can we protect the internal startup from the parent organization? I
would like to reframe and reverse the question: How can we
protect the parent organization from the startup? In my experience,
people defend themselves when they feel threatened, and no
innovation can ourish if defensiveness is given free rein. In fact,
this is why the common suggestion to hide the innovation team is
misguided. There are examples of one-time successes using a secret
skunkworks or o -site innovation team, such as the building of the
original IBM PC in Boca Raton, Florida, completely separate from
mainline IBM. But these examples should serve mostly as
cautionary tales, because they have rarely led to sustainable
innovation.2 Hiding from the parent organization can have long-
term negative consequences.
Consider it from the point of view of the managers who have the
innovation sprung on them. They are likely to feel betrayed and
more than a little paranoid. After all, if something of this
magnitude could be hidden, what else is waiting in the shadows?
Over time, this leads to more politics as managers are incentivized
to ferret out threats to their power, in uence, and careers. The fact
that the innovation was a success is no justi cation for this
dishonest behavior. From the point of view of established
managers, the message is clear: if you are not on the inside, you are
liable to be blindsided by this type of secret.
It is unfair to criticize these managers for their response; the
criticism should be aimed at senior executives who failed to design
a supportive system in which to operate and innovate. I believe this
is one reason why companies such as IBM lost their leadership
position in the new markets that they developed using a black box
such as the PC business; they are unable to re-create and sustain the
culture that led to the innovation in the first place.
Creating an Innovation Sandbox
The challenge here is to create a mechanism for empowering
innovation teams out in the open. This is the path toward a
sustainable culture of innovation over time as companies face
repeated existential threats. My suggested solution is to create a
sandbox for innovation that will contain the impact of the new
iwnonrokvsaatisonfolblouwt sn:ot constrain the methods of the startup team. It
1. Any team can create a true split-test experiment that a ects
monullytipthaert sapnroddbuocxte)d oprarotsnlyof ctehretaipnrocduuscttomorersesrevgimceen(tfsor oar
territories (for a new product). However:
2.eOnnde. team must see the whole experiment through from end to
3. No experiment can run longer than a speci ed amount of time
m(uosurealdlyisarufpetwivewienenkosvfaotriosnims)p. le feature experiments, longer for
4. No experiment can a ect more than a speci ed number of
tcoutsatlommearisns(turesuaamllycuesxtopmreesrsebdasaes).a percentage of the company’s
5. Every experiment has to be evaluated on the basis of a single
standard report of five to ten (no more) actionable metrics.
6. Every team that works inside the sandbox and every product
that is built must use the same metrics to evaluate success.
7.aAnndy cteuastmomtheart rceraecattieosnasn(seuxpppeorirmt ecnatllms, ussotcmiaol nmiteodritaheremacettiroincs,
afobrourmt itthifresoadmse,tehticn.g) cwahtaislterotphehicexhpaeprpimenesn.t is in progress and
At the beginning, the sandbox has to be quite small. In the
company above, the sandbox initially contained only the pricing
psiazegeo. fDtehpeesnadnidnbgooxnctahne btyepdees onfepdriondudcitsetrheentcowmaypsa.nFyormeaxkaems,ptlhee,
arentaoilnlionpeersaetrivoincemmiigghhtt rreessttrriicctt iitt ttoocecertrataininpastgoersesoroursegreogorwaps.hiAc
areas. Companies trying to bring an entirely new product to market
miUghntlibkueilidn tahecornecsterpicttitoenstaorroumnadrkceutsttoemst,ercsusintocmeertrasininsethgemseanntds.box
are considered real and the innovation team is allowed to attempt
to establish a long-term relationship with them. After all, they may
btheeierxlpeearrinminegntminiglewstoitnhesthaorseeaecacorlmy paldioshpetder.s for a long time before
Whenever possible, the innovation team should be cross-
fsuhnocutlidonbael aenmdphoawveereadctloearbuteiladm, mleaardkeert,, lainkde tdheeplTooyyoptraosdhuucstas.oIrt
freeaqtuuirreesd tion rethpeortsaonndbthoex suwcictehsosuotr pfariilourreaopfptrhoovsael.e Itortsshobuyldusinbeg
standard actionable metrics and innovation accounting.
woTrhkiesdapcrporsosa-fcuhncctaionnwalolyr.kTehveen rfostr fteewamcshtahnagtesh,avsuechneavserabepfroicree
cchooanrdgien,amtioany ancortosrseqdueipreargtmreeanttes:negningeinereienrgineg, omrta,rkbeuttinthg,eycursetoqumireer
service. Teams that work this way are more productive as long as
apnroddnuocttijvuistyt sitsaymbeuassyu.red by their ability to create customer value
True experiments are easy to classify as successes or failures
bteeacmauseletaorpns-leivmelmmeedtiraitceslyeithwehremthoevre iotsr thasesyumdopnt’ito.nEsithaebrowutay,hothwe
ctiumsteo,mtehres wteiallmbebhuaviledsarelitceorarrceyct.abBoyuutsitnhgostehemsaemtriecsmeatcrriocssseathche
company. Because the innovation team is reporting on its progress
banyyuosninegwthheo sryesatedms thoof siennroevpaotritosnisacgceotutinntginagndiemscprilbiceidt lienssPoanrtinTwthoe,
pifoswomereoofnaectwioannatbslteomsaebtroictas.gTehtihseefifnencot visateixotnretmeaemly,phoewoerrfsuhl.eEwveilnl
have to learn all about actionable metrics and learning milestones
toTdhoeits.andbox also promotes rapid iteration. When people have a
chance to see a project through from end to end and the work is
bdoenneefiitnfrosmmatlhlebpaotcwheesr oafnfdeeddeblaivcker.sEaachclteimarevtehredyicftailqutoicmkloyv, eththeye
inmummbederias,tetlhy.eyThhuavs,e tahesreealteoamppsortteunnditytoto caocntveorngethoenir opndtiimngasl
solutions rapidly even if they start out with really bad ideas.
As we saw earlier, this is a manifestation of the principle of small
batches. Functional specialists, especially those steeped in waterfall
loarrgsteagbea-tgcahtees.dTevheislocpamuseenst,ehvaevnegboeoednitdreaainsetdo tgoetwboorkggiendedxotrwemn eblyy
waste. By making the batch size small, the sandbox method allows
steeaembseltoowm, athkeesechsemapallmiinsittaikaelseqxpuiecrkimlyeanntsdcsatnartdelemaronnisntgra.tAesthwaet’lal
pteaarmenht acsoma pviaanbyl.e new business that can be integrated back into the
Holding Internal Teams Accountable
WWeithalarneaidnyterdniasclusstsaerdtupletaeranmin,gthmeisleesqtuoennecseionf daecctaoiulnitnabCihliatyptiesrth7e.
soanmecu: sbtuoimlderanaricdheeatlypmeosd, ellauonf cthheademsiirneidmduimsrupvtiiaobnlethpartoidsubcatsetod
establish a baseline, and then attempt to tune the engine to get it
cloOseprertoattihneg iidneatlh.is framework, internal teams essentially act as
isntatertgurpatse.dAisntothethye dceommopnasntrya’steovseurcaclelssp, orthtfeoylioneoefdprtoodubctescoamnde
services.
CULTIVATING THE MANAGEMENT PORTFOLIO
There are four major kinds of work that companies must manage.3
As an internal startup grows, the entrepreneurs who created the
original concept must tackle the challenge of scale. As new
mainstream customers are acquired and new markets are
conquered, the product becomes part of the public face of the
company, with important implications for PR, marketing, sales, and
business development. In most cases, the product will attract
competitors: copycats, fast followers, and imitators of all stripes.
Once the market for the new product is well established,
proOcnecdeurethse bmecaormkeet fmororetherounteiwne.prTooducctomisbawt etlhl eesitnaebvliisthabedle,
commoditization of the product in its market, line extensions,
itnhcisrepmheanstea,l ouppegrraatdioens,aalnedxcneelwlenfocermtaskoefsmoanrkaetignrgeaatreer ersosleen,tiaasl.aInn
important way to increase margins is to lower costs. This may
roepqtuimireizataiond, ideelreegnattiotny,peconotrfol,maanndageexr:ecuotnioen. wChoompeaxncyelsstocink
prTicheesrdeeipseandfoounrththpishkasinedasofwperlel,doicnteabdloemgrinoawtethd. by operating costs
and legacy products. This is the domain of outsourcing, automation,
acrnidticaclo.stFarielduurectioofn. faNciolniteiethseloerss,iminpforartsatrnutctiunrferasitsruscttiullremoisrsiothne-
aHboawnedvoenrm, uennltikoef tlhoeyaglrocuwstthomanedrsocpotuimldizdaetiroanil pthheaswe,hionlveesctommenptasniyn.
this area will not help the company achieve top-line growth.
Mumanpairgeesr:s corfititchiizsedkinwdheonf osorgmanetihzaintigongosues ewr rtohneg,fatuenaopfpbreacseiabtaeldl
when things are going well.
peWrspeetcetinvde otof lsapregaekcoomf pthaensiees,foinurwphhicahsetsheoyf mbuasyinreespsreessefnrotmenttihree
dasivtihsieonesvoalnudtiohnunodfrethdes obruseivneenssthinoutshaensdeskoifndpseoopfleex. tTrehmate’s cloasgeicsails,
the easiest to observe. However, all companies engage in all four
mphaarskeestpolafcew, oterakmaslloftpheeoptilme ew. oArks hsaorodntoasadavanpcreodiut ctto thhiets ntehxet
dpehvaesleo.pEmveernytsu(Rcc&eDss)f,ulepverondtuuacltlyorbfeecaatumree baegpaanrtlifoef itnheresceoamrcphanayn’ds
strategy, was subject to optimization, and in time became old news.
emTphleoypeerosboleftmen ffoorlloswtarttuhpesparondducltasrgtehecyomdepvaenloieps aaslitkheeyismtohvaet
from phase to phase. A common practice is for the inventor of a
onrewdipvirsoidounctthoart feualttiumreatteolymcaonmagmeetrhciealsiuzbesseqitu. eAnst raesroeusruclet,s,stteraomng,
acrnedatoivpetimmiaznataigoenrsofwpirnodduucpts graetthtienrgthstaunckcrewaotirnkginngewonontehse. growth
This tendency is one of the reasons established companies
struggle to nd creative managers to foster innovation in the rst
place. Every new innovation competes for resources with
established projects, and one of the scarcest resources is talent.
