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Make Elephants Fly

By Steven S. Hoffman

I want to personally introduce my book on innovation to all the members of BPI Network. I wrote this because innovating is hard. It's one of the most difficult things you will ever do. But in today's world, we all have to innovate or get left behind.

I struggled with innovation for years. Most of the time, my products were incrementally innovative. They weren't radically innovate. There was no breakthrough that put me in another league from my competitors. That type of innovation comes rarely, but when it does, it has an enormous impact on your business.

When I was successful at radically innovating, everything changed. My business went from linear to exponential growth. After working with hundreds of companies on innovation, I've come to learn some of the secrets to innovating on products, business models, and organizations.

In this book, I document how startups go through the process of radical innovation. I show step-by-step how successful startups manage to rethink and reinvent their businesses. I also provide numerous case studies on startups that failed, and I explain exactly why they failed.

The result is a detailed exploration of the process of innovation and what everyone, whether you're a CEO, manager or employee, needs to go through to make this leap forward in your thinking and approach.

I hope you enjoy Chapter 14: Design Innovation!

CHAPTER 14 (special sneak peek)

"My goal is to simplify complexity. I just want to build stuff that really simplifies our base human interaction."
- Jack Dorsey, co-founder of Twitter and Square

I’ll tell you something most people don’t know about me. I’m a designer at heart. I love design. My mother was an artist, and I was brought up going to museums around the world and studying everything from the great masters to abstract expressionists and postmodernism. As a child, I thought I would be an artist, but my father, an MIT-trained rocket scientist, persuaded me to study something more practical. After obtaining a bachelor’s degree in electrical computer engineering with near perfect scores, I rebelled and went to graduate school in cinema and television at USC. I wanted to be a creative force in the world. I wanted to design my own reality.

After making dozens of short films and writing scripts, I joined a Hollywood TV production company and quickly rose up to the level of development executive. That’s where I met the founder of SEGA, the Japanese game company. He offered me a position in Japan designing video and arcade games. How could I refuse? Being an avid gamer, this was a dream come true. So I spent the next several years designing games, first in Japan and then in Silicon Valley. I developed everything from PC games to online and mobile games.

Design has always been my passion. I often spend hours leafing through design magazines or browsing new product on Kickstarter or simply walking through a city studying the architecture. So when startups come into Founders Space, I can’t help but give them feedback on their designs. I often find myself launching into a fervent rant that goes something like this: “Hire a real designer. Don’t do this yourself. You’re not a designer. You’re an engineer, and what you have looks crappy. Nobody is going to put up with a bad user experience. The customer doesn’t care about your technology. It’s great design that matters.”

Everyone thinks of Silicon Valley as a technology-centric ecosystem, when, in fact, design now lies at the heart of the machine. I’d argue that there is more wealth being created now through design innovation than technological innovation. For every piece of technology that is invented, there are thousands of ways to employ that technology in newly designed products, many of which have the potential of opening up and transforming multibillion-dollar markets.

Design innovation focuses primarily on human factors. All of the fields of study shown below impact the design process and how designers approach developing a new product or service:

  • Anthropometrics - the study of the human body and its movements 

  • Physiology - the functions of living organisms and their parts 

  • Psychology - the way the mind works, including both conscious and unconscious experiences
  • Sociology - how people relate to one another and interact 

  • Anthropology - how human societies and cultures function 

  • Ecology - the relations of organisms to one another and to their physical surroundings.

There was a time when design was relegated to engineers. They tended to design products based on features, functions, and their personal preferences, with little or no regard for human factors. It is only recently that design has come to forefront. Today product teams often include designers with experience in human factors, interaction design, systems design, engineering and industrial design. It’s not an exaggeration to say that design is at the center of almost every new successful product coming out of Silicon Valley.

Apple didn't become the largest company in the world based on its technology. Steve Jobs wasn't an engineer. He was a designer and creative thinker. If you look at the iPod, which reinvented Apple, it's not a marvel of new technology. There were many MP3 players on the market at the time. It wasn't just about building superior hardware. Apple knew they'd never win the hardware war. Their approach was to rethink the entire experience of playing music on a device. That’s why Tony Fadell, who worked for Jobs and helped spearhead the iPod’s design, was intensely interested in how to create a better experience for users.

If you take the iPod with its click wheel and compare it to other MP3 players at the time, it was a design marvel. No other MP3 players allowed users to smoothly scroll through long lists of music with one hand, while stopping on a single song with surprising accuracy. Apple created an entire ecosystem that made it a joy to access, play, and purchase music. This included the iTunes online store and the iPod's unique interface, which enabled users to effortlessly browse through numerous songs and playlists.

