Join Ayah Bdeir for an in-depth discussion in this video Applying an engineering method to business, part of Creative Insights: Ayah Bdeir and littleBits.
The transition from engineering to business is something that not a lot of people talk about and I started to look for answers and sort of ways to do it. And there isn't much about it. Engineers really like to, to dig deep in a problem and to start from the very source of the problem and to problem solve and iterate and really kind of understand the lay of the land. Business doesn't necessarily work that way. You have to sometimes make sweeping assumptions and just go for it and then if it doesn't work, change course.
So there was a little bit of adaptation that I had to go through. The very first financial model I made, I spent countless hours trying to estimate exactly how much I would need for money for printers, and for a network, and for tables and chairs. And then I realized, after speaking to a financial adviser, that you could just estimate administrative costs to be a percentage of your total costs. And I was like, how does that make any sense? Where is that percentage coming from? But you know, you, you start to learn these little tricks and that you do use little short cuts. I still very, very, very much employ all my engineering skills and engineering thinking in, in my in running the business every single day.
It’s the instincts of, diagnosing a problem, of problem solving, of putting people together that are smarter than you in a room and asking them of their recommendations and then making an assumption and then testing the assumption and changing. course if the assumption turns out to be incorrect. We one day noticed that some people were very excited about buying individual bits. They didn't only want to buy kits, they want to buy individual bits. So we decided, could it be possible that we can make a product type, that is not a kit and not a box and just sort of a more flexible prototype where you could combine different bits and change them every once in a while? So ,we came up with this idea of a bundle.
And initially, we put it up on the website. It was just a button that you click that added a bunch of bits to your cart and you purchased them. The barrier to, to try that was really easy. It was just like programming some stuff on the back end of our cart. Suddenly we start to see that people were doing it more and more, and people liked it. We thought, oh, maybe there's something interesting there to put a package around it. So we designed the bag. We designed postcard. We put it up and then we saw, oh, people actually really do want this, this type of product and it's getting popular. Then we decided, okay, then in that case, maybe we should be making a bundle every month.
If we make a bundle every month then we swap different things in and we propose projects for people to make. Then people are going to be excited about continuing to grow their library and making new projects. And this is an example where, if we had in the very beginning wanted to come up with this bundle product, we could have spent three to six months in thinking about how it would work, and how the mechanics of the supply chain would work, and what kind of bits should go into it, and the frequency and worrying about the team that needs to be in place to maintain that frequency, we would have likely not done it. But because we pieced it together into it's very basic pieces and we start with one and then fine tune the process as we go it becomes something that's more manageable, more exciting.