In 2008 US based tech startups have used the lean startup processes outlined by Eric Reis, Steve Blank and Alexander Osterwalder. It is a system that values experimentation over planning, market feedback over intuition and an iterative approach to product development instead of a belief that if fully built the customers will come.
The ever evolving lean canvas has replaced the established business plan. Instead of assuming that the imagined business model will work, the lean system searches for a business model that works based on actual evidence. It is said that business plans rarely survive the first contact with customers. They often don’t behave in the way you think they will. Boxer Mike Tyson perhaps articulated this truth most colorfully when he said, “Everybody has a plan until they get punched in the mouth.” The same is true for small business owners and the customers they wish to serve.
Small business owners can leverage the lean startup principles and processes used by tech entrepreneurs to build and deliver great products to thousands, if not millions, of customers quickly and affordably. Here are 3 ways you can leverage tech lean startup principles to boost your small business today:
1. Validate Assumptions to Mitigate Risk
The primary difference between the old established route to business success is that the lean startup entrepreneur first asks “Should this idea be brought to market?” instead of “How do I build my product?” Write down all of the assumptions you have about your idea and how the market will respond to your idea. Include what you think it will cost to develop your product, who it will benefit most, how you will drive awareness to your big idea and how you will sell it. Then come up with small experiments to test your idea.
For example, if you’re thinking about starting a food truck business selling meat pies, you could easily and affordably launch a simple landing page announcing that your “Meat Pie Food Truck” is coming soon and a spot for people to enter in their email address if they want to be notified when it arrives in their area. You could then run a series of Facebook ads to drive targeted traffic to your landing page and analyze how many people sign up for the announcement. The campaign could run for 10 days at $5 per day. If no one signs up you may want to rethink your idea or test with a better value proposition, or ad “hook” to motivate interest and the click through to the landing page. Start testing the assumptions that are the most riskiest to your business viability.
2. Talk To Your Market
One of the biggest reasons business owners struggle is that they look at their business and their product from their own perspective. The problem with that strategy is that the market doesn’t think about your business and product the way you do. They have their own opinions, their own perspective. In order to find out, specifically, how your market thinks about your company and what you have to offer you have to talk to them. Google does not have your answers. You need to get away from your desk and go to where lots of people in your market can be found. You might find groups of them at meet ups. They could be shopping at the mall. Figure out what they have in common in the types of places and events they attend and get your butt over there.
Ask open-ended questions about the relevant problems they have, what pisses them off, what creates the biggest pain in their daily life or work. Seek to learn. Dig deep to fully understand their perspective impact of the problem (pain), what difference it would make to have a solution (benefit) and what’s working and not working about the things they are now using to try to solve the problem. Do no selling. Just learn as much as you can.
3. Start with a Minimum Viable Product
Instead of investing a lot of time, energy and money in fully developing your product just build the simplest and smallest version of it to test to see if you’re headed in the right direction. Analyze the feedback you get in your initial talks with people in your market. Identify the one most important thing your product must do to deliver the benefit your market is actively seeking.