Entrepreneur Is a Job Title
dTiheerwenaytlyo,utaollfowthiinsgdilsetrmomnga icsrotoss-mfuanncatigoentahle tfeoaumr skintods odfevweloorpk
around each area. When products move from phase to phase, they
tahree hparnoddeudctoas bpeatrwt eoefnthteeamhasn. dEomplooryesteasycbanehcihnodoasendtobmegoivnewwoirtkh
on something new. Neither choice is necessarily right or wrong; it
deSpoemndes poenotphleetaemrepnearatumraelntinavnedntsokrisllswohfothperepfeerrsoton iwnoqrukewstiiothno.ut
athree parmesbsuitrieouasndanedxpesceteatioinnnsoovfattihoen laatser abupsiantehss tpohwaasreds. Osethneiorrs
management. Still others are particularly skilled at the management
eof criuennnciinegs aannd ewstraibnlgiisnhgedoubtuscionsetssr,edouuctstioounrsc.inPge,oapnled sbhoolustledrinbge
allIonwfeadctt,oefnintrdepthreenkeiunrdsshiopf jsohbosutlhdatbseuictothnesimdebreedst.a viable career
path for innovators inside large organizations. Managers who can
tloealdeatevaemthsebcyoumsipnagntyhetoLreeaanpStthaerturepwmaredtshoodfotlhoegiyr sskhiollusldornhoatvheavtoe
pretend to t into the rigid hierarchies of established functional
dsiempparlytm“eEnntst.reIpnrsetenaedu,r”theuyndsehroutlhde hnaavme ea. bTuhseinyessshocaurldd tbheat hseaylds
aanccdoruenwtaabrldeedviaactchoerdsiynsgtelym. of innovation accounting and promoted
After an entrepreneur has incubated a product in the innovation
slaarngdebrotxe,amit hevaesnttouablleyrweiinlltebgeranteedediendtotothgeropwariet,ntcoomrgmanerizcaiatiloizne. iAt,
aonf dthsecaliennito.vAattorrsstw, thhois wteoarmkewdililnretqhueirseanthdebocxo.ntIinnufeadct,letahdiesrsihsipa
positive part of the process in that it gives the innovators a chance
to train new team members in the new style of working that they
mastered in the original sandbox.
moIdveeatlhlye, tethaemsoauntdboof xthewsilalndgbroowx aonvderinttoimteh;e tchoamt pisa,nyra’sthsetarndthaardn
routines, there may be opportunities to enlarge the scope of the
ssaunbdjebcotx.toFoerxpeexraimmpelnet,atiifoonnliyn ctehretaisnanadsbpoexc,tsnoefwthfeeapturoredsucctanwebree
aadccdoemd.plIinshetdhebyonsltianretinsgerwviicteh adesscarnidbbedox etahralitere,nctohmispacossueldd tbhee
product pricing page. When those experiments succeeded, the
scuobmsepqauneyntcloyumldigahdtdadthdethweesbesairtech’s fhuonmctieonpaaligtey otor tthhee osvaenrdablloxw.eIbt
wdeesriegn.taIrfgeotneldy icneirttiaailnly,cutshtoemperrosdourctc’serrtaeianchnucmoubledrsboef icnucsrteoamseedrs.
When such changes are contemplated, it’s important that senior
cmaannfaegnedmfeonrt tchoenmsisdeelvrews hpeotlhiteircatlhlye itneatmhes pwaorerknitnogrginantihzaetisoann.dTbhoex
sandbox was designed to protect them and the parent organization,
anWd oanrkyinegxpiannstihoen nineneodsvatotiotankesatnhdisboinxtoisaclcikouendt.eveloping startup
emxupsecrliems.enAtts. Trshte, tehaerliteesatmexwpielrlimbeenatsblme atyo ftaaikletoonproondluycemmoduecsht
learning and may not lead to scalable success. Over time, those
cteoanmstsanatrefeaeldmboasctkguoafrasnmteaeldl-btaotcihmpdreovveeloapsmleonntg aans dtheayctigoentatbhlee
meOtrficcsoaunrdsea, reanhyelidnnacocvoautinotnablseysttoemleaernvienngtumalillyestwonilels.become the
victim of its own success. As the sandbox expands and the
tchoempcyacnlye’swreilvlenhuaevegrtoowbseagsina aregsauinlt. oTfhtehefosramndebroixn’snoinvnatoovrastiwonilsl,
become guardians of the status quo. When the product makes up
athdediwtihoonlael sraunledsboanx,ditcoinnetrvoitlasbnleyewdeildl bfoercommisesieonnc-ucrmitbicearledopweirtahtiothne.
pNleawy. innovation teams will need a new sandbox within which to
Becoming the Status Quo
tTrhainssfloarsmt tartainosnitifornomis eraspdieccailalloyuthsaidrderfsortointnhoevaetmorbsotdoimacecnetpto:fthtehier
status quo. I have found it disturbing in my career. As you can guess
farlowmaytshebeteenchanibqiuteos fI aadtrvooucbalteemaaskpearrtatofthtehecoLmeapnanSiteasrtautp ,wIhihcahveI
hmaavkeinwg,oarknedd,eaprluyshciunsgtomfoerr rianpvoidlveimtereantti.onW, hdeantat-hdersieveindedaescwisieorne
not part of the dominant culture, it was simple (if frustrating) to be
afonr amdyvoicdaetaes..ASlilncIehtahdetdoodmoinwaanst pcuulsthuraesfhoaurnddatshehmumhaenrelyticpaol,sstihbeley
would compromise with me a “reasonable” amount. Thanks to the
pinscyecnhtoivleo:gitchael pmhoerneormadenicoanl mofy asungchgeosrtiinogn, wthaiss, ltehde mtoorae pliekrevleyrsiet
wgoaasl.that the reasonable compromise would be closer to my true
Fast-forward several years to when I was running product
dinedvoeclotrpinmaetendt.inWtohtehne Lweea’ndSthairrteupnceuwlturpee.oSpplleit, tethsteinyg,hcaodntitnouobues
dneepedloeydmteonct,onatninduecutsotobmeear sttersotinngg awdveorceataellfosrtamndyariddeapsr,amctiackei.ngI
sure each new employee was ready to give them a try. But for the
pbeecoopmlee pwahrot ohf athde bsteaetuns qwuoor.king there awhile, those ideas had
Like many entrepreneurs, I was caught between constant
efovranwgaeyliszitnhgeyfocroumldy ibdeeaismpanrodvecdo.nsMtayntelympenloteyreteasinfiancgedsutghgeesstaiomnes
sinucgegnetsitvioen Iis,htahde mexoprleoiltiekdelyyeitariss tbheaftotrhee: ctohme pmroomreiserawdiilclalmothvee
in the direction they desire. I heard it all: suggestions that we go
ubaseckletsos wQaAt,erhfaalvledmevoerleopomrelnets,s ucsuestmomoreer qinuvaoliltvyemasesnutr,anucsee (mQoAr)e,
wviasiyo.n and less data, or interpret data in a more statistically rigorous
It took a constant e ort to consider these suggestions seriously.
However, responding dogmatically is unhelpful. Compromising by
auIt’ovme afotiucanldlythspatlitetvinegrythseugdgieffsetiroenncsehdooueldsnb’tewsourbkjeecittehdert.o the same
rigorous scienti c inquiry that led to the creation of the Lean
Sretasurtlutspoifnthteheprorpstospeldacceh.aCngaen?wCeanusweethinecuthbeaoterythteo cphraendgiectinthea
sWmhaelnl etveearmthaenyd sceoeulwd hbaet hiampppleenms?enCteadn, wtheesme eaaspuprreoaitcsheims phaacvte?
allowed me to increase my own learning and, more important, the
pLeroanduScttiavrittuyp otfecthhneiqcuoemsptahnaitesweI hpaioveneweroerdkeadt wIMitVh.UMaarneynooft mthye
oexriegciuntaeldcboynterimbuptliooynese.sRwathhoerb,rtohuegyhwt tehreeircoonwcneicvreeda,tiivnictyubaantdedt,alaenndt
to the task.
“yoAubrovwe aayll”, Ioffacebduitlhdiisngcoma mcoonmqpuaensytiown:ilHl owwodrko?weWkhnaot wotthheart
companies are using it? Who has become rich and famous as a
arellsuwlt?orTkhinegseiqnueastisolonws earr,e mseonrseibllein.eTahrewtiatayn. sWohfyouarreindwuestrdyoianreg
somIt eitshitnhgesdeiffqeureenstti?ons that require the use of theory to answer.
Those who look to adopt the Lean Startup as a de ned set of steps
sotrarttaucpticssituwaitlilonno, tthsiuncgcseecdo.nsItahnatdlytogolewarrnontgh.isWthheenhathrdatwhaayp.pIennsa,
kwneowfactehathtethaegep-rooldbledmilemismduaesutomma aspriezceidalbcyauDseemvienrgs:usHoawsydstoemwiec
cause? If we’re in the middle of adopting a new way of working,
tphreobtleemmpstathtiaotnarwisiel.l Saolwmaeytismbees tthoatbtleanmdeentchye isnecworrseycstt,esmomfeotrimthees
not. Learning to tell the di erence requires theory. You have to be
pabroleblteompsrtehdaitctretshueltoaurtecormeaellyofptrhoeblcehmasn.ges you make to tell if the
froFmor feuxnacmtipolnea,lcheaxncgeilnlegncthee—deexcenlilteinocneofinpromdaurckteivtiintyg,fosralaest,eaomr
product development—to validated learning will cause problems.
As was indicated earlier, functional specialists are accustomed to
measuring their e ciency by looking at the proportion of time they
daraey bulosnygd,oifnogr theexiarmwpoler.k. TAhaptrogisramwmhyer mexapneyctstrtaodibtieoncoadl inwgoarlkl
environments frustrate these experts: the constant interruption of
nmuemetbinergss, ocfrobsos-sfsuensctailolnaaclthaasndao dsr,aganodn eexpcliaennactyio.nHs ofworeveenr,dltehses
Sintadritvuidpu. aInl seteadci,ewnceywoafntthetosefosrpceecitaelaimstss itso nwootrkthecrogsosa-fluinnctaionLaelalny
to achieve validated learning. Many of the techniques for doing this
—Meaacstiuorne-aLbelaermn etrfiecesd, bcoancktinuloouospd—epnleocyemsseanritl,yandcathueseovetreaalml Bsuiltdo-
sfausbtowpteimciazne fbouriltdh.eiIrt idnodeisvidnuoatlmfuanttcetriohnos.wItfdasoteswneotcamnamtteerashuorwe.
What matters is how fast we can get through the entire loop.
timIne:msywyitecahrisntgeatcohivnaglitdhaistesdystleemar,nIinhgavfeeenlostiwceodrstehibs epfaotrteernit efveeerlys
better. That’s the case because the problems caused by the old
ssyysstteemm taernedaltlo tboeo itnatnagnigbilbel.e,Hwavhinergeatshethbeenperobt leomf sthoefortyheisntehwe
apnrotidduoctetivittoy tihsesaen cihnaelvleitnagbelse. pIfaritt oifs tkhneowtrnanstihtaiotn,thiist cloasns boef
managed actively. Expectations can be set up front. In my
cfroonmsuldtainygopnrea;ctoitchee,rfworiseex,atmhepylea,rIehlaiavbeleletaorndeedratoil rtahiesewthheoslee iessuoerst
ocanucseeitainsaulynsdiserawnday.faAsts trheespcohnasnegetepcrhongirqeusesess,towe gcaunreusoeutthwe hroicoht
problems need prevention. Ultimately, the Lean Startup is a
fardaampetewdortko, tnhoet caobnlduietipornisntooffesatechpssptoecfiollcowco.mItpiasndy.esRigantheedrtothabne
copy what others have done, techniques such as the Five Whys
acollmowpanyyo.u to build something that is perfectly suited to your
emTbheedboesntewsealfy itno aachcioemvemmuansitteyryofofparnadctiecxep. loTrheerteheisse iadetahsriivsintog
community of Lean Startup meetups around the world as well as
online, and suggestions for how you can take advantage of these
resources listed in the last chapter of this book, “Join the
Movement.”
