The Lean Startup


The Lean Startup‎
Author: Eric Ries
Publisher: Currency
Published: 9/13/2011
Most startups fail. But many of those failures are preventable. The Lean Startup is a new approach being adopted across the globe, changing the way companies are built and new products are launched. Eric Ries defines a startup as an organization dedicated to creating something new under conditions of extreme uncertainty.

Lean Startup by Eric Ries

The Lean Startup gives strategies and tools for entrepreneurs to gain success systematically.

Their primary focus should be delivering working, good-quality products to their customers.

Startups should not waste time building a feature that paying customers haven’t asked for.

Startups main strategy should revolve around the Build-Measure-Learn feedback loop. They should push a working minimal viable product (MVP) out to customers as soon as possible.

After measuring data collected from the launch, startups can learn what is working and what is not. If things are not working, they can decide to pivot in a new direction or persevere and grow.

This strategy requires experimenting, adapting and learning in the fastest way possible to save on time and money.

Key Takeaways

Start

-Every iteration of products and new features is intended to grow the startup. To get this to work, a startup needs continual feedback to catch problems as early as possible.

-Startups must be flexible in pivoting strategies. While gaining new customers and catering to old ones, they must test to see if customers appreciate product improvements.

-Startups should not build products or features that no one asks for.

Define

-Startups are unpredictable and do not behave like traditional corporations. However, startups need to focus on building a strong team -- including management -- along with the product. Teams can become disorganized and work can become scattered with no clear focus when management doesn’t have a strong foundation.

Learn

-Getting feedback and data from customers gives startups a chance to learn from mistakes, failures, and successes. Startups need to not wait on capturing this data. They must act on it immediately.

-Learning from data is essential for development and growth. This is called validated learning: measuring progress against business goals in an unstructured environment.

Experiment

-The Build-Measure-Learn feedback loop is crucial. Start by building an MVP, measure the results of MVP and then make adjustments based on results. Startups can decide to persevere with the product or take a pivot.

Leap

-Completing the feedback loop in the shortest time possible gives startups a chance to save money, time, and energy on products and features that aren’t working.

Test

-Startups should build and launch their MVP as soon as possible, so they can start testing.

-To build and launch quickly, startups should focus on a small-batch approach. Startups should test small iterations to see if their work is being used.

Measure

-A startup’s main goal is to find a business model that is profitable and sustainable.

-Every iteration of the product should improve its usefulness to the customer.

-Metrics should be tracked. If no improvements are shown, pivot.

Pivot

-Pivoting when a product or feature isn't working is wiser than pushing through and hoping things work out.

-When pivoting, startups don't start from scratch rather they use what they learned to push in a new direction.

Batch

-Working in small batches is ideal. Small batches shorten the learning cycle, make problems with quality easier to spot and reduce risk.

-When planning, do the Build-Measure-Learn feedback loop in reverse. Once a startup has a hypothesis to test, they can figure out how to measure it then build the MVP.

Grow

-There are three growth engines: sticky, viral and paid. Sticky is focused on existing customers for recurring revenue. Viral is getting existing customers to advertise through word-of-mouth. Paid is investing in paid advertising if the customer acquisition cost is low.

-Startups should focus on one engine when starting.

Adapt

-Speed is important to go through the Build-Measure-Learn feedback group. However, startups should not cut corners and sacrifice quality.

Innovate

-Teams need to be made up of people from all departments. Open communication in a cross-functional team is best.

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