Each time a startup fails, huge amounts of money, time, and skill are wasted. Yet with the right approach, their success rate could be greatly improved. In the book, The Lean Startup, Eric Ries gives us a guide and a roadmap on how to create a successful startup. Every startup has to deal with some form of uncertainty. The lean startup is all about successfully creating new products or services in uncertain conditions. It's all about cutting down on waste, constructing an adaptive organization, and flourishing in a world that's changing rapidly. The whole idea behind the lean startup is that you set a hypothesis about your customers and what's crucial for your business. Then, you build the most minimal product to test that hypothesis. Run the experiment, collect data on user behavior, and analyze it. Reflect on your hypothesis—how off were you? Adjust your strategy, update the hypothesis, and loop back in
In this summary, I’ll share with you three key lessons that I learned from the book.
Key Lesson #1: Get into the Build-Measure-Learn feedback loop using a minimum viable product
When you're creating a startup, think of your products as experiments—basically, you're figuring out what works for a successful business. Now, here's the deal: to make things move forward, you've got to jump into this thing called the Build-Measure-Learn loop real quick. The key is speed. Moving through this loop fast means you learn quicker and make bigger strides. So, the first thing you need to do is to test out your big assumptions, especially those about value and growth. And how do you do this? With a product that has the minimum features necessary to run the experiment. This is called a Minimum Viable Product (MVP). This MVP lets you complete the whole Build-Measure-Learn loop without burning too much time and effort. So, you don’t need to waste a lot of time to come up with a perfect product to run the experiment. In startup land, the real deal is figuring out early on if what you're building is what people actually want. Forget about strict timelines and budgets for a sec—if the product doesn't truly solve a problem, it's not hitting the mark. So, the golden rule here is to use the Build-Measure-Learn loop with a minimum viable product. That's your way of turning ideas into real products, seeing how customers react, and deciding whether to change course or keep going. It's all about speeding up this feedback loop for a successful startup journey.
Key Lesson #2: Validated Learning is the foundation of a lean startup
In the startup world, there are two ways to learn—bad learning and validated learning. Bad learning is like winging it, doing stuff without thinking much, and then coming up with reasons afterward. Like, "Oh, that didn't work, so we should do this instead." Now, validated learning is way more disciplined. It's about having testable ideas, running experiments to test those ideas, and looking at real data to see what actually works. It's like having solid proof of what you've learned.
The big question is: How do you quickly figure out what your users want without burning a ton of resources? That's where the Lean Startup strategies kick in. You start by setting a hypothesis—basically, what you think your customers really care about. Then, you measure it to see if you're making your product better. It's like having a clear goal and testing different versions of your product to see what clicks with customers. Now, validated learning is crucial. It's about figuring out what's really working and what's just wasting time. You measure the results of each idea you try, so you're making real progress and creating value. So, in a nutshell, it's all about learning smart, testing ideas, and ditching what doesn't work. That's how startups really get on the path to success.
Key Lesson #3: Validated learning will determine when to pivot or preserve
Let's say you have a testable hypothesis and run an experiment to validate that. There comes a point where you're looking at the data and wondering, "Should we keep going in this direction, or is it time to switch things up?" Here's the deal: it's not always a clear-cut decision because you rarely face complete failure. More often, you're sort of making progress, but it feels like you're not really getting anywhere. That's where the hard decisions come in. There are two signs that shout "pivot time": Your metrics aren't hitting the goals you set for your startup. Your experiments are just not moving the needle anymore. It's a sign you're running out of good ideas. There are different types of pivots. It could be zooming in on a single feature, zooming out to make a small thing a big thing, or changing your target customers or how you make money—lots of options. Now, a pivot is a big deal. It's not just tweaking things; it's a fundamental change to your whole business strategy. Here's the thing: without a clear hypothesis, complete failure is hard to come by. And without that failure, you might not feel the push to make a radical change—a pivot. In a nutshell, you're figuring out what's working, what's not, and when it's time to make a big move or keep pushing forward. It's like having a roadmap for those tricky decisions in the startup journey.
So, in summary, the goal of a lean startup is to learn what the customers want, as quickly as possible. For that, you've got to define your leap-of-faith assumptions and test them with a Minimum Viable Product (MVP). This MVP helps you run experiments to check if your assumptions are right or not. That's when you go through the Build-Measure-Learn loop, using validated learning and then deciding whether to pivot or preserve.