lean startup, customer development, and the business model canvas

Lean Startup, Customer Development, and the Business Model Canvas

Startup Dhaka

Key Lean Startup Concepts

Uncertainty and Scarce Resources

Lean Startup Innovations

Old School

• Business Plan First• Startups = Small

Companies• Linear Process• Product Development First• Beta Test

New School

• Business Model First• Startups = Temporary Search

Organizations• Iterative Process

• Customer Development First• Minimum Viable Product

Customer Development

• What Needs to be True for Your Business Model to Work?

• Evidence from Interviews• Hypotheses Cannot be Trite,

Ridiculous, or Non-Confirmable• Why, Why, Why, Why, Why?

Hypothesis Development

Build-Measure-Learn Cycle

What Most Startups Want to Build

What They Should Build First

Eventually Build This

Business Model Canvas

Source: http://businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf

PRODUCT-MARKET FIT

Customer Archetype

Value Propositions

Pains and Gains – NOT FeaturesPain Killers

• Reduce Waste• Kill Frustration• Fix Underperforming

solutions• End Customer Challenges• Wipe Out Negative Social

Consequences• Eliminate Risk

Gain Creators

• Create Savings• Better Outcomes• Customer Delight

• Ease Work Flow or Life• Create Positive

Consquences

http://www.behaviormodel.org/

Case Studies

Technical Insight

Market Insight

Initial Value Proposition: Accuracy

Tactics: VP RankingPain Killers Gain Creators

Relevance 1. Test Strip Cost2. Delivery/ Payment3. Meter Cost4. Small Sample Size 5. Alternative Site Testing

(Less Pain)

1. Test Speed2. No Coding3. Large Display4. Form Factor5. Memory

Frequency 1. Small Sample Size2. Alternative Site Testing3. Test Strip Cost4. Delivery/ Payment5. Meter Cost

1. Test Speed2. Large Display3. Form Factor4. Memory5. No Coding

Prototype v MVP

Value Proposition

Team PrivacyProtect privacy for users of location-based services (LBS)

The Business Model Canvas: ver 1.0

Creating awareness

educational

Technology

Privacy advocacy

groups

Developing costs

Marketing costs

App revenue (or free?)

trustBuilding trustSmart phone users uneasy about privacy

Perception of enhanced

privacy

Own website

Consumers Don’t Care

About Location Privacy

The Business Model Canvas: ver 2.0

Creating awareness

educational

Technology

Developing costs

Marketing costs

trustBuilding trust

Social Network

Providers

Security of Company Geodata

Companies uneasy about employees’ online

activities

Companies subscription charges

Own website

Avoid direct employer -> employee monitoringWe Have No Key

Technology Resources

The Business Model Canvas: ver 3.0

??? Consumers

???

Companies

???Understanding Aggregate Info

for Large Hidden

Databases in Real-Time

Without Crawling

???

Technology ???

???

Government Agencies

How to Get Interviews

• Friends and Families• Introductions• Affinity Networks

• Traditional Networking• Cold Calls• LinkedIn

12 Interview Tips1. One person at a time2. Know your goals and questions ahead of time3. Separate behavior and feedback in discussion4. Get psyched to hear things you don’t want to hear5. Disarm “politeness” training6. Ask open ended questions

7. Focus on actual behavior, not speculative or abstract feelings8. Listen, don’t talk9. Follow your nose and drill down10. Parrot back or misrepresent to confirm11. Ask for introductions12. Write up your notes as quickly as possible

Source: http://giffconstable.com/2011/07/12-tips-for-customer-development-interviews-revised/