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Getting lean startup - quick reference guide

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Do you want to get a quick overview of Lean Startup? Well, this guide gives you a good overview of key aspect of applying lead startup method to your startup ideas.

Do you want to get a quick overview of Lean Startup? Well, this guide gives you a good overview of key aspect of applying lead startup method to your startup ideas.

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  • Got a great idea  brainstorm  business plan  pitch  cha-ching build an awesome product (and in sleuth mode) booom!  Big launch! Yay!!
  • Got a great idea  brainstorm  business plan  pitch  cha-ching build an awesome product (and in sleuth mode) booom!  Big launch! Yay!!
  • Got a great idea  brainstorm  business plan  pitch  cha-ching build an awesome product (and in sleuth mode) booom!  Big launch! Yay!!
  • Traditional view in has been to prepare “Business Plan” but no business plan survives first contact with customers. Why? Its based on series invalidated assumptions from solution right through to customer how it would be distributed.1.Problem – list the top one to three problems need to be solved? How are their solved today? Existing alternatives?2. Customer Segment – who are we solving it for? Who are the early adopters - main segment to solve first’3. UVP - Why are we different and worth getting people’s attention? High level pitch - getting the idea across quickly “Aliens: Jaws in space” , Star wars “cowboys and Indians in space”4. Solution - how we are going to solve the problem5, Channels- very important – the path to customers (ie inbound – blogs, SEO vs outbound SEM, ads, cold calling)6. Revenue stream – how going to charge and make money7. Cost structure – cost to build mvp, interview 30 to 50 people, burn rate (fixed and variable costs) What is the break even point?8. Key metrics – AARRR - acquisition (make interest to your solution), activation ( sign up or walk into your store), retention (come back), revenue (get money from them) and referrel (NPS – refer others)9. Unfair advantage- something that cant be copied or brought easily Dream team - FB purchase of Instgram for $1b, Steve Job and Pixa or “Community” FB vs Google +Each 9 areas of the busines model needs to be tested. These are all GUESS. Need to turning them in FACT
  • How do we systemically turn theses GUESS into FACT? We priorities else it would be to overwhelming.Order: Problem - are we solving the right problem for our customers? Channel - do we have easy and sustainable path to our customers?Revenue stream/Cost structure – what we charge to customers is based on WHO we target (eg Fuji water customers)Customer segment – is the market big enough? Is the problem worth solving?Solution - is it feasible to build and maintain?Often use “Advisors” to first validate the model by asking What do they think is the riskiest aspect of the plan? Have that overcome similar risks? How? How would they go about testing the risks? Are there other people we should speak with?One approach is use Analogs and Antilogs, as described by John Mullins and Randy Komisar in their book; Getting to Plan B. This approach looks at the history of successful companies and uses this knowledge to learn what the risky assumptions within your business model may be.
  • Arm with a clearer understanding of the problem we are trying to solve, prioritized problem
  • 1. Product risk scenario might be understand the (1), with this understanding we define a minimal set of features to test with customers (2) and we validate MVP and see if we can realize the UVP (3) and early adopters. We track this against our metrics (4)
  • 1. Product risk scenario might be understand the (1), with this understanding we define a minimal set of features to test with customers (2) and we validate MVP and see if we can realize the UVP (3) and early adopters. We track this against our metrics (4)2. Customer risk scenariomight be identify who is experience pain points (1), narrow down to early adopters (2), establish a channel to keep engaging segment (3), keep building channel to scale to acquire customers (eg community base solution) (4)
  • 1. Product risk scenario might be understand the (1), with this understanding we define a minimal set of features to test with customers (2) and we validate MVP and see if we can realize the UVP (3) and early adopters. We track this against our metrics (4)2. Customer risk scenariomight be identify who is experience pain points (1), narrow down to early adopters (2), test channels to keep engaging segment (3), keep building channel to scale to acquire customers (eg community base solution) (4)3. Market risk scenario – might be identity competition/ alternative solutions (1), than test price what customers would verbal say they will pay (2) and than (3) what they actually will pay (3) and optimize cost
  • Full solution is time consuming and could lead to waste, We want to build something that is just enough of a solution in front of customers to ‘test’ and get their reaction and help define further changes or “pivots”
  • Full solution is time consuming and could lead to waste, We want to build something that is just enough of a solution in front of customers to ‘test’ and get their reaction and help define further changes or “pivots”
  • This turns our Leap of Faith assumption from: Our event will attract a large enough audience to make the project sustainable.To the falsifiable hypothesis: 20% of the customers we speak to will register for our eventEg “Being know as an “Expert” will drive early adapters vs “A blog post will drive 10 sign up”Falsifiable hypothesis: “Specific Repeatable action” will generated “Expected measureable outcome”
  • Positive results means we can go forward, else we need to quickly refine (pivot) or abandon the test.
  • We need to first test “qualitatively” (eg customer interviews) THEN “quantitatively”. This example is about “quantitatively” testing the experiment.
  • Full solution is time consuming and could lead to waste, We want to build something that is just enough of a solution in front of customers to ‘test’ and get their reaction and help define further changes or “pivots”
  • Full solution is time consuming and could lead to waste, We want to build something that is just enough of a solution in front of customers to ‘test’ and get their reaction and help define further changes or “pivots”
  • Positive results means we can go forward, else we need to quickly refine (pivot) or abandon the test.
  • Positive results means we can go forward, else we need to quickly refine (pivot) or abandon the test.
  • Transcript

