The Change Imperative: Why Pivotal Advocates Lean Startup Management Practices

This post was brought to you by our sponsor, Pivotal Labs.

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!). We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is Janice Fraser, who is Director of Innovation at Pivotal. She’ll be giving a workshop on The Lean Startup Leader’s Guide at the 2015 Lean Startup Conference. Learn more about her here.

A few months ago I had the pleasure of shadowing Eric Ries as he led an annual planning meeting for one of his clients. As I watched him field questions, organize team activities, and challenge their results with surprising frankness, I was struck with the clear insight that Lean Startup is not a process. It’s not even a mindset (something I’ve long advocated). It’s actually more far-reaching than either: Lean Startup is management.

More specifically, Lean Startup stands as an alternative to the management philosophies that have predominated over the last century, which are ingrained enough to be taken as fact. Lean Startup is an emerging management philosophy that enables all kinds of companies to rise to the substantial challenges posed by a tech-driven world, where the already-relentless pace of change is ever-accelerating. It’s a way of running a company, organizing people, and evaluating the effectiveness of their efforts.

“To meet the demands of the fast-changing competitive scene, we must simply learn to love change as much as we have hated it in the past.” That’s what management guru Tom Peters said all the way back in 1987. But the “fast-changing scene” he was talking about still had people sending memos on paper, and our phones stayed on our desks when we left the office.  

Pivotal Labs was formed only two years later, in 1989. In the decades that followed, Pivotal Labs became one of the most influential software shops in the world, specifically because it understood that software developers need to be responsive to change. As one of the earliest and most thoughtful leaders in the Agile movement, Pivotal Labs optimized its practices to manage the “unknown unknowns” of developing new products. (If you haven’t read The Agile Manifesto lately, it’s even more relevant today than when it was published in 2001.)  

The Air You Breathe

Despite experiencing the benefits of Agile, we’ve seen some companies—large and small—struggle to bring Agile home when they leave the Pivotal offices. They find it hard to deliver game-changing innovation when, for instance, their budgeting process requires a pre-approved list of specifications, and success is measured by how close to “on-time, on-spec” they deliver. It’s the things that happen outside of the software team that can prevent a company from routinely, efficiently delivering value-creating software.

Consider the typical project cycle:

  1. Someone creates a report around some analysis, or comes up with a “great idea”.
  2. It sounds good to their boss, so they make a plan.
  3. They socialize the plan around the company to build support.
  4. They get feedback – often from a select group of influencers – and revise the plan, strengthening the commitments and expectations.
  5. At a certain point, it’s deemed good enough to submit for funding through some type of investment committee.
  6. If they’re lucky, it’s Approved! Funded! The project is a Go! Huzzah!
  7. The team executes on the plan. Lots of project management goes into making the compromises and negotiations required to bring it in on-budget and on-time. If they’re really good, it comes in close to budget, and pretty much on schedule. But just as often they’re either behind schedule or over budget, or both.
  8. Go To Market.

There are at least two things wrong here.

First, the go/no-go decision is based on estimates of potential future returns (in the best case),  or on the opinions of a ratification committee (in the worst case). Second, success is measured in terms of project delivery rather than product value—did you do what you promised, when you promised, for the price you promised?

This classic “plan and control” process is flawed because it fails to validate the fundamental assumptions and premise on which the project rests. This leaves the entire effort vulnerable and explains why so many efforts (software or otherwise) fail to deliver the expected value to the business. Delivering software according to plan creates no value if the assumptions underlying the project are flawed.

The dominant management practices of the past century emphasized long-range planning and control to ensure predictable outcomes. Prediction was possible because past experience was a reliable source of knowledge in a more stable world of longer production cycles, where disruption was an occasional urgency rather than an ongoing reality.

From here on, management must instead optimize for adaptability—for learning and innovation—to ensure responsiveness in an unpredictable world.

And that’s why Pivotal is committed to Lean Startup. The imperative Tom Peters laid down in 1987 has even more dimensions than he might have imagined. In a world propelled by all things digital, we believe that Lean Startup provides a deeply effective and modern solution.

Retooling for Innovation

In his forthcoming book, The Leader’s Guide, Eric Ries says, “Building and growing a Lean Startup requires leaders to continually question whether our organization’s beliefs and values support or hinder entrepreneurial innovation. That means taking a good look at the way people are rewarded, the way projects are funded, and the way we talk about success and failure.”

Implementing an Agile software practice requires the same questioning and retooling, but it means more than recalibrating only your software team. When you live in a world where everything—from your wristwatch to the weather—might be completely different next year, the companies that create the most value will be those with acute perception, empirical decision processes, mechanisms to consistently test assumptions, and an organization that supports this.

