Validation vs. Learning: What Went Wrong With FamDoo?

The creators of a digital tool for parents to motivate their children had validated their idea through research, but the company failed.This case study and course explore what should have been done.This case is intended for undergraduate or graduate entrepreneurship courses that use Ash Maurya's Lean Canvas or Osterwalder's Business Model Canvas.The case is designed to give students an introduction to using these tools to develop hypotheses and hypothesis tests.Analysis of the case is divided into three segments that follow the general sequence with which a Lean Canvas or Business Model Canvas should be filled out: 1) Problem/Unique Value Proposition/Customer, 2) Solution/Channels/Competition, and 3) Economic Model.Through this application, students will gain a better appreciation for how to approach early-stage market research and avoid common pitfalls.The company in the case, FamDoo, spent almost $2 million developing and launching an online platform to help parents manage chores and allowances and motivate their children through the use of redeemable points.Although the company's research prior to development seemed to validate the concept, the platform has struggled to attract users and generate revenue.Applying the Lean Canvas and/or Business Model Canvas reveals assumptions the company was making that should have been challenged, and students are asked to frame these assumptions as hypotheses and discuss what was missed in Famdoo's market research.Students are also asked to identify how these hypotheses might have been better tested prior to making a significant investment in the platform and what options the company has moving forward.This article describes the history of FamDoo, and the teaching notes and six appendices (available above for downloading) provide the material needed to conduct the class and engage students in applying key principals.