P1: Vision

Question 1

1: What are the chapter names in P1: Vision?

Answer 1

1 Start
2 Define
3 Learn
4 Experiment

Question 2

2: [START] What are two diametrically opposite approaches when introducing organization management into startup?

Answer 2

Full blown management approach: Entrepreneurs are rightly wary of implementing traditional management practices early on in a startup, afraid that they will invite bureaucracy or stifle creativity.

Just Do It approach: Many entrepreneurs take a “just do it” attitude, avoiding all forms of management, process, and discipline. Unfortunately, this approach leads to chaos more often than it does to success.

Question 3

3: [START] What is the root of the Lean Startup name?

Answer 3

The Lean Startup takes its name from the lean manufacturing revolution that Taiichi Ohno and Shigeo Shingo are credited with developing at Toyota.

Question 4

4: [START] What are the main tenets behind Lean thinking approach developed at Toyota?

Answer 4

Drawing on the knowledge and creativity of individual workers, the shrinking of batch sizes, just-in-time production and inventory control, and an acceleration of cycle times.

Question 5

5: [START] What should comprehensive theory of entrepreneurship address in the context of early-stage venture?

Answer 5

Vision and concept, product development, marketing and sales, scaling up, partnerships and distribution, and structure and organizational design.

Question 6

6: [START] What is the first effect of introducing Lean thinking approach into the organization?

Answer 6

You pretty quickly will get feedback from your teams that the new process is reducing their productivity.

Question 7

7: [START] What is the main goal of a startup?

Answer 7

The goal of a startup is to figure out the right thing to build—the thing customers want and will pay for—as quickly as possible.

Question 8

8: [START] What is the common problem with planning at startups?

Answer 8

Too many startup business plans look more like they are planning to launch a rocket ship than drive a car. They prescribe the steps to take and the results to expect in excruciating detail, and as in planning to launch a rocket, they are set up in such a way that even tiny errors in assumptions can lead to catastrophic outcomes.

Question 9

9: [START] What is the main purpose of the Lean Startup method?

Answer 9

The Lean Startup method is designed to teach you how to drive a startup.

Question 10

10: [START] What is the opposite approach to complex planning at startup?

Answer 10

Instead of making complex plans that are based on a lot of assumptions, you can make constant adjustments with a steering wheel called the Build-Measure-Learn feedback loop.

Question 11

11: [START] Explain the significance of the Build-Measure-Learn loop.

Answer 11

Through this process of steering, we can learn when and if it’s time to make a sharp turn called a pivot or whether we should persevere along our current path.

Question 12

12: [START] What is the connection between vision, strategy and product? Explain the terms like optimization and pivot.

Answer 12

Startups also have a true north, a destination in mind: creating a thriving and world-changing business. I call that a startup’s vision. To achieve that vision, startups employ a strategy, which includes a business model, a product road map, a point of view about partners and competitors, and ideas about who the customer will be. The product is the end result of this strategy.

Products change constantly through the process of optimization, what I call tuning the engine. Less frequently, the strategy may have to change (called a pivot). However, the overarching vision rarely changes. Entrepreneurs are committed to seeing the startup through to that destination. Every setback is an opportunity for learning how to get where they want to go

Question 13

13: [START] What is the main challenge of the entrepreneurship?

Answer 13

The challenge of entrepreneurship is to balance all these activities (acquiring new customers and serving existing ones, trying to improve our product, marketing and operations, deciding if and when to pivot).

Question 14

14: [START] What makes the difference between companies as they grow?

Answer 14

As companies grow, what changes is the mix of these activities in the company’s portfolio of work (acquiring new customers and serving existing ones, trying to improve our product, marketing and operations, deciding if and when to pivot).

Question 15

15: [DEFINE] What is the definition of the Lean Startup?

Answer 15

The Lean Startup is a set of practices for helping entrepreneurs increase their odds of building a successful startup.

Question 16

16: [DEFINE] What is the definition of a startup?

Answer 16

A startup is a human institution designed to create a new product or service under conditions of extreme uncertainty.

Question 17

17: [DEFINE] What is the significance of institution word in startup definition?

Answer 17

The word institution connotes bureaucracy, process, even lethargy. How can that be part of a startup? Yet successful startups are full of activities associated with building an institution: hiring creative employees, coordinating their activities, and creating a company culture that delivers results.

Question 18

18: [DEFINE] What is the significance of product in in startup definition?

Answer 18

I prefer to use the broadest definition of product, one that encompasses any source of value for the people who become customers. Anything those customers experience from their interaction with a company should be considered part of that company’s product.

Question 19

19: [DEFINE] What is the significance of innovation in startup?

Answer 19

Startups use many kinds of innovation: novel scientific discoveries, repurposing an existing technology for a new use, devising a new business model that unlocks value that was hidden, or simply bringing a product or service to a new location or a previously underserved set of customers. In all these cases, innovation is at the heart of the company’s success.

Question 20

20: [DEFINE] Why detailed business plans fail to work at startups?

Answer 20

The future is unpredictable, customers face a growing array of alternatives, and the pace of change is ever increasing. Yet most startups—in garages and enterprises alike—still are managed by using standard forecasts, product milestones, and detailed business plans.

Question 21

21: [DEFINE] What is the difference between sustaining innovation and disruptive innovation?