As Director of the Innovation Practice at Pivotal, I’m often called into client meetings to talk about how a company can be “more innovative”. After 25 years in Silicon Valley, I can assure you that every human is innovative; it’s the company—optimized for business-as-usual predictability—that stymies innovation. The honest answer then, to our clients’ desire for innovation is: Change your company…a lot. From root to tip. It’ll take a while, but that’s expected. Others have done it, and you can too.

Imagine the scale of institutional changes that companies like GE, Intuit, and Twilio have undergone to shift their management practices toward Lean Startup:

Instead of asking funding teams to compare well-crafted, thoroughly socialized, politically supported plans, leadership teams compare projects based on the actual results of lightweight experiments. Plans are replaced by prioritized “assumptions to validate” and budget-allocation is managed like an investment board, releasing funds when empirical, market-based evidence shows that the “startup” is on the right track.

This is the process that Eric Ries was preparing teams for at the client planning meeting last month, with his typical candor. That company has been moving toward full-scale Lean Startup management for years, and it was enlightening to watch him deconstruct the teams’ plans by having them prioritize learnings, so that investment decisions could be made based on validated data.

Pivotal has partnered with Eric Ries and the Lean Startup Conference because together Pivotal’s Agile process and the Lean Startup management approach set a foundation for consistently, reliably delivering customer value with far less risk.

On November 16, I will be leading the first-ever Official Leader’s Guide one-day workshop as part of the Lean Startup Conference. Pivotal will be offering 11 more of these workshops to backers of Eric’s record-breaking Kickstarter campaign at Pivotal offices in cities around the world, including London, New York, Toronto, Los Angeles, and Tokyo.

Lean Startup Co will send an announcement with dates and locations for those workshops when the book ships. I can’t wait to meet you there!

*”Company” in this context can also mean non-profit, NGO, government agency, educational institution, or any other complex human endeavor.

Building Products Beyond the Launch

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!) We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts all in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is Poornima Vijayashanker, the founder of Femgineer. She’ll be giving a talk on How to Ship Your Ideas at the 2015 Lean Startup Conference. Learn more about her hereand check out the original version of her blog post here.

I’ve contributed to more than a handful of launches. Probably the most successful and public one to date has been’s launch at the original TechCrunch40 competition, where we walked away as winners of a nice $50K check! It was definitely an atypical launch.

What I’ve learned from both successful and underwhelming launches is that you get more than one chance. While launch day is important, it is not what is going to make or break your product’s success. A very successful launch can set a good tone, but you can’t become complacent. I’ve come across too many products that had awesome launch days, only to see them fizzle out shortly thereafter. I’ve also experienced launches where I heard crickets. While they felt like catastrophic failures, it was possible to rebound quickly.

So, while this post aims set you up for success, know that launch day isn’t everything unless you’re building software for SpaceX.

By now you’re probably eager to get your product out the door and into the hands of customers. Or, maybe you’re a little bit apprehensive because you’re worried that it’s just not perfect. Perhaps you’ve already launched but are only hearing crickets. Well, don’t worry. In this post I’m going to cover a number of strategies to give your product a successful launch.

Too often people get so obsessed with product features that they forget infrastructure requirements related to securing their product, scaling it, and providing customer support.

Let’s dig into these 3 areas.

Securing your product

I highly recommend taking the time to think about basic security and compliance. Here is what you absolutely need to do:

  1. Encrypt usernames and passwords. As simple as this sounds, the last thing you want is for a security breach to impact your launch day.

  2. Set up an SSL certificate for your website. This means that your site will start withhttps:// rather than http://. If you just have a public-facing website with no login, then it’s OK to not have an SSL certificate. But if you have created a login-based website, then you definitely need to have an SSL certificate. Otherwise, your users will be susceptible to various forms of snooping and attacks. You can read up on SSL certificates on Wikipedia.

  3. Set up a data backup mechanism. Depending on who is hosting your product, they might already do hourly or daily backups. But it’s always good to check.

  4. Secure log files. If you are writing things out to a log, those must also be clear of cleartext passwords and logins.

  5. Expire sessions (unless requested). I know a lot of people want to keep their sessions alive indefinitely. You can offer this service if you’d like, but keep in mind that you may want to monitor devices and IP addresses to make sure that someone’s account isn’t being hijacked.

  6. Be transparent about cookies. If you absolutely need to store cookies, ask permission to store them and make sure it’s clear to your customers why you’re doing it. Read TRUSTe’s blog post on the best practices for doing this.

