2009 08 19 The Lean Startup TechStars Edition
Upcoming SlideShare
Loading in...5
×
 

2009 08 19 The Lean Startup TechStars Edition

on

  • 7,927 views

 

Statistics

Views

Total Views
7,927
Views on SlideShare
5,910
Embed Views
2,017

Actions

Likes
10
Downloads
121
Comments
0

16 Embeds 2,017

http://www.startuplessonslearned.com 1504
http://startuplessonslearned.blogspot.com 444
http://holger-dieterich.de 24
http://futurephilanthropreneur.wordpress.com 12
http://dancroak.tumblr.com 10
http://feeds.feedburner.com 6
http://web.archive.org 4
http://dancroak.com 3
http://bigkittylabs.com 3
http://syawalisme.blogspot.com 1
http://app.dev2k3.fdle.gov 1
http://sthomps.posterous.com 1
http://safe.tumblr.com 1
http://feeds2.feedburner.com 1
http://www.startuplessonslearned.blogspot.com 1
http://bklabs.us 1
More...

Accessibility

Categories

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment
  • The premise of the lean startup is simple: if we can reduce the time between these major iterations, we can increase the odds of success.
  • Even though some aspects of the product were eventually vindicated as good ones, the underlying architecture suffered from hard-to-change assumptions. After years of engineering effort, changing these assumptions was incredibly hard. Without conscious process design, product development teams turn lines of code written into momentum in a certain direction. Even a great architecture becomes inflexible. This is why agility is such a prized quality in product development.
  • Do our actions live up to our ideals?
  • After our crushing failure, the founders of my next company decided to question every single assumption for how a startup should be built. Failure gave us the courage to try some radical things.
  • After our crushing failure, the founders of my next company decided to question every single assumption for how a startup should be built. Failure gave us the courage to try some radical things.
  • Based on that experience, and the experience of the other startups I have worked for, I now strongly believe there is a better way to create startups. I’ve called this vision the Lean Startup. It combines three key trends.
  • Let’s look at those changes schematically.
  • Run tests locally:-- Sandbox includes as much of production as humanly possible (db, memcached, Solr, Apache).-- Write tests in every language. We use 8 different test frameworks for different environs. Otherwise you get fear and brittle.-- Example kind of problem is that AJAX updater for site header. Seemingly innocuous change would break shopping experience.CIT/BuildBot:-- Simply don’t push with red tests. Even if the site is in trouble. Example Christmas site outage with memcache sampling.-- Give an idea of the scale. 20 machine cluster, runs 10000 tests and 100,000’s of thousand of assertions on every change.Incremental deploy:-- Catch performance bugs and gaps in test coverageSlow query in free tags. This started to drive database load higher on one MySQL instance due to contention and data size. Detected and rolled back before it affected users and before the database was hosed due to high load.Changed transaction commit logic in foundation of the system. This passed all tests but caused registrations to fail in production due to subtle difference between sandbox and production. System detected drop in business metric in 1 minute and reverted the changeAlerting and Predictive MonitoringExample: Second tier ISP to block our outbound emailExample: Rooms list performance time bombExample: Registration quality, second tier payment methods, invite mail success rates by serviceStory: Anything that can go wrong will, so just catch it then fast.
  • Webcast: May 1Workshop: May 29Fliers up frontDiscussion in web2open

2009 08 19 The Lean Startup TechStars Edition 2009 08 19 The Lean Startup TechStars Edition Presentation Transcript

  • The Lean Startup#leanstartupTechStars Edition
    Eric Ries (@ericries)
    http://StartupLessonsLearned.blogspot.com
  • Most Startups Fail
  • Most Startups Fail
  • Most Startups Fail
  • Most Startups Fail
    But it doesn’t have to be that way.
    We can do better.
    This talk is about how.
  • What is a startup?
    A startup is a human institution designed to deliver a new product or service under conditions of extreme uncertainty.
    Nothing to do with size of company, sector of the economy, or industry
  • Product / Market Fit
    “Do whatever is required to get to product/market fit. Including:
    changing out people,
    rewriting your product,
    moving into a different market,
    telling customers no when you don’t want to,
    telling customers yes when you don’t want to,
    raising that fourth round of highly dilutive venture capital
    —whatever is required.”
    — Marc Andreessen
    http://blog.pmarca.com/2007/06/the-pmarca-gu-2.html
  • The Pivot
    What do successful startups have in common?
    They started out as digital cash for PDAs, but evolved into online payments for eBay.
    They started building BASIC interpreters, but evolved into the world's largest operating systems monopoly.
    They were shocked to discover their online games company was actually a photo-sharing site.
    Pivot: change directions but stay grounded in what we’ve learned.
    http://startuplessonslearned.blogspot.com/2009/06/pivot-dont-jump-to-new-vision.html
  • Speed Wins
    if we can reduce the time between major iterations
    we can increase our odds of success
  • A Tale of Two Startups
  • Startup #1
  • Stealth Startup Circa 2001
  • All about the team
  • A good plan?
    Start a company with a compelling long-term vision.
    Raise plenty of capital.
    Hire the absolute best and the brightest.
    Hire an experienced management team with tons of startup experience.
    Focus on quality.
    Build a world-class technology platform.
    Build buzz in the press and blogosphere.
  • Achieving Failure
    Company failed utterly, $40MM and five years of pain.
    Crippled by “shadow beliefs” that destroyed the effort of all those smart people.
  • Shadow Belief #1
    We know what customers want.
  • Shadow Belief #2
    We can accurately predict the future.
  • Shadow Belief #3
    Advancing the plan is progress.
  • A good plan?
    Start a company with a compelling long-term vision.
    Raise plenty of capital.
    Hire the absolute best and the brightest.
    Hire an experienced management team with tons of startup experience.
    Focus on quality.
    Build a world-class technology platform.
    Build buzz in the press and blogosphere.
  • Startup #2
  • IMVU
     
