Do you want to become a business owner and don’t have time to read cover to cover?
ashishb.net has a good summary on The Lean Startup. It employs a strategy which includes a business model, a product road map, and a view of partners, competitors, and customers. The product is the end result of the strategy. Products change constantly (engine tuning). Strategy changes occasionally (pivot). Vision rarely changes. In general management, failure to deliver results is caused by failure to plan or failure to execute. Both are frowned upon. But in the modern economy, both are useful tools for testing new ideas.-
A startup is a human institution designed to create a new product or a service under conditions of extreme uncertainty. Success under such scenarios requires rapid experimentation.
There is a lot of learning involved in the process and sometimes, when things go south, people resort to saying “I learned a lot”. What’s more important is to figure out validated learning.
Nick Swinmurn had a hypothesis that people will buy shoes online. Rather than buying inventory upfront, he took photos of shoes at local shoe stores, and if the users bought it, he would buy and ship it to them. This absolutely minimum product tested customer demand as well as many other business issues like payments, returns, and customer interaction. Zappos was acquired by Amazon for $1.2 Billion.
The Build-measure-learn feedback loop is at the core of the Lean Startup model. Once an MVP is built, the goal is to rapidly learn and iterate upon the product based on the user’s feedback.
All startups make some assumptions (leap of faith) about their viability. In the case of iPod, there were two assumptions, users would put earphones in a public place (“analogous to Walkman”) and they would pay for the music (“antilogous to Napster”).
Groupon was meant to a “collective activism platform”. That assumption failed. Andrew Mason experimented with a WordPress blog and a mailing list to sell discount coupons. They had no fancy forms on the site.
Wizard of Oz is a useful testing process for such situations. Rather than building an automated system.
Grockit followed the Kanban model, where there are four buckets – backlog -> in progress -> built -> validated. Each containing at most 3 features. After validation, either a feature is built or discarded.
Pivot or Persevere
A startup’s runway is the number of pivots it can make. Votizen started as a social network for verified voters to discuss civic actions. That did not take off. Then it pivoted to @2gov, which allows users to recruit more verified voters for their petitions. This product has higher usage but still very few were willing to pay for it. They pivoted further to businesses as customers, who despite signing the letter of intent, decide to eventually not buy the product. The final pivot was to use Google Adwords for acquiring users who want to pay to acquire more users. That worked out. Startup Visa Act was solely a result of that social lobbying.
Toyota used the small-batch approach to compete with its much more capitalized American counterparts whose batch sizes were relatively much larger.
Sabeer Bhatia grew Hotmail by adding a signature “Get your free e-mail at Hotmail” to every outgoing email. If you are asking whether your startup has achieved a product/market fit then you are not there yet. When product/market fit happens, it leaves no room for doubt.
Five whys help one to diagnose the problems and build the right set of things which should go into an employee training manual.
I’m looking for a special person to share arguably the biggest secret to underwear profits yet. I got this feeling you might be that person. Can you keep this as a secret?