lean.md

Business plans suck

• Guess
• Empirical testing, not theory
• Lean canvas is good to snapshot and define

By the end of the program, I expect it to be a mess, full of scribbled out assumptions that were wrong. Be very willing to tweak it

Customer Segments

• Build something that people want

1. Split broad customer segments into smaller ones

For example, for a photo sharing service: Anyone that shares lots of photos and videos turns into:

1. Photographers
2. Videographers
3. Graph Designers
4. Architects
5. Doctors

Make sure you aren't too broad, but also don't be too narrow. Err on the side of narrowness

• Write down your main customer segment
• List the other customer segment
• Be sure to distinguish between customers and users
• Customers pay you.
• Multiple canvases for more complicated models (e.g where you need buyers and sellers, with different incentives, etc)

Early Adopters

• The success of your business model is highly dependent on defining & qualifying early adopters
• Who need your product the most?
• Facebooks early adopters = Harvard students

Problem

• What are the top 1-3 problems that your early adopters have?
• Why is this a problem x3
• Painkillers vs. Vitamins
• What is the job the customer is 'hiring' you to do?
• How do they currently try to solve the problem?

Solution

• Your solution
• Embrace an MVP - SMALLEST solution you can build that delivers value
• Be okay with changing this solution
• Briefly outline how you envision solving each of your problems

Value prop

• Craft your Value prop around your #1 problem, and the benefit that customers receive
• Avoid marketing words
• End result the customer wants + period of time + address objections
• Create a high concept pitch - distill your product into a few words (e.g. uber for x). This is NOT a value prop, but its very valuable b/c it will help you easily explain the product

Revenue Streams/Pricing

• Pricing is totally your product
• Pricing determines your customers
• Economics - luxury goods vs normal goods
• Price for value, not cost
• They will compare to existing alternatives
• Keep your pricing VERY simple at the start, you don't need multiple pricing plans
• Keep something for your early adopters, and keep their existing alternatives in mind

Channels/Paths to customers

• Difficult to get right
• How will you get in front of customers
• You need to get your product in front of many customers
• iterate on
• Start building and testing asap

Metrics

• How will you measure success
• Will change as your product moves through various stages
• (2) key metrics
• One that works out some way to measure how your customers derive value
• Second is one that works out your success metric - revenue target? customer target?

Cost Structure

• Obviously impossible to get this completely right, but it's value to ballpark
• Outline your fixed, variable costs
• Go for short term

Unfair/Competitive Advantage

• What makes you better than the others
• First to market is not a unfair advantage - Apple, Microsoft, Google, Facebook.
• Something that cannot be easily copied or bought
• It's okay if you can't find one right now. it's cool to leave it blank, don't leave it weak and you might find one over time.