Lean Startup Essentials - SeedHack Edition

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SeedHack @ London Business School.

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Lean Startup Essentials - SeedHack Edition

  1. 1. Lean Startup Essentials Lean Startup Essentials @lfittl @nikgraf SeedHack 23rd September 2011
  2. 2. Lean Startup Essentials #1: Introduction Whats the Lean Startup? • How to create order in the (unavoidable) chaos of a startup • First learn, then execute • Quick Iterations on your business model
  3. 3. Lean Startup Essentials #1: Lean Startup Most startups fail from a lack of (paying) customers.
  4. 4. Lean Startup Essentials #1: Lean Startup Why? Startups are not just a small version of a big company.
  5. 5. Lean Startup Essentials #1: Lean Startup Startup: Temporary organization used to search for a repeatable and scalable business model. As defined by Steve Blank.
  6. 6. Lean Startup Essentials #1: The Lean Canvas We need structured learning before we execute.
  7. 7. Lean Startup Essentials #1: The Lean Canvas The Lean Canvas
  8. 8. Lean Startup Essentials #1: The Lean Canvas Problem Solution Unique Value Unfair Customer Proposition Advantage Segments Top 3 problems Top 3 features Single, clear, Can’t be easily Target customers compelling copied or bought message that states why you are different and Key Metrics worth buying Channels Key activities you Path to measure customers Cost Structure Revenue Streams Customer Acquisition Costs Revenue Model Distribution Costs Life Time Value Hosting Revenue People, etc. Gross Margin
  9. 9. Lean Startup Essentials #1: The Lean Canvas Problem • The top 3 problems the Problem Key Activities Value Customer Customer Proposition Relationships Segments customer is facing today Key Channels Resources Cost Structure Revenue Streams • These might be things they’ve already started building in house, because there is an active need
  10. 10. Lean Startup Essentials #1: The Lean Canvas Customer Segments • Narrow group of people that Key Partners Key Activities Value Customer Customer Proposition Relationships Segments buy/use your product Key Channels Resources Cost Structure Revenue Streams • Marketplace biz models = 2 cust segmens (or more)
  11. 11. Lean Startup Essentials #1: The Lean Canvas Value Proposition • Single, clear, compelling Key Partners Key Activities Value Customer Customer Proposition Relationships Segments message that turns an unaware Key Channels Resources visitor into an interested Cost Structure Revenue Streams prospect • What you put on your landing page
  12. 12. Lean Startup Essentials #1: The Lean Canvas Solution • Whats the Minimum viable Key Partners Key Activities Value Customer Customer Proposition Relationships Segments product (MVP) ? Key Channels Resources Cost Structure Revenue Streams • Minimal set of functionality to solve each problem of the customer
  13. 13. Lean Startup Essentials #1: The Lean Canvas Channels • How does the customer learn Key Partners Key Activities Value Customer Customer Proposition Relationships Segments about your product? Key Channels Resources Cost Structure Revenue Streams • B2B and B2C vastly different! • SEM, SEO, Friend Invites, Social Media, Direct Sales, Tradeshows, PR, Content Marketing, etc.
  14. 14. Lean Startup Essentials #1: The Lean Canvas Revenue Streams • How much is the problem Key Partners Key Activities Value Customer Customer Proposition Relationships Segments worth to the customer? Key Channels Resources Cost Structure Revenue Streams • Not how much it costs you to implement the solution • Avoid Free and Freemium! (marketing tactic, not rev model)
  15. 15. Lean Startup Essentials #1: The Lean Canvas Cost Structure • What are your HR costs? Key Partners Key Activities Value Customer Customer Proposition Relationships Segments (rough estimate) Key Channels Resources Cost Structure Revenue Streams • Marketing channel costs • Infrastructure costs • It’s about Unit Economics, not your made-up 5 year plan
  16. 16. Lean Startup Essentials #1: The Lean Canvas Live Example Someone from the audience: Pitch us an idea 4 other people: What’s the problem? What’s the customer segment? What’s the value proposition? What’s the revenue model?
  17. 17. #2: Customer DiscoveryTest Your Hypothesis
  18. 18. Lean Startup Essentials #2: Customer Discovery Customer Interviews 30 min in-person with your prototypical customer People like talking about their field - explore their worldview.
  19. 19. Lean Startup Essentials #2: Customer Discovery How to conduct an interview 1. Set context & tell your story 2. Tell your problem hypothesis 3. Listen to their worldview 4. Ask for follow up / references DO NOT sell them your solution
  20. 20. Lean Startup Essentials #2: Customer Discovery Online Market Tests: Google Adwords Fake Landing Page with “Signup to be notified when we launch” “Can we call you to ask a couple of Qs?”
  21. 21. Lean Startup Essentials #2: Customer Discovery Amy Hoy’s Sales Safari: Lurk in online forums of your customer segment, learn how they talk about products & benefits
  22. 22. Lean Startup Essentials Q&A
  23. 23. Lean Startup Essentials Literature Literature
  24. 24. Lean Startup Essentials Literature Steve Blank - The Four Steps to the Epiphany steveblank.com
  25. 25. Lean Startup Essentials Literature Alex Osterwalder - Business Model Generation businessmodelgeneration.com
  26. 26. Lean Startup Essentials Literature Eric Ries - The Lean Startup lean.st
  27. 27. Lean Startup Essentials Literature Ash Maurya - Running Lean book.runningleanhq.com
  28. 28. Lean Startup Essentials Literature Neil Davidson - Don’t Just Roll the Dice
  29. 29. Lean Startup Essentials Thanks! @lfittl @nikgraf

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