Title: The Lean Startup
Author(s) Name(s): Eric Ries
Published in: January, 2011
Why You Might Like This Book: Read this book if you enjoy
- building a start-up,
- building tech-based start-ups,
- entreprenurship,
- learning how to make a start-up successful,
- having a clear pathway in founding your own company,
- learning what mistakes to avoid as a technologist or engineer or programmer turned CEO or founder,
- understanding what your customers want, and above all,
- learning to avoid building something that nobody might want to buy.
Who Should Avoid This Book: Avoid this book if you are triggered by or dislike
- NA.
“The Lean Startup” is a book written by Eric Ries, one that’s quite popular among both successful, established entrepreneurs and many beginners as well. Eric himself is an entrepreneur and has faced several challenges and many failures in his journey as a founder, so he draws from his own personal experiences and the knowledge he has gained from other founders’ experiences and other startups. The book begins with a highly relatable, deeply personal experience for young, ambitious entrepreneurs. With this, by relating to the ambition, confusion, subject knowledge and the lack of business knowledge, and the sense of shame that entrepreneurs feel when their exciting, promising start-ups fail, the author has you hooked.
This is not one of those vague, pop-psychology, motivating books that encourage people to do what they feel they want to. Instead, the book focuses on minimizing abstract, vague questions and problems and tries to give us solid, clear definitions and set measurable standards. For example, who is this book for? As the name gives it away, it is for those who want to build startups. But then, what is a startup? This is a fundamental question that many founders and aspiring business persons would ponder over. And Eric says that a start-up need not necessarily be a new company with a simple office space or someone who builds something innovative, but a startup is a company that gets built with extreme uncertainty. Which is something many entrepreneurs around the world, irrespective of the economy consitions and cultures, can relate to. These people don’t have clear ideas but are highly ambitious, excited about their ideas, willing to work hard, be committed to what they are doing, and believe that what they are building is definitely worthy of all this. Except that tehy don’t have a clear, startegic, solid plan. that’s where Eric offers solutions.
Interesting Quote: “the business and marketing functions of a startup should be considered as important as engineering and product development and therefore deserve an equally rigorous methodology to guide them. He called that methodology Customer Development”.
This book, according to the author is about the “Lean Startup approach”, the guidance that entrepreneurs and innovators lack and need to run their businesses successfully, which he himself learned after a lot of failures and finally witnessing unprecedented success through his business IMVU. He emphasizes that traditional management strategies and principles cannot be applied to start-ups because unlike traditional businesses, start-ups come with a lot of uncertainty from even the builders and founders themselves, and just because old school management ways don’t work, you can’t go wild and run your business carelessly and whimsically either. “The Lean Startup Movement” is dedicated to helping entrepreneurs learn and practice business and management skills and approaches in such a way that would result in the success of these startups and not end up as initially hyped and soon failed startup like most failed companies out there. Also, this idea is inspired by the lean manufacturing revolution that Taiichi Ohno and Shigeo Shingo are credited with developing at Toyota.
Hard work should pay off, but it doesn’t, not always? The more we read, the more we understand the differences that are present in building a traditional business versus building a startup, and why we need to have new ways of thinking, building, measuring, improving, and selling. He points out how, realistically, the typical technical entrepreneur or programmer would prefer to not engage in managerial activities and would consider building something that works as expected successful – how this is wrong because this way, you might have a product, which nobody might want. Eric explains how he, as the chief technology officer of IMVU, painstakingly wrote the code for a complicated, innovative product and its integration and deployment, and when they nervously and hopefully launched the product, they learned that too many customers, most of them didn’t want to use the product the way they imagined, how they learned after begging and pleading family and friends to buy paid features and interviewing dozens of users, that what people want was not what they had built, that the core of their product itself – into which Eric had put in so much time and effort – had to be discarded. This must have been very hard to come to terms, and this is a major reason for most startups’ failures: not knowing what customers want and building something that should ideally work well but somehow has no demand or need; potential customers are not interested at all!
Validated Learning: This is an important concept introduced by Eric. He suggests that “validated learning” is the antidote to the impulsive, not well thought out, “let’s just build it and worry about other things later” mentality. Acording to him, emphasis must be placed from the beginning on building something that the customers will want. But he himself acknowledges the uncertainty in the world of startups, so he insists on learning at every step to gather useful information to meet users’ needs. Every feature, every marketing campaign, and every product iteration is an experiment designed to discover what customers truly value. If you can’t measure it, you didn’t learn it. What then is an “experiment”? This is where he guides his readers to focus on the right questions to ask: ask “should this be built?” instead of “can this be built?”. The first question is about sustaining a business whereas the second question is about challenging oneself to build something they might enjoy.
Vision: How to set a clear vision in an uncertain situation? Two critical areas you need to focus on are: the Value Hypothesis – “does it provide any value to the users?” and the Growth Hypothesis – “How will new users find your product or service?”. The author also recommends learning through person-to-person interactions with potential users and customers, directly, at all phases of building and maintaining the product because that is the only way to really understand what they want, so that you can provide exactly that. Talk to your customers and don’t dodge this step or assume that you already know.
There are many more such valuable pointers in the book, almost a complete, very useful guide for someone who has the entrepreneurial excitement, the motivation, and the talent to build something but is clueless on how to sell what they built to customers or even who their target audience are and how to please them, so the product can be transformed into a profitable business venture that pays back. This is a must-read for every aspiring entrepreneur, for anyone who is in the early stages of building their start-up because this book offers solutions, as Eric speaks from his own experience thorugh failures and successes, for most of the problems a beginner might face in successfully selling a product they consider brilliant. I would give this a 5-star rating.
