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Kindle Notes & Highlights
by
Eric Ries
I have learned from both my own successes and failures and those of many others that it’s the boring stuff that matters the most. Startup success is not a consequence of good genes or being in the right place at the right time. Startup success can be engineered by following the right process, which means it can be learned, which means it can be taught.
too many startup business plans look more like they are planning to launch a rocket ship than drive a car.
Innovation is a bottoms-up, decentralized, and unpredictable thing, but that doesn’t mean it cannot be managed.
when you have only one test, you don’t have entrepreneurs, you have politicians,
which of our efforts are value-creating and which are wasteful? This question is at the heart of the lean manufacturing revolution;
The irony is that it is often easier to raise money or acquire other resources when you have zero revenue, zero customers, and zero traction than when you have a small amount.
This is one of the most important lessons of the scientific method: if you cannot fail, you cannot learn.
The value hypothesis tests whether a product or service really delivers value to customers once they are using it.
For the growth hypothesis, which tests how new customers will discover a product or service, we can do a similar analysis.
“Success is not delivering a feature; success is learning how to solve the customer’s problem.”4
The MVP is that version of the product that enables a full turn of the Build-Measure-Learn loop with a minimum amount of effort and the least amount of development time.
Remember, if we’re building something that nobody wants, it doesn’t much matter if we’re doing it on time and on budget.
You cannot be sure you really understand any part of any business problem unless you go and see for yourself firsthand. It is unacceptable to take anything for granted or to rely on the reports of others.6
No matter how many intermediaries lie between a company and its customers, at the end of the day, customers are breathing, thinking, buying individuals.
the facts that we need to gather about customers, markets, suppliers, and channels exist only “outside the building.”
If we do not know who the customer is, we do not know what quality is.
Defects make it more difficult to evolve the product. They actually interfere with our ability to learn and so are dangerous to tolerate in any production process.
remove any feature, process, or effort that does not contribute directly to the learning you seek.
Part of the special challenge of being a startup is the near impossibility of having your idea, company, or product be noticed by anyone, let alone a competitor.
The only way to win is to learn faster than anyone else.
a long-term reputation is only at risk when companies engage in vocal launch activities such as PR and building hype.
The rate of growth depends primarily on three things: the profitability of each customer, the cost of acquiring new customers, and the repeat purchase rate of existing customers.
If you are building the wrong thing, optimizing the product or its marketing will not yield significant results.
Energy invested in success theater is energy that could have been used to help build a sustainable business.
For a report to be considered actionable, it must demonstrate clear cause and effect. Otherwise, it is a vanity metric.
The heart of the scientific method is the realization that although human judgment may be faulty, we can improve our judgment by subjecting our theories to repeated testing.
The true measure of runway is how many pivots a startup has left: the number of opportunities it has to make a fundamental change to its business strategy.
waiting too long to release can lead to the ultimate waste: making something that nobody wants.
The critical first question for any lean transformation is: which activities create value and which are a form of waste?
Sustainable growth follows one of three engines of growth: paid, viral, or sticky.
Sustainable growth is characterized by one simple rule: New customers come from the actions of past customers.
The rules that govern the sticky engine of growth are pretty simple: if the rate of new customer acquisition exceeds the churn rate, the product will grow.
If you are causing (or missing) quality problems now, the resulting defects will slow you down later.
Having a low-quality product can inhibit learning when the defects prevent customers from experiencing (and giving feedback on) the product’s benefits.
if a mistake happens, shame on us for making it so easy to make that mistake.
1. Be tolerant of all mistakes the first time. 2. Never allow the same mistake to be made twice.
startup teams require three structural attributes: scarce but secure resources, independent authority to develop their business, and a personal stake in the outcome.
structure is merely a prerequisite—it does not guarantee success. But getting the structure wrong can lead to almost certain failure.
It does not matter how fast we can build. It does not matter how fast we can measure. What matters is how fast we can get through the entire loop.
There is a reason all past management revolutions have been led by engineers: management is human systems engineering.
The big question of our time is not Can it be built? but Should it be built?
In the past the man has been first; in the future the system must be first. This in no sense, however, implies that great men are not needed. On the contrary, the first object of any good system must be that of developing first-class men; and under systematic management the best man rises to the top more certainly and more rapidly than ever before.3
As a movement, the Lean Startup must avoid doctrines and rigid ideology. We must avoid the caricature that science means formula or a lack of humanity in work.
The idea of the Build-Measure-Learn feedback loop owes a lot to ideas from maneuver warfare, especially John Boyd’s OODA (Observe-Orient-Decide-Act) Loop.
