A look behind the curtain of our modern technology may take us back to the 1980s!

Following on from my first column, I’ve been exploring how to improve the user experience of cryptocurrency. To do so, you need to know why you are building a product and the problem it solves. Here I delve into that topic further, exploring product innovation in crypto, blockchain and fintech.

Just because you can build it, does not mean you should

Rule 101 in Product Management and UX. The way to decide whether to build a product comes from whether it meets a user need. We identify the problems in daily life and design solutions. Have you ever stood in the rain trying to flag down a taxi, wondering if you have enough cash to pay the fare? If so, you’ve experienced the pain points that led to Uber. It sounds simple, but actually it’s difficult to identify these and even more difficult to solve them. Many start-ups fail because there wasn’t a problem in the first place.

With a problem identified, we look for potential ways to solve it. No company can launch the perfect product immediately. They don’t understand enough about which features it needs. That’s where experiments and testing help. The first version of any product is a prototype, a term sometimes prefixed by ‘Wizard of Oz’. It looks like a functional product but humans are behind the curtain pulling the levers to make it work. The purpose is not to mislead users, but to learn how to serve them better. If no one uses your prototype, you shouldn’t continue to build it. If they only use one of its features, that’s where you should focus.

Investment and product development

Product development soon requires investment. We all know how that works from popular TV show Dragon’s Den. The entrepreneurs (always for some reason described as ‘plucky’) present the early version of their product. They try to convince the investors that there is a market for the idea. If successful they get the cash, usually in return for a higher stake in the business than expected. Clearly it helps to be, or at least know a wealthy individual if you want to start a business.

I find it interesting how ICOs have subverted that idea. It’s a thoroughly modern recipe: take an idea, add a white paper, mix in tech and serve with slick website design via social media. People contribute money for tokens, and only then the product development starts.

Two questions

What are the benefits of this approach? You can contribute to making an idea into a product if you believe in it, much like the Kickstarter model. Contributors can even be part of the development and test early features. A pool of individuals rather than one wealthy Dragon seems to open up investing to more people.

Where can it go wrong? These are still only ideas. Some companies apply the Wizard of Oz method with the wrong intention. They make the idea seem more advanced than it is. They don’t test and learn. Or they underestimate the regulations that apply to their business model. With the SEC cracking down on unregistered ICOs recently, there are people looking behind the curtain all the time.

Cards and crypto

Yesterday, Monzo announced a new round of crowdfunding to raise £20M. It is one of the most promising financial services start-ups listed in CB Insights’ Fintech 250. The report highlights vast investment in this area, with record highs in 2017.

I predict that we will see cryptocurrency popping up in many of these FinTech apps. For example, Revolut started by solving the problem of exchange rate fees. But now it has a crypto section. Users can convert pounds to dollars or Euros, BTC, ETH, BCH, XRP or LTC. This addresses pain points of buying crypto such as using private keys and interacting with exchanges.

With all this digital innovation, the race is on to offer the best version of something more tangible – the card. A fancy credit card as a status symbol may seem like an 80s throwback, but it’s back in fashion for a new generation. In the UK market, the Monzo neon orange card (or should that be hot coral?) had a functional benefit: it stood out in your wallet amongst the dark blues and greys of traditional banks.

Now Revolut has launched a metal card with a premium monthly subscription. It’s not quite a black Amex, but the positioning sets up the idea of a VIP exclusive club. It comes with benefits including worldwide travel insurance and a concierge. I will report back on whether it lives up to the hype.

Jessica