One innovation that is emblematic of Fadell's attention to detail and insight into the user experience is that he noticed whenever someone purchased a new device, took it home, and opened the box, it wouldn't turn on. This was because the battery needed to be charged. So the customer would have to wait an hour or more before they could use the device. How frustrating was that?

Fadell suggested they make sure every battery was fully charged, so the customer would open the box and instantly be able to use the iPod. It transformed the user experience. Up until this point, no electronics maker had paid much attention to how the product looks coming out of the box--how it feels to unwrap it and use it for the first time. But now most high-end consumer electronics companies ship their products with a charged battery and pay attention to the entire unboxing experience.

This is the essence of design innovation. It's putting yourself inside the head of the customer. How does a person feel when using the product? In the end, it's the experience that counts--not the features. No problem is too small to overlook. If it affects the overall experience, it should be improved. Just look at how carefully Apple designed their packaging. Fadell and his team wanted to delight users every step of the way.

Fadell went on to work on the iPhone. After that, he left Apple to travel the world for eighteen months as he thought about what to do next. "I had to pull back and get out of Silicon Valley to gain perspective and see the world in a different way," he said. So many people forget how important it is to refresh your mind. Working all the time is the death of creativity. Fadell needed to experience life before embarking on his next design journey.

The break apparently paid off because what he came up with next was the Nest thermostat, a truly groundbreaking product that launched the IoT wave. What Nest did is to rethink the entire experience of bringing smart devices into the home. The Nest thermostat was less an engineering marvel than a design masterpiece. The beauty of Nest is that it's so simple. Instead of programming it, like you do with older digital thermostats, it learns your heating and cooling habits, adjusting itself automatically to provide just the right environment and saving you money in the process.

Nest is also a showpiece. It looks stunning. Instead of having a cheap LCD screen that you have to squint at, it's a beautiful half sphere with temperature displayed boldly in the center and an elegant ring of color around it. It’s worthy of showing off to your geeky friends. Early adopters loved it. For them, price doesn’t matter if the product’s cool factor is off the charts.

Fadell's design philosophy is that it's important to recreate a product category--not just make something incrementally better, and this starts with solving a real problem for the customer. He calls this making painkillers rather than vitamins. Vitamins make you incrementally healthier. You can live without them. But if you're in pain, you need it to stop right away.

How do you know if you have a real problem to solve? Just ask other people. Do they get as frustrated as you do? Can you eliminate their pain points? The greater their suffering and annoyance, the greater the room for innovation. Understanding exactly where existing products stumble is the key. That's how you reinvent a category. With Nest, he wanted to remove the hassle and pain of programming a digital thermostat. No one likes to do that. I personally struggle with it every time I go to a new hotel. Now how does this darn thing work?

When Fadell demoed early versions of Nest to his friends and colleagues, many of them wanted additional features. Some wanted a touch screen so they could have greater control. But Fadell refused. He was convinced that the best feature to offer was simplicity itself. The act of adjusting the temperature by simply turning a circular ring was a beautiful experience, and he didn't want to mess it up by adding more complexity.

The reason Google paid billions for Nest was that they wanted Fadell on their team. He understood how to seamlessly weave technology into people's lives. This is an art few people in the world grasp. And it is the future of all products moving forward, whether in the home, workplace or outdoors. Google saw IoT as the next frontier, and Fadell had blazed the trail.

But Fadell isn’t alone. There are many other great examples of design innovation. We usually think of Airbnb as a brilliant business model innovation, but it's more than that. Yes, the idea of being able to rent out unused space in your home to travelers visiting your city is a huge leap forward, but what most of us don't realize is how hard this problem was to solve.

Now it seems obvious that people love the idea of making extra money renting out spare rooms, but this wasn't always the case. When Brian Chesky, Joe Gebbia, and Nathan Blecharczyk started Airbnb, all the VCs they talked to thought the idea was crazy. Who would let strangers into their home? How could anyone trust random visitors in their private space? What if the stranger was a thief, or worse, a rapist or murderer? The consensus was that Airbnb would never amount to much. People just didn't want to take that sort of risk.

Luckily, two of the three founders were designers. They had met at the Rhode Island School of Design and understood the principles of design thinking. Their challenge was to make people feel comfortable with the novel idea of sharing space together, even though they had never met.

If you look closely at Airbnb, the site feels both friendly and safe. The descriptions and instructions are warm and inviting. The profiles have large photos, so you can clearly see the person. There's also room for a description with just the right amount of space. The reviews are displayed prominently in the profile. Chesky and Gebbia even thought about how to structure the conversation between the hosts and guests. How large should the text box be when people message one another? Where should the buttons be placed? How should users be prompted?