13
EPILOGUE: WASTE NOT
ThWisinsyleoawr Tmaayrlkosr’sthTeheoPnreinchiupnledsreodfthSciaennntiivecrsMaraynaogfemFernedt,erircskt
published in 1911. The movement for scienti c management
tcrheamngeneddotuhse cporuorsspeeoriftythethtawtenwtieethtackeentfuorry bgyramntaekdintgodpaoys.sibTlaeytlhoer
iemepcrtoivveinlyg itnhveenetedciewnhcayt owfeinndoiwvidcuoanl siwdoerrkseirms,pmlyanmaagneamgeenmtenbty:
exception (focusing only on unexpectedly good or bad results),
sctoamndpaerndsiaztiinogn, wanodrk—aibnotove taalslk—s,thethiedeatastkh-aptluwso-brkoncuasn bsyestsetmudieodf
awnhditei-mcoplrloarvewd otrhkrotuhgaht cseoensscicooumspeanoierst. aTsayslyosrteminsvetnhtaetd mmuosdt ebrne
managed at more than the level of the individual. There is a reason
amllanpagaestmemnatniasgheummeannt syrestveomlustieonngsinheearviengb. een led by engineers:
In 1911 Taylor wrote: “In the past, the man has been rst; in the
fpuatsusr.e,Wthee asryestelmivinmgusitnbethe rswt.”orTldaylhoer’simparegdinicetdio.nAhnads cyoemt, ethtoe
rsuevcocelusstfiuoln. WthhaetreahseTauynlloerasphreedachheads scbieeennce—ains amwaanyy ofwtahyisn—kitnogo,
many people confused his message with the rigid techniques he
asydsvteomca,teadn:d—timmeostangdallminogtioofnalslt—udthiees,idtehae thdait ewroenrktiearls sphioeuceld-rabtee
terxetarteemdealys lhitatlremmfuol raentdharneqauuitroemdatthoens.eMoarntsy ooff tlhateesre tihdeeoarsisptsroavnedd
emxatrneamgeerlsy thoarumndfuol. aCnridticraelqlyu,irleedanthme aenuofartcstuorifnglatreerditshceoovreirsetsd atnhde
wisdom and initiative hidden in every factory worker and
rtaesdkireacntdedtoTwaayrlodr’tshenoctoiorpnooraftee orcgieanncisymawasaya fwrohmolet.heBuint deiavcidhuoalf
these subsequent revolutions has embraced Taylor’s core idea that
wrigoorkroucasnexbpeersitmudeinetdalsacipepnrtoi accahl.ly and can be improved through a
TaIynlotrhecotuwldenntyo-t rhsatvceenimtuaryg,inwede. fOacuer aprnoedwucsteivteocfappraocbitlyemgsretahtlayt
exceeds our ability to know what to build. Although there was a
ttwreemnetinedthouscenamtuoryu,ntmoofst inovfenittionwaasnddevinonteodvattiooninicnreathsiengeatrhley
hporoudseucttihviety woforwldo’rskeprsopanudlatmioanc.hinAeltshionugohrdetrhatot feperdo,jeccltothise, satnildl
incomplete, as the millions who live in poverty can attest, the
csoapluatcioitny ttoo tbhuaitldpraolmbloemst aisnyntohwingstrwicetlcyaan pimolaigtiicnael.oTnhee. Wbieg hqauveestitohne
of our time is not Can it be built? but Should it be built? This
dpelapceensdussoninthaenquunaluistyuaolf hoiusrtocroicllaelctmivoemimenatg:inoautriofnust.ure prosperity
In 1911, Taylor wrote:
wWaestcea,nosueresoouilrbfoeirnesgtscavrarnieisdhibnyg, oouordws iantetor-pthoewseeras;gaonidngthtoe
end of our coal and our iron is in sight. But our larger
wofasteosuorf huamctsan easort,awrehichblguondoenrienvge,ry dilaly-dtihreroctuegdh, sucohr
ivnaeguecliyenatpp…recaiaretedl.ess visible, less tangible, and are but
We can see and feel the waste of material things.
Ahowwkewvaerrd, ,leianvee cnioetnhti,ngorviislli-bdliereoctredtanmgoibvleembeenhtsinodf tmheemn.,
tThheeiirmaapgpinraetciioanti.oAnncdalflosr ftohrisanreaascot no,femveenmtohroyu,gahnoeurodrat iolyf
loss from this source is greater than from our waste of
material things, the one has stirred us deeply, while the
other has moved us but little.1
A century on, what can we say about those words? On the one
hand, they feel archaic. We of the twenty- rst century are
hyperaware of the importance of e ciency and the economic value
of productivity gains. Our workplaces are—at least when it comes
to the building of material objects—incredibly well organized
compared with those of Taylor’s day.
On the other hand, Taylor’s words strike me as completely
contemporary. For all of our vaunted e ciency in the making of
things, our economy is still incredibly wasteful. This waste comes
not from the ine cient organization of work but rather from
working on the wrong things—and on an industrial scale. As Peter
Drucker said, “There is surely nothing quite so useless as doing with
great efficiency what should not be done at all.”2
And yet we are doing the wrong things e ciently all the time. It
is hard to come by a solid estimate of just how wasteful modern
work is, but there is no shortage of anecdotes. In my consulting and
travels talking about the Lean Startup, I hear the same message
consistently from employees of companies big and small. In every
industry we see endless stories of failed launches, ill-conceived
projects, and large-batch death spirals. I consider this misuse of
people’s time a criminally negligent waste of human creativity and
potential.
What percentage of all this waste is preventable? I think a much
larger proportion than we currently realize. Most people I meet
believe that in their industry at least, projects fail for good reasons:
projects are inherently risky, market conditions are unpredictable,
“big company people” are intrinsically uncreative. Some believe
that if we just slowed everything down and used a more careful
process, we could reduce the failure rate by doing fewer projects of
higher quality. Others believe that certain people have an innate
gift of knowing the right thing to build. If we can nd enough of
these visionaries and virtuosos, our problems will be solved. These
“solutions” were once considered state of the art in the nineteenth
century, too, before people knew about modern management.
cenTthuery,retoqou,irbeemfoernetspeoofpalen kenveewr-faabstoeurt wmoordledrnmmakaneagtheemseenat.ntique
approaches unworkable, and so the blame for failed projects and
dbousitnheessiemspooftsesinblies.hAealtpeerndaotinvesleyn,iothremanngaegremofenbtl,awmheicihs ipsoaisnkteedd taot
nancial investors or the public markets for overemphasizing quick
buxtesfaarntdooshloitrttl-etetrhmeorreysutoltsg.uWideehthaveeapctlieonntsyoofflbelaadmeres taongdoinavroesutnodrs,
aliTkhe.e Lean Startup movement stands in contrast to this hand-
wringing. We believe that most forms of waste in innovation are
pthraetvewnetacbhlaenognecoeutrhecoirllceacutisvees mariendu-nsdeetrcsotonocder.nAinllgthhaotwisthreisquwiorerdk iiss
toIbteisdoinnesu. cient to exhort workers to try harder. Our current
problems are caused by trying too hard—at the wrong things. By
fioncnuosviantgioonn: tfounlcetaironnatlhaet wciheincchy,iswceurlroesnetlsyiguhntkonfotwhen.rAeasl Dgeomalinogf
taught, what matters is not setting quantitative goals but xing the
mmoetvheomdenbtystawnhdischforththoeseprginocailpsleatrheatatthtaeinsecide.ntTi hcemLeetahnodSctaanrtubpe
bHroowugchatntowbeebauriltdo aanssuwstearintahbelemoorsgtapnrizeasstiionng ainronuonvadtiaonneqwuessetitoonf:
products or services?
ORGANIZATIONAL SUPERPOWERS
A participant at one of my workshops came up to me a few months
a“Kftneorwwainrdg toLeraenlatSetatrhtuepfolploriwncinipglesstormy,akwehsicmh eI afemelplairkaephIrahsianvge:
superpowers. Even though I’m just a junior employee, when I meet
wsimithplecoqrupeosrtaiotensVaPnsdavnedryGqMuisckilny hmeylpltahregme csoeemhpoawny,thIeiarspkrotjheecmts
acaren blaayseoduotnafupnladnamtheenytaclohuyldpoftohlelosews tthoatscaierenttiesctaablllye.vIanlimdaitneuttehse,irI
plans before it’s too late. They consistently respond with ‘Wow, you
are brilliant. We’ve never thought to apply that level of rigor to our
thinking about new products before.’ ”
wiAthsina hreissullatrgoef tchoemsepainntyeraasctaionbsr,ilhlieanhtaesmdpevloeyloepe.edThaisrehpaustabteioenn
good for his career but very frustrating for him personally. Why?
pBreocdauuscet palaltnhsoaurgehduheenisotqtouihteis bspriellciiaanlti,ntheilsligiennsicgehbtsutintotohavainwgeda
tahlteeorrnyattihvaets.aHlleowissfrhuismtrattoedpbreecdaicutsewthhaetmwainllaghearpspheenisanpditcphrinogpohsies
ideas to do not see the system. They wrongly conclude that the key
tTohesuycacreessfaisilinngdtiongseberitlhlieanotpppeoorptulneiltiykheehiismretoallpyupt roensetnhteinirgtethaemms.:
taoboaucthhieovwe ibnentotevratiroensuhltasppsyesntes.matically by changing their beliefs
Putting the System First: Some Dangers
LmikodeeTrnaylcoorrpboerfaotrieonuss,toourpuchtatlhleengsyestiesmto presrts.uHadoewtehveerm, aTnaaygloerrsismof
slehsosuolnds aoctf ahsisatorcyautaisonawrey tbarlein,gantdheiste isneimwpoidrteaanst ttoo leaarnmothree
mainstream audience.
thaTnaylionrdiivsirdeumalembbreilrleiadnfcoer. hHisefroecuissonthseystfeumllatiqcuportaectifcreomratThheer
Principles of Scienti c Management that includes the famous line
about putting the system first:
In the future it will be appreciated that our leaders must be
trained right as well as born right, and that no great man
ccoanm(pwetiethwthitehoaldnsuymstebmer ooffpoerrdsionnaarlymmaennagwemhoenht)avheopbeeetno
properly organized so as efficiently to cooperate.