  7. PCI Compliance. If you plan to take any form of payment, then I recommend integrating with a third-party vendor like Stripe or BalancedPayments.

  8. Spam Act. If your product sends out emails to customers or on behalf of customers, check out the Can Spam Act and make sure you’re compliant.

This is just the tip of the iceberg when it comes to security and compliance measures, which I believe are just as important as building a product. You might decide to throw caution to the wind, but there are a lot of people trolling the internet looking to hack young products. If you’re unaware of the security measures mentioned above, then I highly recommend doing more research on them. Some companies that offer a lot of great literature and tools are TRUSTe and Verisign.

Track customer usage and growth, and set up support channels

You’ll want to test the product internally before launch. Start by giving it to a handful of trustworthy early adopters and putting some mechanisms in place to track usage and collect feedback.

The best way to track usage is to take the time to install an analytics tool like KISSmetrics or Mixpanel into your product.

These tools help identify the following:

  • Drop-off points. If you see a lot of people who sign up but then don’t actually upgrade or use the product, you’ll be able to spot the point at which they dropped off.

  • What is actually being used. Too often teams bicker about needing to refine features without knowing if customers are actually using them. Using a tool like Mixpanel makes it easy to identify usage statistics so you and your team can discuss what features need work versus ones that people haven’t even discovered yet!

We always plan for the downside, but what about the upside? Can your product handle 100 concurrent customers? What about 1,000 or 10,000? If you’re not sure whether your product can scale, then you’ll want to do some load testing. Check out orLoadImpact.

Next you’ll want to set up a few customer support and application monitoring tools:

  • A landing site. This is the public-facing site where customers are going to come and sign up to try out your product, but they are also coming here to look for things like an About page, a Contact page, FAQs, testimonials, and video tutorials. Keep in mind that this web presence will grow alongside your product.

  • A live chat client like Olark to be able to message customers as they come to your website. You’ll place this on your landing site.

  • A ticketing tool for customers to report bugs and any issues they experience, likeGetSatisfaction, HelpScout, UserVoice, or ZenDesk.

  • Graceful error handling so your customers won’t get pissed off if they cannot log in. Check out Status Pages.

  • A performance monitoring tool like New Relic, because you’ll want to know if any bottlenecks emerge once you start to put some load on your product.

Priming your customers

Whenever people tell me they heard crickets on launch day, I ask them what their launch sequence was, and of course, they look bewildered.

A launch sequence is a set of marketing campaigns you send out to prime your initial set of customers. Yes, you have to prime them!

If you just send out an email the day of launch, don’t expect people to just drop everything they are doing and try out your product.

You’ll want to send out a sequence of emails to your network, early adopters, and whoever else is signed up to try out your product. And, you want to do it at least a month in advance. Ideally, you’ll send out about 4-5 reminders. You might feel like you’re being spammy, but people need constant reminders.

On launch day before you flip the switch to go live, you’ll want to send out one final reminder.

You’re not quite done once the product is live. The day after, you want to reach out to customers and ask them how things went. Following up is the key to getting feedback!

Depending on how launch day goes, you’ll want to let things simmer for a couple days—maybe even a week—because at this stage the feedback won’t be settling. It may all be really positive or negative.  After a while, sit down with the feedback and segment it. Know that you cannot fix everything at once, and not everything needs to be fixed or refined immediately! Software evolves slowly.

It’s called software for a reason

One of my favorite ice creams is Ben & Jerry’s Half Baked. I just love the gooey brownie batter and chunks of cookie dough. In fact, I love it more than when people serve a fully-baked brownie or cookie a la mode.

Software is like Ben & Jerry’s Half Baked ice cream. It’s never quite done, and that’s what makes it delicious! Unlike hardware or a physical product, you can iterate on it constantly, but the key is to pick a couple things to iterate on—not everything.

You’ll want to sit down and sift through feedback from all your channels: customer support tickets, calls, chats, and emails. Keep track of outliers, like feedback that was extremely positive and extremely negative. You’ll want to reach out to these folks to understand why they are at the extremes.

Those who were extremely positive will become great case studies and testimonials. Those who are negative may have valid concerns, depending on how constructive they are. Finally, look for the common criticisms.

It’s important to marry anecdotal feedback with data, which is why I recommended setting up an analytics tool like KISSmetrics or Mixpanel.

You should see exactly what features your customers explored and didn’t. This will help you decide where you want to focus your efforts going forward. I cannot tell you how many times I’ve heard of people refining the wrong workflows or features, only to find out later that no one was using them! If you want to use your time wisely, set up a tool that tracks customer paths and provides you with analytics so you know which ones to work on.

