Lean Startup

Lean Startup OverviewPresented by Quang Nguyen (Sebastian) MBA, PMP, TESOLLittle self-introductionStrong passion in entrepreneurship and educationSolid belief that entrepreneurship can be taught and passion can be inspiredStrong desire to make HCMC the next Silicon ValleyFacebook: @qthebossSlideshare: @qthebossTwitter: @nvquangvnBlog: http://nhakhoinghiep.wordpress.com/ AgendaWhatWhyWhereWhenWhoHowWarningI am here to learn, not to teachI do not like good words. I love hear you says No, youre wrong.I have no credit for Lean StartupI have no credit for any intelligent work on this slides, including images, terminologies, processes, philosophies The context is web startupSo who got the credit for Lean Startup?

Eric RiesCo-founder and CTO of IMVUEntrepreneur-in-Residence at Harvard Business school, 2010Best Young Entrepreneur of Tech, 2007Startup advisory Steve BlankRetired serial entrepreneurBuilt 8 startups in 21 years including MIPS ComputersNow teaching Entrepreneurship at Berkeley, Stanford, and ColumbiaWhat is Lean?

And lean is everywhere

So what is lean startupProduct/market fit means being in a good market with a product that can satisfy that market.Lean Startup is a method of testing the assumptions and hypothesis of a business idea in an iterative manner while validating your product/market fit before you ship a complete product.The key is to eliminate waste.

WebvanAn online grocery business that promised to deliver products to customers homes within 30 minutesBacked up by Benchmark Capital, Sequoia Capital, Softbank Capital, Goldman Sachs, and Yahoo!The largest dotcom failure in historyWhy failed?Untested planGrew too fast

Why should we care?

Where on earth do people use Lean?

Who actually used Lean Startup?Dropbox (www.dropbox.com)Peernuts (www.peernuts.com)Peernuts is a sharing platform for cultural goods. You just have to log in, list your library, connect with your friends and get access to the hundreds of films, books, video games, comics they want to share with you.Right now, Peernuts is in beta mode, available in French and just for DVDs.And a lot more: IMVU, Votizen, KISSMetric, Aarkvard, Hearsay, Epic Scale, Food on the Table, Pbworks, Dropbox - 1st Launch

Dropbox - 2nd Launch

Dropbox - 3rd Launch

Dropbox - Key LessonsPublic launch in Sep 2008Ignored mainstream PRDid not focus on building lots of featuresInvested heavily in analytics, such as survey, split tests, landing page, signup flow optimization, sharing encouragement Peernuts homepage

Peernuts Blogging before CodingStep #1: A short blog post10-question pollNo code AT ALLPeernuts Market shrinkingStep #2: Is your market really big and totally bullish? If yes, youre missing the point. If its big thats too big. Start shrinking your market!Started with DVD

Peernuts Feature BurnerTest #3:Ask yourself if you have more than 3 features. If yes, youre too fat.3 features:a movie listing powered by an external movie databasea loan dashboarda friend system coupled with Facebook connect and a basic mail invitationNo rating system, no wish list, no recommendation, no notification, no privacy setting NOOOOO!!!

Peernuts No designerStep #4:First product ship objective is to learn, learn, and learn.Dont depress if you dont have a wonderful logo. It looks weird but if you dont care, it will just be fine! Remember: you dont need the perfect product but a working prototype. Peernuts ProcrastinationDid you postpone product ship for the 3rd time? If yes, stop messing around. Release it!Learn with your customers > Refine useless aspects of your product

Peernuts - ConclusionRight now: Peernuts doesnt work. But: we have a great feedback on the service we are buildingWill we add features? NOIncrease customer performanceWill we start massive communication? NOWait until the virality rate > 1Will we work on our market? YESWe dont have the correct positioning yet.Is it okay to not consider any business model for the moment?Extra: The Lean Startup

How to use Lean Startup?Lean CanvasKey MetricsMVP (Minimum Viable Product)Build Measure Learn loopCustomer Development

Lean Canvas

Customer Lifecycle / Conversion Behavior

Key Metrics - AARRR

Before Product / Market Fit

After Product / Market Fit

Minimum Viable Product (MVP)MVP is the product with just the necessary features to get money and/or feedback from early adopters.Do MVPs seem abstract to you?

MVP examplesIf Apple can launch a smartphone without Find or Cut-and-Paste, what can you cut out of your product requirements? Sramana MitraUSV-backed foursquare uses Google Docs to collect customer feedback. No code, no maintenance.Fliggo sells it before they build it.Grockit puts up a notify-me-when-you-release form on steroids.Auto e-commerce site uses manualation and flintstoning for their backend.Semiconductor company uses 5 people and FPGAs to build a $100M semiconductor product line.Consumer company uses fake screenshots to sell their product.Allicator uses Facebook ads: Ditch Digger? Feeling spread thin? Click here to complete a survey and tell us about it.ManyWheels uses Microsoft Visio to build clickable web demos for prospective customers.Cloudfire uses a classic customer development problem presentation.

Build Measure Learn loop

Customer Development (cont)

Traditional Product Development

Agile Development

Product Development at Lean Startup

ConclusionThink big but start small.The longer you survive, the higher chance you will succeed.If you have to fail, fail it early and cheaply.Its new. So be skeptical.Q & A