The Lean Startup or an appeal to rethink entrepreneurship

Marc Zuckerberg, founder, and CEO of Facebook once described Entrepreneurship as translating your passion into a business. This assertion is interestingly brilliant considering that it puts into simple words the concept of entrepreneurship, which remains an enigma for most of us. Indeed, this description reminds us that the entrepreneur needs to put together his or her interests and personal assets in pursuing an economic opportunity. Nevertheless, I was disillusioned to learn from a study conducted in the USA that in general, 90% of startups fail. The report convincingly affirmed that “the absence of market needs” remained the main reason for this high failure percentage. In other words, the goods or services that most startups conceive and want to sell do not find any buyer or do not suit the potential purchaser’s needs. This information has significantly triggered my inquisitiveness to ascertain the best approach to create and manage successful ventures.  Fortunately,  my disappointment has started to dispel as I was recently exposed to a powerful method that makes the process of starting a company less risky. Indeed, it enables entrepreneurs to create prosperous businesses using wisely their resources. In this blog, I am presenting the key features of the methodology and sharing my personal experience in applying it.

My name is Sanane Behi and I am part of the professional MBA 2nd year at the Telfer School of Management. I always had an interest in entrepreneurship and this long-time attraction finds its origin in my childhood. In fact, my father had several businesses and I grew up watching him managing his enterprises and undergoing all the emotions that a businessperson can possibly endure. Since my father had warned me that being an entrepreneur is a tough and arduous endeavor, I found judicious to give myself the necessary time to grasp the rudiments before I make the big jump. Thus, when I learned that the Telfer School of management was offering an entrepreneurship course, I did not hesitate to enroll in the program. As I could expect, the course taught by Prof. Daze provided me with a unique opportunity to learn and rehearse a new venture creation process. Furthermore, Prof Daze presented us with the Lean Startup approach, a revolutionary method advocated by Eric Ries in his book “The Lean Startup”. This method distinguishes itself from the other methods that have been previously applied by businesspersons as it encourages experimentation over complex planning, customer feedback over intuition, and iterative design over traditional “big design up front” development. Actually, the Lean Startup method urges entrepreneurs to implicate potential customers early in the development and production stages of the new product. This will enable you to benefit from the feedback gathered directly from the potential clients to refine the product, so it respects the customers’ needs. Actually, the Lean Startup method relies on five principles but in this paper, I am drawing your attention to two key principles: 

1.    “Validated learning”: The idea here is that entrepreneurs’ business ideas remain a series of assumptions until there are validated by potential customers. Therefore, the method suggests summarizing those hypotheses in a framework called a “business model canvas”, which is essentially a diagram that depicts how the future venture is going to create value for itself and its customers. 

2.    “Build-measure-learn”: The method advocates for an experimentation approach called “customer development” consisting of seeking potential customers’ views on all aspects of the business model to redesign their offerings and make the necessary adjustments (“iterations or pivots”). The inputs obtained will then be used to assemble a “minimum viable product” which will help further tailor the product to the specific needs of its customers.

In sum, the lean method helps eliminate wasted time and resources by developing the product iteratively and incrementally.

Additionally, my team’s project involves the creation of a specialized creperie in the region of Ottawa as we observed that there was no such creperie the region.  As suggested by the Lean Startup method, we started with devising our business canvas model to better comprehend the elements of our venture.  We then selected validation methods (Face-to-face interviews, online surveys etc.) suited to contact our potential customers and approached them to get their feedback. As predicted by the Lean method, the comments received were incredibly fruitful and truly gave us an enhanced sense of what our potential client is really looking for. Consequently,  we readjusted our business model based on the feedback collected, and we began working toward developing our minimum viable product that we are going to test to make sure that it suits well the customer’s need.  

As you read these lines, I am persuaded that you want to know the outcome of this fascinating journey that we have begun with our business project. Not to worry,  I am pledging to write another blog which will relate the progress that we will have done with the project and the result obtained with the Lean method. I sincerely hope that you learn something from this modest article and I strongly encourage you to leave your comments and feedbacks.