Extreme Lean Startup for Developers

Ashley Aitken ashley.aitken@innovately.com.au

www.innovately.com.au Innovately • @innov8ly

v1.2 • © Innovately 2017

INVESTORS

PERSPECTIVE

DEVELOPERS

PERSPECTIVE

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“The New Lean Way”1. Lean Canvas

2. Validation

3. Agile Software Development

4. Alpha => MVP => v1.0

5. Early Adopters

6. Launch Product

7. Build next version, measure something, learn something …2

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The Old Traditional Way1. Business Plan

2. Market Research

3. Waterfall Development

4. Alpha => Beta => v1.0

5. Private Beta Testers

6. Launch Product

7. Build next version, get some feedback, learn something…3

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Not really “The Lean Way”1. Lean Canvas

2. Validate Solution

3. Agile Software Development

4. Alpha => MVP => v1.0

5. Early Adopters

6. Launch Product

7. Build next version, Measure something, Learn something4

Faux Lean Approach

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Incremental Radical

Types of Innovation

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Disruptive

Lean Startup is radical innovation of Startup

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Implications of Lean Startup

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for Software

Developers6

Overview• Introduction and Overview

• Traditional vs Lean Startups

• Implications for Developers

• Summary

• Q & A7

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Experience in Lean Startup• Since 2010

• Lean Startup Perth

• Steve Blank Workshop

• Coached and Mentored Startups

• Practice Lean Startup with Customer Development

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Innovately.com.au• Applying the principles and practices of Lean Startup and Customer

Development to the commercialisation of innovation in companies of all sizes, in all sectors and all stages of maturity (including startups).

• Services include:

1. Training Courses - Lean Commercialisation 2. Accelerator Programme 3. Practice Group 4. Consulting

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.com.au

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TRADITIONAL STARTUPS

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Traditional Startup Approach

• From Concept to Prototype

• From Prototype to Product

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Most startups fail not because the product cannot be built

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• not enough customers want it!• the business model isn’t viable,

• the business model isn’t repeatable,• the business model isn’t scalable,

but because

They run out of money!

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What often happens after launch?1. Lean Canvas

2. Validation

3. Agile Development

4. Alpha => MVP => v1.0

5. Early Adopters

6. Launch Product

137. NOTHING HAPPENS…

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So what do traditional startups do?

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Few peopleuse the

product or service

Ask customers

what features are missing…

Build the missing

features into product or

service

PR

Features PR

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Field of Dreams15

Focus too much on product! “If you build it they will come…”

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The question IS NOTcan you build it?

The question IS

should you build it?16

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LEAN STARTUPS

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The Experts

18Eric Ries Steve Blank

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Lean Startup withCustomer Development

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What is the product?

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The product is not the Product. The product is the Business Model.

BIG IDEA

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Business Model Canvas

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What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?

Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?

For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?

For whom are we creating value?Who are our most important customers?

What type of relationship does each of our CustomerSegments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?

What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?

What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?

Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?

What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?

Day Month Year

No.

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or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.

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“A startup is not a smaller version of a large company.”

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BIG IDEA

- Steve Blank

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Definition - StartupA startup is a temporary organisation searching for a repeatable and scalable business model. - Steve Blank

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Lean Startup Strategy

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Search vs Execution

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The most important thing in a startup is not the idea but how

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well the team can EXECUTEwell the team can SEARCHwell the team can ………………

BIG IDEA

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Business Model Canvas

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What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?

Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?

For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?

For whom are we creating value?Who are our most important customers?

What type of relationship does each of our CustomerSegments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?

What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?

What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?

Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?

What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?

Day Month Year

No.

This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/

or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.

HYPOTHESES

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Build-Measure-Learn

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Build-Measure-Learn

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Hypothesise-

1. HYPOTHESIS

2. MINIMUM VIABLEPRODUCTS

(MVPs)

4. VALIDATED LEARNINGINSIGHTS?

PIVOT?

Evidence-Based Entrepreneurship

3. RUN EXPERIMENTSTO COLLECT DATA

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Get Out Of The Building!

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Lean Process

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Experimentfor

Valid. Learn.

FirstBMC

Launch & Scale

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“The true measure of progress of a startup is the amount of

”validated learning.…………………….traction.revenue.customers.

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BIG IDEA

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Benefits of Lean Approach• Minimise waste

• Money

• Time & Effort

• Less likely to fail

• More agile and adaptive32

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Lean Startup in the Enterprise

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IMPLICATIONS FOR DEVELOPERS

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Lean Startup Process

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Customer Development & Agile Development

vs. Product Management &Agile or Waterfall Development

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Understand Lean Startup

Do NOT focus on:

• product development

• executing and scaling

• “shiny things”

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• DO focus on:

• customer development

• searching for business model

• validated learning

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Build Experiments not a Product

• As quickly and cheaply as possible

• With as little code as possible (preferably none)

• The goal is to validate hypotheses not to build the best product!

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Design Experiments• Elevator pitch

• Diagram

• Brochure

• Wireframe

• Explainer video

• Interviews and surveys

• Landing page38

• Concierge MVP

• Wizard of Oz MVP

• Buy button (non-functional)

• Functional MVP

• Crowd funding campaign

• Selling for $

• …

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Who does the development? [FOR FOUNDERS]

• Don’t outsource development (e.g. to build the product or service)

• Use inhouse or closely managed remote developers

• Technical co-founder essential for Lean Startup

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Technical Debt?

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Definition - Technical Debt

• The eventual consequences of any (bad) system design, software architecture, or software development within a codebase.

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Technical Debt - OK!Experiments

$$$$$ The best debt is $$$$$

debt you don’t have to repay!

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Technical Debt - NOT OK!Experimental Infrastructure

Core Application Code Continuous Delivery Experiment Support

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Tools and Infrastructure

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Feature Flags / Toggles• Essential part of Continuous Deployment

• Essential part of Lean Startup

• Examples

• FF4J, Togglz (JVM)

• Feature Switcher, Feature, … (.NET C#)

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Frameworks for Experiments• Code to help you run experiments (with cohorts of users)

• Frameworks for online field experiments

• Examples

• Facebook’s PlanOut (for Java, Javascript, PHP, Go, Ruby, …)

• Cloudera’s Gertrude (for Java, based on Google infrastructure)

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Data Collection and Analytics

• Crucial because the focus is on testing hypotheses with experiments

• Built-in to your architecture, e.g. EDA, CQRS,…

• Add-on to your application, e.g. logging

• Dashboards, e.g. Kibana (from ELK stack)

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SUMMARY AND Q&A

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Summary• Lean Startup is more than just a bit of validation and

then build something and see what happens.

• Lean Startup is searching for a repeatable, scalable and viable business model.

• Lean Startup is a combination of Customer Development and Agile Development.

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BIG IDEAS

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Criteria for a Lean Startup

1. Focus on validated learning over and above everything else.

2. Running experiments with explicit hypothesesas quickly and cheaply as possible.

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Lean Startup for Developers

• Focus on building experiments as quickly and cheaply as possible

• Less concern for technical debt in experiments than platform

• Use tools and libraries to assist experimentation and analysis

• Get out of the building (literally and by tracking users)!

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Thank You

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To get a copy of the “Lean Startup Summary Sheet”

Signup for Innovately Newsletter http://www.innovately.com.au

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Extreme Lean Startup for Developers

Ashley Aitken ashley.aitken@innovately.com.au

www.innovately.com.au Innovately • @innov8ly

INVESTORS

PERSPECTIVE

DEVELOPERS

PERSPECTIVE

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THE END

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