How Lean Startup Principles Saved Magoosh Tens of Thousands of Dollars, Bhavin Parikh, Magoosh
•Download as PPTX, PDF•
1 like•222 views
Magoosh, a company that creates web and mobile apps to help students prepare for standardized tests, embedded Lean Startup principles into its core values to great success. CEO Bhavin Parikh will provide a concrete example of how those values helped an individual on his team use Lean Startup to invalidate a feature hypothesis.
Recommended
Recommended
More Related Content
Viewers also liked
Viewers also liked (18)
Similar to How Lean Startup Principles Saved Magoosh Tens of Thousands of Dollars, Bhavin Parikh, Magoosh
Similar to How Lean Startup Principles Saved Magoosh Tens of Thousands of Dollars, Bhavin Parikh, Magoosh (20)
More from Lean Startup Co.
More from Lean Startup Co. (20)
Recently uploaded
Recently uploaded (20)
How Lean Startup Principles Saved Magoosh Tens of Thousands of Dollars, Bhavin Parikh, Magoosh
- 1. Lean Startup = Save $$$
- 4. How do we stay lean?
- 9. TOEFL is not like other tests
- 10. And the feedback says… • It would be better if Magoosh provides a service for grading speaking and writing answers submitted by students. • Plz include score validation for speaking and writing • I’m sure most people on the survey mention this, but I really wish the Speaking and Writing section of Magoosh was actually graded.
- 12. The excitement rabbit hole Photo courtesy of Flickr user aldenchadwick under the Creative Commons 2.0 license
- 13. But wait… Done > Perfect Data > Intuition
- 14. Let’s try a test (Done > Perfect)
- 16. Results (Data > Intuition) Photo courtesy of Flickr user César Astudillo under the Creative Commons 2.0 license
- 17. Cost of the experiment $3K to $5K
- 18. Cost of the actual solution $30K to $50K
- 19. Lean = Validation = Profit
- 20. Building a lean culture
Editor's Notes
- How Lean Startup Principles Saved Magoosh Tens of Thousands of Dollars Or how we integrated Lean Startup Principles into our culture
- Magoosh comes from the Old Persian, “magush”, one who’s wise and generous. That’s what we try to be with affordable online test prep (SAT, ACT, GMAT, GRE and more)
- We follow lean: With less than $1M raised, we’re doing $10M in annual sales, with 2 software engineers
- How do we stay lean? Core values, keep us all accountable Through 2014, no employee had worked at a startup before What’s “Lean Startup”
- Don’t delay for tomorrow what can be done well today Move fast Take a big idea and make a small change
- Use data to inform decisions Assume everything is an experiment Analyze feedback and metrics Represents the Measure and learn phases
- Test of English as a Foreign Language For non-native English speakers attending college or grad school in the US. Taken by over 1M people each year Problem: We want to improve our conversion rate; lower that other exams
- Lucasruns our TOEFL product Has never worked at a startup before Has never done product management before Been with Magoosh 4 years
- Speaking and writing Most tests can easily be graded by a computer Writing section for many tests doesn’t matter that much TOEFL: Over 50% of the test is speaking or writing, and it matters — a difficult problem for us (at our price point).
- Grade our speaking and writing! Students cited lack speaking and writing grading more than any other reason for not purchasing
- The data has spoken Both Lucas and I started looking into options to solve this problem 3rd-party tools Grading in-house Student-led grading
- We identified the problem! We have an insight! We were excited about building something out, whether process or product. 3rd party options were the most exciting, but we’d need to train them against our prompts A LOT OF WORK
- We had forgotten our core values, briefly Done > Perfect Take a big idea and make a small change Data > Intuition Assume everything is an experiment
- A/B test on the plans page Grading in-house wasn’t sustainable, but Lucas developed a quick approach and would refund anyone not happy
- Lucas created a simple rubric and shared with others on our team Our plan was to provide a score but not offer any feedback. We know students would want feedback, but ultimately our goal was to test the impact on conversion — if there was an impact, we could always improve the grading later
- Small improvement but not statistically significant Much less than we expected Much less than what we needed to spend time on this problem
- Experiment took a few days to setup and a few weeks to monitor Lucas and our team were doing grading Cost: ~$3K to $5K
- Training the tools: grade 100 essays per prompt Implementing the tool (engineering/UX) Iteration
- Using our values and the Lean Startup approach, we validate A LOT. Validation saves us time and money We solve more important problems for our students We’ve been a profitable startup (oxymoron?) since 2012.
- Why Magoosh values instead of the Lean Startup terminology? It’s authentic to us. It avoids confusion based on how others might describe Lean