    • 1. “Are you designing an amazing solution that solves no problem?” - Franki Chamaki Franki Chamaki
    • 2. Trends and threats put push on us… Constant connectivity, collaboration and crowdsourcing, customised consumption, cloud computing, convergence and competitor pressures Franki Chamaki 2
    • 3. Traditional way to secure funds and bring ideas to market Franki Chamaki 3
    • 4. Got an idea We brainstorm Create a business plan
    • 5. Design the product (mostly in sleuth mode) Cha-ching $$ Big launch Yay!! booom! Franki Chamaki 5
    • 6. If you like this story and you like should read this book… Franki Chamaki 6
    • 7. Franki Chamaki 7
    • 8. A startup is an organization formed to search for a repeatable and scalable business model. - Steve Blank 8Franki Chamaki 8
    • 9. 9 A startup vs. company? Franki Chamaki 9
    • 10. 10 Start up CompanyTransition Franki Chamaki 10
    • 11. Start up Transition CompanyStart up Company Problem/ Situation Fit Scale Transition Product/ Market Fit Franki Chamaki 11
    • 12. 12 Do we have a problem worth solving? Have we built something people want? How do we accelerate growth? Start up Transition CompanyStart up Company Problem/ Situation Fit Scale Transition Product/ Market Fit Franki Chamaki 12
    • 13. 13 Start up Transition CompanyStart up Company Problem/ Situation Fit Scale Transition Product/ Market Fit Focus: Validated learning Process: Pivots Focus: Growth Process: Optimization Franki Chamaki 13
    • 14. 14 Start up Company Problem/ Situation Fit Scale Search Execute Transition Product/ Market Fit Focus: Validated learning Process: Pivots Focus: Growth Process: Optimization Franki Chamaki 14
    • 15. Franki Chamaki So how do we go about searching for the right business model? 15
    • 16. Method: Lean Startup 16Franki Chamaki 16
    • 17. A Lean Startup is an iterative process to reduce risk in searching for the right business model based on validated learning 17Franki Chamaki 17
    • 18. So, how to we actually do this? 18Franki Chamaki 18
    • 19. There are three key principles 19Franki Chamaki 19
    • 20. 1. Document our plan “A” 20Franki Chamaki 20
    • 21. 1. Document our plan “A” 21 2. Identify the riskiest parts of plan Franki Chamaki 21
    • 22. 1. Document our plan “A” 22 2. Identify the riskiest parts of plan 3. Systematically test our plan. Get out of the office! Franki Chamaki 22
    • 23. 23 1. Document our plan “A” Franki Chamaki 23
    • 24. 24 1. Document our plan “A” http://www.ashmaurya.com/2012/02/why-lean-canvas author of Running Lean Franki Chamaki 24
    • 25. 25 What are the product, customer and market risks? 2. Identify the riskiest parts of plan p p p m mm m c c cp Franki Chamaki 25
    • 26. 26 Problem interviews Validate top problems? Any new problems? Rank the problems? How they solve it today? 2. Identify the riskiest parts of plan Franki Chamaki 26
    • 27. 27 Solution interviews Does it resonate? What most important? Missing? Add? Remove? Will they pay $X? 2. Identify the riskiest parts of plan Franki Chamaki 27
    • 28. 28 Systemically eliminate risk: customer side 1 2 3 4 Franki Chamaki 28
    • 29. 29 1 2 3 4 Systemically eliminate risk: product side Franki Chamaki 29
    • 30. 30 1 2 3 4 Systemically eliminate risk: market side Franki Chamaki 30
    • 31. 31 How do we actually test our riskiest assumptions? Franki Chamaki 31
    • 32. 32 Minimum Viable Product (MVP) is a minimum set of solution features we can use to test. But its really more like… MVE - minimum viable experiment Franki Chamaki 32
    • 33. 33 Minimum Viable Product (MVP) is a minimum set of solution features we can use to test Franki Chamaki 33
    • 34. 34 We test our MVP by making falsifiable statements rather the leap of faith assumption Franki Chamaki 34
    • 35. 35 It gives us the permission to move forward Franki Chamaki 35
    • 36. A 36 People will be interested in renting their physical space to unrelated people? Launch page will drive 500 sign up?B Falsifiable hypothesis: OR Franki Chamaki 36
    • 37. 37 Success metric: 500 people or more in a given month interested Franki Chamaki 37
    • 38. 38 Exchange value: Do people exchange currency (e.g. sign up)? Franki Chamaki 38
    • 39. 39 Pivot the customer segment… Franki Chamaki 39
    • 40. 40 Target ‘earlier adaptors’ (e.g. car enthusiasts and owners of classic and vintage cars in the key city areas (eg Potts Point) Franki Chamaki 40
    • 41. We will validate the problem and customer of your idea! Franki Chamaki 41
    • 42. Quick tutorial video (4mins)… Franki Chamaki 42
    • 43. 43 So you have a great idea? Franki Chamaki 43
    • 44. 44 Prove it! Franki Chamaki 44
    • 45. Reading options URL: http://hbr.org/2013/05/why-the-lean-start-up-changes-everything/ar/pr Franki Chamaki

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