Part Two: Steer//Chapter 5: Leap Flashcards
What is central in Lean Startup?
The Build-Measure-Learn Loop
Explain The Build-Measure-Learn loop.
First: You set a hypothesis. What do you believe about your customers that are vital to your business? How are you going to measure this?
Second: You build an MVP that is capable of testing this hypothesis
Third: You run the experiment. remember to get real feedback and show this to real customers and not just go ask them. Check about the feedback are trustable.
Fourth: Analyse and reflect on the feedback. How far off was your hypothesis? What do you need to change about your strategy? Should you actually change your entire direction? What have we learned?
Fifth: You go to step one and use your new knowledge to build a new hypothesis.
What is important in optimizing the BML Loop
To minimize time going through this Loop. You need to be quicker and quicker to go through these steps.
What two things about Facebook impressed investors?
First: That half of the users came back to Facebook every single day. This showed proof that Facebook was valuable to its customers.
Second: The huge early-traction facebook got.
These two hypotheses represent two of the most important leap-of-faith questions ane new startup faces.
What are the first and second challenges as an entrepreneur?
The first challenge is to build an organization that is capable of going through the BML and testing its assumptions systematically.
Second, it is important for the entrepreneur to perform these tests without losing sight of the company’s overall vision.
How does the book describe a leap-of-faith?
Eric Ries says that if a company has critical assumptions that it is believing are true without testing them, it can mean that if it’s not true the company risks total failure.
What is important when making assumptions that are critical to your company’s success?
To make sure and test these assumptions and not just rely on them.
What are Analogs and Antilogs?
Analog means to look at things that are similar to you and your product that has succeeded. Be careful, just because Company X succeded with product Y and you are company X1 and have an improved product Y doesn’t mean you will succeed. You still need to test your assumptions.
Antilog means the opposite. For example, the iPod did an antilog because it had a leap-of-faith that people would pay for music in contrast to the walkman. This was antilog because it was the opposite of another company’s leap-of-faith.
Why did some competitive companies to facebook not get success?
Because they didn’t have the tools and knowledge to test what kind of their plans were working and they failed to test their assumptions and meet customer demands.
In contrast, facebook learned what its customers wanted and build a product that gave customers value.
Explain: Value VS Growth
Value means you are creating a product that is giving value to customers and using real-customer-data to go in the right direction. This is where the true innovators are.
Growth simply means that it’s growing on paper. This could be by raising money, and using paid advertising to grow, but not actually building a valuable product. These companies are often doomed and blind.
How did the lead engineer “Go see yourself” when developing the Toyota in 2004?
He took a long road trip in the previous toyota in its current main market and asked customers about their problems and what they liked about the Toyota. That gave him really much validated data and that helped him in building the new car. The car was a huge succes.
How should you interview people?
- Focus on finding early adopters. These are people who often have the biggest problem that your product solves.
- Focus on their problem and not your solution. People most often know their problem and not the solution to it.
- Keep the same procedure for every interview, its okay to modify but make sure to ask the same questions.
What are the two biggest dangers when entrepreneurs conduct market research?
- Falling victim to false data and just wanting to get started without knowing anything.
- To overanalyze and read reports, planning on the whiteboard and never getting started.
Both are wrong but you need to make sure you got the right learning and real-customer feedback.
You can’t know everything but you need to know something.
