Startup Methods I - Lean Startup, Agile Programming

UNIT 6 Startup Methods I  Customer Development Manifesto 1. There are no facts inside your building, so get outside. 2. Pair customer development with agile programming development. 3. Few business plan survives first contact with customers. 4. Failure is an integral part of the search for the bus...

UNIT 6 Startup Methods I  Customer Development Manifesto 1. There are no facts inside your building, so get outside. 2. Pair customer development with agile programming development. 3. Few business plan survives first contact with customers. 4. Failure is an integral part of the search for the business model. 5. If you’re afraid to fail, you’re destined to do so. 6. Iterations and pivots are driven by insight. 7. Validate your hypotheses with experiments. 8. Success begins with buy-in from investors and cofounders. 9. Focus on market type; it changes everything, (existing, new, re-segmented, clone) 10.Fast, fearless decision-making, cycle time, speed and tempo 11.If it’s not about passion, you’re dead the day you open your doors. 12.Not all startups are alike. 13.Metrics of startup are different from metrics of existing companies. 14.Startup titles and functions are very different from a company’s titles and functions 15.Preserve cash while searching for the best business model. After its found, spend. 16.Communicate and share learning. 17.Startups demand comfort with chaos and uncertainty.  Lean Startup Method Startup: is a temporary company designed to search for a repeatable and scalable Business Model. The lean startup method is not about cost, it is about speed. Lean startups are supported by a compelling vision, and are rigorous about testing each element of the vision. Lean Startup: is a way of developing enterprises based on quick product cycles with intense, hypothesis-driven experimentation and adaptive learning that allows for a repeatable & scalable business model paired with an agile customer development focus. A process that undergoes constant changes and iterations. Lean Startup Method Startups that follow the Lean Startup Method often deploy two other related methods: Agile programming Business Model Canvas Agile Programming a lean startup principles for development in which requirements and solutions evolve through collaboration, where the team regularly reflects on how to become more effective before tuning and adjusting behaviors accordingly. The concept emerges from Agile software development programming.  Tools for developing thinking skills 5 Why Analysis Five whys (5 whys) is a problem-solving method that explores the underlying cause-and-effect of particular problems. The primary goal is to determine the root cause of a defect or a problem by successively asking the question “Why?”. Number ‘5’ here comes from the anecdotal observation that five iterations of asking why is usually sufficient to reveal the root cause. In some cases, it may take more or fewer whys, depending on the depth of the root cause. Example for Five Why's Problem: My car is not working 1. Why won’t your car start? (First why) Because the battery is dead. 2. Why is the battery dead? (Second why) Because I left my headlights on. 3. Why did you leave your headlights on? (Third why) Because I forgot to switch them off. 4. Why did you forget to switch them off? (Fourth why) Because I was in a hurry. 5. Why were you in a hurry? (Fifth why, a root cause) Because I didn’t plan well and had too much to do. Root Cause: I am not planning my time well. Exercise Think of a time when you did not meet a goal. Use the Five Why’s process to get to the root cause of why this goal was not achieved.  Business Model Canvas Business Model Canvas is a lean startup approach for developing new business models. It is a visual chart with nine "building blocks" describing a firm's value proposition, infrastructure, customers, and finances. The Business Model Canvas was introduced in 2005 by Osterwalder. Business Model Canvas in 5 Minutes - UK https://www.youtube.com/watch?v=_4MHqyf4Vw0  Name or Company Name: Team Date: The Business Model Canvas COMPANY NAME MM/DD/YY Key Partners Key Activities Value Proposition Customer Relationships Customer Segments Who are our Key Partners? What Key Activities do our What value do we deliver to the What type of relationship does For whom are we creating value? Who are our Key Suppliers? Value Propositions require? customer? each of our Customer Who are our most important Which Key Resources are we Our Distribution Channels? Which one of our customer’s Segments expect us to establish customers? acquiring from partners? Customer Relationships? problems are we helping to and maintain with them? Which Key Activities do Revenue streams? solve? Which ones have we partners perform? What bundles of products and established? services are we offering to each How are they integrated with Customer Segment? the rest of our business model? Which customer needs are we How costly are they? satisfying? Key Resources Channels What Key Resources do our Through which Channels do our Value Propositions require? Customer Segments want to be Our Distribution Channels? reached? How are we reaching Customer Relationships? them now? How are our Revenue Streams? Channels integrated? Which ones work best? Which ones are most cost- efficient? How are we integrating them with customer routines? Cost Structure Revenue Streams What are the most important costs inherent in our business model? For what value are our customers willing to pay? Which Key Resources are most expensive? For what do they currently pay? Which Key Activities are most expensive? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?  Value Proposition Cost Customer Structure Segments Key Customer Partners Business Relationship Model Canvas (9 Components) Key Channels resources Key Revenue Activities Streams 1. Value Proposition 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? 2. Customer Segments For whom are we creating value? Who are our most important customers? 3. Customer Relationships What type of relationship does each of our Customer Segments 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? 4. Channels 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? 5. Revenue Streams For what value are our customers 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?