Learn-Measure-Build by Janice Fraser

Learn-Measure-Build Craft Useful Experiments By Running Backwards

Janice FraserDecember 2013

1Monday, December 16, 13

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Luxr.coRadically helpful workshops for

startup founders

First month free...use discount code: TEHCARD


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TWEET!

#LeanStartup

@clevergirl@luxrco


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• Learn the difference between an experiment and a solution test.• Discover the seven steps to crafting an experiment with a clear

result. • Practice identifying assumptions and defining testable

hypotheses. • Understand the anatomy of an experiment. • Design an experiment to test a real-life hypothesis.

• "Get out of the classroom" to run a real-world experiment on your fellow conference-goers.

• Define a result and make a go-forward decision. • Refine the experiment based on cost, time, and manpower. • Identify the four characteristics of successful experiments.



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LEAN Star tup


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LEAN Star tup


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Build measure

learn!


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Lean Startup is NOT


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Lean Startup is NOT

Cheap Startup


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Lean Startup is NOT

Cheap Startup

Fast Startup


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Lean Startup is NOT

Cheap Startup

Fast Startup

Shortcut Startup


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Lean Startup is...


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An approach for building companies that are creating new products and services in situations of extreme uncertainty.

Lean Startup is...


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An approach for building companies that are creating new products and services in situations of extreme uncertainty.

The approach advocates creating small products that test the entrepreneur’s assumptions, and using customer feedback to evolve the product, thereby reducing waste.

Lean Startup is...


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1. List your assumptions.2. Understand your customers.3. Experiment efficiently.4. Adjust direction based on evidence.


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Go backward to go forward.

Learn

Measure

Build


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Think of it like this...


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TDD


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TDD

A Lean Startup is a test-driven COMPANY


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Write the test first


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Plot the difference

THINK

release

MAKErelease

MAKErelease

MAKE

RISK

= U

NVAL

IDAT

ED EF

FORT

TIME


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Lots of little wigglesRI

SK =

UNV

ALID

ATED

EFFO

RT

TIME


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RISK

= U

NVAL

IDAT

ED EF

FORT

TIME

Each wiggle is a learning cycle.

MAKE

releaseBUILD

LEARN

BUILD

MEASURE


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There’s a pattern to startup work:

ideation decisionmaking

ideation etc.


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1. Choose the problem to tackle. Clarify what’s uncertain, what you need to learn.

2. Understand the possible answers.3. Brainstorm “what you could do to prove it”.4. Choose the most broadly differentiated set of

indicators.5. Run the experiment. 6. Write down the results...on a sheet of paper. 7. Project the results into your future.

7 steps to foolproof experiments


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Box Me UpProvides you with plastic storage boxesTranports your stuff to storagePay to get your stuff back Per-box per year1 round trip per transactionIs it profitable?Storage facility “outside the city” that they have a long-term leaseThey keep your stuff for a yearFully secured; all sorts of insurance; 24-hr armed security.3 sizes of boxTarget customer is Young Families, 2 incomes, urban, 2 kids, owns homeFull “Bill of Lading” Which you fill out online. Max insurance is $500/box. Next-day pickup and deliveryCOGS: $12/box, avg., $6/box per storage, Assumption 40% capacity yr 2. Within 15 of the cityIf no-pay, stuff gets auctioned after 90 days of no-pay.Not a Moving company.Drop-off and pickup are same location. Nothing prevents business useRIght now margin is negative, because we’re not at scale. No union issues.Breaks even in year 3. No special handling boxes.Raised $5m series A from Sand Hill Road VCs150 customers in SF and 42 in NY. Size = boxbee sizeCommitted to pay $28/box/yr. Cost of customer acquisition? Nobody is paying up front.


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UsesMary can...

Features

Users

Business thinking goes here

whywhathow


Themed Releases

This Week

How Products Work


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UsesMary can...

Features

Users

Sketches, wireframes, pixels


whywhathow


Themed Releases

This Week

How Products Work


© LUXR.CO 2013


UsesMary can...

Features

Users

Sketches, wireframes, pixels


whywhathow


Themed Releases

This Week

How Products Work THINK

MAKECHECK

BUILDMEASURE

LEARN


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4 Characteristics of Successful Experiments1. High-stakes learning goal.2. Extremely clear, focused hypothesis with

controlled variables. 3. Broadly differentiated indicators

covering all possible outcomes.4. Right size and scale.


Learn-Measure-Build by Janice Fraser

Business

Transcript of Learn-Measure-Build by Janice Fraser