"If you want to create a great product, just focus on one person. Make that one person have the most amazing experience ever," says Chesky. Even calling the users "hosts" and "guests" was intentional. It's like hosting a party at your home and inviting guests, rather than renting space to some stranger. The idea was that you could become friends. It wasn't just about the money but the experience of meeting new people from all over the world and sharing your home and city with them. That's what makes Airbnb so special. That's why people love it.

Most hotels are impersonal. You don't typically become friends with the desk clerk or concierge, but with Airbnb, you are invited into an intimate space where you have a chance to get to know someone personally and share an experience with them. They designed their service with this in mind.

Chesky and Gebbia also made sure the front page was magical. They featured the most attractive and romantic spaces right on top. It gave users the feeling they were going on an adventure--something they couldn't get from a typical hotel. The homepage featured fabulous tree houses, country farms, luxury apartments, jungle retreats, and even castles. With big bold photographs and alluring descriptions, it was an entry into a magical kingdom.

All this is what made Airbnb a sensation that swept the world and changed how we all think of travel. And Airbnb isn't alone. Box redefined how we think of file sharing through design. Slack reshaped enterprise communication through design. Xiaomi captured the low-end smartphone market through design. Snapchat and WeChat took messaging to a new level through design. WeWork re-envisioned the office and workspace. Uber and Lyft remade transportation through design. And the list goes on.

Understanding design is essential to innovation. In the coming decade more product categories will be reinvented by design than any other type of innovation. Why? Because design doesn't require a huge amount of capital--just exceptionally talented people who can perceive what customers really want from a product or service. This means any entrepreneur with a laptop has the potential to disrupt an entire multibillion dollar industry if they can figure out the customer's pain point and design it out of existence.

My very first entrepreneurial success came out of design. My partner and I created a computer game called Gazillionaire that was meant to teach students and adults how to become entrepreneurs. It was a game where you started your own trading company in the psychedelic Galaxy of Gogg. The game was technically outdated the day it was released. Our publisher only agreed to distribute it because their QA team had fallen in love with it. The animations were crude, the graphics were homemade, and tech was primitive, but that didn’t stop it from becoming a hit. People adored the unique experience it created, and it received glowing reviews from the critics. In fact, our publisher was upset that our little game received better reviews than their multimillion dollar Star Trek franchise.

Shockingly, Gazillionaire, along with its companion games, Zapitalism and Profitania, are still selling today. Schools and universities around the world are using them to teach business and economics, while adults email us saying things like, “I finally understand why I have to get rid of my credit card debt!” The point is that good design beats big budgets and tech wizardry almost every time.

I tell entrepreneurs that if they want to succeed, they shouldn't get an engineering degree or MBA. There are more than enough engineers and MBAs coming out of college right now. What we need are more designers who can figure out how machines and humans can better work and live together. Human computer symbiosis lies at the center of a massive shift we are now undergoing. This is where the hard problems of the future lie and the potential for massive change exists.

New possibilities for design are unfolding every day with advances in technology. Design thinking extends into how connected devices communicate, the types of data sensors gather, how we interface with augmented reality, and what electronics we strap to our wrists, embed in our bodies, and connect to our brains. Right now, there are thousands of businesses that are waiting to be totally disrupted and new markets created simply through design thinking.

About the Author

Steven S. Hoffman

Steve Hoffman (Captain Hoff) is an angel investor, partner at FOUNDERS.VC, Eminence Ventures (China), LP in August Capital, serial entrepreneur, and author of the book Make Elephants Fly. Hoffman is also the Captain & CEO of Founders Space, one of the world’s leading incubators and accelerators, with over 50 partners in 22 countries.

Always innovating on his life, Captain Hoff has tried more professions than cats have lives, including serial entrepreneur, venture capitalist, angel investor, studio head, computer engineer, filmmaker, Hollywood TV exec, published author, coder, game designer, manga rewriter, animator and voice actor.

In Silicon Valley, Hoffman founded two more venture-backed startups in the areas of games and entertainment, and worked as Mobile Studio Head for Infospace, with such hit mobile games as Tetris, Wheel of Fortune, Tomb Raider, Thief, Hitman, Skee-Ball and X-Files.

Hoffman went on to launch Founders Space, with the mission to educate and accelerate entrepreneurs. Founders Space has become one of the top startup accelerators in the world. Hoffman has trained hundreds of startup founders and corporate executives in the art of innovation and routinely works with the world’s largest global corporations and venture funds.