lean launchpad - week 3 - experiment day

Lean Launchpad:Experiment Day

Weekly Topics

» 5/12 – What to Expect» 5/19 – First Pitches» 5/26 – Experiment Day» 6/2 – Customers, Users, Payers» 6/9 –Value Propositions» 6/16 – Distribution Channels» 6/23 – Customer Relationships» 6/30 – Revenue Models» 7/7 – Partners» 7/14 – Key Resources & Costs» 7/21 – Lessons Learned Presentations

Today’s Agenda

- 09:05am - 404 Video - 09:10am - Review assignments / homework- 09:30am - Presentations- 10:00am - Design first experiment - 10:30am - Get out of the building! - 03:30pm - Review data- 03:45pm – Share-Out – What did you learn- 04:00pm - Design second experiment- 04:20pm – Homework + Coaching

404 Video

Video

Homework Review

Customer Development

Manifesto Rules

» 1: There are no facts inside the building, so get outside.» 2: Pair customer development with agile development» 3: Failure is an integral part of the search» 4: Make continuous iterations and pivots» 5: No business plan survives first contact with customers so use a business model

canvas» 6: Design experiments to test and validate your hypotheses» 7: Agree on market type. In changes everything» 8: Startup metrics differ from those in existing companies» 9: Fast decision-making, cycle time, speed and tempo» 10: It’s all about passion» 11: Startup job titles are very different from large companies» 12: Preserve all cash until needed. Then spend.» 13: Communicate and share learning» 14: Customer development success begins with buy-in

Customer Discovery

» Problem / Solution Fit» Earlyvangelists» MVPs» Business Model Hypotheses» Product features & benefits

Business Model Patterns

» Multi-sided» “Free”» Freemium» Open Source» Insurance» Bait & Hook» Open» Outside-In» Inside-Out

Business Model Design

» Epicenters» “What If?” questions» Ideation process» Team diversity» Brainstorming

Blog Posts

» What is a startup? First principles» Make no little plans – defining the scalable

startup» A startup is not a smaller version of a large

company

Presentations

»3-5 minutes˃Market Size˃ Type of business: IP, Licensing, startup,

unknown˃ Proposed experiments to test customer

segment, value proposition, channel and revenue model of the hypotheses.

Forward Intelligence

Appstore Analytics

WionTV

City Recess

Verb Club

Experiment Day Begins

Principles

All new business ideas begin as educated guesses- We often begin with assumptions- Design experiments to capture customer behavior data- Make good decisions based this data

Move through the loop quickly- Test riskiest assumptions via hypotheses- Do it again based on what you learned

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Assumptions and Hypotheses

What is the biggest assumption that if false, will cause my product to fail?

“If this is not true, we’re out of business”

Rank assumptions in order of greatest risk, develop experiments to validate/in each assumption.

What’s the difference between assumptions and hypotheses?- Hypotheses are numeric

What makes a good Experiment?

• Tests your riskiest assumption…• Based on a numeric hypothesis…• Measures real behavior (or as close to it as possible)• Can be built and executed quickly!

Minimum Viable Product

Build the least amount required to get the behavioral data you need to validate/invalidate your hypothesis.

Rapid Experiments with Customers

Ask yourself: Is this the minimum amount I can do to validate/invalidate my most important hypothesis?

Let’s Try It….

Based on your Business Model Canvas…

» Write down you top 5 riskiest assumptions, related to your customer and value proposition.

Let’s Try It….

» Prioritize these assumptions, riskiest at the top (are you sure..? Focus on customer problem assumptions)

Let’s Try It….

» Select the top assumption!

Let’s Try It….

» Write down at least three numeric hypotheses based on behavior

Let’s Try It….

» Select the hypothesis most likely to provide real validation

Let’s Try It….

» Create a list of 3 potential experiments based on this hypothesis

Let’s Try It….

» Choose first experiment to execute

Go, Go, Go!

» Return no later than 3:15pm

Data Review

» What was your hypothesis?» What was the experiment you designed to test the

hypothesis?» What was the result (pass/fail)» What did you learn?» What was surprising?» What will you do next?

Design Experiment 2

» Document / review / re-prioritize 5 riskiest assumptions

» Choose riskiest assumption» Write 3 measurable, behavioral hypotheses» Which one will provide best validation?» Brainstorm 3 experiments» Choose an experiment that will validate/invalidate

your hypothesis fastest.

Homework

» Team presentation for next class: (5 minutes)˃ Talk to as many customers as you can˃ What were your value proposition hypotheses?˃ What do customers think about your value proposition hypotheses?˃ Post updates in the Google group (lessons learned, canvas changes)

» Read: Business Model Generation p146-150, 161-168 and 200-211

» Read: The Startup Owners Manual p85-97