Lean Startup - Think Big, Act Small, Learn Fast

Ola Sundell
Ola SundellCEO, Founder at HUB13
LEAN STARTUP




Think Big, Act Small, Learn Fast
Pushing Agile To The Next Level
Easy to understand, difficult
          to apply
1) Introduction to lean startup
   Link to agile developmen
2) Lean startup as business design
   methodology
3) What are the challenges in applying lean
   startup methods?
4) Benefits of applying lean startup methods
5) Final conclusion
How to successfully
launch NEW products and
        services?
Lean Startup - Think Big, Act Small, Learn Fast
”There is surely nothing quite so useless
as doing with great efficiency what should
            not be done at all”


           - Peter Drucker -
”By focusing on functional
 efficiency, we lose sight of the
real goal of innovation: to learn
     that of which is currently
             unknown”
           - Eric Ries -
Research conducted on new product
  success and failure indicates that it
takes 58 new product ideas to deliver a
       successful new product.
Building product according to
specification, but failing to address
           customer need
Launch your idea before
     you build it
Stop Building, Start
     Learning
Pushing Agile to the Next Level


Agile                              Lean Startup
Recognise we don’t know solution   …we don’t even know the
                                   problem
”The big question of our time
  is not Can it be built? but
      Should it be built”
         - Eric Ries -
Your solution is NOT ”the
        product”
Your Business Model Is ”The
Product”               Customer

- Ash Marya -




Business Model




       Solution
Scorecard to help you systematically validate your
   business model before building the product
X   X
X   X     X
  X   X
  X     X
Building A Market For A New
          Product




  How do we go from no customers to a few
  customers and from a few customers to many
  customers?
”A startup is a temporary organisation in
   search of repeatable, scalable and
       profitable business model”
          - Steve Blank -
”Lean isn’t about being cheap
[but is about] being less wasteful
   and still doing things that are
                 big.”
           - Eric Ries -
Solving
  Think Solving Big
Problems To A Few People
Building A Market For A New
          Product




      Finding and talking
         to customers
Product design

                      Strategic


Customer             Operational
  value
 design                  Core
            Lean      (function,
           Startup      specs)




                     Dropbox
Lean Startup - Think Big, Act Small, Learn Fast
Strategy is based on
    assumptions
Customer Value Design

         Build

        Measure


         Learn




     Launch tests
List your business model
       hypotheses
PRODUCT   MARKET
Lean Startup Principles
1)   Build-Measure-Learn Loop
2)   Validated Learning
3)   Minimum Viable Product
4)   Pivot
Market type influences
everything a startup does
What are you aiming to do with your
   product?

1. Bringing a product into an existing market with a
   known business model
2. bringing a new product into an existing market
3. bringing a new product into a new market
4. bringing a new product into an existing market and
   trying to:
   4.1. re-segment that market as a low-cost entrant or
   4.2. re-segment that market as a niche entrant
5. cloning a business model that’s successful in another
   country
Problem-Solution Fit      Optimizing product




              PRODUCT/MARKET FIT
X       X
X      XX    XXX
  X
  XX      XX      X
                  X
   X   X
       X     X
             X
       X        X
Pivot or persevere
”A pivot is a structured course correction
   designed to test a new fundamental
  hypotheses about the product, strategy
            and engine of growth”
Minimum Viable Product
1) Not a product but a test to attract early customers
2) Get as much feedback as possible, as soon as
   possible
3) that version of a new product which allows a
   team to collect the maximum amount of validated
   learning about customers with the least effort.
4) The challenge is to understand what not to ship
5) requires judgment to figure out, for any given
   context, what MVP makes sense
PRODUCT   MARKET
The Iteration Meta-Pattern




  Ash Maurya, Running Lean
Lean Startup - Think Big, Act Small, Learn Fast
MVP Dashboard
Validated Learning
Data driven or data informed?
Metrics matter because they
relate to your business model
   Use analytics to measure whether
  your customers are doing what your
    business model hopes they will
Startup Metrics
Lean Startup and Metrics
Qualitative and quantitative metrics.
• Qualitative metrics are unstructured, anecdotal, revealing, and hard to
  aggregate;
• quantitative metrics involve numbers and statistics, and provide hard
  numbers but less insight.

Vanity and actionable metrics
• Vanity metrics make you and your investors) feel good, but don’t change
   how you’ll act.
• Actionable metrics change your behavior by helping you pick a course of
   action.

Exploratory metrics and reporting metrics
• Exploratory metrics are speculative, and try to find unknown insights that can
  give you the upper hand,
• focusing on the interesting and unexpected and on trying new things,
• while reporting metrics keep you abreast of the!normal, managerial, day to
  day operations.
Challenges in applying lean
     startup methods
”A startup is a human institution
designed to create a new product
  or service under conditions of
      extreme uncertainty”
           - Eric Ries -
Attitude
1. Are you entrepreneurial enough?
2. Is there a visionary startup founder in
   you?
3. Is your # 1 goal to build a product or
   launch a business model for a vision?
4. Do you have a role in a startup team or
   are you just there to do a task?
Benefits of applying lean
   startup methods
1. improves communication with tech and
   business managers
2. gives multiple shots at big goals
3. improving our understanding of where we
   go wrong
Final conclusion
Think big, act small, learn
           fast
All that matters is
1) that you really understand what your
   customer wants,
2) have a discipline for finding it out, and
3) that you don’t start building a core
   product until you’ve tested your business
   model (hypothetical or real)
Accept business design as
 your biggest challenge
Talk to customers and launch
    ideas early and often!
Thank you!
Internet
meetup.com/lean-startup-helsinki
           Email
     ola.sundell@mentor.fi
             Cell
      +358-40-549 47 55
           Twitter
       @TheLeanStarter
In an early stage startup,
success is not in a "to do" list, it's
                 h

        in a "to learn" list.

