book

Running Lean, 2nd Edition

by Ash Maurya

February 2012

Intermediate to advanced

235 pages

5h 47m

English

O'Reilly Media, Inc.

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What Is Running Lean?Why Are Startups Hard?Is There a Better Way?Customer DevelopmentLean StartupBootstrappingWhat Will This Book Teach You?Is This Book for You?How Is This Book Organized?Part 1: RoadmapPart 2: Document Your Plan APart 3: Identify the Riskiest Parts of Your PlanPart 4: Systematically Test Your PlanAbout MeWhy This Book?Field-TestedDisclaimersPractice Trumps TheoryThere Are No Silver Bullets
Step 1: Document Your Plan AThere Is an “I” in VisionCapture Your Business Model HypothesesYour Product Is NOT “the Product”Step 2: Identify the Riskiest Parts of Your PlanThe Three Stages of a StartupStage 1: Problem/Solution FitStage 2: Product/Market FitStage 3: ScalePivot Before Product/Market Fit, Optimize AfterWhere Does Funding Fit into All This?Step 3: Systematically Test Your PlanWhat Is an Experiment?The Iteration Meta-Pattern
Case Study: How I Wrote Iterated This BookUnderstand the ProblemDefine the SolutionValidate QualitativelyVerify QuantitativelyIs the Book Finished?
Brainstorm Possible CustomersSketching a Lean CanvasProblem and Customer SegmentsUnique Value PropositionHow to craft a unique value propositionSolutionChannelsFree versus paidInbound versus outboundDirect versus automatedDirect versus indirectRetention before referralRevenue Streams and Cost StructureRevenue streamsCost structureKey MetricsAcquisitionActivationRetentionRevenueReferralUnfair AdvantageNow It’s Your Turn

What Is Risk?Rank Your Business ModelsSeek External Advice
Assemble a Problem/Solution TeamForget Traditional DepartmentsStart with the Smallest Team Possible, but No SmallerThe three must-haves: development, design, and marketingBe Wary of Outsourcing Your Problem/Solution TeamRunning Effective ExperimentsMaximize for Speed, Learning, and FocusIdentify a Single Key Metric or GoalDo the Smallest Thing Possible to LearnFormulate a Falsifiable HypothesisValidate Qualitatively, Verify QuantitativelyMake Sure You Can Correlate Results Back to Specific ActionsCreate Accessible DashboardsCommunicate Learning Early and OftenApplying the Iteration Meta-Pattern to RisksWhat About Unfair Advantage?
No Surveys or Focus Groups, PleaseAre Surveys Good for Anything?But Talking to People Is HardFinding ProspectsPreemptive Strikes and Other Objections (or Why I Don’t Need to Interview Customers)
What You Need to LearnTesting the ProblemFormulate Falsifiable HypothesesConduct Problem InterviewsWelcome (Set the Stage)Collect Demographics (Test Customer Segment)Tell a Story (Set Problem Context)Problem Ranking (Test Problem)Explore Customer’s Worldview (Test Problem)Wrapping Up (the Hook and Ask)Document ResultsDo You Understand the Problem?What Are the Problem Interview Exit Criteria?
What You Need to LearnTesting Your SolutionTesting Your PricingDon’t Ask Customers What They’ll Pay, Tell ThemDon’t Lower Signup Friction, Raise ItThe Solution Interview as AIDAHow Is This Different from a Pitch?Formulate Testable HypothesesConduct Solution InterviewsWelcome (Set the Stage)Collect Demographics (Test Customer Segment)Tell a Story (Set Problem Context)Demo (Test Solution)Test Pricing (Revenue Streams)Wrapping Up (the Ask)Document ResultsDo You Have a Problem Worth Solving?What Are the Solution Interview Exit Criteria?
Product Development Gets in the Way of LearningReduce your mVPGet Started Deploying ContinuouslyDefine your activation FlowThe Anatomy of an Activation FlowBuild a Marketing WebsiteThe Anatomy of a Marketing WebsiteThe Landing Page Deconstructed
The Need for Actionable MetricsWhat Is an Actionable Metric?Metrics Are People FirstSimple Funnel Reports Aren’t EnoughSay Hello to the CohortHow to Build Your Conversion Dashboard
What You Need to LearnFormulate Testable HypothesesConduct MVP InterviewsWelcome (Set the Stage)Show Landing Page (Test UVP)Show Pricing Page (Test Pricing)Signup and Activation (Test Solution)Wrapping Up (Keep Feedback Loop Open)Document Results
Make Feedback EasyTroubleshoot Customer TrialsAcquisition and ActivationRetentionRevenueReferralAre You Ready to Launch?What Are the Launch Criteria?3, 2, 1 ... Launch!
Features Must Be Pulled, Not PushedImplement an 80/20 RuleConstrain Your Features PipelineProcess Feature RequestsThe Feature LifecycleHow to Track Features on a Kanban BoardThe Process Steps Explained
What Is Product/Market Fit?The Sean Ellis TestFocus on the “Right” MacroWhat About Revenue?Have You Built Something People Want?What Are the Early Traction Exit Criteria?What About the Market in Product/Market Fit?Start by Identifying Your Key Engine of GrowthSummaryDesign Pattern for a Network Effects ProductDesign Pattern for a Multisided (Marketplace) Product
What’s Next?Life After Product/Market FitDid I Keep My Promise?Keep In TouchResourcesBooksBlogsTools
How to Build a Low-Burn StartupWhy Premature Fundraising Is a Form of WasteHow to Achieve Flow in a Lean StartupThe Conflicting Pull for TimeCreating Daily FlowCreating Weekly FlowEliminating Software WasteHow to Set Pricing for a SaaS ProductWhat About Freemium?The Problems with FreemiumHow to Approach FreemiumHow to Build a Teaser PageHow to Write a Sales LetterHow to Create a Teaser Landing PageHow to Get Started with Continuous DeploymentCommitTestDeployMonitorHow to Build a Conversion DashboardHow to Collect DataHow to Visualize Your Conversion DashboardHow to Track Retention

Content preview from Running Lean, 2nd Edition

Chapter 15. Conclusion

Congratulations! We’re done.

What’s Next?

I believe that the life of any startup can be divided into two parts: before product/market fit (call this “BPMF”) and after product/market fit (“APMF”).
—Marc Andreessen, “The Pmarca Guide to Startups”

Life After Product/Market Fit

Getting to product/market fit is the first significant milestone of a startup. At this stage, some level of success is almost guaranteed and your focus can now shift from learning to scaling (see Figure 15-1).

Figure 15-1. After product/market fit

Along with continually tuning and resetting your engine of growth to meet customer adoption challenges as you attempt to “cross the chasm” between early adopters and mainstream customers,^[25] you will inevitably also be faced with new challenges as you grow your company.

Every process works well until you add people.

The key is to build a continuous learning culture of experimenters versus specialists, where it’s everyone’s job to be accountable toward creating and capturing customer value.

The Toyota style is not to create results by working hard. It is a system that says there is no limit to people’s creativity. People don’t go to Toyota to “work,” they go there to “think.”
—Taiichi Ohno

Did I Keep My Promise?

I started this book stating that no methodology can guarantee success, but I promised a repeatable, actionable process for building products, one that ...