Summary and Analysis of The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses

Based on the Book by Eric Ries

• Editorial: Worth Books
• Año: 2016
• ISBN:
  9781504043434
• Categoría: Studienhilfen
• Categoría: Studienführer

So much to read, so little time? Get the key points of The Lean Startup —the bestseller about creativity, efficiency, and building a sustainable business. Through successes and failures with tech companies, Eric Ries began to realize there was a better way to develop a startup. Using his experiences, as well as valuable lessons learned from other industries, Ries identifies the difficulties a startup faces and how to build a more efficient—and successful—business. In the end, all of his advice comes down to saving the most important resource of all: time. This summary of that bestselling business book covers such topics as:

• How to shorten project-development cycles
• Validated learning and rapid scientific experimentation
• Measuring progress accurately
• Identifying your customers' desires
• How to adapt to changing circumstances quickly

With chapter-by-chapter overviews, definitions of key terms, context and analysis, important quotes, and other features, this summary and analysis of The Lean Startup is intended to complement your reading experience and bring you closer to a great work of nonfiction.

Summary

Introduction

Ries describes the Lean Startup method and how he developed it. There are five basic ideas behind this approach:

1. Anyone, anywhere, can be an entrepreneur. Contrary to the popular definition, Ries defines a startup as any group attempting to make a new product or service in an unpredictable environment. Thus, anyone running such an enterprise is an entrepreneur.
2. The management of the startup is as important as the product itself. The concepts of “entrepreneurship” and “management” cannot be separated.
3. Since startups are inherently untested, being new products or ideas, they require a continual state of learning in order to be successful. Ries uses the term “validated learning” to describe this cycle of testing.
4. There is a standard process that startups should follow: “Build-Measure-Learn.” Ries believes companies should first make a product, see how consumers react to it, and then take action in response. This cycle continues throughout the building of the business.
5. No matter how exciting and fresh its product is, a startup needs to do the dull work of quantifying progress.

Part One: VISION

1. Start

There are more entrepreneurial opportunities today than at any other time in human history. But because we use antiquated management techniques, startups are not getting the most out of our human resources and, worse, they are “achieving failure”—a phrase Ries uses to describe the perfect execution of a plan to build something that it turns out nobody wants or needs. Rather than make something and wait to see if it attracts customers, businesses should use scientific methods to determine what customers want before they spend a lot of time and money creating a perfect product.

2. Define

Any type of entrepreneur in almost any industry can use the Lean Startup philosophy to increase the likelihood of launching a successful startup. What makes a startup different from other businesses isn’t that the business is related to technology, necessarily. It’s that the new service or product is framed by extreme uncertainty—that is, there is no known business model and no known market for the product. Ries uses the example of Intuit’s SnapTax to illustrate that a startup can even exist within an established business. Customers who were using Intuit’s TurboTax began asking if there was a way to complete their taxes entirely on their phones. Seizing this opportunity, Intuit was able to develop such a product while still maintaining its core business with TurboTax.

3. Learn

A startup must measure progress, but knowing the right way to measure progress is critical. If a business is failing, entrepreneurs will often spin it as a learning experience. While doubtlessly true, that doesn’t change the fact that the exercise is a waste of time and money. It’s not surprising, therefore, that “learning” has something of a bad reputation in business. In spite of this, it is a vital piece of the startup process.

Ries reconceives “learning” to make the process an actual, quantifiable part of product development. He calls this “validated learning,” meaning that each experiment leads to an improvement in the process or an improvement to the product (and therefore validates the time and money spent on learning). It helps a startup understand how close its vision is to what customers want—which may be very different from what the creators originally imagined. According to Ries, validated learning requires a scientific approach to measure results and test hypotheses.

4. Experiment

Learning is impossible if there isn’t a wa...