             - Sean Ellis -
1 of 58

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Lean Startup - Think Big, Act Small, Learn Fast

  • 1. LEAN STARTUP Think Big, Act Small, Learn Fast
  • 2. Pushing Agile To The Next Level
  • 3. Easy to understand, difficult to apply
  • 4. 1) Introduction to lean startup  Link to agile developmen 2) Lean startup as business design methodology 3) What are the challenges in applying lean startup methods? 4) Benefits of applying lean startup methods 5) Final conclusion
  • 5. How to successfully launch NEW products and services?
  • 7. ”There is surely nothing quite so useless as doing with great efficiency what should not be done at all” - Peter Drucker -
  • 8. ”By focusing on functional efficiency, we lose sight of the real goal of innovation: to learn that of which is currently unknown” - Eric Ries -
  • 9. Research conducted on new product success and failure indicates that it takes 58 new product ideas to deliver a successful new product.
  • 10. Building product according to specification, but failing to address customer need
  • 11. Launch your idea before you build it
  • 13. Pushing Agile to the Next Level Agile Lean Startup Recognise we don’t know solution …we don’t even know the problem
  • 14. ”The big question of our time is not Can it be built? but Should it be built” - Eric Ries -
  • 15. Your solution is NOT ”the product”
  • 16. Your Business Model Is ”The Product” Customer - Ash Marya - Business Model Solution
  • 17. Scorecard to help you systematically validate your business model before building the product
  • 18. X X X X X X X X X
  • 19. Building A Market For A New Product How do we go from no customers to a few customers and from a few customers to many customers?
  • 20. ”A startup is a temporary organisation in search of repeatable, scalable and profitable business model” - Steve Blank -
  • 21. ”Lean isn’t about being cheap [but is about] being less wasteful and still doing things that are big.” - Eric Ries -
  • 22. Solving Think Solving Big Problems To A Few People
  • 23. Building A Market For A New Product Finding and talking to customers
  • 24. Product design Strategic Customer Operational value design Core Lean (function, Startup specs) Dropbox
  • 26. Strategy is based on assumptions
  • 27. Customer Value Design Build Measure Learn Launch tests
  • 28. List your business model hypotheses
  • 29. PRODUCT MARKET
  • 30. Lean Startup Principles 1) Build-Measure-Learn Loop 2) Validated Learning 3) Minimum Viable Product 4) Pivot
  • 32. What are you aiming to do with your product? 1. Bringing a product into an existing market with a known business model 2. bringing a new product into an existing market 3. bringing a new product into a new market 4. bringing a new product into an existing market and trying to: 4.1. re-segment that market as a low-cost entrant or 4.2. re-segment that market as a niche entrant 5. cloning a business model that’s successful in another country
  • 33. Problem-Solution Fit Optimizing product PRODUCT/MARKET FIT
  • 34. X X X XX XXX X XX XX X X X X X X X X X
  • 35. Pivot or persevere ”A pivot is a structured course correction designed to test a new fundamental hypotheses about the product, strategy and engine of growth”
  • 36. Minimum Viable Product 1) Not a product but a test to attract early customers 2) Get as much feedback as possible, as soon as possible 3) that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort. 4) The challenge is to understand what not to ship 5) requires judgment to figure out, for any given context, what MVP makes sense
  • 37. PRODUCT MARKET
  • 38. The Iteration Meta-Pattern Ash Maurya, Running Lean
  • 41. Validated Learning Data driven or data informed?
  • 42. Metrics matter because they relate to your business model Use analytics to measure whether your customers are doing what your business model hopes they will
  • 44. Lean Startup and Metrics Qualitative and quantitative metrics. • Qualitative metrics are unstructured, anecdotal, revealing, and hard to aggregate; • quantitative metrics involve numbers and statistics, and provide hard numbers but less insight. Vanity and actionable metrics • Vanity metrics make you and your investors) feel good, but don’t change how you’ll act. • Actionable metrics change your behavior by helping you pick a course of action. Exploratory metrics and reporting metrics • Exploratory metrics are speculative, and try to find unknown insights that can give you the upper hand, • focusing on the interesting and unexpected and on trying new things, • while reporting metrics keep you abreast of the!normal, managerial, day to day operations.
  • 45. Challenges in applying lean startup methods
  • 46. ”A startup is a human institution designed to create a new product or service under conditions of extreme uncertainty” - Eric Ries -
  • 47. Attitude 1. Are you entrepreneurial enough? 2. Is there a visionary startup founder in you? 3. Is your # 1 goal to build a product or launch a business model for a vision? 4. Do you have a role in a startup team or are you just there to do a task?
  • 48. Benefits of applying lean startup methods
  • 49. 1. improves communication with tech and business managers 2. gives multiple shots at big goals 3. improving our understanding of where we go wrong
  • 51. Think big, act small, learn fast
  • 53. 1) that you really understand what your customer wants, 2) have a discipline for finding it out, and 3) that you don’t start building a core product until you’ve tested your business model (hypothetical or real)
  • 54. Accept business design as your biggest challenge
  • 55. Talk to customers and launch ideas early and often!
  • 57. Internet meetup.com/lean-startup-helsinki Email ola.sundell@mentor.fi Cell +358-40-549 47 55 Twitter @TheLeanStarter
  • 58. In an early stage startup, success is not in a "to do" list, it's h in a "to learn" list. - Sean Ellis -