muInstthbee parsstt.thTehims ainn nhoassbeenesen,fhiroswt; einvetrh,eimfuptulireesththeastygsrteemat
men are not needed. On the contrary, the rst object of any
good system must be that of developing rst-class men; and
under systematic management the best man rises to the top
more certainly and more rapidly than ever before.3
Unfortunately, Taylor’s insistence that scientific management does
ninodtivisdtaunadls winasoqpupicoksliytiofonrgtootten.ndIninfgacta,ntdhe pprroomduocttiinvgitythgeainbsetsot
be had through the early scienti c management tactics, such as time
afonrdemmanosthioipn (tshtuedyfo, retrauskn-npelruso-bfotnoudsa,y’asnfduncetsipoencailalldyepafurntmcteionntsa)l,
wsigehret osof tshigeniimcpaonrttathnacet soufbstehqeuepnetopgleenewrahtoionwseoref mimapnlaegmeresntlionsgt
them.
rigTidhisahnads ltehderteobytwfoaiplerodblteomtsa:k(e1) abduvsainnetassgesysotfemthsebeacdaampetaobvileirtlyy,
creativity, and wisdom of individual workers, and (2) there has
wbeheinchaennaobvleeroermgapnhiazsaitsioonns toplaacnhnieinvge, copnresivsetenntitorne,sualntsdipnraocmedoustrley,
hsteaatidc wonorbldy. Othne tlheeanfacmtoarnyufaocotur,ritnhgesme povroebmleemnts, hanavdetbheoesne tlaecsksolends
have spread throughout many modern corporations. And yet in new
pgernoderuacltwdeevaerelosptimlleunsti,negnatnreopuretdnaetuerdshfripam, aenwdorikn.novation work in
samMey rheodpuectiisonthisatt ttrhaep.LeWane Satraertjuupstmbeogvienmnienngt wtoilulnncootvfearllthinetorutlhees
that govern entrepreneurship, a method that can improve the odds
ionfnsotavrattuivpe supcrcoedsus,ctasn. dTahissysitnemnaoticwaapyprdoiamchinitsohebsuitlhdeingtrandeiwtioannadl
entrepreneurial virtues: the primacy of vision, the willingness to
otavkeerwhbeollmd inrgiskosd,dsa. nOdurtshoeciectoyunraegeeds trheequcirreeadtiviinty athned vfiasicoen ooff
aernetrseupcrhenperuercsiomusorreesothuarnceesvtehra.tIwnefaccatn, nitotisafpforerdcisteolywabsetceatuhseemth. ese
Product Development Pseudoscience
Icobnesltiietvuetetshatthief Tmayalnoargwemereenatlivoef toednatrye,phreenweuorusldacnhduckinlenoavtawtohrast.
Although we harness the labor of scientists and engineers who
fweaotusldofhatevcehndiaczazllewdizaanrydreya,rltyh-etwmenatnieatghe-mceenntturpyrapcetricsoesn wweithustehetior
woroguanldizgeo tshoemfar aarsetogecanlelrtahlleymdpesveouiddosocfiesncciee.nti c rigor. In fact, I
We routinely green-light new projects more on the basis of
tihnteuritoiootnctahuasne foafctths.eApsrowbel’evme .sAeellninthnroovuagthioonutbtehgiisnsbowoikth, tvhiasitoins.nIto’st
what happens next that is critical. As we’ve seen, too many
tinhantovsautpiopnortteathmesirevnigsaiogne irnathsuecrcethssantheexapteors,insegletchteiveelleymenndtisngofdtahtea
tvoisicorneattoe tarudeaetax-pfreereimzeonntes,foorr, uenvelinmwiteodrse“,exstpaeyriinmgeinntasttieoanlt”hthmaotdies
devoid of customer feedback or external accountability of any kind.
pAlnayctiinmgehiaghtleigahmts aotntema pgtrsaptho odfemgroonssstrmateetriccasu, siet iasndengeageicntg biny
peseeuctdoissciternucee?. AHnoywtimdeo awteeakmnoawttemthpattsthtoe jpursotipfyosietds fcaailuusreesanbdy
resorting to learning as an excuse, it is engaged in pseudoscience as
weIlfl. learning has taken place in one iteration cycle, let us
demonstrate it by turning it into validated learning in the next
cshycolwe.inOgnolyurbaybibliutyildtoinugsea omurodperlodoufctcuosrtosmerevricebethoacvhioarngaendit othveenr
timTehrcoaungwhoeuetstoaubrlischelreebarlaftaioctns aobfotuhtethseucvcaelsisditoyf otfheouLrevainsioSnt.artup
movement, a note of caution is essential. We cannot a ord to have
othuer lsiukcec.eTshsibs rweeads tahenfeawte posfesucdieonstciiecncmeaanraoguenmdepnti,voantsd, MinVthPes, eanndd,
Ifobretlhieevev,ictthoartysoetf broaucktiniets wcaourske obvyerdeccraedateisv.eScwieonrkce, mcaemcheatnoizsattaionnd
over humanity, and plans over agility. Later movements had to be
spawned to correct those deficiencies.
spTawaynleodr btoelcioevrreedctinthmosaendyetfhiciinegnscitehsa.t he dubbed scienti c but that
our modern eyes perceive as mere prejudice. He believed in the
minhenereonvtesruptheeriowriotyrkiinngboctlhasinsetsellaignedncteheansdupcheariroarcitteyr ooff amrisetnocoravteicr
women; he also thought that lower-status people should be
soufpTearyvlioserd’s sttirmicetl,yabnyd tihteiisr tbeemttpetrisn.gThtoesfeorbgeilvieefshiamrefpoarrhtaavnidngpbareceenl
bliYnedt twohtheenmo.ur time is viewed through the lens of future practice,
what prejudices will be revealed? In what forces do we place
usuncdcueess foafitohu?r Wmhoavtemmeinght?t we risk losing sight of with this initial
forIt ims ewittho thseesee qtuheestiLoenasnthaSttaIrtwuipsh mtoocvleomsee.nAts ggraaintifyfianmg eas iatnids
recognition, it is far more important that we be right in our
Wprhesactriips tnioeneds.edWihsaat ims aksnsiovwenprsoojefcatrtios djuissctotvheer htiopwoftothuenlioccekbetrhge.
vast stores of potential that are hidden in plain sight in our modern
wdoorwkiftohrciet?. IWf ewheasvteopnpoerdeawl caostnincegppteoofpwleh’asttiismpeo, swsihbalet.would they
exSptearritminegntaitnionthteo dlaistceove1r88th0es, opTtaiymloarl wbaeygatno caut pstreoeglr.aImn thoef
course of that research, which lasted more than twenty- ve years,
ihnedivaindduahl iesxpcoelrliemaegnutess. Wpehraftorims erdemmarokraeblethaanboutwt etnhtiys ptrhoojuescatnids
tehnatitreit choasdt nwoasacpadaeidmibcybaincdkuinsgtr,ynoougtovoefrnthmeenitmRm&eDdiabtuedgperto. Ittss
generated from the higher productivity the experiments enabled.
Tphroisduwctaisvitoynliyn jounset oenxepekriinmdeonftawl oprrko.gOratmhertosciuennctiovcermtahneagheimddeennt
disciples spent years investigating bricklaying, farming, and even
sshatoivseleidngw. Tithheythwe efroelkobwseissdseodmwoifthcrleaaftrsnpienrgsothnes torrutthheanpdarwaebrleesnootf
expCeanrtsa.ny of us imagine a modern knowledge-work manager with
the same level of interest in the methods his or her employees use?
How much of our current innovation work is guided by
catchphrases that lack a scientific foundation?
A New Research Program
What comparable research programs could we be engaged in to
disFcoorveronheowthtoinwg,orwkemohraeveeffevcetriyvellyi?ttle understanding of what
stimulates productivity under conditions of extreme uncertainty.
oLupcpkoirltyu,niwtiietsh tocyctelest tnimewes apfapllrionagcheevs.erTywhuhse,reI, pwroepohsaevethamt awney
create startup testing labs that could put all manner of product
deHveolwopmmeignhttmthetohsoedtoelsotgsiebsetocotnhdeutcetset.d? We could bring in small
cernogsisn-efuenricntigo,naalndtehaamves, thpeemrhawpsorkbetgoinnsoinlvge wpriothblepmrsodbuyct usainndg
di erent development methodologies. We could begin with
pinrtoebrnleamtiosnwalithpcrloegarramrigmhitnagnscwoemrsp,eptietriohnaps s tdhraatwnhafvroemdtehveelmopanedy
dcoamtabpaesteitsionosf awlseoll-pdreovnidede aprcolebalermbsasewliinthe oclfeahrowsolluotnigonist. shTohuelsde
take for various problems to be solved so that we could establish
csulebajrelcytst.he individual problem-solving prowess of the experimental
Using this kind of setup for calibration, we could begin to vary
tthhee cleovnedlitoiofnusnocferthtaeinetxypaebriomuetnwtsh. aTthtehcehrailglehntgaenwswilelrbies twohinilceresatislel
bPeerinhgapasbwlee ctooulmdeuasseurreealt-hweorqludacliutystoomferthperoobuletcmoms aendobthjeecntivhealvye.
real consumers test the output of the teams’ work. Or perhaps we
csaomuled gsoetsooffarparosbtloembusildovmeriniamndumovveiarblaegapirnodtuoctsqufoarnstioflyvinwghtihche
prWodeucaelssothceoubledstvacurystothmeearllc-oimnvpeorrstiaonntrcaytcelse. time by choosing more
or less complex development platforms and distribution channels to
test the impact of those factors on the true productivity of the
teams.
Most of all, we need to develop clear methods for holding teams
accountable for validated learning. I have proposed one method in
this book: innovation accounting using a well-de ned financial
model and engine of growth. However, it is naive to assume that
this is the best possible method. As it is adopted in more and more
companies, undoubtedly new techniques will be suggested, and we
need to be able to evaluate the new ideas as rigorously as possible.
All these questions raise the possibilities of public-private
partnerships between research universities and the entrepreneurial
communities they seek to foster. It also suggests that universities
may be able to add value in more ways than by being simply
nancial investors or creators of startup incubators, as is the current
trend. My prediction is that wherever this research is conducted will
become an epicenter of new entrepreneurial practice, and
universities conducting this research therefore may be able to
achieve a much higher level of commercialization of their basic
research activities.4
THE LONG-TERM STOCK EXCHANGE
Beyond simple research, I believe our goal should be to change the
einndtiursetryecohsaysstedmevoolfveedntrienptorenaeurfseheidpe.r Tsoyostemmuchforofgioaunrt smtaretduipa
companies and investment banks. Part of the reason established
cporemspsuarneiefsrosmtrugpgulbelitco minavreksettscotnosihstietnstlhyoritn-teirnmnovpartoiontabisiliitnyteannsde
growth targets. Mostly, this is a consequence of the accounting
monetthhoedksinwdes hoafvgerodsesv“evlaonpietyd”fmoreetrviacsludaitsicnugssmedaniangCerhsa,pwtehric7h. Wfochuast
sistoncekesdeodf iscoamnpewanikeisndthoaftstoacrke eoxrcghaannigzee,ddetsoignseudstatointraldoengi-ntetrhme
thinking. I propose that we create a Long-Term Stock Exchange
(LTSE).
