Eric Ries

Startup Advisor

The Lean Startup: Innovation Through Experimentation
17 minutes, 7.9mb, recorded 2010-05-04
Eric Ries

Lean Start-up movement concepts have entered the zeitgeist, says Eric Ries. His IT-sector "mid-term report card" shows an industry under pressure, but he says successful entrepreneurs have a superior process: the Lean Start-up process. They Pivot through a Build-Measure-Learn feedback loop. Lean Start-up techniques, such as Innovation Through Experimentation, can be applied to any company, industry, or start-up.

Not many IT "success" stories live up to the raw talent - plus passion, time, and energy - the founders and employees poured into them. This holds true across the IT spectrum, not just start-ups. This leaves us not taking enough risk. It results in faith-based decision-making and products nobody wants.

Still, entrepreneurship is a noble calling. Technological change is changing the face of work, and start-ups have to be put on a more rigorous footing. Ries says entrepreneurship is a specialized management approach, geared for great uncertainty. It should be distinct from general management because a start-up is an experiment. It's not just "Can we build a product?"; it's "Should we build it? Can we build a sustainable organization to support those products or services?"

Central to a Lean Start-up is the concept of "Pivot," a change in direction while staying grounded in what we've learned. The trick to a Pivot is to change one thing at a time. In the Build-Measure-Learn feedback loop, a Pivot is one full-turn through the loop. This feedback loop is "a unit of progress" in a start-up. Start-ups grow through validated learning, through a series of Pivots.

For start-ups, the question is not "How much money do I have left?", it's "How many Pivots do I have left?" The goal is to reduce time between Pivots to increase the odds of success before the money runs out. The techniques of the Lean Start-up process minimize the time through the feedback loop. Lean Start-ups are driven by a compelling vision and by rigorous testing of each element of that vision. According to Ries, we must test continually our assumptions against reality to see what actually is possible.

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Eric Ries is the author of the blog Lessons Learned. He was the co-founder and served as Chief Technology Officer of IMVU, his third startup. He is the co-author of several books including The Black Art of Java Game Programming (Waite Group Press, 1996). In 2007, BusinessWeek named Ries one of the Best Young Entrepreneurs of Tech. He serves on the advisory board of a number of technology startups including pbWiki, Smule, 750i and KaChing.

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