what mushrooms and fish poop taught us about launching a new line of breakfast cereals
TRANSCRIPT
Lean Startup 201
Jonathan Bertfield & Adam Berk
November 16 th, 2015
2015 Lean Startup Conference
Sponsored by:
Jonathan Bertfield
• 20 Years in Product Management
• Consulting clients: Pearson Inc., Disney, Associated Press, News Corp. Sesame Workshop, Business Insider, American Press Institute
• Coach at General Assembly Enterprise, NYU Stern
Adam Berk
• What problem are you solving? I help teams pick their riskiest assumptions and run experiments.
• Currently at Pearson with >>• Founded a sharing economy site
with the opposite result of AirBnb
201 agenda
1. Who’s here? Why?
2. What will I learn?
3. What is the Lean Startup & where did it
come from?
4. How and why does it work?
5. What should I do next? (go to Aubrey’s
WS!)
what will I learn?
Deep dive into riskiest assumptions, hypotheses Discussion of Topics:• What is an MVP (what are some great examples?)• What do I measure?• What do I do with my learnings?
Exercise: list your assumptions and rank themGet INTO and THROUGH BML once!
Common Purpose
We share a vision for the kind of company we want to create:
A company that continuously createsnew sources of growth.
A company that actually creates value for customers.
recap from 101
1. Quickly build products that matter
2. Recognize your assumptions (what you know vs. what you don’t)
3. Test assumptions early and often 4. Don’t spend time and money building
the wrong things
teaser for 301
1. Get out your bunsen burners because you are going
to run a REAL experiment
2. Aubrey Smith worked directly with Eric Ries
integrating Lean Startup at GE, you don’t want to miss her workshop!
3. Advanced topics like innovation accounting,
governance, regulated markets
we believe that you…
1. have read the book 2. believe that LS is “at least worth
considering” 3. have run an experiment or thought about
it in your lifetime4. want to run more experiments with your
team
we believe you will leave here with...
• An “intermediate level understanding” of the current state of Lean Startup thinking
• An understanding of what to test• An introduction to how to run experiments
THE CONFIDENCE TO GET IN (AND THROUGH) THE LOOP
we promise...
● practical● no jargon ● honesty
If you promise● to trust us the first time, test us the second
time● respect your peers● participate fully in the exercises without fear
of...
what is a startup?
“A human institution designed to create a new product or service under conditions of extreme uncertainty. “
- Eric Riesauthor, The Lean Startup
A method to systematically address uncertainty through rapid iteration and market learning.
what is the Lean Startup?
what is the Lean Startup?
History
Terminology / Definitions
Application / Applicability
simple history of Lean Startup
• Edwards Deming• Lean Manufacturing - Toyota Production System
• Agile Software Development• Customer Development - Steve Blank
• Lean Startup - Eric Ries• Business Model Canvas - Osterwalder
• Lean Startup Community
ENTERPRISE
STARTUPS
Three Key Areas to Discuss
History
Terminology / Definitions
Application / Applicability
what is the Lean Startup?
Terminology / Definitions• Entrepreneurs• Startups• Uncertainty (Product / Market / Model)• Minimum Viable Product / Pre MVP• Experiments
○ Assumptions○ Hypotheses○ metrics, vanity metrics, customer development
• Validated Learning (how to do test and measure the right things)
• Pivots
what is the Lean Startup?
scientific methodRoger Bacon (1214 - 1284) is credited as the first scholar to promote inductive reasoning as part of the scientific method.
1. Identify problems to generate ideas2. Identify and prioritize the underlying
assumptions behind those ideas3. Generate hypotheses and predictions 4. Define and deliver tests that expose
opportunities for learning5. Use resulting data to inform activity
Attribution: CC George Thomas
Attribution: CC bixentro
what kinds of uncertainty?
Technical / product Can we build this?
Customer / market If we build this, will people use/buy it?
Business modelOnce we build this, can we find a way to make money from it?
● Technical / product ○ TESLA BATTERY, SOLAR, SOME STUFF THAT
AUBREY WILL TALK ABOUT IN 301
● Customer / market ○ YOUR IDEA (99% of the time)
● Business model○ GROUPON, HOMEJOY
what kinds of uncertainty?
@FAKEGRIMLOCK - follow HIM, HER, IT? -- it’s BRILLIANT
Minimum Viable Product
Translate your critical assumptions into an experiment:1. Isolate critical assumptions for testing2. Prioritize assumptions for testing3. Draft your hypothesis to be tested4. Build an experiment5. Measure the results6. Collect the data and learning in a systematic
Validated Learning using scientific principles
High Risk
Low Risk
UnknownKnown
Assumptions: prioritization
Why?● Focuses you, your employees● Draw line in the sand ● Introduces accountability● Saves time● Introduces “learning” cultureHow ● most unknown thing that will kill the idea,
democratic, random?
Assumptions: @ AirBnb
Assumptions: Expert Tip1. Do this as a team
Spend 1-3 days listing, prioritizing your critical assumptions as a team
2. Get on the same pageAgree on what is most critical to test, how to test it
and when you will meet next to discuss the results (2, 4, 6 weeks)
3. Track everythingAssign one person in charge of collating & tracking learning in an excel spreadsheet
scientific method
1. Identify problems to generate ideas2. Identify and prioritize the underlying
assumptions behind those ideas3. Generate hypotheses and predictions 4. Define and deliver tests that expose
opportunities for learning5. Use resulting data to inform activity
components of an example hypothesis
I believe [target market/customer type]
will [do this action / use this solution]
[at this level/frequency]
for [this reason]. (by this date)
how does it work?
Three Key Areas to Discuss
History
Terminology / Definitions
Application / Applicability
scientific method
1. Identify problems to generate ideas2. Identify and prioritize the underlying
assumptions behind those ideas3. Generate hypotheses and predictions 4. Define and deliver tests that expose
opportunities for learning (&PROOF)5. Use resulting data to inform activity
Minimum Viable Product (MVP)
Experiment that helps you validate (or invalidate) hypotheses about the value or growth potential for a new product
An MVP helps you answer a specific question about one of your assumptions (as fast as possible and helps you understand the WHY)
MVP Pearson case study
Learn Build
Measure
Learn Build
Measure
MVP Pearson case study
scientific method
1. Identify problems to generate ideas2. Identify and prioritize the underlying
assumptions behind those ideas3. Generate hypotheses and predictions 4. Define and deliver tests that expose
opportunities for learning5. Use resulting data to inform activity
measure results
What knowledge are you looking to gain?LEARN or PROVE
What you are going to do with the knowledge when you get it?START THE LOOP AGAIN BASED ON NEW EVIDENCE, NEW LEARNINGS, NEW PROOF!!!
why does it work?
why does it work? (less luck more skill)
Path to Success
The ability to LEARN faster than your competition may be
the only sustainable competitive advantage.
Arie de Geus
Questions?
Phil DillardLean Startup Trainer
Heather McGoughCo-Founder, Lean Startup Company(415) [email protected]