Lean Startup — Eric Ries
> Validated learning: learn what users want before building a product.
**** Build a prototype
**** Interview users
**** Experiment different features with different users
**** Make a video explaining the product
> Validate following assumptions for your business
**** Value hypothesis: Doe your product delivers value to its users. Are users returning ?
**** Growth hypothesis: Will new users discover your product. Is product spreading to new users ?
> Figure out assumptions in your business. Build an early MVP that validates those assumptions.
> Build Product from ideas. Measure data from product. Get ideas from data. Repeat this loop. MVP is the fastest way to get through this loop with minimum effort.
> Do not get discouraged if MVP fails. Measure data, get ideas to pivot strategy and improve upon your MVP.
> Run experiments(A/B tests) & derive their success not with vanity metrics
> Do not rely decisions on vanity metrics
**** If a metric can not be justified with an action, it is vanity metric. Some clearly defined action(s) should have resulted in change of a metric.
**** Metric should be defined in terms of human behaviors.
> When business metrics are not increasing, pivot. Pivot means, talk to your new users, and get into Build-Measure-Learn loop again. MVP is for early adopters. Early adopters are ready to use a un-polished prototype, but mainstream users are not that forgiving. Flatline growth means, you need to understand the needs of these new users and pivot accordingly.
> What to do if growth flat-lines ?
**** Check your metrics. It should not be a vanity metric like total number of users. Instead see retention rate and growth rate. If rate of new customer acquisition exceeds churn rate, the business grows. These metrics help you identify what customers are you losing, thereby giving opportunity to understand the needs of that customer segment. Run experiments to address those needs, measure data & build for the retention of that customer segment.
**** Viral coefficient is defined as number of users an existing user brings to the product. So for a coefficient of 0.1, 10 users will bring 1 new user. If you have hundred users to start with, those 100 bring bring 10 new users. These 10 bring again bring 1 new user. So viral growth fizzles out. A product with viral coefficient greater than 1 will grow exponentially.
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