Lean Canvas

Why use it?

• Find a plan that works before running out of resources

• Empirical testing

• Time is the scarcest resource

Customer Segments

1. Split broad customer segments into smaller ones

• Trying to market to everyone end up marketing to no one•Pick your strongest customer segment

Example: CloudFire

•Photo and video sharing service•Ash Maurya’s past company

Example: Possible Customers List

Really broad category: Anyone that shares lots of photos and videos

More Specific:• Photographers• Videographers• Graphic Designers• Architects• Doctors• Parents• Consumers

Customer Segment

2. Distinguish between customers and users •Customers pay you, users don’t•Attract users - aim to convert some/all to paying customers •Users create value through participation

•Monetized through ads

Example

Parents (customer)Family and

friends (viewers)

Parents with young kids

Problem & Customer Segments

3. List TOP 3 problems for early adopters

Five Why’s•Starts w/ customer problem – surface level •Ask why this is a problem

Example

Sharing photos and videos is hard

Why is this a problem?1. It’s time consuming2. There are lots of baby pictures 3. Organizing and uploading takes time4. Parents have no free time 5. There is a lot of external demand from family

What is the job the customer is hiring you to do?• Customers hire your products to get a job done•Often the job is something they have been trying to do, but probably unsuccessfully

Existing Alternatives

1.Describe your customer’s current reality

•What existing solutions/alternatives are they using today?•Doing nothing is also an alternative

Example

• Sharing lots of photos/videos is time-consuming• Parents have no free

time• There is lots of external

demand on this content

Flickr Pro, SmugMug, Apple MobileMe, Facebook

Solution, Unique Value Proposition, Revenue Streams• Minimum Viable Product = smallest solution that delivers customer value • Still solves a specific problem, but gets you paid as well

For each problem on your canvas:• Outline a specific solution• Craft your UVP around your #1 problem and finished

story benefit• Avoid empty marketing promises

Example

•Instant, no-upload sharing•iPhoto/folder integration•Better notification tools

Unique Value Proposition

Example

• Get back to the more important things in your life. Faster.• Share your entire photo and video library in under 5 minutes

• Photo and video sharing without the uploading

Revenue Streams

• Pricing is part of your product• Price relative to existing alternatives• Important to understand existing alternatives and position

solutions against them • Resist urge to create multiple pricing plans

Example

30-day free trial then $49/yr

Channels

•Path to customers•Don’t need to build scalable channels from day 1 •Start w/ outbound channels

Channels

• Identify a few scalable channels you might employ• Inbound channels

Examples

•Friends•Daycare•Birthday parties•AdWords•Facebook•Word of Mouth

Key Metrics

•How you measure success•Think about KPI’s•Key numbers that tell you how your business is doing•Changes as your product moves through various stages

Key Metrics

1. List the customer action that drives value• What key activity would you use to measure your

value proposition?• Ex. Twitter - posting tweet

2. How will you define success?• What will you need to achieve to make building the

product worthwhile? • Ex. Revenue target

Example

Key Action: Sharing an album/video

Success metric: Build a $5M/yr business

Cost Structure

•How you build enough runway for your product•Ballpark sizing of business model

1.Outline your fixed and variable cost2.Evaluate against your metric for success

Example

Hosting costs = Heroku (currently $0)People costs – 40 hrs x $65/hr = $10k/mo

Unfair Advantage

• Aka Competitive Advantage/Barriers to Entry• How will you defend against competition?

Bad Examples

Good Examples

•Don’t create sustainable unfair advantage on their own • “A real unfair advantage is something that cannot be easily copied or bought.” - Jason Cohen, Founder WPEngine

Example