Book review: The Lean Startup
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For instance, we're all familiar with the concept of runway on Hacker News right? How many of us think it's the amount of time that we have left or money left in the bank? Ries writes this on the subject:
"The true measure of runway is how many pivots a startup has left: the number of opportunities it has to make a fundamental change to its business strategy. Measuring runway through the lens of pivots rather than that of time suggests another way to extend that runway: get to each pivot faster."
How many entrepreneurs feel like they're barrelling down the runway and just crossing their fingers that something's going to change? "Apple will feature my iPhone app and I'll get a thousand users, I can just feel it!" Or, "I'm sure we can just get some angel funding, it's a hot market right now."
With Ries' view of the runway, you can literally rely on Pivotal Tracker to show you whether you're extending your runway or shortening it, and that's damn more effective than praying/crossing fingers/refreshing Google Analytics every half hour to see if your product has gone viral, etc.
EDIT: The book of course goes into when you should/shouldn't cut costs to extend runway and when you should pivot faster. It also explains what it means to pivot faster (e.g., validate your assumptions more quickly, not necessarily code features faster). I just wanted to clarify that given my PT remark above.
A lot of "great business books", like Crossing the Chasm, on the other hand, can be fairly easily summed up in a few pages, even if the ideas are certainly good ones.
I'll probably get it anyway because I'm a sucker for business books, but honestly with many of them you're not missing anything if you read the summary.
We're starting to realize that you can't guess and strategize for future occurances, you just have to try them out and react accordingly. You have to get a little bit better one day at a time and not just think about how you great you want it to be.
That's the biggest hurdle with trying to change the world, we spend too much time thinking and arguing over what's better while key opportunities are passing us by every day.
Here's the alarming thing that the book suggests: that we are all scientists trying to reveal market insights. Some of us manage to find out that our hypothesis was true and we are rewarded. Some of us disprove a hypothesis, which is a perfectly scientifically admirable thing to do, but we are penalized for it. 100 years from now, will people laugh at how our society was naive enough to let entrepreneurs who fail go personally bankrupt in some cases? Will they even consider revealing market truths to be failure? I'm guessing that 100 years from now we'll have reached a point where these things are true:
1. We won't see so many half-baked products get to market (e.g., Blackberry Playbook) because conventional wisdom by then will have prevented those kinds of products from getting as far along in the product development stage as they do now without having fundamental assumptions about them get validated earlier on.
2. There will be a market that rewards entrepreneurs for revealing insight into their "failures" because these failures provide truths about the market and are just as equally applicable as truths about the market that validate assumptions.
If your startup operates on the assumption that your vision is flawless, you're not causing your vision to be less uncertain by refusing to notice the risk.
You're shooting the messenger. You've conflated trying to measure whether a strategy is flawed with causing it to be flawed. Pull your head out of the sand. It is not the fault of the book that people who have flawed ideas won't get rich without fixing their ideas.
What I meant by jury is still out, is that we might find that the framework suggested in The Lean Startup actually increases success rates amongst startups in addition to being a model for revealing truth. Revealing truth faster will allow startups to extend their runway and if we find that most successful businesses only require X pivots on average before they start to profitable, we very well might see startups be able to accomplish these X pivots succeed where they may have followed a more traditional launch and pray model and achieved fewer than X pivots, running out of runway.
If it sounds like I'm trying to be negative about the book, I'm not. It's fantastic and I'm absolutely suggesting everybody buy a copy :P
I agree with what you're saying but when the strap line of the book is "How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Companies" [emphasis added] the misunderstanding is, well ... understandable.
- There exist at least two entrepreneurs today - At least two of them use continuous innovation - At least two of those who use continuous innovation create radically successful companies - This book will tell you how they do it
I think you're doing it wrong if that happens.
Certification consists of a 4 hour workshop starting at only $4200.
Disclaimer: Lunch not included, though you can split-test dishes at the Minimum Viable Café at competitive, pivoted, market-driven, customer-verified, inflation-adjusted price models, with guaranteed* radical results to your entreprenurial execution capabilities.
* not guaranteed.
Got my pre-ordered copy the next day and gave it to our first hire and bought 3 more copies for the senior guys on my team.
Get it and read it, it's worth the time.
I haven't read the book yet, but from Eric's blog, he mentions three books as big inspirations: Beck's "Extreme Programming Explained", Poppendieck's "Lean Software Development", and Blank's "Customer Development".
The first two books were also important in the Agile community. (Although in my view what now gets sold as "Agile" has watered both of those down almost to the point of meaninglessness.) The third is new, and provides an approach to business that complements Agile software development practices very well. So you could look at the Lean Startup approach as Agile (or perhaps the best of Agile) for startups.
So far, though, the Lean Startup movement still has substantial depth. I think that's because startup people all know they're in a do-or-die situation, and they are willing to work very hard for a competitive advantage. The real question for me is whether the Lean Startup community can retain that depth as it gets more popular.
Business is terribly faddish, and now all manner of large companies are going to want to pretend they're lean startups. They will pay people lots of money to help them pretend. Let's hope that money isn't enough to corrupt the actually useful material in the Lean Startup approach.