In addition to quarterly reports on pro ts and margins,
companies on the LTSE would report using innovation accounting
orenpothrteiorninthteernraelveennuteretphreeynewuersrheipgeneeroarttisn.gLfirkoemInpturoitd,utchtesythwatodulidd
not exist a few years earlier. Executive compensation in LTSE
Tcoramdpinagnioens wthoeuLldTSbEe wtieodultdohthaveecommupchanhyi’gshleorntgr-atnersmactpioenrfocormstsanacned.
LfeTeSsEtocmominpimaniizeesdwayoturladdibneg aanldlomweadssivtoe pstrriucectsuwreingths.eiIrn ecoxcrphaonragtee,
governance to facilitate greater freedom for management to pursue
ltohinngk-tienrgm, thienvtreasntmspeanrtesn. cyInofatdhdeitLioTnSEtowilslupprpoovritdefovarlulaobnlge-tdearmta
athbeouLtThSoEwwtoounlduratucrceelienrnatoevathtieoncrienattihoenreoafl twheornlde.xtSogmeneethraintigonlikoef
great companies, built from the ground up for continuous
innovation.
IN CONCLUSION
iAdseoalomgyo.vWemeemntu, stthaevoLiedanthSetacratruicpatmuruestthaavtosicdiednocectrmineeasnsanfodrmriguilda
or a lack of humanity in work. In fact, science is one of humanity’s
emnotrsetprecnreeautrisvheip wpiulrlsuunitlso.ck Ia vabsetlsiteovreehotuhsaetof ahpupmlayninpgoteinttialt.o
What would an organization look like if all of its employees
weFroeraormneedthwinigth, eLveearnyoSntaertwupouolrdgainnisziasttiothnaatl asusspuemrppotiwonerss?be stated
mexapkleic-iwtloyrkanbduttesotuedt orifgaorogeunsluyinneotdaessiraesttoalldinisgcotavcetricthoer atrufothrmthoaft
underlies every project’s vision.
deWfenedewrosuolfd qnuoatlitwyaasnted ttihmeecoownbeonydsloesfsreacrkgluemssenadtsvabnectew;einenstetahde,
wofe twheoucludstroemcoegrn’sizelotnhga-ttesrpmeedbeanned tq.uWalietywaoreuladllireascein ttohetepsutrsouuirt
vision but not to abandon it. We would look to eliminate waste not
vtoisibounilbduqt unaoltittyo caabsatlnedsoinn itth. eWsekwy obuultdinloothketoseervliimceinoafteagwilaisttye annodt
breakthrough business results.
leaWrneinwg,onuoldt wreistphornedcritmo ifnaaitliuorness aanndd bselatbmaec.ksMworieththhaonnethstayt,awnde
would shun the impulse to slow down, increase batch size, and
binydublygpeaisnsinthge tchuerseexocfespsrewvoernktiothna. tIndstoeeasd,nwotelweaodultdoalcehairenviengsp. eWede
wloonugl-tderdmedmicaistseioonurtsoelbvueisldtosuthsteaicnraebalteiovnaolufenaenwd icnhstaintugteiotnhse wwiothrlda
for the better.
Most of all, we would stop wasting people’s time.
14
JOIN THE MOVEMENT
InThtehenpuamstbeferwofyeraersso,utrhceesLeaavnaiSlatabrlteupfomr oasvpeimrienngt ehnatsregporneengeluorbsails.
incredible. Here, I’ll do my best to list just a few of the best
eTvheenrtes,stbiosoukps,toanydoub.lRoegasdfionrg fiusrgtohoerd,raecatdioinngisabnedttfeurr.ther practice.
yoTuhheadmotostbiemipnoSrtialinctonreVsoaullrecyestoarenldocoatlh. eGroennetraerpertehneeudrasytsowshhearree
ideas and struggles with. However, being embedded in a startup
echcoansygsetdemis tihsastttihllesaenecimospysotretmanstaprearstproinf geinngtreuppreinnemurosrheipa.ndWmhaotr’es
staIrtump ahiunbtasianrouannd tohe wcioalrld.website for The Lean Startup at
http://theleanstartup.com, where you can nd additional resources,
inncdludliinnkgs ctahseerestutodiems yanbdlolgi,nSktsarttoupfuLrtehsesronrseaLdeianrgn.eYdo, uaswwillelal lsaos
videos, slides, and audio from my past presentations.
Lean Startup Meetups
Chances are there is a Lean Startup meetup group near you. As of
Fthriasncwisrcioti,nBg,ostthoenr,eNaerwe oYvoerrk,aChhiucangdore,da,ndwiLthosthAenglealregse.sYt oiun Scaann
nd a real-time map of groups here: http://lean-
satraertuinpt.emreesetetudp.icnomst/a.rtYinogu caanneawlsogronudpa, laisntdoftocoitlisestowhseerteopneeopulpe
yourself.
The Lean Startup Wiki
cNoomt perveehryenLsievaenlSisttarotuf pevgernotuspanudseostMheeretruepso.cuormcestoisomrgaainnitzaei,neadndbay
hvottlpu:n/t/eleerasnstartupo.npbworkst.hceom/ Lean Startup Wiki:
The Lean Startup Circle
hTahpepelanrignegstoncolimnem, urnigihtyt noofwp,raocntictheeaLroeaunndSttahretupLeCainrclSetamrtuaiplinigs
elinstt.repFroeunneudresdshbaryingRitciphs, rCeosloluinrsc,es,thaend lsitsotriehsaesvetrhyoduasayn. dIfs yoouf
have a question about how Lean Startup might apply to your
bhuttspi:n/e/slseansotarrtupicnidrculset.rcyo,m/it’s a great place to start:
The Startup Lessons Learned Conference
For the past two years, I have run a conference called Startup
Lessons Learned. More details are available here: http://sllconf.com
REQUIRED READING
Steve Blank’s book The Four Steps to the Epiphany is the original
bdoogo-keaarbeodutcocpuystoomfetrhdisevbeoloopkmfeonllto.wWehdenmIe weavserbyuwilhdeirneg. IIMt VisU,ana
indispensable guide. You can get a copy here:
hhttttpp::////ewrwicrwi..essta/rFtouuprlSetsesponssleoarrnerde.caodm/m20y08/r1ev1i/ewwhato-ifs-cuitstomheerre-:
development.html. Steve also maintains an active and excellent
dbleovgelaotphmttepn:/t./hsttmevle. bSlatenvke.coamlso/ maintains an active and excellent
Brant Cooper and Patrick Vlaskovits have created a short but
eDxecveellloepntmebnot,okwhiccahllepdroTvhideesEantrgeepnrteleneiunrt’rsodGuuctiidoen ttoo tChuesttoompiecr.
You can buy it here: http://custdev.com or read my review here:
hguttipd:e/-/two-wcuwst.ostmaretru.hptlmeslsonslearned.com/2010/07/entrepreneurs-
When I rst began blogging about entrepreneurship, it was not
nearly as common an occupation as it is now. Very few bloggers
twoegreethaecrtiwveelydewbaotrekdinagndonrefninewed itdheeases iadbeoaustoennlitnreep. reneurship, and
bloDgavaet hMttcpC:l/u/r5e0, 0fohuantsd.teyrpoepf athde.covemn/tu. r5e00rSmtar5t0u0psSthaarstuapns,ewxcreitlelesnat
blog as well: http://blog.500startups.com/. Dave’s “Startup Metrics
afonrdPmireaatesus”rinpgreosnenlitnaetiosenrvliacieds tohuatt agrefraatmlyeiwnorukenfcoerdththinekcionngceapbtooutf
“engines of growth.” You can see the original presentation here:
2ht.htptm://l 500hasats.tywpeepllad.coams /50m0bylogs/o2r0ig0i8n/a0l9/starertaucpti-omnetri- here:
ghrttopw:/t/hw-fowr-wy.osutarr.htutmpllessonslearned.com/2008/09/three-drivers-of-
Sean Ellis writes the Startup Marketing Blog, which has been
isntarutuepnsti:ahlttipn:/m/sytarthtuinpk-minagrkaebtoinugt.choomw/ to integrate marketing into
thoAungdhrtesw oCnhenv’sirballogmFaurtkueritsitnigc,Plastyaritsuopnemofettrhices,besatnsdourdceessigfonr:
http://andrewchenblog.com/
eaBrlaybLaekaNn iSvtiarwturiptesevtahnegeelxicste:llhetntpt :b//lovgenVtuenretuhareckHs.acockms/a.nHde’ws assinacne
gone on to create Angel List, which matches startups and investors
around the world: http://angel.co/
Other fantastic Lean Startup blogs include:
• Ash Maurya has emerged as a leader in helping bootstrapped
online businesses apply Lean Startup ideas. His blog is called
nRaumnnei.ng LeanB,oatnhd he alscoanhas releabseed an eBfoouonkdof the shaemree:
http://www.runningleanhq.com/
• httSpe:a/n/wwwM.uskrpmhuyrphyo.cnom/ebalorlgy/-stage software startups:
• Brant Cooper’s Market by Numbers: http://market-by-
numbers.com/
• Patrick Vlaskovits on technology, customer development, and
pricing: http://vlaskovits.com/
• Tanhde HKiItSeSnmSehtarihc’ss hMttapr:k/e/thiintgenBislmog.c:ohmttp://blog.kissmetrics.com/
FURTHER READING
Clayton M. Christensen’s The Innovator’s Dilemma and The
Innovator’s Solution are classics. In addition, Christensen’s more
dreicsreunpttiwveorkininsoavlastoionextrienmeplyrahcteiclpe,ful infocrludseineginTghetheIntnhoeovarytoro’sf
P(arbeoscurtipetdiouncat(iaobno).ut disrupting health care) and Disrupting Class
http://ericri.es/ClaytonChristensen
Geo rey A. Moore’s early work is famous among all entrepreneurs,
ecospneticniualeldy Ctororsesinnge thhies Cthhianskminga,nadnIdnsIidheavtehefoTuonrdnahdios.laBteustthweohraks,
Dealing with Darwin: How Great Companies Innovate at Every
Phthtaps:e//oefriTchrie.eirs/EDveoalulitniogWn,iethspDeacriwalilny useful.
LTehaenPrinPcriopdluesctof DPreovdeulocpt mDeenvetlopbmyentDFolnoawld: SecGo.nd RGeeinneerrattsieonn.
http://ericri.es/pdflow
hTthtpe :T//oeyroitcariW.esa/ythbeytoJyeofftarewyaLyiker.
CLeoarnporTathioinnk,iRnegv: iseBdanainsdh UWpdaastteed bayndJamCeresaPt.eWWomeaalctkhanidn DaYnoiuerl
hTt.tJpo:/n/eesr.icri.es/LeanThinking
STtheevePneWopaltets’s. Tycoon: Henry Ford and the American Century by
http://ericri.es/ThePeoplesTycoon
The One Best Way: Frederick Winslow Taylor and the Enigma of
hEtfftpic:i/e/necryicbriy.eRs/oObenretBKeastnWigaeyl.
