we knew we'd struck gold 91%
said they would use our product we
created a demand curve with their
willingness to pay data creating a
revenue maximizing price of one hundred
and forty three dollars per wireless
mouse for a switch which was great
because it only cost us 20 bucks to make
how are we wanted to validate that our
revenue streams that these pricing
points was actually accurate we wanted
to know what landscapers really put
their money where their mouths were as
far as these pricing points and so we
decided to do another test and see if
landscapers would sign letters of intent
to purchased a product once it was ready
and they did 51,000 dollars in just one
week of pre-orders now this was great
and we had we're so excited that we had
validated our revenue streams next we
had to validate the tech assumptions our
riskiest text tech assumptions revolved
around power generation water pressure
loss pressure loss thank you and in the
distance of the wireless signal so to
test this we designed and redesigned
over ten iterations before we proved the
technology worked with our prototype
this took us just five weeks and three
hundred dollars now we were excited
about a new prototype and wanted to take
this to more customers to get more
our solution validation and the
irrigation tradeshow in Long Beach
California was coming up and this would
be a perfect place to test our product
but before that we wanted to test a few
more of our assumptions starting with
our channels we'd assume we could go
directly to landscapers now to test this
we would sit down with professionals in
irrigation retail a distribution and ask
them what they thought about our model
so we went to a cocktail party with
virtual rain one of the largest
marketing groups in the irrigation
sector and they said we need it to sell
through standard irrigation retailers
now we took this and did some of our own
validation research talking to 21
different landscaping companies to get
understand their buying habits and turns
out they were all buying from the same
irrigation retailers that virtual rain
had told us about to get big we needed
to sell where they were already going so
we had invalidated our previous channel
but validated the correct channel along
the way the last thing we needed before
the trade show was IP now we had assumed
that our unis unfair advantage would be
a patent that would protect protect our
technology to validate this we ran a
test of talking to a patent attorney in
the area and he validated this was
indeed patentable and after six weeks of
working with him we had a provisional
patent as of November 2018 so we had
validated our unfair advantage as well
now it was finally time for the
irrigation trade show the largest
irrigation trade show in the world and
we were blown away despite having a
dinky little booth in the back corner we
were approached by Rain Bird or bitten
Toro the Microsoft's and apples of the
irrigation industry all wanted to talk
about either acquisition or a
partnership we're still in discussion
with Rain Bird today which is the
largest of these three so all this was
great we had more validation from
hundreds of other landscapers saying
things like oh I could use this a few
times a week people been asking what a
wireless phone will be available it's
nothing like in this market or my
favorite from an Israeli CEO this is
shop like knife so we considered our
solution validated but that last phrase
I mean this is wasn't all that came from
the trade show we also got connected
with a company in the agriculture space
and they said farmers have to wire their
valves over hundreds of acres of land
and they felt this pain on an even
deeper level so we were excited to add
them to our customer segments that we
would explore more in the future so with
all this validation and I have some
competition winnings and we were
approached by many angel investors one
even offered to fly us out on their
to Washington to install our system and
talk about investment one venture
capitalist venture capital firm wanted
to wants to invest and they also know
Mark Cuban and can potentially get us in
a shark tank if we wanted to do so so
this is all great but we are not done
using the lean canvas model we still
have some key metrics that we are
planning to validate within the next few
months including our customer retention
and product lifetime this will be done
through a series of tests including a
beta test that's scheduled to launch
August of this year and our version one
product which will be officially
launched in spring of 2020 now by using
lean canvas model we were able to
discover a really big pain form a unique
solution that our customers can't wait
to get their hands on and create a
product that will revolutionize an
entire industry
thank you I'll start things up so I
wanted to go back to the problem why is
broken wires a problem for a landscaper
don't they don't they get paid to come
back and fix it yeah that's a that's a
good question yeah I think a lot of it
has to do with the fact that they want
to provide value to their customers and
especially the ones when they start
adopting it and once wireless technology
begins to become an industry standard
and it's a very competitive environment
in the landscaping industry and so if
their neighbors are offering Wireless
you know sprinkler systems they're gonna
be wanting to offer that as well and a
lot of it is they also have some many of
them have kind of warranties within a
certain time frame and so if they have
something they won't have to worry about
wiring maintenance and this is something
that a they I would add value to their
their business as well yeah I can see
that I can see the raw wired cost and
installation being a pain but I was just
one of them was the was the pain of
fixing but I you know if they're gonna
get paid that's actually good thing it's
like dentists and want people not to
have cavities they don't want their
cavities to fall out there so I'm
curious about the the two companies that
are in the space that that you aren't
talking to you anymore so I'm kind of
curious can you share like what
happened in those conversations right
that's mostly because we we pursued Rain
Bird more because they're the largest
brand and in the landscaping industry
they always want reliability that's like
the number one thing that always comes
up when we talk to landscapers and Rain
Bird is known for being reliable with
their technology which is why we pursued
them the most yeah I mean if you
actually are interested in selling
though what you want to do is create a
market for your business and the way you
create a market is by having more than
one suitor not just one suitor yeah and
I guess on that story took two also
clarify we are still talking with orbit
as well they have a manufacturing
facility here in Salt Lake and so we're
in discussion with them still about
manufacturing and rainbirds more of the
distribution side of its discussions can
you explain a little bit about you ended
with the retention tests and with a beta
and I'm just curious how does that prove
out retention how does that so what
specifically about the beta would prove
yeah that's a great question
so yeah again we're planning on
launching a beta test over the hunger
you hundred units with different
landscapers and we're gonna offer them
give them the the option to buy more
after they've played around with it and
and seeing that it's working so it's
it's a very simple test of just having
them buy one and then see if they'll buy
again so I'm interested in what evidence
you used change your channel because you
went from direct where you control the
customer relationship and can learn from
the customer and get new information and
then said you over here there's a
potentially bigger channel let's go work
with these people where the customer is
farther away and I lose a lot of that
evidence what drove that decision in the
absence of well anything out there for
real yet yeah that's that's a great
question so one stat that we didn't add
in there was that after asking them if
they bought any supplies online there
was like one out of 21 who had bought on
online and so we knew that there would
be a behavioral shift already we're
switching to wireless irrigation and the
landscaping industry is very slow moving
and so to mitigate the the behavioral
changes it's not we why do you know that
you just said something
that you know you said definitively like
we know that it's that people aren't
going to do this right it's big change I
only got one person right but but what
one person is one person right so why
did you suddenly say well I'm not gonna
do that anymore I'm gonna go do
something different well what evidence
did you have to support that to say yeah
I suppose that was an underlying
assumption that we just had from talking
to them and we had just assumed that if
they're already going to this location
to buy all these other supplies and they
don't buy anything online the transition
would be easier if it was where they
were already going but just to be clear
you didn't try selling it online that
was just a that's correct
okay okay thank you all right I think
that's it cool thank you thank you drive [Applause]
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