Most Technology Start-ups take the following conventional approach in their endeavour to start a successful business like prepare an elaborate business, plan pitch it to investors, build a team, develop and introduce a product, sell the product.
Lean Start-up Lean Product Development for Start-Ups
Most Technology Start-ups take the following conventional
approach in their endeavour to start a successful business :
- prepare an elaborate business plan
- pitch it to investors
- build a team
- develop and introduce a product
- sell the product
Research shows that 3 out of 4 start-ups end up failing in their
endeavour somewhere along this path. In most cases, further the
stage of the failure from the point of inception, higher is the
cost of failure.
The alternative Lean approach for Product Development by
Start-ups is essentially based on the following philosophy :
- build a 'minimum viable product' based on continuous 'customer
development'
In the Lean Start-up model the founders do not begin with a
business plan, instead they begin with the search for a business
model. In this approach, multiple quick iterations of
experimentation and feedback are conducted which result in a
business model that is executable.
This will typically follow the following sequence :
- Translate idea into business model hypothesis.
- interact with one or more customers to test the hypothesis and
validate the assumptions about the customer needs.
- create a 'minimum viable product' to fulfill a customer
need
- let your customers try out the product and get feedback
- based on the customer feedback develop the next iteration of
the 'minimum viable product'
Business Model Hypothesis :
Founders are expected to briefly describe the hypothesis in a
framework called Business Model Canvas. This involves listing out
how the company will create value for itself and for its customers
in the Business Model Canvas (shown below) provided by Business
Model Generation. This is a template in which you need to answer a
set of questions under 9 key areas resulting in the business model
hypothesis.
Read Full Blog : Lean Start-up Lean Product Development for
Start-Ups
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