Lean startup in 6 minutes

Reading Time: 6 minutes

Starting a company does not require having an extensive capital any more. You can start a business from your living room in day or faster following methods introduced by lean startup. In other words, no money, no access, no connections? Not a problem. All you need is to find out a need, pain or market gap and follow it relentlessly. But, how will you know if that specific idea you have is viable? Let’s discuss the process leading to success.

Lean research

One of the first advice Steve Blank gives to people is to “get out of the building”. This part of lean canvas is called “customer discovery”. The name stands for itself. You need to meet your potential customers and talk with them to find out if your idea is feasible or not. Only by interviewing the people you can discover what their pains and needs are and then put together an idea for a product they will want. Test the problem. You also go the other way and take the risk of making a product based on your own ideas without doing any research.

Next step is “customer validation”. In this part of lean methodology you are testing your solution. You know there is a need, pain or a gap on the market with potential customers. Your next move is to create an MVP which stands for “minimum viable product”. Key word is “minimum”. In this part, you need to move fast and not fall in love with the result because you will probably have to pivot couple times and modify your product.

Customer validation part can be approached from various angle. You can either develop some basic app, website or beta version (real product) to show it to potential customers, or you can create just a simple mockup or paper model to simulate to behavior of real version. Both of these options are applicable. It only depends on how lean and fast you want to go.

Lean development using habits

The basic habit loop you can find hidden under any habit you can imagine compose from three parts. These parts are cue, routine and reward. Those are the three key factors you need in order to form a new habit or change the one already existing. Knowing these information can help you make your product or service better or even create it from a scratch. A few months ago, Nir Eyal published a great book about habits and product creation called Hooked: How to Build Habit-Forming Products.

In his latest book Nir talks about the four patterns you need to remember and implement when creating a habit-forming products or services. These patterns are a bit like an extension of our previously mentioned habit loop. The patterns are following … Trigger, action, reward and investment. As said, you can see the similarity. Cue and trigger, routine and action, reward. However, the fourth and last pattern, investment, is what matters the most.

Let’s start discuss these patterns starting with trigger. Trigger can be either internal – coming from within you (emotions and behavior) – or external – coming from the outside. Example of external trigger can be an app notification or a website link. Your goal is to connect the external trigger with internal (behavior and emotion). Action follows immediately after the trigger. The longer the delay between those two, the less likely will user follow the loop and complete it, i.e. create new habit and use your product repeatedly.

One thing you can do is making the action as easy as possible. Remove every obstacle, limit the options and simplify the whole process that needs to be done (shorter form, less text, bigger buttons, etc.). Reward comes right after the action. When you drink your coffee or tea in the morning, and feel the taste? When you get workout done and endorphins are rushing through your head? When you check the feed on Facebook or Pinterest and dopamine is taking control over your mind? That’s the reward.

Important thing about reward to mention, it needs to be less predictable. If your product will deliver the same reward over and over again, users will lose interest. You need to keep it more or less unpredictable, mix a bit entropy and novelty into it. Pinterest is a great example. You never know what pictures you will discover, that’s why you are scrolling down continuously. The last pattern is an investment. Simply, if you want the user to come back they need some reason for it.

Some examples of the investment can be filling up personal details into profile, inviting friends going through tutorial or letting people to create something and store it. Online services and tools like canva or task management tools like asana and Trello do a great job. By letting you create some design or schedule for your team and storing it into your account, you have some reason to come back in the future, for task schedule definitely.

Investing your time to explore psychology and mechanic of habits will help you invent products your users will not only love to use, but will use them repeatedly. That’s what you should aim at with your business. Customers using your product on a daily basis can easily be converted into your evangelist and spread the message (your business) further without the need to spend any resources on your side. If you don’t believe me, take a look at Dropbox, Instagram, Snapchat or Facebook and the way they grew.

The last thing or a piece of advice for you is to focus on one feature. You don’t need to create a Swiss knife, at least not in the beginning. Aim for getting done one thing and do it better than anyone else. Later on, you can slowly add or adjust your product or service according to the feedback from your users. In the beginning more features will only distort your focus and waste precious time and resources.

Lean marketing

You’ve got a viable product and existing market for it. How will you get the people talking about it? You can use many hacks or lean methods to spread the word. One method is viral marketing. This method uses existing social networks and services to increase awareness of your product. The goal is to motivate people to talk about your product in positive terms, word-of-mouth. To get this done you need to focus on emotion, positive if possible.

Think about showing your product or service in the best light. Show people how it will benefit them and how easier their lives will be thanks to it. Remember, focus on positive emotions and avoid the negative ones. You want your product to be associated only with good feelings. Avoid attacking your competitors and comparing yourself with them. Also, implement a bit of unpredictability to trigger curiosity in people.

What would lean marketing be without growth hacking. Yes, another buzzword to your toolbox. Like viral marketing, growth hacking also focuses on word-of-mouth and social media as the main advertising channel. Again, your goal is to motivate people to bring their friends on board by coupons and promotional codes. Good examples of growth hacking practices are offering additional storage space used by Dropbox and Box. You will get x amount of space for inviting x amount of friends. Or Treehouse … invite your friends and you will pay less for a month fee. Similar approach is used by avast!.

Think about how you can engage your users and motivate them. Can you give them something special in an exchange for bringing their friends? You could give them lower prices or some “hidden” feature for signing up early. Use your product or service as a premise and think out of the box, use your creativity and fantasy.

Conclusion

Using lean startup methodology and few hacks along the way can help you build business faster and with less resources then before. You |no longer need to spend weeks or months thinking about some groundbreaking idea if you don’t want. Spending huge amount of money on advertising is also not a pre-requisit for building successful company. In this age, you can start right now with what you have and create something remarkable. What are you waiting for?

Thank you very much for your time. And, until next time, have a great day!

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