When Claire Ciel Zimmerman entered the Summ’er Up entrepreneurship program at Dalhousie University this summer, she hadn’t even heard of a lean canvas.
The co-founder of the magazine publishing startup Bootstrap had to learn how to use the nine panels of the canvas to test theories on developing a business.
“As my colleagues and I moved through the program we began to see the value of the lean canvas as a set of guiding principles, which became very useful in considering how to establish a viable business with a sustainable revenue model,” said Zimmerman.
She has now joined the growing list of entrepreneurs who have come to understand the value of the canvas in plotting out what works – and more importantly, what doesn’t work – in a new business.
The canvas is a single sheet with nine panels where entrepreneurs write in their theories about how their business will work. They then go out and interview potential clients and/or partners about those theories, and adjust the business plan as needed. The idea is to make all your mistakes before you’ve built your product, saving time and money and getting customers more quickly.
“For students, it’s really a starting place,” said Mary Kilfoil, the professor who oversees the Starting Lean and Summ’er Up programs at Dalhousie. “It provides an immersive experience. It meshes the theory with practical, hands-on experience when students are really at the idea stage and they’re bumping up against whether an idea has any traction at all.”
The lean canvas is now a standard tool at entrepreneurship programs, and its acceptance has come about remarkably fast given that it dates back only to the writings of Alexander Osterwalder in 2008. It has two huge strengths: first, it presents all the main components of a business on a single sheet, so a team can view it instantly; and second, it forces a team to make mistakes early, so they save time and money.
“It helps the entrepreneurs to really understand the market in which they operate and understand their competitors,” said Kilfoil. “They’re finding out what’s out there in the market. And that gets them thinking about the strengths and weaknesses of their own business model.”
She added that the practitioners of the canvas also must be adept at tailoring their questions for each group they meet, so they discover the most pertinent information possible. The idea is not to get a set of unified data (as you would with a survey) but to return with information that will help you develop a product the market wants.
But educators and mentors also warn that the lean canvas is not the silver bullet for every startup, and company founders have to be careful to look beyond the canvas for other components of their business.
“The big shortfall is people are integrating their business with the lean canvas … [and] are expecting miracles within a six-week to eight-week program,” said Dhirendra Shukla, who teaches the Management & Entrepreneurship program at the University of New Brunswick. “It’s how it’s used that creates the problems.”
Kilfoil, Shukla and others say the big problem with using a lean canvas is that entrepreneurs – especially those with little experience – often fall in love with their proposal and don’t listen closely enough to what people tell them.
That means they’re reluctant to pivot or adjust their business as needed.
“We tend to fall in love with our solutions rather than acknowledge that we are beginning with a series of guesses,” said Alastair Jarvis, an entrepreneur and game producer from Lunenburg, N.S. “Testing these things and willing to be wrong demands some courage. That’s a big piece for me. It’s something we struggle with as humans.”
Different experts find various shortfalls in a lean canvas. For example, some believe it doesn’t deal enough with the financial aspects of starting a company. Others believe potential clients might not understand a truly revolutionary product, so customer feedback would be muted until people can see, test and understand a product.
“One of the good elements of Lean Methodology is the inclusion of early customer validation,” said Toon Nagtegaal, the founder of THENEXTPHASE mentoring program. “But the customer validation is not necessarily true validation because you only know if a customer will buy your product if you say, ‘Here’s the product, give me your money.’”
This article first appeared in the September 2014 edition of Entrevestor Intelligence, which is available here.
Disclaimer: Entrevestor receives financial support from government agencies that support startup companies in Atlantic Canada. The sponsoring agencies play no role in determining which companies and individuals are featured in this column, nor do they review columns before they are published.
