Episode Summary

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Today on Ask an Innovator we discuss the Lean Startup Methodology. We get into what is is, how to use it, and why it’s so dang important to us here at CIL.

We talk through company examples – who has used it and why? And what role the customer plays, how it could save you money, and how it ties into the way software should be developed.

Visit cityinnovationlabs.com/ask-an-innovator for some helpful links and the full transcript.

Helpful Reading on Lean Startup

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Lean Startup by Eric Ries
The Startup Owner’s Manual
4 Steps to Ephiphany
A Guide to Lean Development
5 Ways You Can Use Lean Startup in Your Biz
The Skateboard Methodology – we discuss at 03:07

<figure class="wp-block-image size-large"><figcaption>Software shouldn’t be built in one huge push, it should be built in iterations to gather feedback and move to collect revenue for the client faster.</figcaption></figure>

Timestamps

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Brief Overview of Lean Startup – 00:23
Why Lean Startup is important to us – 01:40
Why use Lean Startup to build software? – 02:59
What are all these acronyms? What is a product validation cone? – 04:37
Can we implement the Lean Startup Methodology? Rewire your brain! – 09:54
Real-life companies that built an MVP – 12:22
We don’t want to waste your money – 16:22
How does customer discovery play into it? – 18:59
Is there a reason not to build software this way? – 20:30
What and WHO are early adopters? – 22:04
5 Things to Learn – 23:29

Lean Startup Methodology Full Transcript

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Erin Srebinski: [00:00:16 ]  Hi, I’m Erin

Josh Barker: [00:00:18 ] and I’m Josh.

Erin Srebinski: [00:00:19 ] We’re from City Innovation Labs. Today we’re discussing Lean Startup. The methodology created by Eric Ries. We as a company, use it all the time. We’ve read the book. We swear by it internally and externally. So today that’s what we’re going to be talking about. So Josh, can you give me a brief overview of what the Lean Startup methodology is?

What is the Lean Startup Methodology?

Josh Barker: [00:00:37 ] Yeah, that’s a great question. Lean Startup, like you said, when I was out in Silicon Valley, they almost referred to it as their Bible. They constantly reference it. They constantly talk about it. Everything is in the context of Lean Startup. And so a lot of people say they’ve read lean startup or they know Lean Startup. I can kind of differentiate who has and who hasn’t because the Lean Startup methodology provides a very scientific approach to creating and managing startups.

A lot of people think, “Hey, it’s all luck.” There’s a huge portion of luck in there of hitting the right time at the right market fit. But, there is a very scientific way about going about how do you know if your product is going to be successful in the market without investing tons of time and energy ahead of time of building out fully your concept.

So it’s a way of figuring out if, you know, if there’s a product there, this is a term that lean startup uses a product-market fit (PMF). If there’s a product-market fit before it even enters into the market before you’re done with the product.

Why We Use Lean Startup

Erin Srebinski: [00:01:40 ] So why did we start using this at CIL? Like why do you feel like it’s important to our process?

Why do you feel like it’s important to build software this way? Dig into that a little bit.

Josh Barker: [00:01:49 ] Yeah. Yeah, absolutely. It’s a great question. It’s really what differentiates us, I would say from our competition, because, if you look in the marketplace of custom software development firms, they’re going to largely just do what you ask them to do.

So if you come to them and say, “Hey, I want you to build this piece of software,” they’re just going to go out and execute on it. Versus if you were to come to us, we’re very much collaborative, work with a lot of market enterprise companies that their problem is they have a lot of money to spend, but how do they spend it the most effective way?

So what we do is we help them go through the Lean Startup process and very incrementally take very small risks with them. Because building software is a risky endeavor. Taking very small risks and then testing it out. I’m using another term in Lean Startup, experiment. So we help run these rapid small experiments to see if there’s traction in the marketplace or traction within their target market and see how well they respond to it. And then we’re able to, you know, actually move forward with coding, that particular thing. So it really reduces the risk of building software by quite a bit.

Erin Srebinski: [00:02:59 ] Okay. So going through Lean Startup building software, what does that process actually look like? How does that change the process from beginning to end?

Building Software with Lean Startup

Josh Barker: [00:03:07 ] Yeah. Yeah. We use a Lean Startup methodology in conjunction with agile methodologies. A lot of custom software development firms will do that, but it looks different. They might go out and just build it. So what it’ll look like is them saying, “Hey, I want to go build this thing,” and they go build that thing for us.

We say, how can we narrow this down to the very minimum viable product? There’s another term from Lean Startup, a minimum viable product. How do we pare it down and deliver that piece to the market and get it in the hands of users as fast as possible? That’s something we help our customers understand and do rather than doing for example a six-month project.

A Customer says, “Build this.” We tell them it’s going to take six months. Instead of delivering the entire thing in six months, we divide it into small pieces where we say how can we deliver this? Another analogy we use is if you think in terms of transportation, a skateboard, scooter, motorcycle car analogy of dividing it down into very manageable pieces and delivering the core primary value to the market as fast as possible.

That way they can test the marketplace, it can even start capturing revenue faster. that’s how we kind of work with our clients on the Lean Startup.

Erin Srebinski: [00:04:20 ] Yeah. Generating revenue, usually a pretty important thing.

Josh Barker: [00:04:23 ] It is.

MVP Explained

Erin Srebinski: [00:04:23 ] Cool. So, okay. You mentioned MVP and we talked about MVT yesterday. Can you explain MVT, MVP, and what that process is, what that means? Dig into that too.

Josh Barker: [00:04:35 ] Yeah. Yeah, absolutely. I call this the product validation cone. This is kind of my own creation, but these terms are industry standards. So at the, at the top, you’ve got kind of this minimum viable test.  So if you think about this, I use the word experiment before, when I was talking about the Lean Startup methodology.

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