Most startups fail. They all fail for the same reason. They run out of resources before they become a success.
Lean business development recognizes the extremely limited resources available to most startups. Lean provides a plan and a tool-set for proving the value of your business before resources are exhausted.
Lean is lightweight and agile. Lean attacks the riskiest ideas first. Lean provides a set of tools for quickly and cheaply testing all the ideas in a new business concept.
When developing a lean business, we regularly test our ideas in the marketplace against predetermined goals. When test results don’t match our goals, we don’t quit. We learn from our ideas, improve our business plans and test again.
The purpose of any startup is to create a scale-able, repeatable business model. Lean endeavors to perfect the business model before investing in scaling. With lean, errors in the business model design are discovered when they are still inexpensive to fix.
I was once fortunate enough to work for a startup which raised and spent in excess of $300 million. This startup failed because they delayed addressing their most fundamental assumptions. This never would have happened in a lean business development. With lean, the founders of this company could have tested their assumptions and made thousands of improvements or pivots to their business model. Unfortunately, we invested $300 million in scaling a business which the critical decision-makers did not want. This experience has turned me into a lifetime evangelist for lean business development.
E7 Systems has worked through lean business development processes with a number of clients. Bill has also volunteered his time public speaking on lean business development and mentoring at the SCAPE business accelerator in Durango.
Lean business development begins with the lean canvas, a single (very large) page business plan that exposes your ideas in nine essential components of any new business.
The lean canvas is a business model design tool created for teams. The canvas is posted on the wall and completed by the founders, maximizing communication and discovery. With the business model identified, a lean team can identify the assumptions underlying the elements of the business plan. These assumptions are prioritized, and the riskiest assumptions are singled out for verification.
Lean business development provides tools to economically and rapidly validate or disprove assumptions on the campus.
Rather than make an immediate profit, a lean startups mission is to iterate through their assumptions, either validating them with real data or improving the business model design.
For more details on lean business development, please review our lean business blog. If you have any questions or are interested in helping with your lean business development contact us.
Check out our presentations on Lean Startups and Business Model Design
Low Fidelity Artifacts enable lean startups to move exceptionally quickly. Ideas are visualized and vetted with real customers before building the “whole enchilada”.