The word “Pivot” seems to have become a cliché. We hear it all the time, but often times misunderstood as a mere change.
Pivot is one of the core concepts of lean startup and is a structured course correction based on the feedback from the marketplace. It isn’t easy, but powerful.
As the 4th slides of this series, I’ve tried summarizing what Pivot is as detailed in the lean startup book. Hope you enjoy.
I am sure that many of you have heard about MVP, minimum viable product. It is one of the core concepts of lean startup, but often times misunderstood as a mere prototype.
As the 3rd slides of this series, I’ve tried explaining what MVP is in detail with examples from the lean startup book. Hope you enjoy.
Happy New Year! I hope everyone has kick started the year nice and well.
As I promised, I am going to do a series of posts about Learn Startup.
Here is the second one – overview of key concepts. I hope you find it useful.
I have been a huge fan of Lean Startup. It is a methodology or set of practices, still WIP, and increasing its popularity quite rapidly. However, as it spreads, I noticed that many people misunderstand what it is and words like “pivot” took to have wings.
I’d highly recommend reading The Lean Startup by Eric Ries, and other related books, but also like to share my version of digests. I am planning to cover this topic as a series in the early part of 2012.
So today, as the last working day of 2011, I’ll share the very basic intro on Lean Startup. Stay tuned for what’s coming.
Wishing you all a very happy New Year!
One of my pet peeves is that some startups focus too much on the press as marketing or user acquisition strategies. The attitude is much more strong in Japanese companies, but you see it everywhere.
The idea of coordinated product and marketing launch probably stems from the experience at more established companies. There is nothing wrong with that in and of itself, but it doesn’t really make sense for early stage startups. Because, at that point, you are still figuring out the right product for the right market (yes, this is marketing as well), and your assumption could be totally wrong. The power of such press coverage isn’t much of discovery, it is about amplification. So, if you are wrong, you will let everybody knows that you have no clue. Not a smart thing to do, is it?
Today’s GigaOM article better explains this point with quotes from Eric Ries, so check it out.
Or worse, you are maybe skipping “figuring out” phase and simply believe that once you build your awesome product and get grand publicity for it, people will flock to your product and the user number skyrocket from there on. I must say that’s just too naïve. Yes, that happens and you could be one of the lucky ones, but the likelihood of this happening is so small, you (or your investor) will end up wasting lots of money and time.
Product launch and marketing launch can be and should be separated. By all means, go out with your product early and iterate often. You can’t be at the other end of spectrum, stealth mode, being too secretive about what you are making. Because you won’t be learning anything in that way.
Getting some press coverage by influential media certainly gives you a wave of traffic, but if you are not ready to ride on that wave, it could work against you. As getting on such media is not an easy task, you should use your shot wisely.
I saw some interesting numbers at Josh Kopelman’s Redeye VC blog that I’d like to share with you.
He compared his portfolio companies in different vintage on how long they took to get to $250K range revenue. To simplify the analysis, he’s set the time frame for 18 month. The result is;
just three of the fourteen companies in our 2005 fund (21% of the portfolio) generated revenues in excess of $250,000 during the 18 month period.
19 of the 32 companies in our most recent 2010 fund (around 60% of the portfolio) have already generated over $250K in revenues.
He says that investment strategy and initial amount haven’t changed, although the fund size and investment team size has increased. Further, he points out potential direct reasons that may have impacted this drastic change, such as the natures of portfolio mix (recent vintage has more e-commerce companies) and possibility that the team has gotten better at investment selection. As well as indirect ones, such as growth in monetization platforms and shorter time to market due to the decreased cost and technical complexity to start a company.
Yes, these are very small sample numbers and may be highly skewed due to the reasons like above. Yet, I think this is very interesting and somewhat in line with what I have been feeling. (I am no investor, but I do hear about various actual and read about other startup cases.) And I just noticed that Dave McClure jumps in comment saying “this was my intuition as well”. My guess is that a lot more anecdotes like this is out there.
I think this is a real trend. And I believe that one of the contributing reasons is the rise of more scientific approaches to make real progress, such as Lean Startup. Whether they identify themselves “lean” or not, I certainly see that more startups are employing techniques like MVP, metrics, and iteration with live users. Such approaches make sense and I think somewhat lower the hurdle for success. Because, you don’t need to be a genius or super star team to make it. You just have to be good at learning and be disciplined. Pretty encouraging, isn’t it?
One of the easiest traps I realized when I had an operational role in a startup was to get buried by everyday stuff to do. Doing this research, updating tweets, tracking a bug, preparing that report, responding to unclear business inquiry, etc. etc.
Getting things done makes you feel good for sure. But, you need to make sure that the stuff you are doing and checking off of your list is the right thing to do at the time. If it is not necessary or doesn’t have any impact on desired outcome, then the time and energy you used to finish the task is complete waste. Even worse, it gives you a false sense of accomplishment.
There are only a few things that matter depending on your phase. Get a new user. Make a user happy. Engage a user. Decreases user dropout. Increase revenue. So on and so forth. Does the stuff you are doing right now contribute to any of these?
Most of the to-dos and daily routine were planned at some point to address these, but they may not be appropriate any longer. Situation may have changed or they simply have lost meaning behind once assigned to someone else.
It’s about the old efficiency vs. effectiveness dilemma. There is no point in executing wrong things perfectly.
It is so easy though to postpone what really matters. Life goes on by attacking to-do list heads down day in and day out. Especially so when you are swamped or even have a not-so-enlightened micromanaging boss. What you have to do is to step back once in a while and evaluate if you are moving to the right direction.
You gotta start and move a step forward. Easier said than done, I know. This is a note to myself as well. I had procrastinated for too long to do this first post. The theme and rest of the setting is not done yet, but so what, it doesn’t matter.
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