Startup Monday: Lean Startup 101

by Morgan on August 8, 2011

This year I have been intensely focusing on the Lean Startup Methodology and while I’ve talked about it quite a bit on my blog, I don’t think I’ve ever taken the time to fully explain it! If you rewind even one year I had not heard of Lean Startup myself so I don’t expect many of you to know what it is. That being said, once I learned about the concept and process involved, I was immediately hooked and it has not only helped to streamline my business, it has honestly changed the way that I think.

So let’s dive in, allow me to introduce you to the founder of the Lean Startup Movement and creator of the term “Lean Startup” Eric Ries:

Eric not only created the term “Lean Startup” but is also the leader of the movement and recently finished an excellent book about the lean startup process. I had the chance to read Eric’s book actually before it was finished as he gave a copy away to all the attendees of his conference, Startup Lessons Learned earlier this year in San Francisco. Eric is a successful Entrepreneur who found a better way to build a business and took the time to document the process. His methodology is now used by many major startups and is wildly popular with Venture Capitalists and Angel Investors who see this methodology as a way to get traction and find success much quicker than ever before.

The lean startup process can be summarized as the following:

Coming-up with the assumptions you are making about your customer (or your customer’s beliefs)
Creating a MVP (Minimum Viable Product) – the bare basics of what you plan to build but enough for customers to test out
Testing your assumptions and determining if they are correct or not
Rapidly iterating making changes based on customer feedback
Major focus on Customer Development, iterating and pivoting based on the feedback you receive

This whole process is possible through the use of agile software development methods and popular platforms like Ruby on Rails. The Lean Startup Methodology is a significant deviation from how most startups run their business. Just think about it, so many startups come-up with what they think is a great idea, heck we all do this. You tell friends and family members and they say, “very cool – sounds like a great idea!” Then startups just begin building, many have day jobs so spend nights and weekends building something. After a year or two they release what they’ve made only to find-out that nobody wants to use it!

The Lean Startup processes helps you hone your idea and validate your market very early-on so you aren’t building something that nobody will use. Focusing on customer development means always testing the assumptions you’re making and iterating based on customer feedback. Many non-lean companies don’t hit the customer development stage until an entire product is finished, they may have spent years building something without ever getting customer feedback, then they go-into beta only to find-out that many of the features they added over the years were not wanted or needed, and they are missing many that are.

I have been busy applying the Lean Startup methodology to almost every area of my business because the customer development process shouldn’t be limited to software only, it really extends to your entire company. In my case I run a ton of web businesses, this year I have been reaching-out to my customers in each niche and better understand what they like, what they don’t like, and what they really want. This means I’ve stopped saying, I think people would love it if I added this feature, and instead now reach-out to people directly, and without biasing them say, “what is the one killer feature you’d love to see?” Whenever you hear yourself saying things like, “I just know people are looking for this” or “I bet people would love this” or “there must be tons of people doing this” understand that those are just assumptions. You need to prove your assumptions through customer development, and in many cases, you’ll find your assumptions are wrong.

This is the critical point in the Lean Startup process. When you find-out your assumptions are wrong, you don’t abandon your idea, but you may have to Pivot and change your idea to adapt to what customer are really looking for. Sometimes the Pivot could take you in a very different direction than you initially intended but if you’re creating something that customers want, then this will bring you much closer to finding real traction and use of what you’re making.

To really get some real world experience with the Lean Startup process I took-part in Lean Startup Machine in New York City a couple of weeks ago. This was an absolutely incredible experience that allowed me to go through the entire process in an intense, boot-camp format that was absolutely incredible! If you didn’t have a chance to read any of my posts about Lean Startup Machine you can check them out below:

Getting Ready For Lean Startup Machine NYC – Day 1

Lean Startup Machine Day One Review: 48 Hours Without Sleep Starts…Now!

Lean Startup Machine Day 2: Ready, Set, Go!

Lean Startup Machine NYC Comes To An End and A New Chapter In My Life Begins

Lean Startup Machine NYC: RoundTable Wins!

Now I am far from a Lean Startup Expert, heck I just started learning about it this year but I’m doing everything I can to learn everything I can! As you all have probably learned about me by now, I love learning new things and constantly challenging myself to change how I work. I know that one of the keys to success in business is not getting stuck in your ways and assuming you know everything but instead learning what’s out there and if there might be a better way to do what you’re doing.

If you want to learn more about the Lean Startup Methodology I definitely highly recommend reading Eric Ries’s book and attending one of the great Lean Startup conferences, competitions, or events taking place throughout the year. Of course I’ll continue to share everything I learn about Lean Startups right here on my blog and since I’m using this every single day, I have a lot to share!

{ 1 comment… add one }

AndyO August 9, 2011, 3:54 am

Thanks for the rundown, Morgan. I feel I’ve gone the way of the non-lean startup too many times and spent too much time developing out sites to find they aren’t what I think they should have been in the first place, from a user point of view. I think I’m going to try this methodology for a new tech site I’m drawing up plans for.

I pre-ordered the book on Kindle, too! Hope your referral code was in there.

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