  • IMVU
     
  • New plan
    Shipped in six months – a horribly buggy beta product
    Charged from day one
    Shipped multiple times a day (by 2008, on average 50 times a day)
    No PR, no launch
    Results: 2007 revenues of $10MM
  • Lean Startups Go Faster
    Commodity technology stack, highly leveraged (free/open source, user-generated content, SEM).
    Customer development – find out what customers want before you build it.
    Agile (lean) product development – but tuned to the startup condition.
  • Commodity technology stack
    Leverage = for each ounce of effort you invest in your product, you take advantage of the efforts of thousands or millions of others.
    It’s easy to see how high-leverage technology is driving costs down.
    More important is its impact on speed.
    Time to bring a new product to market is falling rapidly.
  • Customer Development
    • Continuous cycle of customer interaction
    • Rapid hypothesis testing about market, pricing, customers, …
    • Extreme low cost, low burn, tight focus
    • Measurable gates for investors
    http://bit.ly/FourSteps
  • Agile Product Development(A tale of two startups, revisited)
    • Principles drawn from Lean Manufacturing and Toyota Production System
    • These examples are drawn from software startups, but increasingly:
    • All products require software
    • All companies are operating in a startup-like environment of extreme uncertainty
  • Traditional Product Development
    Unit of Progress: Advance to Next Stage
    Waterfall
    Requirements
    Specification
    Design
    Problem: known
    Solution: known
    Implementation
    Verification
    Maintenance
  • Agile Product Development
    Unit of Progress: A line of Working Code
    “Product Owner” or in-house customer
    Problem: known
    Solution: unknown
  • Product Development at Lean Startup
    Unit of Progress: Validated Learning About Customers ($$$)
    Customer Development
    Hypotheses,
    Experiments,
    Insights
    Problem: unknown
    Data,
    Feedback,
    Insights
    Solution: unknown
  • Minimize TOTAL time through the loop
    IDEAS
    LEARN
    BUILD
    DATA
    CODE
    MEASURE
  • How to build a Lean Startup
    Let’s talk about some specifics.
    Small Batches
    Continuous deployment
    Split-test (A/B) experimentation
    Minimum Viable Product
    Five why’s
  • Small Batches
    IDEAS
    LEARN
    BUILD
    Learn Faster
    Customer Development
    Five Whys
    Build Faster
    Continuous Deployment
    Small Batches
    Continuous Integration
    Refactoring
    DATA
    CODE
    MEASURE
    Measure Faster
    Split Testing
    Actionable Metrics
    Net Promoter Score
    SEM
  • Benefits of Small Batches
    Faster feedback
    Problems are instantly localized
    Reduce risk
    Reduce overhead
  • Continuous Deployment
    IDEAS
    LEARN
    BUILD
    Learn Faster
    Customer Development
    Five Whys
    Build Faster
    Continuous Deployment
    Small Batches
    Continuous Integration
    Refactoring
    DATA
    CODE
    MEASURE
    Measure Faster
    Split Testing
    Actionable Metrics
    Net Promoter Score
    SEM
  • Continuous Deployment
    • Deploy new software quickly
    • At IMVU time from check-in to production = 20 minutes
    • Tell a good change from a bad change (quickly)
    • Revert a bad change quickly
    • And “shut down the line”
    • Work in small batches
    • At IMVU, a large batch = 3 days worth of work
    • Break large projects down into small batches
  • Cluster Immune System
    What it looks like to ship one piece of code to production:
    • Run tests locally (SimpleTest, Selenium)
    • Everyone has a complete sandbox
    • Continuous Integration Server (BuildBot)
    • All tests must pass or “shut down the line”
    • Automatic feedback if the team is going too fast
    • Incremental deploy
    • Monitor cluster and business metrics in real-time
    • Reject changes that move metrics out-of-bounds
    • Alerting & Predictive monitoring (Nagios)
    • Monitor all metrics that stakeholders care about
    • If any metric goes out-of-bounds, wake somebody up
    • Use historical trends to predict acceptable bounds
    When customers see a failure:
    • Fix the problem for customers
    • Improve your defenses at each level
  • Rapid Split Tests
    IDEAS
    Code Faster
    Learn Faster
    BUILD
    LEARN
    Continuous
    Deployment
    Five Whys Root
    Cause Analysis
