Read, execute, profit: ‘The Lean Startup’
“A startup is a human institution designed to create a new product or service under conditions of extreme uncertainty.” ― Eric Ries, The Lean Startup
There’s a way to handle startup uncertainty, and it’s called Validated Learning.
According to Ries, startups don’t exist to make stuff, make money, or serve customers. Instead, they exist to learn how to build a sustainable business. This learning can be validated scientifically, by running experiments that allow us to test each element of our vision. (Hence, Validated Learning.)
The Lean Startup methodology is derived from the manufacturing industry, where progress is measured by the production of high-quality goods with minimal waste.
In the startup world, Validated Learning is intended to reduce wasted cycles in the development process. When you focus on figuring the right thing to build — the thing customers want and will pay for — you need not spend months waiting for a product beta launch to change the company’s direction. Instead, entrepreneurs can adapt their plans incrementally, inch by inch, minute by minute.
Most Validated Learning systems incorporate the following six steps:
1. Start with a specific goal that can be either learning- or performance-based
2. Identify a metric that represents that goal and will indicate how well it is met
3. Act to achieve the goal, usually by consuming some kind of training content
4. Analyze the metric to determine how well the goal was met
5. Use this information to improve the training content, delivery method, et al., and try again
6. Repeat as needed to achieve the desired result
To prep for Validated Learning, start today with the following thought exercises:
- Ask whether your startup idea actually solves a problem for users
- Quickly come up with an action or a program that will test the idea with the users. Perform reassessment or reevaluation if needed
- Define the category of people who need your product, and use that to identify the kind of potential customers you need to go to for initial feedback. You’ll also need to decide what you want to ask: You’ll need information that is specifically useful to build your product or service in a way they understand and will buy
- Consider the sustainability of the product or service. Will you be able to maintain the current level of engagement or service?
Once you’re clear on those four questions, you’ll be ready to put a Validated Learning cycle into motion.