TThayeloPr.rinciples of Scienti c Management by Frederick Winslow
http://ericri.es/ScientificManagement
Extreme Programming Explained: Embrace Change by Kent Beck
ahnttdp:C/y/nerthicirai.eAsn/dErmesb.raceChange
Toyota Production System: Beyond Large-Scale Production by
Taiichi Ohno.
http://ericri.es/TaiichiOhno
The idea of the Build-Measure-Learn feedback loop owes a lot to
ideas from maneuver warfare, especially John Boyd’s OODA
t(oObBseoryvde’-sOriideenats-DeisciCdeer-tAacint) LtoooWp.inT:heThmeosSttraactceegsysibolef iJnotrhonduBcotiyodn,
Applied to Business by Chet Richards.
http://ericri.es/CertainToWin
hOtutpt :o/f/ethriecrCi.reiss/isObuytOWfT. hEedCwraisridss Deming.
hMtytpY:/e/aerrsicwrii.tehs/GMeynYereaalrsMotors by Alfred Sloan.
Billy, Alfred, and General Motors: The Story of Two Unique Men, a
Legendary Company, and a Remarkable Time in American History
hbyttpW:/i/lleiraimcriP.eesl/frBeiyll.yAlfred
Ththtep:P//raecrtiiccrei.eosf/MPraanctaigceemOfeMntanbaygPeemteerntF. Drucker.
Getting to Plan B: Breaking Through to a Better Business Model by
John Mullins and Randy Komisar.
http://ericri.es/GettingToPlanB
Endnotes
Introduction
1. Fnoeraran uyopu-t,o-dsaetee hlitstpti:n/g/loefanL-esatanrtSutpa.rmtuepetmupe.ectoumps oorr tothendLoeanne
CSthaarptutperW14ik,i“:Jhotitnp:t/h/eleManosvtearmtuepn.tp.”bworks.com/Meetups. See also
Chapter 1. Start
1. MFiavneufTahcitrutryinEgigshtat:tishttitcps:/a/nwdwawn.af liyvseitshiarrtyeeidgrhatw.cnomfr/o2 m010th/e0 2b/lu osg-
manufacturing-i s-not-d ead.h tml
Chapter 2. Define
1. The Innovator’s Dilemma is a classic text by Clayton Christensen
ainbnoouvtatthioend. iAlcounlgtyweistthabiltisshseedqucoelm, TphaneieInsnhoavvaetowr’isthSodliusrtuiopnt,iviet
clareyastoeuatustpoencoimcosuusgdgeivsitsioionnssfotor hpouwrsueestasbtalristuhped-lickoemipnannoiveasticoann.
These speci c structural prerequisites are discussed in detail in
Chapter 12.
2. For more about SnapTax, see http://blog.turbotax.intuit.com/
turbotax-press-releases/t axes-o n-y our-mobile-phone-
iatl%lthEi2n%gs8d0.c%om99/s2-0a-1s1n0ap20/401/e1x4c2lu0s1i1v–e4-i 8n6tu5it-s aeneds-mhtotpre:/-/thmaon-b ilized.
350000-d ownloads-for-snaptax-i ts-s martphone-tax-f iling-a pp/
3. Most information relating to Intuit and SnapTax comes from
IpnrfiovramteatiionnteravbioewutsInwtuiitth’s Ifnotuunidt inmgacnoamgeems efrnotmaSnudzaenmneplToayyeleosr.
and Kathy Schroeder’s Inside Intuit: How the Makers of Quicken
B(Ceaamt brMidigcero, sMoaftss.:aHnadrvaRrdevBoulsuitnioesnsizPerdess,a2n003E).ntire Industry
Chapter 3. Learn
1. The original ve founders of IMVU were Will Harvey, Marcus
Gosling, Matt Danzig, Mel Guymon, and myself.
2. Uhtstapg:/e/winwtwhe.b uUsinnietessdwSeteakt.ec somw/atsecehvneonlomgyo/rteechco_sntacetsn/t rated; see
im050307.h tm
3. Tthoaht eleadr mtoooreurapboivuottIaMwVaUy’fsroemarltyhecoandvde-rosnatisotrnastewgyit,hseceu:shtottmp:e/r/s
mixergy.c om/ries-l ean/
4. Arigwhotrdkoinfdcauotfionm:edterimcso,nsctarlalteidngacvtailoindaabtelde lmeaertnriincsg, rewqhuiicrhes athree
discussed in Chapter 7.
5. This case was written by Bethany Coates under the direction of
Professor Andy Rachle . You can get a copy here: http://hbr.
org/product/i mvu/an/E 254-P DF-E NG
Chapter 4. Experiment
1. Spohmileosoepnthrye,puresninegurtshehaavceroandyomptJeFdDtIh. iAs srleocgeannt eaxsamthpeilre sctaanrtubpe
seen at http://w ww.c loudave.com/1171/what-m akes-a n-
entrepreneur-four-letters-j fdi/
2. http://techcrunch.com/2 009/11/0 2/amazon-c loses-zappos-deal-
ends-u p-p aying-1–2-b illion/
3. I want to thank Caroline Barlerin and HP for allowing me to
include my experimental analysis of this new project.
4. cIonnfodrumctaetdiobny SaabroauLtesKlioe.dak Gallery comes from interviews
5. The VLS story was recounted by Elnor Rozenrot, formerly of
MInnehorsaig. hFtorVemnoturereos.n AthdediVtiLoSn,asleedetthaeilawrtiacslepirnovHidarevdarbdyBAuksisnheasys
Review: http://hbr.org/2 011/0 1/n ew-business-models-in-
eecmoenrogminigc-tmimaerks.eintsd/ia art/im1 es.coorm/n epwres/ssnewsc-ob vye-croamgepanya/t http://
acortripcloersahtoew-tr/e5 n3d2s/5v0i3ll2a.gc em-lsaundry-s ervices-t akes-on-t he-d hobi/
6. For more on the early e orts of the CFPB, see the Wall Street
JCoounrsnuaml’esrApBriulre1a3u, 20Y1e1t”,; ahrtttipc:l/e/o“nFloirneC.wosmj.pc olamin/ta sr,tiDcloen/’S tBC10al0l
0142405274870355 130457626077235 7440148.h tml. Many
idnecdoircpaoterdateptuhbilsicexspeerrviamnetsntaalreapcpurroraecnhtlyin wthoerkipnugblihcarsdectotor
AunndeeershthCehloepadrae,rsChhiprisofVPeriens,idTeondtdOPbaarmka, .aInwd oDualdvidlikFeotroretshtafnokr
introducing me to these groundbreaking efforts.
Chapter 5. Leap
1. For example, CU Community, which began at Columbia
Uidn/i2v2e6r9si1ty3,1h/.adThanis eaacrclyouhnetadofstFaartc.eSbeoeokh’tstpf:o//uwndwinwg.sliasted.croamwn/
from David Kirkpatrick’s The Facebook Effect (New York: Simon
& Schuster, 2011).
2. Actual engagement numbers from 2004 are hard to nd, but this
pattern has been consistent throughout Facebook’s public
s“t6a0te%melongts.inFdoarileyx.aAmbpoluet, 8C5h%risloHguignheast lreeapsot rotendceina w20e0ek5, tahnadt
93% log in at least once a month.” http://t echcrunch.c om/
2930%05/l0o9g/0 i7n/8a5t-o lfe-caostlleognec-setuadenmtso-untshe-.”fahcettbpo:/o/kt/echcrunch.c om/
3. I rst heard the term leap of faith applied to startup assumptions
vbeynRtuarnedy rKmomKilseairn,ear fPoermrkeinrscoClaleuageuleda&ndBcyuerrrse.nHt epaerxtnpearndats tohne
the concept in his book Getting to Plan B, coauthored with John
Mullins.
4. http://w ww.forbes.c om/2009/0 9/1 7/v enture-c apital-i pod-
intelligent-technology-komisar.h tml
5. “CAhacralreesfuEl.lyDruersyeeaar,chheidmstealbflea cpoimonpeileerdcfaorrmMakoetor,r rmevaegaalzeidnethbayt
fSrtoamtes19fo0r0 ttohe19p0u8r,p5o0se1 coofmmpaanniuefsacwtuerriengforamuetodminobtihlees.UnSiitxetdy
percent of them folded outright within a couple of years;
aqnuoottheeirs6fropmerctehnet FmoorvdedbioingtroapohthyeTrhaerePaesoopflep’sroTdyuccotoionn:.”HeTnhriys
Ford and the American Century by Steven Watts (New York:
Vintage, 2006).
6. Jeffrey K. Liker, The Toyota Way. New York: McGraw-Hill, 2003,
p. 223.
7. http://w ww.a utofieldguide.c om/a rticles/030302.h tml
8. In the customer development model, this is called customer
discovery.
9. FSocrhmrooerdeero,nIntshiedefoIunntudiitn.g of Intuit, see Suzanne Taylor and Kathy
10.cFoomr/mj oourrenaoln/2t0h1e1L/0ea2n/leUaXn_umxo_pvreomdeunctt,_ssteeewahrtdtpsh:/i/pw_a wnw.h t.cmolopanerd.
http://w ww.slideshare.net/jgothelflean-u x-getting-o ut-o f-the-
deliverables-b usiness
Chapter 6. Test
1. http://w ww.pluggd.in/groupon-story-297/
2. “Groupon’s $6 Billion Gambler,” Wall Street Journal; http://
online.wsj.c om/a rticle_e mail/S B100014240 527487 04828 1045
76021481410 63543 2-IMyQjAxMTAwMDEwO DExND gyWj.html
3. T2h0e00terams pmaritniomf uvamriovuiasbaleppprrooadcuhcetshtaospbreoednucitnduesveelsoinpcmeeantt.leFaosrt
an academic example, see http://www2.c s.uidaho.edu/
~billjunk/P ublications/DynamicBalance.p df
See also Frank Robinson of PMDI, who refers to a version of
the product that is the smallest needed to sell to potential
hcutmstol)m. Terhsis i(shstitmp:i/l/arprtoodSutcetvdeevBellaonpkm’secnotn.ccoemp/t hoofwthitew“omrkins/immuvmp.
f2e0a1tu0r/e03s/e0t”4/ipnercfuescttoiomne-bryd-s euvbetlroapctmioenn-tth(eh-mttpin:/im/s utemve-fbelaatnukr.ec-o m/
set/). My use of the term here has been generalized to any
tvheersiBounilodf-Ma eparsoudruec-Lt etharant cfaenedbbeagcink tlhoeopp.roFcoesrs mofolreea,rnseinegh,tutpsi:n//g
wprwodwu.sctta-grtuuidpele.hsstomnlslearned.com/2 009/08/m inimum-viable-
4. Many people have written about this phenomenon, using varying
Cterromssiinnoglotghye. PCrhoabsamb.lyFothremmoorest, wseiedeElyricreVadonisHGiepoperle’sy rMesoeoarrec’hs
into what he termed “lead users”; his book The Sources of
eInanrloyvvaatniogneliisst atogreematpphlaasciezetothsetaretv. aSntegveelicBallanpkowueserss tohfe ttheersme
early customers.
