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What is Lean Startup?

The Lean Startup is a term coined by Eric Ries in his book by the same name. It is a concept that has been around for some time, but has really taken off with the introduction of the Lean Startup Machine program that brought it to the masses.

The Lean Startup concept is simple, but powerful. It is a method of developing a new product by doing the following:

  1. Embrace the fact that you do not know what the customer wants or needs.
  2. Run a series of low cost experiments to test the idea, determine whether people need the product, and what features or functionality they want or need.
  3. Learn from the experiment, and pivot (make a fundamental change in the product) if necessary.
  4. Repeat steps 2 and 3 until you have a product that people want to buy and use.
The Lean Startup approach is a very powerful way to build a new product. It improves upon the old way of just writing down a feature list and going full speed ahead. It is based on the concept that you learn far more from getting out and talking to customers, and running experiments, than you do from sitting in a room and speculating about what people want.

1. Embrace the fact that you do not know what the customer wants or needs.

"If you are not embarrassed by the first version of your product, you've launched too late." รน Reid Hoffman (LinkedIn founder)

The first step to embracing the fact that you do not know what the customer wants is to admit it. This is a tough step for many companies. It is much more comfortable to think that you know exactly what the customer wants, but the truth is that you do not. Once you have admitted that you don't know, you can think about ways to figure it out. There are two major ways to do this. The first is to talk to the customer. The second is to run experiments. Let's look at each of these. Talking to the customer is by far the most important way to learn what they want. It is important to remember that the customer is not always right, but they almost always want what they think they want. You will learn more by talking to them and listening to them than you will from your own internal thoughts. Trying to figure out what the customer wants by yourself is almost never effective. If you are trying to figure out what software to build or what product to develop without talking to the customers, you are just guessing. The Lean Startup approach relies heavily on talking to the customer and testing your ideas with them. This is the heart of the process.

2. Run a series of low cost experiments to test the idea, determine whether people need the product, and what features or functionality they want or need.

Once you have figured out that you don't know what the customer wants, you can start running experiments to figure it out. The first step to running an experiment is to validate that there is a demand for the product. Are people willing to spend money on it? Do they want it? It is important to remember that there may not be a market for the product, even if people want it. If you want to develop a product that is already in the market, you can run a market research survey to see if people are interested in buying a product like yours.

If you are trying to create a completely new product, you will need to have the following things in place:
  • A way to reach your customers
  • A way to run low cost experiments
  • A way to collect data
  • A way to analyze the data
You need to have these things in place before you can start running experiments. Once you have your experiments set up, you need to start running them. The objective of an experiment is to learn something. What you learn from the experiment will help you pivot your product.

The Lean Startup approach has you start out with a minimum viable product. The MVP is the smallest thing you can do to test your idea and learn something from it. The MVP will vary based on what you are trying to learn. If you are testing to see if people want the product, you might consider a landing page or video that describes the product. If you are testing to see if people will buy the product, you might consider an e-commerce site that has a shopping cart but no checkout process.

The MVP should be small and cheap to run. The smaller and cheaper it is, the more experiments you can run, and the faster you will learn what you need to learn. It is important to remember that your objective is to learn something from each experiment. If you are spending a lot of money on the experiment, it is unlikely that you will learn anything.