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Wednesday, December 7, 2011

Lean Start Up: #1 - Overview

The Lean Startup by Eric Ries (Crown, 2011) from a video of Eric Ries at Authors@Google. Reviewed/summarized by Steve Gladis, PhD, November 2011.

Overview: According to Eric Ries, a startup is “an organization dedicated to creating something new under conditions of extreme uncertainty.” As such, an entrepreneur can be anyone working in his/her basement, a team member in a small company, or someone in a Fortune 500 working on something new when conditions are uncertain. Thus, entrepreneurs are everywhere—not just two guys toiling in a garage with a great idea. Lean startup takes its origins from lean manufacturing and focuses on operating efficiently in a world of uncertainty. To do that, Ries points out that any entrepreneurial company tries to build a sustainable business by conducting “scientific” experiments that test elements of vision. Entrepreneurs hold faithful to a build-measure-learn mantra. Build a product, test it with customers and measure the results, and then modify it by pivoting or preserving—adjusting the product to meet customer needs or holding steady with the plan. Finally, innovation accounting helps startups measure and hold themselves accountable for steps moving them forward. Startups need not invest enormous amounts of money and time before making critical changes, thus reaching their vision sooner and remaining intact financially.
Five Principles of Lean Startup
- Entrepreneurs are everywhere
- Entrepreneurship is management
- Validated learning
- Build-measure-learn
- Innovation Accounting

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