5. “nToormthael cpasruoadlucotbsdeervmeor,nsthtreatDiorno,p”boDxredwemsoayvs,ide“boultoowkeedpluikteina
aabudoiuetncae.dRoezfeenrenEcaesstetro eTgagys Zthoantdawyearendta‘iClohroecdolaftoer Rtahien’Daingdg
allusions to O ce Space and XKCD. It was a tongue-in-cheek
nhooudrtso, tthheatvcirdoewodh,aadndmiotrkeictkheadn o10,0a0c0haDiniggres.a”cthitotnp.:/W/ainthsiwne2rs4.
owriethil-lcye.coo-dmr/etwop-hioc/u1st3o7n2/-.mYaorukectainng-sleeesstohnes-of rroigmin-darlovpibdoeox-aa-sq wa-e ll
as the reaction from the Digg community at http://digg.c om/
software/G oogle_Drive_k iller_coming_from_MIT_S tartup. For
more on Dropbox’s success, see “Dropbox: The Hottest Startup
You’ve Never Heard Of” at http://tech.f ortune.cnn.com/2011/
03/16/c loud-computing-f or-t he-r est-of-us/
6. This description courtesy of Lifehacker: http://lifehacker.c om/
5586203/food-on-t he-t able-b uilds-menus-a nd-grocery-l ists-
based-on-y our-f amilys-p references
7. This list was compiled by my colleague, Professor Tom
Eisenmann at Harvard Business School, Launching Technology
Vcleansst.urFeosr fmororae,csaesee hthttapt:/h/eplaautftohromresdanodnneAtwarodrvkasr.bklofgosrphoits.c onmew/
2011/0 1/launching-tech-v entures-part-i -course.h tml
8. http://www.r obgo.o rg/p ost/5 68227990/product-l eadership-
series-user-d riven-design-a t
9. socihatlt-ps e:/a/rcv he-netnugrienbee-aata.crdomva/rk2 -0f 1o0r-/5002-/m1 i1ll/ioconn/firmed-google-b uys-
10. This is the heart of the Innovator’s Dilemma by Clayton
Christensen.
11. For more, see http://bit.ly/DontLaunch
Chapter 7. Measure
1. bBoyugchotntbryastY,ahGoooo)glhea’sd ma amininicmoummpeatictcoorunOtvseizrteuroef $(e5v0e,nwtuhailclhy
deterred us from signing up, as it was too expensive.
2. For more details about Farb’s entrepreneurial journey, see this
Mixergy interview: http://mixergy.c om/f arbood-nivi-grockit-
interview/
Chapter 8. Pivot (or Persevere)
1. phtitvpo:t/-c/aw sew-wstu.sdliydeshare.net/d binetti/l ean-s tartup-at-s xsw-votizen-
2. For more on Path, see http://techcrunch.c om/2 011/0 2/0 2/
2. gFooorglem-torireed-toon-b uPya-tp ha,ths-fe oer-h1 t0tp0:-/m /tiellcihocnr-up nacthh.-csaoimd-/n 2 o0/11/0 2/a0 n2d/
http://techcrunch.com/2011/02/0 1kleiner-p erkins-leads-8 –5-
million-r ound-for-p ath/
3. Includes approximately $30 million of assets under management
and approximately $150 million of assets under administration,
as of April 1, 2011.
4. For more on Wealthfront, see the case study written by Sarah
Milstein at http://w ww.s tartuplessonslearned.com/2 010/07/
Wcaseea-lstthufdroyn-k t’aschriencge-na tnastuocmceys-so,f-sp eievohtt.thpt:m//lb. its.bFloorgs.n ymtimorees.comon/
2010/10/ 19/w ealthfront-l oses-the-sound-e ffects/
5. IMVU’s results have been shared publicly on a few occasions. For
2008, see http://www.w orldsinmotion.b iz/2008/0 6/i mvu_
creoamch/ea sb_o2 u0t_/m p irlelisos_nr_er leegaisset.sp/hp pre;ssf_orerle2a0se0_92 0s0e9e1h0t0t5p_:1//.p whwp,w.imavnud.
for 2010 see http://techcrunch.c om/2 010/04/24/imvu-revenue/
6. BDuesainliensgs awrcihthitecDtuarrewiisn.a c“oOnrcgeapntizeaxtipolnoarled sitnrudcteutraeil ibnaMsedooroe’ns
mproiodreiltizainndg Vonoelumofe towpoerabtiuosninsesms omdeol)d.elIsnn(oCvoamtiopnlextypsyessteamres
understood and executed in completely di erent ways
dhtetppe:/n/dw inwgwo.nd ewahliincghwmitohddealrwanine.cnotmer/ptrhiseeBoadookp/ts.” For more, see
darwinDictionary.p hp
Chapter 9. Batch
1. http://l ssacademy.c om/2008/03/2 4/a -r esponse-t o-t he-video-
skeptics/
2. If you’re having trouble accepting this fact, it really is helpful to
watch it on video. One extremely detail-oriented blogger took
tohnee tvimideeowaenndt: b“Yrookueloitsedobwetnw,eseenco2nda-nbdy-s5ecsoencodn, dtos esveeerywthiemree
you move the pile around between steps. Also, you have to
myoaunamgeovtehethpeilpeilseevaerroaulntdimbeestwdeuerningsteapst.asAkl,sos,omyoeuthihnagveyotou
don’t have to do nearly as much with [single-piece ow]. This
laolsookinhgasfoar fwacotorkryincoprorollgarreys:s sitnovrienngt,ormy.o”viSnege, trheetrireevsitngo,f atnhde
commentary here: http://l ssacademy.c om/2008/0 3/24/a-
response-t o-t he-v ideo-skeptics/
3. Timothy Fitz, an early IMVU engineer, deserves credit for having
tciominoethdytfhitez.w teorrmdpcroenstsi.ncoumou/s2 d00ep9l/o0 y2m/1e0n/tcionntainbuloougs-p ost: http://
deployment-a t-imvu-d oing-the-impossible-fifty-times-a -day/. The
wacoturkalodfevtoeolopmmaneyntdoif ethreenctoenntigniunoeeurssdaetpIlMoyVmUenftorsymsteemtoisgtihvee
adequate credit here. For details on how to get started with
ccoonnttiinnuuoouuss-ddeeppllooyymmeennt-t,5 -seeaes.hhttmtpl://r adar.oreilly.c om/2 009/0 3/
4. Fseotrupte, chnisceael hdttepta:/i/lse nogf.w Weaelathltfhrfornotn.ct’osmc/o2 n0t1in0u/o0 u5s/d deeppllooyymmeenntt-
infrastructure-for.h tml and http://eng.wealthfront.c om/2 011/
03/lean-startup-stage-at-s xsw.h tml
5. This description of School of One was provided by Jennifer
Carolan of NewSchools Venture Fund.
6. FPorrodmuoctreDoenvetlhoepmlaernget-bFalotcwh: dSeeactohnsdpiGraeln,esreaetiTonheLPerainnciPprloedsuocft
Development by Donald G. Reinertsen: http://bit.ly/pdflow
7. TahuethseorleoafnLehaenalHthoscpairtealsex(NamewpleYsorakr:ePcrooudrutcetsiyvitoyf PMreasrsk, 2G0r0a8b)a.n,
8. This illustrative story about pull is drawn from Lean Production
2Si0m0p7)li.fied by Pascal Dennis (New York: Productivity Press,
9. Fwowr wan.o reexilalmygpmlet.e ouf/itnhtiesrvmieiwsu/nfdaetbrsotya-nind-ian-gleaant -ww oorrkld,/see http://
10. Information about Alphabet Energy comes from interviews
conducted by Sara Leslie.
11. For more on Toyota’s learning organization, see The Toyota
Way by Jeffrey Liker.
Chapter 10. Grow
1. TihneAHdoatmmaLi.l sPteonrey,nbaleorngg’s wViirthalmLaonoyp.otFhoerr mexoarme polnesH, iostmreacoilu, natlesdo
see http://w ww.fastcompany.com/m agazine/27/n eteffects.html
2. Faonrdmpoaressioonn,thseeefohutrtpc:u//stw omwwer.s ctaurrtruepnlceiesssoonfslteiamrnee, dm.coonmey/,20sk0i9ll/,
12/b usiness-e cology-and-f our-customer.html
3. http://pmarca-a rchive.posterous.c om/t he-pmarca-guide-to-
startups-part-4 -the-only
4. TthheisCihsatshme (leNsesownYoofrkG:eHoarrpeeyrMPaopoererb’sacbkess,ts2e0ll0i2n)g. book Crossing
Chapter 11. Adapt
1. TToayiiocthai OPrhondou(cNtioewn YSyosrtke:mP:roBdeuycotinvdityLParregses-,S1ca9l8e8)P.roduction by
2. stFaortruplmesosorensleoarnnedN.ceotm/2P0ro0m8/o1te1r/neSt-cp orroem, otseere-s chottrpe:-/ /www.
operational-t ool-to.html and The Ultimate Question by Fred
Reichheld (Cambridge, Mass.: Harvard Business Press, 2006).
3. Information about QuickBooks comes from interviews conducted
by Marisa Porzig.
Chapter 12. Innovate
1. Je rey Liker, John E. Ettlie, and John Creighton Campbell,
PErnagcitnieceesre(dNewinYorJka:pOaxnf:ordJaUpnainveesresity TPerechssn,o1l9o9g5y)-M, pa.n1a9ge6m. ent
2. For one account, see PC Magazine’s “Looking Back: 15 Years of
PC Magazine” by Michael Miller, http://www.p cmag.com/
article2/0,2 817,35549,0 0.asp
3. The following discussion owes a great deal to Geo rey Moore’s
DhaedalsinucgcewsisthimDpalrewmienn(tNinegwthYisofrrka:mPeowrtoforlkioinTcroadmep, a2n0i0e8s)o.fImhaanvye
different sizes.
Chapter 13. Epilogue: Waste Not
1. http://w ww.i biblio.o rg/e ldritch/f wt/t i.html
2. http://www.goodreads.com/a uthor/q uotes/66490.Peter_D rucker
3. http://www.ibiblio.o rg/e ldritch/fwt/t i.html
4. In fact, some such research has already begun. For more on Lean
SRteasretuarpchrePsreoajreccht patrogBrYaUm,s,httspe:e//nNaatthhaannfurFru.cror’ms /L2 e0a1n0/0St9a/r1tu5p/
the-l ean-startup-research-project/, and Tom Eisenmann of
Hp arrovjaerdct,Bhuttspin:/e/ssp laStcfohromols’asndLnaeutwncohriknsg.b loTgescphonto.cloogmy/2 V01en1t/u0r1e/s
launching-t ech-ventures-p art-i v.h tml
Disclosures
eI ihthaevreaws oarkcoednsuwlittahntt,haedvfoislelor,woinrgincvoemstpora.nIiehsanvaemaerdeliantiothnisshibpoookr
equity interest in each of them.
Aardvark IMVU
Dropbox Intuit
Food on the Table Votizen
Grockit Wealthfront
I have additional interests in companies through my a liations
wfoiltlhowvienngturermcaspiatsaleitrhmers. aI hcaovnesuilntavnestteodr inasora wliomrkiteedd wpiathrtntehre.
