Lean Startup, Customer Development, and the Business Model Canvas
Startup Dhaka
Key Lean Startup Concepts
Uncertainty and Scarce Resources
Lean Startup Innovations
Old School
• Business Plan First• Startups = Small
Companies• Linear Process• Product Development First• Beta Test
New School
• Business Model First• Startups = Temporary Search
Organizations• Iterative Process
• Customer Development First• Minimum Viable Product
Customer Development
• What Needs to be True for Your Business Model to Work?
• Evidence from Interviews• Hypotheses Cannot be Trite,
Ridiculous, or Non-Confirmable• Why, Why, Why, Why, Why?
Hypothesis Development
Build-Measure-Learn Cycle
What Most Startups Want to Build
What They Should Build First
Eventually Build This
Business Model Canvas
Source: http://businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf
PRODUCT-MARKET FIT
Customer Archetype
Value Propositions
Pains and Gains – NOT FeaturesPain Killers
• Reduce Waste• Kill Frustration• Fix Underperforming
solutions• End Customer Challenges• Wipe Out Negative Social
Consequences• Eliminate Risk
Gain Creators
• Create Savings• Better Outcomes• Customer Delight
• Ease Work Flow or Life• Create Positive
Consquences
http://www.behaviormodel.org/
Case Studies
Technical Insight
Market Insight
Initial Value Proposition: Accuracy
Tactics: VP RankingPain Killers Gain Creators
Relevance 1. Test Strip Cost2. Delivery/ Payment3. Meter Cost4. Small Sample Size 5. Alternative Site Testing
(Less Pain)
1. Test Speed2. No Coding3. Large Display4. Form Factor5. Memory
Frequency 1. Small Sample Size2. Alternative Site Testing3. Test Strip Cost4. Delivery/ Payment5. Meter Cost
1. Test Speed2. Large Display3. Form Factor4. Memory5. No Coding
Prototype v MVP
Value Proposition
Team PrivacyProtect privacy for users of location-based services (LBS)
The Business Model Canvas: ver 1.0
Creating awareness
educational
Technology
Privacy advocacy
groups
Developing costs
Marketing costs
App revenue (or free?)
trustBuilding trustSmart phone users uneasy about privacy
Perception of enhanced
privacy
Own website
Consumers Don’t Care
About Location Privacy
The Business Model Canvas: ver 2.0
Creating awareness
educational
Technology
Developing costs
Marketing costs
trustBuilding trust
Social Network
Providers
Security of Company Geodata
Companies uneasy about employees’ online
activities
Companies subscription charges
Own website
Avoid direct employer -> employee monitoringWe Have No Key
Technology Resources
The Business Model Canvas: ver 3.0
??? Consumers
???
Companies
???Understanding Aggregate Info
for Large Hidden
Databases in Real-Time
Without Crawling
???
Technology ???
???
Government Agencies
How to Get Interviews
• Friends and Families• Introductions• Affinity Networks
• Traditional Networking• Cold Calls• LinkedIn
12 Interview Tips1. One person at a time2. Know your goals and questions ahead of time3. Separate behavior and feedback in discussion4. Get psyched to hear things you don’t want to hear5. Disarm “politeness” training6. Ask open ended questions
7. Focus on actual behavior, not speculative or abstract feelings8. Listen, don’t talk9. Follow your nose and drill down10. Parrot back or misrepresent to confirm11. Ask for introductions12. Write up your notes as quickly as possible
Source: http://giffconstable.com/2011/07/12-tips-for-customer-development-interviews-revised/
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