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Lean Startup Essentials
Part 1:
Why? & Lean Canvas
#1
#1: Lean Startup
Most startups fail from a lack of

(paying) customers.
#1: Lean Startup
Startup:
Temporary organization used to
search for a repeatable and scalable
business model.
As defined by Steve Blank.
#1: Lean Startup
Your initial Goal:

Improve likely success rate of your venture,
and reduce risk of failure.
Enable yourself to actually
make the jump into a full-time entrepreneur.
#1: Lean Startup
Your Process:
Likely entirely chaotic.
No one implements the lean startup
as a strict process.
Similar to agile adoption (e.g. Kan-ban)
you need to make a slow transition
into more structured thinking.
#1: The Canvas
Product is only 1 of the 9

critical aspects that make your
company work.
#1: The BM Canvas
The Business Model

Canvas

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#1: The BM Canvas
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Who are our Key Partners?

Who are our key suppliers?
Which Key Resources are we acquiring from partners?
Which Key Activities do partners perform?
What Key Activities do our Value Propositions require?

Our Distribution Channels?
Customer Relationships?
Revenue streams?
What value do we deliver to the customer?

Which one of our customers problems are we helping to solve?
What bundles of products and services are we offering to each Customer Segment?
Which customer needs are we satisfying?
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What type of relationship does each of our Customer

Segments expect us to establish and maintain with them?
Which ones have we established?
How are they integrated with the rest of our business model?
How costly are they?
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What Key Resources do our Value Propositions require?

Our Distribution Channels? Customer Relationships?
Revenue Streams?
Through which Channels do our Customer Segments

want to be reached?
How are we reaching them now?
How are our Channels integrated?
Which ones work best?
Which ones are most cost-efficient?
How are we integrating them with customer routines?
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Who are our most important customers?
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What are the most important costs inherent in our business model?
Which Key Resources are most expensive?
Which Key Activities are most expensive?
For what value are our customers really willing to pay?

For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each Revenue Stream contribute to overall revenues?
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This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License.
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Month
No.
Year
The Business Model Canvas - Example
KP
KA
Customers who
build new LEGO
designs and post
them online
become key
partners generating
content and value
LEGO has to
provide and
manage the
platform/ logistics
that allow
packaging/ delivery
of customer made
sets
KR
LEGO has not yet

fully adapted its
resources and
activities, which are
optimised primarily
for the mass market
C$
The Factory leverages production

and logistics costs already incurred
by its traditional retail mode
VP
CR
LEGO Factory
substantially
expands the scope
of the off-the-shelf
kit offering by giving
LEGO fans the tools
to build, showcase,
and sell their own
custom designed
kits
LEGO Factory
builds a Long Tail
community around
customers who are
truly interested in
niche content and
want to go beyond
off-the-shelf kits
CH
LEGO Factorys
existence depends
heavily on the Web
channel
R$
CS
Thousands of new,
customer designed
kits perfectly
complement LEGOs
standard sets of
blocks. LEGO
Factory connects
customers who
create customised
designs with other
customers, thus
becoming a
customer matchmaking platform and
increasing sales
LEGO Factory aims to generate

small revenues from a large number
of customer designed items. This
represents a valuable addition to
traditional high-volume retail
revenues.
#1: The Lean Canvas
The Lean Canvas
#1: The Lean Canvas
Focused on Early-Stage
integrates Problem/Solution
fields

Problem
Solution
Top 3 problems
Top 3 features
Key Metrics
Key activities you
measure
#1: The Lean Canvas

Unique Value Unfair
Proposition
Advantage
Single, clear,
compelling
message that
states why you
are different and
worth buying
Customer
Segments
Cant be easily
Target customers
copied or bought
Channels
Path to
customers
Cost Structure
Revenue Streams
Customer Acquisition Costs

Distribution Costs
Hosting
People, etc.
Revenue Model
Life Time Value
Revenue
Gross Margin
Lean Canvas is adapted from The Business Model Canvas (http://www.businessmodelgeneration.com) and is licensed under the
Creative Commons Attribution-Share Alike 3.0 Un-ported License.
RUNNING LEAN
#1: The Lean Canvas
Product
Solution
Cost Structure
Unfair Advantage
#1: The Lean Canvas
Market
Customer Segments
Problem
Revenue Streams (Pricing)
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#1: The Lean Canvas
Market <=> Product
Unique Value Proposition

Distribution & Marketing Channels
Key Metrics
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#1: The Lean Canvas
Example: Tupalo
Problem
Solution
#1 Finding
Business DB
information,
quality & location #1 Search
of a business
function, Sitemap
#2 Business CP
#2 Promoting a
business,
Key Metrics
providing correct
information to
#1 Avg. Reviews
customers
per user
Unique Value Unfair

Proposition
Advantage
Customer
Segments
Yellowpages
online.
Herold / ED
Partnership
#1 9-to-5 folks
looking for lunch
options, etc.
Find the best

restaurant/etc.
near you.
SEO Know-How
Channels
#1 Long-tail
mainstream
#1 Long-tail SEO #2 Business

owners
#2 European
(restaurants, etc.)
Directories (B2B
Sales)
#2 Avg. Revenue
per business
Cost Structure
Revenue Streams
Software Development
SEO
Partnership Deals
#1 Free
#2 Hundreds/Thousands of EUR (recurring)
#1: The Lean Canvas
Example: Freckle
Problem
Solution
Tracking time
Time tracking
precisely without with superb UX,
effort
no unnecessary
fuss
Easily invoice
clients with good
report on
Key Metrics
performed work
Hours tracked
Rev. per user
Unique Value Unfair

Proposition
Advantage
Customer
Segments
Time tracking
software that
youll actually
use.
Freelancers
Existing
audience:
Mailinglists,
Twitter, etc.
Agencies
Channels
- Word of mouth
- Cross-sales
- Freebies
- Existing
audience
Cost Structure
Revenue Streams
Software Development
Marketing/Copywriting
CC fees
Hosting
12-50 USD / month (dep. on company size)
#1: The Lean Canvas
Example: Garmz
Problem
Solution
#1 Massproducing a
fashion garment
No-barriers
fashion
production,
chosen by the
community
#1 Marketing &
sales
#2 Buy trendy
clothes
Key Metrics
#1 New designs
uploaded
#2 Conv. rate to
actual sale
Unique Value Unfair

Proposition
Advantage
Customer
Segments
#1 Make your
design talent
visible
#1 Fashion
designers
#2 Find the latest

fashion trend &
be unique
Team with
industry
experience
Channels
Fashion blogs
Partnerships
#1 Fashion schools
#1 Fashion events
#2 Word of mouth /
strong brand
Cost Structure
Revenue Streams
Production! (super expensive)

Prototyping
Payout to designer
Marketing, Biz Dev, Software Dev
#2 100 EUR / piece
#2 Trend-chasing
hipsters
#2: Customer Discovery
Part 2:
Customer Discovery
Customer Interviews
30 min in-person with
your prototypical customer
People like talking about their field explore their worldview.
How to conduct an interview

1. Set context & tell your story
2. Tell your problem hypothesis
3. Listen to their worldview
4. Ask for follow up / references
Online Market Tests:

Google Adwords
Fake Landing Page with
Signup to be notified when we launch
Can we call you to ask a couple of Qs?
User Groups & Conferences:

Hand out cards with invite codes landing page with join our soon-tolaunch beta programme
SolidRails
European VPS cloud. Fully-integrated Rails hosting.

Your private beta access code: OEWO8C
Amy Hoys
Sales Safari:
Lurk in online forums of your
customer segment, learn how they
talk about products & benefits

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Lean Startup Essentials

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