Tmharnoyugmhortehecsoempramnise,sIbehyaovnedetqhuoisteyliasntedd arebloavtieo.nship interests in
500 Startups Kleiner Perkins Caufield & Byers
Floodgate Seraph Group
Greylock Partners
Acknowledgments
Iheolwp eeda mtraekmeeTndhoeuLsedaenbSt toafrtgurpatiaturdeealittoy.thFeirmst aannydpfeoorepmleowsthaorehathvee
itdheoauss,acnhdaslloefnegnetdretphreemne, urers nareodutnhdemth,eawndorilmd pwrhoovehdavtheetmes.teWditthhoeuset
their relentless—and mostly unheralded—work every day, none of
thiRsewaloustladrtbuepspoinssviobllvee. Tfahialunrke,yeomu.barrassing mistakes, and constant
chaos. In my research for this book, I discovered that most
oenf ttrheepirrednaeiulrys wanodrkmtaonldagienrspwuboluicld. Tphreefreerfonroet, tIoahmaviendthebetreedaltostothrye
mcoaunraygoefouwsheonmtresppreenntehuorsurws hino tceodnisoeunsteindtetorviheawves athnedirfasctot-rciheesctkoilndg,
conversations. Thank you.
coIllahbaovreatboeresnwghroatheafuvel tphursohuegdhomuet tmoyacccaormeeprlitsohhmavoeremtheanntoIrscoaunldd
htoavSeiloicnonmyVaolwleny. WiniltlhHearvresty pislarceespaonndsibfoler ftorrusbtointhg rmeceruwitiinthg tmhee
opportunity to try out many of these ideas for the rst time at
IMMaVttU.DIaanmzigg,raatnedful MtoelmyGuoythmeor nIMaVsU wcoeflol unasdertsheMamrcaunsyGoIMsliVnUg,
employees who did so much of the work I discussed. Of course,
nmoinlleionosf othfaItMwVoUulcdushtoamveerbseoevnerptohsesibyleearws.iIt’hdouatlsothleikseuptopothrtanokf
DMaavhiodnMeyi,llRstaoyneO, cKaemnpDo,udaan,dFJearnsoanndAoltPieariiz,foSrtetvheeiWr ehienlspteainlo,nOgwtehne
way.
We all owe Steve Blank a debt for the work he did developing
the theory of customer development at a time when it was
considered heretical in startup and VC circles. As I mentioned in the
IFnotrrotdhuectipoans,t Ssteevveenwyaesarasn, ehaerlyhaisnvbeesetonr ainn aanddviasedrv,ismerentotoIrM, VanUd.
collaborator to me personally. I want to thank him for his
enTcohueraLgeeamn eSntat,rtsuupppmoortv,eamndenftriiesnmdsahdipe.up of many more thinkers,
pMrcaCcltuitrieo,neArssh, Manadurywar,itBerrasntthCaonopjuesrt, Pmater.ickI Vwlaanskt otvoitst,hSaenakn DElalvise,
Andrew Chen, Sean Murphy, Trevor Owens, Hiten Shah, and Kent
vBeenctkurfoerctahpeiitraliidstesaws,esruepepaorrlty, asunpdpeovratenrgselainsmd .adSeovpetrearls.inI vweostuolrds lainkde
Atondtehrasnokn (MBaikseelinMe)a,plJeosshanKdopAelnmnanM(iuFriras-tKoRo(uFnldooCdgaaptieta),l),StReovne
Conway (SV Angel), and Jeff Clavier (SoftTech VC).
feeAdsbyaocku, citaenraitmioang,inane,dttheisstibnogo. kI riencveoivlveeddinavtarleumabelned,oinu-sdaemptohuenatrolyf
feedback from Laura Crescimano, Lee Ho man, Professor Tom
CEiosoenk,maSnhnaw, nandFaSnancihnag, JMudadrk. TGhraanbkasn,alJseonntoifeMr iCtcahroKlaanp,orM, aSncuoettl
fReoesdsboa,ckT,imandO’sRuepilplyo,rt.anIdowReeida sHpoecimalannoftoer otfhethiranskusggteostiRountsh,
Kaplan and Ira Fay for their wisdom and friendship.
cusTthormou-bguhioltutttehsetinpgrocpelsastfoofrmwrittiongrtuhne bsopolikt-,tIeshtadexthpeerbimeneentts ofona
e(yvoeurytchainngsfereomthceovreersudletssigonf ttohessuebtietxlepsertoimaecntutsalabtihtsttpof:/t/hleeabno.sot)k.
Pivotal Labs built this software for me; they are the premier
pMrcaFcatirtliaonnde,rsanodf—agmiloesdt eivmeplooprtmanetn—t.PSaprekceiralTthhoamnkpssoton,RwohboMweoe,rkIeand
tirelessly to build, experiment, and learn with me.
talTenhtaendksdaelssiognteorsIMIVkUnocwof,owunhdoerdMesaigrncuesdGtohsislinbgo,ookn’se coofvtehre, mafotesrt
couOnnteleossf ittheeraptiroenmsi.er web and user experience design rms, Digital
Telepathy, designed and built the website for
Thtetlpe:p/a/tthheyl,eanstdaerstiugpn.ecdom, uasinndg theibruuilntiquethIteerativweePbesriftoermanfcoer
Design process. It’s awesome. Learn more at
httIpw:/a/swewxwtre.dmteelleypfaotrhtyu.ncoamte/to have the support of three legendary
institutions at various points in my journey. Much of the research
tKhaaut mwaenntFoinutnodatthiiosn.bAoot kKawu ams agne,nIerwouansltytounedspeerwcirailtltyenthabnyk tBhoe
FanishebnatcrkeparnedneNuric-ikn-Sreegsiudiennfcoer athteHirasruvparpdorBt.uIsisnpeesnstStchheopola,stwyheearreasI
enjoyed the opportunity to test my ideas against some of the
bTroimghteEsitsemnminadnsninabnudsinMeisks.e I RaombeerstspefcoiarllythegirratesfpuolntsoorPshroipfessaonrds
shuapdptohret, oasppwoerltlunasitytotothespsetunddenatsborifefthteimHeBSwSitthartaunp oTricbee.aItatlhsoe
premier venture capital rm in Silicon Valley, Kleiner Perkins
Cenaturepelrden&euBrsyheirps, iwshneurertuIrreedceaitvetdheanhiignh-edsetpltehveedlsu.cTahtiaonnkisnttoo hCohwi-
Hua Chien, Randy Komisar, Matt Murphy, Bing Gordon, Aileen Lee,
anMd yEllreensePaarcoh, atnedamto hmeylpoefdficmeme adteocaunmdeEnItR,cCasyeriastcuRdoieesd,iningt.erview
MhuanrdisraedPsoorfzisgta, rtwuphos, alnodggedltercothuonutlseasnsdshooufrsstodrioecsu. mI wenatnint gto, tchroanssk-
referencing, and investigating. Additional case studies were
deTveralodpiteiodnbayl SpaurbalGisahvinisgerisLeasliceoamnpdliScaartaehd Manildsteiinns.ular business. I
bFeenrreissteadndfrRoammiatdSveicthei asentdmceonsntreacitgihotnseafrrloymonm. Ianaym paelsooplger.atTefimul
to Peter Sims, Paul Michelman, Mary Treseler, Joshua-Michéle Ross,
LCelaer,aHSohlilhis, HSaeriamhboMuiclsht,eiBno,bASduatmtonP,eFnreannbkeireg,JoGnreetsc,hReanndRyubKionm, Kisaatre,
and Jeff Rosenthal.
yoAutaCrerorwenad, itnhge fheellrctuoleaanhutagsek toefamturonfinpgetohpislei.dMeayinedtoitothr,eRboogoekr
sShchepohlle,rsdaewd itthtehrvoiusigohnthoef ethnitsireboporkocfersosm. I wthaentvetoryablseogitnhnainnkgTainnda
Constable, Tara Gilbride, and Meredith McGinnis and everyone else
Cwohnostwabolrek,eTdaoran Gmialbkriindge,thainsdboMoekreadritehalMityc.Ginnis and everyone else
Those who had the misfortune of reading an early draft know just
ehsoswentmiaul cehdigtoraritaitludheelpI oown eantounLbauelrieeevnabRlyowtilgahntd,schwehdoulep.roIfviydoeud
enjoyed any part of this book, she deserves your thanks.
p rMocyessadhvaissebr,eepnarmtnyerp, haenndomcoennsailglaiegreentt,hCrohurigshtyouFtletthcehepr.ubShlieshhinags
ktheeepunecvaenrnyy satbaikleithyotlodeprrehdaipctpyth—eaflultuarte,thmeaksaemtheintgims hea. pSpheen,traunldy
understands the modern media landscape and has helped me
nalasvoigwataentitstocrtahzaynkwaAtleyrsssaatWevoelry, wtuhrno. hAatsFbleetecnhear tairnedleCssomadpvaoncya,teI
athnids bgoaotekkteoepneerw, arengdioMnselainssda laCnhginucahgielsl.o, who is working to bring
I know it is a cliché to say, “None of this would have been
pthoisssicbalsee,wiitthiosutsitmheplcyonthsteanttrustuhp.pMoryt opfarmenytslo, vVinivgiafanmRileyz.n”iBkuatnidn
Andrew Ries, have always supported my love of technology while
sthtiellirincsoisntisntagnotnlothvee imanpdorstaunpcpeoortf, aIliwbeorualldarntseveedruchataivoen. hWaidthothuet
coowunravgoeictoe astsepa winrtiotetrh.eI vkoniodwofmeyntgrreapnrdepnaeruernshtsiphaovrehbaeveenfowuinthd mmye
every step of this journey—they believed deeply in the power of
wacrciotimngpliashnmd etnoto. kTo smupyrseimsteersjNoyicoilne amndyAsmisatenrdsa’ aannddmmy ybroetvheerry-
iyne-alarsw. Dov, I can only say: thank you for supporting me all these
My wife, Tara Sophia Mohr, has been a constant source of joy
aenvedrycohmigfohr,taenvdereyvsetreyp loofwthtehrwouayg.hSthheishvaes reyxpleenrgiethnycepdreovceersys. sTtraersas,,
you are an incredibly brilliant, strong, and compassionate woman.
Wsuoprpdosrt,caynonuortoveexrpwrehseslmhionwg lomveu,chandI tahpepdreaciliyateadvyeonutrurestetahdaftasist
our life together. Thank you.
About the Author
SEtRaIrCtupRIELSessiosnasnLeeanrtnreepdr.enHeeurcoafnodunaduetdhoarndof sethrveedpoapsulCarTObloogf
hIMasVUad,vhiissedthiardnsutamrtbuepr. oHfesitsaratufrpesq,uleanrgtespceoamkepraantiebsu, sainnedssveevnetnutrse,
capital rms on business and product strategy, and is an
eSntatrrteupprenmeeutrh-iond-orelosigdyenhceas abteeHnarvwarridtteBnusaibnoeusst Sinchothoel.NHewis LYeoarnk
Times, the Wall Street Journal, the Harvard Business Review, the
Huffington Post, and many blogs. He lives in San Francisco.
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The Lean Start-up by Eric Ries
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