Two axes to think about when iterating on your product post-launch

Whatever happened during launch is over now. If it was a successful launch, then you’ll want to keep building momentum. If it wasn’t successful, then know it’s not the end of the world. At this stage, the name of the game is iterate.

Before you begin to iterate, you want to start by formulating a hypothesis on two different axes:

  • The first axis is growth. Think about what channels you can go after to attract more customers. If you already tried several channels and they were unsuccessful, what’s the reason? Was your message unclear? Was it not the channel where potential customers hang out? Or was it just a really small channel?

  • The second axis is retention. It’s not enough for people to sign up for your product. You want to make sure they are sticking around long enough for you to be able to monetize them.

Case Study: Lenda

Lenda is a company I met at 500 Startups and continue to advise. The team is focused on making it easy to refinance your home mortgage entirely online. When I met the Lenda team they had launched and had some significant traction. They were wondering what to do next and how to prioritize all the work they felt like they needed to get done in order to grow.

I sat down with them and asked what their most immediate concern was, and they said it was improving the conversion rate from initial signups to customers who successfully refinanced.

To help determine what was causing the drop-off in conversions, I had them install Mixpanel to see how people were flowing through the product. I also had their marketing person reach out to all the customers who had signed up but had not successfully refinanced.

Here’s what they discovered from their conversations with prospective customers and from looking at Mixpanel data:

  1. 50% of people of the people who made it to the signup page dropped off. The primary reason was because people thought Lenda was a lender for home purchases and home refinances. But right now, Lenda only does refinancing. People who wanted to do a home purchase loan dropped off right before signing up. I encouraged Lenda to change their messaging and to add an email capture form to notify prospective customers when they would be ready to handle home purchase loans.

  2. 50% of people who signed up dropped off at the first step inside the application.This was because they were trying to refinance in other states, but Lenda only services California homeowners. Once again, some simple messaging would solve this.

Lenda learned that their messaging was causing confusion and dropoff. By changing it to reflect their actual service offerings, they attracted more qualified refinancing signups and re-routed folks who were only interested in future service launches.

Now it’s your turn. Audit your software application and look for the following:

  • What are the biggest drop-off points?

  • Are those drop-offs due to messaging or the product being confusing? It will be hard to determine this just by looking at an analytics tool, so you’ll need to gather some anecdotal evidence by reaching out to prospective customers.

Remember, launching is just the first step, and if you want to start off on strong footing, you’ll want to focus on three key areas: security, scale, and support.

Once you’ve launched, you have to take the feedback from customers, sift through it, and begin to refine the product further. To know what to refine, look at the drop-off points in your product’s analytics but also talk to customers. Bridging data with anecdotal evidence will give you a good sense of direction and help you focus on what is most important to helping you grow and retain your customer base.

Get more step-by-step details for how to validate your product idea and improve product adoption in my upcoming guide: How to Transform Your Ideas into Software Products.

Sign up here to hear when the guide launches.

Digital Investing – The Last Frontier

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!) We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts all in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is Devon McConnell, Head of Digital at Wells Fargo Advisors, LLC. She’ll be giving a talk on Digital Investing at the 2015 Lean Startup Conference. Learn more about her here.

Money – more specifically investing – is deeply personal.  It’s how we live our lives, reach certain personal goals and provide for our families.

It’s not as simple as using an app to buy shoes, or hail a taxi, or even book a trip. Drones can’t deliver financial advice to our doorsteps.  This may explain why it’s taken the financial services industry a longer time to adapt in the digital age.

Our industry is at a crossroads with two major drivers of change today – customers’ digital expectations and a complex regulatory environment. It’s the perfect storm. And it’s driving us to look at the very basic operating models we work under to meet new demands.

I hear a lot about how Millennials are demanding financial services firms change the way they deliver advice. The reality from all of the research we’ve seen is that Millenials still want AND expect the human touch. When it comes to saving and investing, though, they usually expect their first experience to be in the digital realm.

Automatic investing tools are here to stay – but so are human advisors. It’s a matter of how technology for all generations can be trusted to support clients and help them reach their goals – throughout their lives.

Major money decisions involve emotions. That’s what drives the work my team and I are doing now – making sure we capture and hold on to the emotional connection when we’re building out our digital experiences.

It forces us to be nimble – and quite frankly, to be very honest with ourselves about how we manage the terrain of building trust and maintaining the emotional connection online.

A trusted brand is important.  And the digital experience can uphold that trust or give pause.  To bridge this gap we have started to incorporate emotional design – focusing not just on whether someone is able to complete a task, but if once they get there, they WANT to complete it.

