lean startup in 1 hour
DESCRIPTION
An overview to the Lean Startup methodology and Lean Canvas tool, meant for an audience with little previous exposure to entrepreneurism or strategic project development. This overview can be provided in a 1-hour time slot, then follow-up can happen with an extended Lean Startup workshop or consulting session.TRANSCRIPT
LeanStartup Roadmap
Matt RutterCCI Gagauzia
Matt RutterCCI Gagauzia
Small Enterprise [email protected]
Entrepreneurial
The reason most startups fail is not because they build a bad product, it’s
that they build a product nobody needs.
-Eric Ries
“A startup is not a ‘doll house’ version of a large
company.”
- Eric Ries
What is а “Lean Startup?”
• “Startup” – a temporary organization designed to search for a repeatable and scalable business model.
• Tradition– Write and Execute– Assumptions– Static (Unchanging)
• Lean– Model and Test– Customer Development
– Agile (Iteration, Pivots))
“Startups that succeed are those that manage to
iterate enough times before running out of
resources.”- Eric Ries
Eric Ries, The Lean Startup
LeanStartup Roadmap
• Idea– Problem
Interviews– Market Research
Need
TalentInterest
IDEACustomer/Problem Fit
Determine if the problem exists and is worth solving
• Problem Interviews• Market Research
Customers care about their problems – not
your solution.
IDEA
- Dave McClure
Problem Interview
Goal: To understand…1. What is the problem? Why is it a
problem?2. Who has the problem?3. How do they currently solve the
problem?
Ash Maurya, Running Lean 81
Problem Interview• Example Script
1. What’s the hardest part about [problem context]?
2. Can you tell me about the last time that happened?
3. Why was that hard?4. What, if anything, have you done to solve
that problem?5. What don’t you love about the solutions
you’ve tried?Justin Wilcox – How I Interview Customershttp://customerdevlabs.com/2013/11/05/how-i-interview-customers/
Market Research• What current solutions/alternatives exist?– Cost– Function– Revenue model
• What barriers to entry exist?• Is this a rising or dying trend?
Resources:– google.com/trends, google.com/think– entrepreneur.com/businessideas/index.html– hbr.org, forbes.com, wsj.com,
techcrunch.com
LeanStartup Roadmap
• Idea– Problem
Interviews– Market Research
• Model– Lean Canvas– Solution
Interviews
MODELProblem/Solution Fit
Determine if your model solves the problem
• Lean Canvas• Solution Interviews
Why Lean Canvas?
• Fast• Concise• Dynamic
“Your Product is not The Product”
- Ash Maurya
A business model describes the rational of how an organization creates,
delivers, and captures value.
-Alex Osterwalder, Business Model Generation
Customer Segments• The specific group of
people or organizations a business intends to serve.– Who has the problem?– For whom are we creating
value?– Who must we sell to or
make happy?
• Early Adopters: The characteristics of the first group of people who will purchase your product.
• Sketch:– Title– Age– Family Details– Income Level– Amount of Free Time– Location– Their Values/Morals– Social Groups– Professional
Associations– Hobbies– Where They Shop
Problems• The top 1-3 problems
your Customer Segments need solved.– What problem are we
curing?– How strong is this
problem?– Will the customer pay to
have this problem removed?
• Existing Alternatives: How the problem is currently solved by the Customer Segments.
• Sketch:– Frequency– Expense– Awareness– Reaction– Newness
Solution• The minimum activities
or features needed to solve the Customer Segments’ top 1-3 Problems.– Outline a feature set to
solve each problem (description of your product or service)
– Only include what is necessary (according to Solution Interviews)
• Sketch:– How problem is
solved– Time needed for
solution– Resources needed– Partners needed
Unique Value Proposition
• A clear and short message stating the business’ unique Solution to the Customer Segments’ Problem.– The value you create for the
Customer Segment– How are you improving the lives
of our customers?– How are you different?
• High-Level Concept: Brief relation of your UVP to something commonly understood (i.e. ВКонтакте: “Facebook for Russians”).
• Sketch:– How your solution relates
to the customer’s #1 problem
– Finished story benefit of purchasing your product
– How the solution will make your customer feel
Note: The UVP represents the emotional trigger that will convince your customer to purchase your product/service
Channels1. Product: How a company
delivers its Value Proposition to the Customer Segments.
2. Marketing: How a company attracts the interest of its Customer Segments.
• Customer Relationship – The closeness and frequency of the relationship developed with the Customer Segments.
• Sketch:– How will you deliver
your solution?– How will your
customer make a purchase?
– How will you find your first 10 paying customers?
– What is the most resource efficient way to attract Early Adopters?
Revenue Streams
• The various income-generating activities of a business.– Customer Segment
paying money to receive the business’ Value Proposition
– Charge as early as the customer will permit
– Determine price based on the value you add, not the cost of production
• Sketch:– For what features will
the customer pay?– What features will be
free?– How will you position
your business against alternative solutions?
– Are you adding value to non-customers who would be willing to pay?
Cost Structure
• All operational expenses of running your business.
• Sketch:– Immediate fixed
costs– Immediate variable
costs (including your labor)
– Break-even point
Key Metrics• The 3-5 indicators of a
business’ health (success).– How you track your
customer’s behavior and preferences
– Monitoring the implementation of your business’ key activities
– Informs a business whether or not it needs to pivot/iterate
• Sketch:– Customer Segment
Awareness– New Customer
Acquisition– Inventory Turnover– Time Needed to
Complete Job– On-Time Payments– Customer Retention– Customer Referral
Unfair Advantage• The features of your
business that are difficult for competitors to copy or buy. – What keeps new
competitors from taking your customers?
– If someone “steals” your idea, how will you continue to exist?
• Sketch:– Current advantages
(often based on existing relationships or networks)
– Advantages your business could develop over time
– Note: passion, existing resources, and being “first to market” are not sustainable competitive advantages.
MODEL• Lean Canvas• Solution Interviews– Return to the earlier interviewees and
propose the Solution and UVP you sketched• Do you have the right feature set?
– Discuss your business model (the interaction of all 9 boxes) with mentors or fellow entrepreneurs• Do you have a realistic path to profit?
LeanStartup Roadmap• Idea– Problem
Interviews– Market Research
• Model– Lean Canvas– Solution
Interviews
• Test– MVP– Early Adopter
Sales
TESTSolution/Product Fit
Determine how to effectively offer your solution in a minimal product
• Minimal Viable Product (MVP)• Early Adopter Sales
Lean Startup
Traditiona
l Startup
Minimum Viable Product
Minimum Viable Product
• Strategy used for fast and qualitative market testing of a product or product feature
• The most resource-efficient (time, money, energy) method of creating and capturing value from the Customer Segment–MUST solve the problem of customer– Should not require a loan or long timeframe
Early Adopter Sales
• Begin selling to very specific Customer Segment (10-15 people)
• Learn which features are “must-have” and which are unnecessary
• Determine price point – High enough the customer must contemplate
the purchase, low enough the customer will buy
Goal: Validate business model not # of sales
LeanStartup Roadmap• Idea
– Problem Interviews– Market Research
• Model– Lean Canvas– Solution Interviews
• Test– MVP– Early Adopter Sales
• Scale– Product 1.0 Launch– Business Plan– Investors
SCALEProduct/Market Fit
Determine if your product will attract demand from regional / national /
international markets
• Product 1.0 Launch• Business Plan• Investors
What is Success?
Know the impact you wish to make in the
world and scale accordingly.
Discussion
Matt RutterEntrepreneurial Development Consultant
Chamber of Commerce and Industry of Gagauzia+(373) 60 735 102
[email protected]: matthewlrutter