Book Club July Edition: The Lean Startup
Each month we want to bring you items from our favourite reads list. If you choose to purchase a copy through the links we provide, you help to support our continued work at no added cost to you.
This month Claudia, our business incubation associate, has been reading The Lean Startup by Eric Ries, a highly recommended and valuable read especially if you are interested in enhancing your entrepreneurial skillset.
Entrepreneurs are faced with the harsh reality, the majority of startups fail. But why is the rate of attrition so high and what can we do build startups more efficiently?
Ries interrogates a thesis around the "Lean Startup" movement, "Can we build more successful companies while requiring less resources?" The Lean Startup methodology takes a scientific approach to business, testing market assumptions through experimentation before committing extensive resources to building the company. This affords founders the conviction to build solutions the customers care about.
Ries introduces the concept by sharing a personal experience of his first startup. He describes meeting his cofounders at college, the excitement of building their first company and achieving early success, followed by the realisation that it was going to fail.
Reflecting on his own experiences and those of the top minds in Silicon Valley, Ries began to challenge traditional thinking and investigated how the concepts of lean manufacturing could be applied to his next startup, which went on to become a success.
Soon, employees, investors and other founders were asking Ries what his secret was, and so The Lean Startup methodology was born and has blossomed into a global movement, highlighting the value of constant user-centric innovation across all organisations.
Breaking it down
The Lean Startup treats entrepreneurship as an exercise in "validated learning" following a continuous set of experiments. It’s about listening to customers and breaking down assumptions. Identifying ‘leap of faith’ assumptions enables founders to create hypotheses and testing these is part of validated learning.
Ries introduces the idea of the minimum viable product (MVP), an early version of a proposed product that contains the minimum number of features to still be considered as "useful" to a customer. By developing an MVP, Reis suggests founders can learn how a customer will react to the product without the need to fully develop the solution. Engaging with customers or early-adopters and using a disciplined, systematic approach to measure the progress of a product enables actionable metrics to inform further product development, rather than using vanity metrics.
Operating in learning sprint cycles, termed Build-Measure-Learn sprints, enables a founder to do innovation accounting, i.e. making informed decisions on whether to pivot or persevere, rather than simply sticking to the plan you had from the very beginning. Ultimately this enables you to learn how to create a sustainable business as quickly as possible, with minimal waste.
A take home quote that stood out to me is from Kodak Gallery founder, David Cook ‘Success is not delivering a feature, success is learning how to solve a customer’s problem’
By Claudia Fryer
More recommended reads?
We have a large collection of great titles that have helped throughout our journey building Spin Up Science and supporting other companies. Take a look at our recommended reading list on the resources page.