Intro to Lean Startup

@hungvpham
Intro to Lean Startup

@hungvpham
Hung Pham
Regional Workshop Leader - Lean Startup Machine
Founder and Producer - Culture Summit
Founder - Profile Gurus
Email: hung@leanstartupmachine.com

@hungvpham
What is Lean Startup?

Lean Startup is a method for developing
businesses and products first proposed in 2011
by Eric Ries. Ries claims that startups can
shorten their product development cycles by
adopting a combination of business-hypothesis-driven
experimentation, iterative product
releases, and what he calls “validated learning”.
- Wikipedia
@hungvpham

Lean Startup is a process for
validating and invalidating your
assumptions as quickly as possible to
discover and deliver what people actually
want while reducing waste.
- Me
@hungvpham

@hungvpham
Lean Startup comes from Lean
Manufacturing and Lean Thinking, which is
derived from Toyota's factory production
system, as they rose to prominence.

@hungvpham
The fundamental principle of lean thinking is
eliminating waste. Waste is any human activity
which absorbs resources but creates no value.
- Womak/Jones “Lean Thinking”

@hungvpham
Type of Waste Definition
Waste of Over Production Creating more than is
needed
Waste of Defects Errors, mistakes causing
rework
Waste of Inventory Holding more inventory
than needed
Waste of Over Processing Processing more than
required
Waste of Transportation Movement of items more
than required
Waste of Waiting Time loss by employees &
customers from waiting
Waste of Motion Movement of people that
does not add value

In a start-up waste is defined as anything
that keeps the team from learning about
how to create value for the customer.
- Eric Ries “Lean Startup”
@hungvpham

@hungvpham
It Starts With a Vision

@hungvpham
Too Often Startups Build This

@hungvpham
When the Customer Wants This

Lean Startup is a process for validating
and invalidating your assumptions
as quickly as possible to discover and
deliver what people actually
want while reducing waste.
- Me
@hungvpham

@hungvpham
The Foundation of Lean Startup

@hungvpham
The Lean Startup Process

Brainstorm here. When you’re ready, pull it over to the right to start your experiment. Experiments
Start here. Brainstorm with stickies, pull it over to the right to start your experiment. Experiments
@hungvpham
1 2 3 4 To form a Customer/Problem Hypothesis:
I believe my customer has a
problem achieving this goal.
Who is your customer? Time Limit: 5 Min
Customer
Problem
What is the problem? Phrase it from your customer’s perspective. Time Limit: 5 Min
Solution
+LÄUL[OLZVS[PVUVUS`HM[LY`VOH]L]HSPKH[LKHWYVISLT^VY[OZVS]PUNTime Limit: 5 Min
Riskiest
Assumption
List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min
Success
Criterion
Result
Decision
Learning
1 2 3 4 5
Who is your customer?
What is the problem? Phrase it from your customer’s perspective.
+LÄUL[OLZVS[PVUVUS`HM[LY`VOH]L]HSPKH[LKHWYVISLT^VY[OZVS]PUN
What are the assumptions that must hold true, for your hypothesis to be true?
Need help? Use these sentences to help construct your experiment.
To form a Customer/Problem Hypothesis:
I believe my customer has a
problem achieving this goal.
Need help? Use these sentences to help construct your experiment.
To form your Assumptions:
0UVYKLYMVY̸hypothesis to be
true, assumption needs to
be true.
Determine how you will test it:
The least expensive way to
test my assumption is...
To form a Problem/Solution Hypothesis:
I believe this solution will result
in XHU[PÄHISLV[JVTL.
To identify your Riskiest Assumption:
The assumption with the least
amount of data, and core to the
viability of my hypothesis is...
Determine what success looks like:
I will run experiment with # of
customers and expect a strong
signal from # of customers.
Project Name: Team Leader Name:
Riskiest
Assumption
GET OUT OF THE BUILDING!
Start here. Brainstorm with stickies, pull it over to the right to start your experiment. Time Limit: 5 Min People
buying
Vespas on
Craigslist
People with
KPMÄJS[
commute
NYC
Relying on
products
that use
oil
Understanding
safety time
saving of
Vespa
People with
KPMÄJS[
commute
NYC
Vespa too
expensive
for identity
risk
Vespa One-
Pager +
Trial
Rent Vespa
Return It
If Not Fit
No friends
Vespa
Pay
$250/month
INTERVIEW:
8/10 don’t
have friend
with Vespa
SELL:
15 email
addresses
in 2 hours
Care about
environment
INTERVIEW:
5/20 buying
Vespa bc
environment
important
Success
Criterion
0/20
PIVOT!
5/10
PIVOT!
50+ in 2 hours
PERSEVERE!
- Skinny Tie!
- Buying for
lifestyle
- “I’m not a
scooter
person”
- Lifestyle is
a risk
- People typing
in ALL CAPS
- Jumping out
of seat to try
Time Limit: 5 Min
OZVS]PUNTime Limit: 5 Min
List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min
Customer
Problem
Solution
Result
Decision
To form your Assumptions:
0UVYKLYMVY̸hypothesis to be
true, assumption needs to
be true.
Determine how you will test it:
To form a Problem/Solution Hypothesis:
I believe this solution will result
in XHU[PÄHISLV[JVTL.
To identify your Riskiest Assumption:
The assumption with the least
amount of data, and core to the
viability of my hypothesis is...
Determine what success looks like:
Project Name: GET OUT OF THE BUILDING!

STEP 1:
@hungvpham
Who is the customer?
!
Define Your Customer Hypothesis

STEP 2:
@hungvpham
What is her problem?
!
Define Your Problem Hypothesis

PROBLEM
@hungvpham
• Must be specific to the person!
!
INCORRECT:
• “People are not recycling” is not a problem
someone has
!
CORRECT:
• “Forgets the day of the week for collection”
• “Confused how to sort plastics”
!
• Two similar but different problems

SOLUTION
@hungvpham
Do not define until the problem is
validated
!
Why? Because every problem
has multiple solutions

STEP 3:
@hungvpham
What do you test?
!
Plan your Experiment (MVP)

@hungvpham
Minimum Viable Product!
Test your riskiest assumption

@hungvpham
MVP != Shitty Product
The Minimum Viable Product (MVP) is that
version of a new product which allows a team
to collect the maximum validated amount of
learning about customers with the least effort.

@hungvpham
What must we learn?
What are the Core Assumptions of
our business?
!
Assumption:
A behavior, mentality, or action that needs to
happen in order for hypothesis to be true.

@hungvpham
What must we learn?
Prioritize: Which Assumption is
the Riskiest?
!
The one that is most unknown,
and crucial to the business

What do we build to test?
1.Exploration - reproduce problem
2.Pitch - collect currency
3.Concierge - deliver customer
expectation
!
(Methods increase in cost of testing)
@hungvpham

@hungvpham
How do we measure result?
Decide on the weakest outcome
you will accept as validation
!
Called the Minimum Success
Criterion

@hungvpham
SHOW ME THE MONEY!
Examples of Customer Validation:
5,000 Email Signups
OR $1,000 in Cash
OR 5 Contracts from Big Companies

@hungvpham
GET OUT
OF THE
BUILDING!

STEP 5:
What did you learn?
!
Analyze Results
@hungvpham

@hungvpham
What happened?
VALIDATED
Brainstorm and test next RA
(NOTE: if you validate with the wrong
customers, it is not validated)
!
INVALIDATED
Pivot the hypothesis

Intro to Lean Startup

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