The word “lean” along with its more unexpected connotations are invading the vocabulary of entrepreneurs these days – especially in Atlantic Canada.
The hot new entrepreneurship course on offer at Dalhousie University this year is titled “Starting Lean”, and it’s based on the “Lean Launchpad” methodology preached by Steve Blank of University of California, Berkeley. Last week, Austin Texas tech guru Ash Maurya spent two days in Halifax hosting seminars based on his book Running Lean.
So what’s the skinny on all this leanness?
The whole concept as it now exists is only a few years old, and it’s the natural evolution of the thinking on how to generate successful startups. It’s essentially a scheme for growing a business under the assumption that investors are NOT going to rush forward to finance your idea. In entrepreneurship circles, lean doesn’t mean the absence of fat so much as early validation of a concept.
As Maurya explained at a breakfast meeting sponsored by Innovacorp, the key is to validate your idea as early in the process as possible by talking to customers and partners about it. Otherwise, the danger is that you’ll burn through your scant cash by building a product, only to find that it’s something no one wants to buy.
“Rather than taking four or five months to build it, start talking to customers from Day One,” Ash implored his audience. “We want to learn something on Day One. It’s really learning through customer experience.”
As a result, business plans are oh-so last year. The new requirement is to have a “canvas” on which you jot down nine elements of a business, and then change the pertinent parts of the canvas each time you hear from potential customers what they think of your idea.
Maurya is such a demon on customer validation that he applied the concept to the writing of his book. He assembled a community of people who read his blog and then sent each of them two chapters every two weeks while he was writing the manuscript. They provided instant feedback (not to mention proofreading) which allowed him to correct the text quickly as he proceeded.
Maurya has brought his lean message to Nova Scotia five times in the past two years. In his first visit, traveling to Sydney in -20C weather, he met a young entrepreneur called Gavin Uhma who had an idea for a co-browsing solution. That idea turned into GoInstant, the latest massive tech exit in the Maritimes.
The Texan has been impressed with the growth of the tech community in the region, which he says is revealed not only in the numbers attending his seminars (200 attended the session Wednesday) but also in the sophistication of the discussion.
Megan McCarthy, the CEO of cleantech company Unreal Energy and a student in Starting Lean, said she found the seminar inspiring. Her business has pivoted a few times, and it was refreshing to hear from a seasoned vet that good businesses do change course. “I think we realized we’re a lot further ahead than we thought,” she said.
For Maurya, the hallmark of lean entrepreneurship is to identify risks as early as possible in the process and attack those issues before anything else. The idea is to find out what doesn’t work and trash it as quickly as possible. He encourages entrepreneurs to toss out the parts that don’t work and focus on what does. Maybe the whole project gets trashed, but at least it’s done quickly.
“All products go through some amount of trashing,” he said. “You’re going to go through a lot of drastic experimentation. You may not even know who your actual customers are.”