Answer 21

• sustaining innovation: creating incremental improvements to existing products and serving existing customers
• disruptive innovation: creating new sustainable sources of growth

Question 22

22: [DEFINE] What is a good metric to keep track of when implementing lean thinking into organizations?

Answer 22

• the number of customers using products that didn’t exist three years ago
• the percentage of revenue coming from offerings that did not exist three years ago.

Question 23

23: [LEARN] What is the main purpose of the learn part in the Vision section?

Answer 23

the question of whether my company was making progress toward creating a successful business

Question 24

24: [LEARN] Why not many people believe in the learning efforts at businesses?

Answer 24

1 “learning” is the oldest excuse in the book for a failure of execution
2 learning is cold comfort to employees who are following an entrepreneur into the unknown

Question 25

25: [LEARN] What is the main reasons to insist on learning phase despite the suspicion?

Answer 25

If the fundamental goal of entrepreneurship is to engage in organization building under conditions of extreme uncertainty, its most vital function is learning.

Question 26

26: [LEARN] What is the main concept for learning phase?

Answer 26

validated learning

Question 27

27: [LEARN] What is validated learning?

Answer 27

Validated learning is the process of demonstrating empirically that a team has discovered valuable truths about a startup’s present and future business prospects.

Question 28

28: [LEARN] Why is validated learning used over market forecasting and classical business planning?

Answer 28

It is more concrete, more accurate, and faster than market forecasting or classical business planning.

Question 29

29: [LEARN] What are the key questions validated learning should bring answers for?

Answer 29

What should we build and for whom? What market could we enter and dominate? How could we build durable value that would not be subject to erosion by competition?

Question 30

30: [LEARN] What is Metcalfe's law?

Answer 30

The value of a network as a whole is proportional to the square of the number of participants. In other words, the more people in the network, the more valuable the network.

Question 31

31: [LEARN] Why the six month to launch approach failed at first for IMVU?

Answer 31

We had a mental model for how people used software that was years out of date, and so eventually, painfully, after dozens of meetings like that, it started to dawn on us that the IM add-on concept was fundamentally flawed.

Question 32

32: [LEARN] What is the main premise of lean approach?

Answer 32

Learning to see waste and then systematically eliminate it, also which of our efforts are value-creating and which are wasteful

Question 33

33: [LEARN] How should productivity be measured in a startup?

Answer 33

It is also the right way to think about productivity in a startup: not in terms of how much stuff we are building but in terms of how much validated learning we’re getting for our efforts. This is true startup productivity: systematically figuring out the right things to build.

Question 34

34: [LEARN] What is the main paradigm shift of the Lean Startup?

Answer 34

The Lean Startup is not a collection of individual tactics. It is a principled approach to new product development. The way forward is to learn to see every startup in any industry as a grand experiment. In the Lean Startup model, every product, every feature, every marketing campaign—everything a startup does—is understood to be an experiment designed to achieve validated learning.

Question 35

35: [EXPERIMENT] What is the main premise behind experimental approach?

Answer 35

This is one of the most important lessons of the scientific method: if you cannot fail, you cannot learn.

Question 36

36: [EXPERIMENT] How to setup experiment in a startup?

Answer 36

1 It begins with a clear hypothesis that makes predictions about what is supposed to happen. 2 It then tests those predictions empirically. 3 Just as scientific experimentation is informed by theory, startup experimentation is guided by the startup’s vision. 4 The goal of every startup experiment is to discover how to build a sustainable business around that vision.

Question 37

37: [EXPERIMENT] What are the two most important assumption entrepreneurs make?

Answer 37

The two most important assumptions entrepreneurs make are what I call the value hypothesis and the growth hypothesis.

Question 38

38: [EXPERIMENT] What is the value hypothesis?

Answer 38

The value hypothesis tests whether a product or service really delivers value to customers once they are using it.

Question 39

39: [EXPERIMENT] What is the growth hypothesis?

Answer 39

Growth hypothesis, which tests how new customers will discover a product or service.

Question 40

40: [EXPERIMENT] Who are early adopters?

Answer 40

The customers who feel the need for the product most acutely. Those customers tend to be more forgiving of mistakes and are especially eager to give feedback.

Question 41

41: [EXPERIMENT] What is the thinking process when thinking about creating a new product?

Answer 41

I try to push my team to first answer four questions: 1. Do consumers recognize that they have the problem you are trying to solve? 2. If there was a solution, would they buy it? 3. Would they buy it from us? 4. Can we build a solution for that problem? Until we could figure out how to sell and make the product, it wasn’t worth spending any engineering time on.

Question 42

42: [EXPERIMENT] Explain the scientific approach on an example.

Answer 42

There were two main hypotheses underlying the proposed event album: 1. The team assumed that customers would want to create the albums in the first place. 2. It assumed that event participants would upload photos to event albums created by friends or colleagues. The Kodak Gallery team built a simple prototype of the event album. They allowed customers to use the prototype to help the team refute their hypotheses. The initial product—flaws and all—confirmed that users did have the desire to create event albums, which was extremely valuable information. Through a beta launch the team continued to learn and iterate. Cook held off his division’s general manager by explaining how iterating and experimenting before beginning the marketing campaign would yield far better results. Success is not delivering a feature; success is learning how to solve the customer’s problem.

Question 43

43: [EXPERIMENT] What is the main idea behind scientific approach?

Answer 43

Identify the elements of the plan that are assumptions rather than facts, and figure out ways to test them.