    CODE
    DATA
    Measure Faster
    MEASURE
    Rapid Split Tests
  • Split-testing all the time
    A/B testing is key to validating your hypotheses
    Has to be simple enough for everyone to use and understand it
    Make creating a split-test no more than one line of code:
    if( setup_experiment(...) == "control" ) {
    // do it the old way
    } else {
    // do it the new way
    }
  • The AAA’s of Metrics
    Actionable
    Accessible
    Auditable
  • Measure the Macro
    Always look at cohort-based metrics over time
    Split-test the small, measure the large
  • Minimum Viable Product
    IDEAS
    Code Faster
    Learn Faster
    BUILD
    LEARN
    Continuous
    Deployment
    Minimum Viable
    Product
    CODE
    DATA
    Measure Faster
    MEASURE
    Rapid Split Tests
  • Why do we build products?
    Delight customers
    Attract lots of them
    Make a lot of money
    Big vision: change the world
  • Possible Approaches
    “Maximize chances of success”
    Build a great product with many features that increase the odds that customers will want it
    Problem: no feedback until the end, might be too late to adjust
    “Release early, release often”
    Get as much feedback as possible, as soon as possible
    Problem: run around in circles, chasing what customers think they want
  • Minimum Viable Product
    The minimum set of features needed to learn from earlyvangelists – visionary early adopters
    Avoid building products that nobody wants
    Maximize the learning per dollar spent
    Get the facts before it’s too late
    Probably much more minimum than you think!
  • Minimum Viable Product
    Visionary customers can “fill in the gaps” on missing features, if the product solves a real problem
    Allows us to achieve a big vision in small increments without going in circles
    Requires a commitment to iteration
  • Examples
    Building IMVU in six months
    2004 “Kerry vs. Bush avatar debate”
  • Techniques
    Smoke testing with landing pages, AdWords
    SEM on five dollars a day
    In-product split testing
    Paper prototypes
    Customer discovery/validation
    Removing features (“cut and paste”)
  • Fears
    False negative: “customers would have liked the full product, but the MVP sucks, so we abandoned the vision”
    Visionary complex: “but customers don’t know what they want!”
    Too busy to learn: “it would be faster to just build it right, all this measuring distracts from delighting customers”
  • Five Whys
    IDEAS
    Code Faster
    Learn Faster
    BUILD
    LEARN
    Continuous
    Deployment
    Five Whys Root
    Cause Analysis
    CODE
    DATA
    Measure Faster
    MEASURE
    Rapid Split Tests
  • Five Whys Root Cause Analysis
    • A technique for continuous improvement of company process.
    • Ask “why” five times when something unexpected happens.
    • Make proportional investments in prevention at all five levels of the hierarchy.
    • Behind every supposed technical problem is usually a human problem. Fix the cause, not just the symptom.
  • There’s much more…
    IDEAS
    Code Faster
    Learn Faster
    BUILD
    LEARN
    Unit Tests
    Usability Tests
    Continuous Integration
    Incremental Deployment
    Free & Open-Source Components
    Cloud Computing
    Cluster Immune System
    Just-in-time Scalability
    Refactoring
    Developer Sandbox
    Minimum Viable Product
    Split Tests
    Customer Interviews
    Customer Development
    Five Whys Root Cause Analysis
    Customer Advisory Board
    Falsifiable Hypotheses
    Product Owner Accountability
    Customer Archetypes
    Cross-functional Teams
    Semi-autonomous Teams
    Smoke Tests
    CODE
    DATA
    Measure Faster
    MEASURE
    Split Tests
    Clear Product Owner
    Continuous Deployment
    Usability Tests
    Real-time Monitoring
    Customer Liaison
    Funnel Analysis
    Cohort Analysis
    Net Promoter Score
    Search Engine Marketing
    Real-Time Alerting
    Predictive Monitoring
  • Get Started Today
    You are ready to do this, no matter
    who you are
    what job you have
    what stage of company you’re in
    Get started now, today.
  • Thanks!
    • Startup Lessons Learned Blog
    • http://StartupLessonsLearned.blogspot.com/
    • Getting in touch (#leanstartup)
    • http://twitter.com/ericries
    • eric@theleanstartup.com
    • Workshop Tomorrow, Aug 20
    • http://bit.ly/boulder-workshop
    • 9am-1pm at TechStars