Has there ever been that time when you’ve delayed reading a book because of the hype surrounding it? The bestselling book by Eric Ries, ‘The Lean Startup – How constant innovation creates radically successful businesses’ just happened to be one of those business books that made it into my “must-read” book list only to be relegated to the “sometime later must-read” book list for many months till I finally decided to pick it up and astoundingly finished it in a couple of days. While a lot of business books tend to be largely intuitive and too high level to be useful to anybody, the Lean Startup is a sparkling gem by Eric Ries, the founder and former CTO of IMVU (creator of 3D avatars), that definitely lives up to the hype surrounding it.
This book addresses some of the key problems facing startups including extreme uncertainty and risk. Nearly 50% of the small businesses in the US fail in the first five years itself. Lack of capital, over investment and lagging sales are some of the causes for this sobering statistics. With The Lean Startup, Eric Ries seeks “to change how startups are built.” Drawing on his experiences as a technology entrepreneur he propounds the use of a methodology called the “lean start-up,” which favors experimentation over detailed planning, feedback from the customer rather than intuition, and iterative design over traditional “big design up front” development. In short, this book aims at educating people that rather than wasting their time, money and resources in creating something that no one wants, it is better to do iterations of small batches of work combined with careful measurement. The book is an amalgamation of various ideas such as the “Lean Manufacturing” of Toyota and Agile Development. It advocates that entrepreneurs instead of having a “just do it” attitude and avoiding all forms of management, process, and discipline should focus on “managerial discipline to harness the entrepreneurial opportunity we have been given.” He methodically divides the book into three parts. Part one: Vision, part two: Steer and part three: Accelerate. The final chapter in the book is titled Join the movement.
Despite the loaded topic, the book is a surprisingly easy read. Some of the concepts such as the Build-Measure-Learn and the Minimum Viable Product (MVP) and innovation accounting for measuring progress through actionable metrics that help to tie in cause and effect are extremely interesting and keeps you hooked. His definition of a startup as a, “a human institution designed to create a new product or service under conditions of extreme uncertainty” is particularly good.
Another significant concept which he introduces is the Pivot or Persevere where once you’ve learned what works and what doesn’t, you need to decide objectively if you should pivot or persevere. “Pivots can be tiny, small, medium or large. They may take the form of singular product feature changes, shifts in customer segments, modifying of platforms, redesign of business architecture, changes in growth engines, technology migrations and more.” As an end note, he also advises startup owners to should build “adaptive organisations” with a culture that values learning from mistakes while operating with discipline.
Ries intersperse his theories with fresh entrepreneurial stories and numerous case studies, mostly drawn from the technology industry. One such fascinating story was of SnapTax where a team of five individuals were given the freedom to experiment while held accountable throughout the process, leading to more-than-impressive results.
The Lean Startup is an excellent resource for people who have jumped into the startup pool but do not know how to wade in it. It advocates thinking big and starting small for improving chances of success and minimizing typical startup failures. This, he believes, will also lead to lesser wastage. Ries is extremely clinical in his approach and the book has a methodical step-by-step approach that start-ups can follow easily. And while you are it, don’t forget to check out the references to interesting websites and required and future reading.
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