No matter what you believe about the power that design might or should have on the startup ecosystem, it's worth taking a flip through Kleiner Perkins Caufield & Byers' recently-released report on design in technology. You'll find designers moving into venture capital firms, an understanding of the multiple demands placed on today's designers, and a smattering of creative businesses all supposedly enabled by design discipline.

At heart, this looks-like-it's-going-to-be-annual report is an argument for a reassessment of the role of design in the startup world, and in that, it succeeds quite well. The report's basic and uncontroversial thesis is that customer experience starts with design, and that customer experience--and therefore design--is going to provide far more of a competitive edge in the future than it has in the past. The report cites Gartner saying that 89 percent of companies believe customer experience will be their primary basis for competition by the end of this year, compared to 36 percent four years ago.

The report also seems to expect every designer to be a jack of all trades, with a solid understanding not just of design but of business, financing, and coding. That's certainly possible, of course, but it seems a lot to ask design schools to handle it all. "New engineers are ready for tech; new designers less so," reads the report. But why would we expect new designers to be as "ready for tech" as engineers? There's a lot to pack into an undergraduate education; it makes sense that engineers would spend more of that time on technology than designers would.

That's not to say that design education can't be better-informed by the outside world. KPCB asked 329 current and former design students which areas they wished they had learned more about in design school. "Understanding business and finances" topped the list, chosen by 68 percent of respondents, followed by "Using research and analytics to design," chosen by 60 percent. Given that each of the top 10 business schools has a student-led design/innovation club, according to the report, these changes will probably come sooner rather than later.

Designers in Startups

The report suggests we're reaching a peak in the number of design firms being acquired, but sees designers steadily moving into tech startups at higher levels and at increased rates. Forty-two design firms have been acquired since 2004, with a full half of that activity taking place within the past year.

But 36 percent of the top venture-backed internet startups had a designer as a co-founder this year, says KPCB, compared to 20 percent last year. The report also highlights the designers who have become venture capitalists, which is noteworthy considering investors' near-constant insistence that to be a venture capitalist, you need to have a technical background. Among the designers-turned-VCs are Scott Belsky, at Benchmark, Albert Lee at New Enterprise Associates, and Khosla Ventures' Irene Au.

Opportunities in Design

The start of the report argues that design is important because of its contribution to user experience. At the end, though, it makes the case that design enables us to unearth new business opportunities.

One type of opportunity is businesses that need semi-addictive behavior from their users. A so-called dark pattern, says the report, is "an interface that has been carefully crafted to trick users into doing things, such as buying insurance with their purchase or signing up for recurring bills." This is only intensified by the fact that it's so easy to make a purchase from a smartphone, and so easy to set up purchases as a recurring subscription.

The flip side is health apps, where it might actually be a good thing for users to be constantly looking at their phones. In healthtech, companies are looking at how to make taking one's medication more appealing, using gamification techniques such as awarding points and spontaneous awards, leveling, and social comparisons.

The report also claims that design thinking engenders a more inclusive attitude in the design of businesses, something that's sorely needed in the startup ecosystem. The range of businesses that KPCB cites as inclusive are pretty interesting. There's littleBits, a maker of electronics toys; Grindr, a sort of Tindr for gay men; Walker & Co., which makes health and beauty products for people of color; Progyny, a service for fertility patients; and home-care company Honor.

It's a bit hard to tell, from a slide dek, exactly why KPCB thinks designers are more inclusive than anyone else. But if these are the sorts of businesses that result from better design chops--and it's not clear exactly how they do--then yes, please. Let's have more of them.

Published on: Mar 17, 2016