Learn from Member.id Experience Building and Validating Products

On her journey to building a business, Member.id Co-founder & CEO Marianne Rumantir talked about how the startup ecosystem in Indonesia has developed until now. The startup world is no longer synonymous with business people or products with an IT background, but also creative and disruptive solutions.

On this occasion, he shared experiences and stories about product/service development and validation. For more details, see Marianne Rumantir's presentation at the incubation program series session DSLaunchpad ULTRA the following.

Finding out whether a business idea is worth it or not

The customer is a common validation metric to find out if the product/service developed is of value or can solve their problem. According to Marianne, sometimes it is necessary to take big steps to develop a product even though it takes a long time. However, it is also important to do the calculations. The product doesn't have to be perfect, but at least it can have an impact on the customer/client.

"There we know that we are making a difference with our solution. No perfect product, at least you are providing or helping them. If there is appetite on the product, this is a sign that someone wants to use it," said Marianne.

In the context of customers in the B2B segment, he also highlighted the importance of two-way communication and data utilization to find out that product/service implementation can make changes to the client's business and meet their needs.

"Communication on a regular basis is important to sharpen alignment. The goal is to ensure that needs are met, let alone long-term cooperation," he added.

Experience while doing product validation

Every startup must have gone through a winding road while doing business product validation. Marianne told how she and her team had failed to validate products due to the Covid-19 pandemic. This situation makes the market demand for its products drop drastically.

He disclosed, Member.id once launched the Madoo app which allows users to convert point and miles from merchant, such as OVO, Gopay, AirAsia, and Garuda. When companies do soft launch, a pandemic ensued and flights were banned. This situation complicates the Madoo validation process considering that the selling value of this application lies in the exchange point and miles.

"Even though we have done a year and a half of research on R&D to build products. We have also invested billions of Rupiah. Such bad timing. Finally, we postpone product until the situation improves. Sometimes there are unexpected situations that make demand The market is falling," he said.

This kind of situation is inevitable. Regardless, Marianne mentioned that generally product validation may take up to 1-2 years. This is to find out whether during this period startup actors can get customers or clients who want to use their products/services.

Looking for investors up to exit plans

Product development will always be related to the capital adequacy of the startup in its first years. Marianne assessed that the development of the startup industry is getting more mature. For startup players, this is the right momentum to build a product/service. More and more investors are daring to invest for early-stage funding (seed round).

"This situation is a good opportunity because we don't really need to big money at the beginning to develop the product. We just need a good amount of money and product concept for the first year. Investors are also more and more willing to invest in seed," he explained.

He also underlined several other things about investors. First, it is important to find investors who can become strategic partners, especially those who already have a large investment portfolio. This can be an opportunity for startups to find new customers/clients from investors' portfolios.

Second, looking for investors who can provide assistance in building products and businesses up to exit plans. "In VC, [VC investment] startups don't ask for a return on investment, they only close meaningful businesses no longer burning money. Every investor has exit plans different. So, look for investors who can provide consultation to build a business."