After all, emotions are like a compass – directing decisions without us even realizing it.  If we feel good, we continue forward. If we don’t – we pause, or walk away.  Building a compelling and trustworthy experience is tricky business wrought with uncertainty.

Historically, traditional businesses like financial services manage uncertainty with a focus on analysis, consensus building and documentation.  That leads to a process and release cycle that takes 2 to 3 years from start to end before anything significant can be learned.

In this day and age – we don’t have that sort of time! It’s leading to an internal transformation at our firm – bringing in agile and lean practices so we can learn from our customers and respond more nimbly.

But in the rush to transform, even the most agile financial services organizations can’t forget the business we are in, and how bonds are built with technology AND people.

Hear the rest of Devon’s story at The 2015 Lean Startup Conference, where she’ll talk about building a digital strategy at Wells Fargo.

Devon McConnell is head of digital at Wells Fargo Advisors L.L.C.

The Nitty Gritty of Setting Up Customer Discovery Meetings

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!) We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts all in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is David Telleen-Lawton, of UC Santa Barbara’s Technology Management Program . He’ll be giving a talk on Customer Discover Meetings at the 2015 Lean Startup Conference. Learn more about him here.

Through the years – and I’m talking since the early 1990s before we called it Lean Startup– I’ve found that the single most likely reason that the Customer Discovery process does not work is that the Customer Discovery meetings never get set up!  That’s right.  The book is read, the process embraced, excitement is shared, but in the end very few meetings actually take place.

Think of your own situation.  If you have no problems getting in front of prospective customers and you are quickly learning about your business model, then I award you a free pass and can attend a different talk at the same time.  However… if you are like most, your lack of setting as many meetings as you need — as timely as you need them — is preventing you from identifying a sustainable business model.  I can change that for you!

And I’m NOT talking about some gimmick or some amazing list of prospects that I have in my hip pocket.  I’m talking about molding your mindset, showing you skills and techniques, and detailing the standard of performance you can use to measure yourself.

RARELY is the problem of not getting meetings a result of prospective customers of your product or service not being interested.  Instead, it’s mostly because you, the entrepreneur, are very clever about finding ways to delay putting in the effort to set up the meetings!  You’re rational (most of the time).  There’s reason behind your stalling.  We’ll discuss that dark side and vanquish it so you can discover your business model and create your version 1 offering more quickly.

In my talk, I’m going to address this single weak link that I’ve observed across the decades, across industries, across product types.  I will explain the nitty, the gritty, the details on how to set up Customer Discovery Meetings … the proper mindset, the proper skills and techniques, and the standard of performance that will turn you into a meeting-set-up machine.

I’ll help you get over the procrastination speed bump by surprising you with how simple your task becomes once you know the standard of performance and a few skills and techniques that I have identified from over one thousand calls into the highest level of target organizations (oops, I let one key techniques slip out there…more when you join me Wednesday afternoon!).

I’ll also make sure we have time to discuss four Customer Discovery Truths that are so often misinterpreted that they actually slow down your learning process.  And there will be time for Q&A about your particular unique situation.

I look forward to having you join me and get you on the fastest path to revenue.


The Full Rundown of the 2015 Lean Startup Conference

The Lean Startup Conference brings leaders from around the world to San Francisco on Nov. 16-19 to discuss the ways they’re shaping the business world for the future. With more than 30 different options over three days and nights for things like interactive sessions, inspiring presentations, startup tours, industry dinners, master classes, Q&As with Eric, and office hours, you won’t want to miss our big annual event. That’s where this rundown of everything you need to know about the conference comes in.

When and where is it again?

The Lean Startup Conference is at Fort Mason (2 Marina Blvd.) in San Francisco starting at 9:00 a.m. on Nov. 17 & 18. We offer an extra workshop day starting at 10:30 a.m. on Monday, Nov. 16 for Gold and Platinum badge holders and additional Startup Tours on Thursday, Nov. 19 for Platinum folks (more info on those tours below).

What’s going to happen each day?

You’re gonna want to arrive well rested. Seriously, look at this full schedule.

Here’s the deal for Monday, Nov. 16:

Swing by at 10:30 a.m for a little networking around the breakfast buffet while you grab your registration goodies.

Then Monday afternoon we dive right in, with workshops from noon to 5:30 p.m. on a range of topics. We’ll have three levels of Lean Startup Training for those interested in making Eric’s groundbreaking concepts real in their workplace. This means practical applications and viable tools for navigating common roadblocks, with industry specific solutions at the higher learning levels.

For conference backers of The Leader’s Guide Kickstarter campaign and all Platinum & Gold badge holders, we’re hosting a special Leader’s Guide Workshop with Janice Fraser of Pivotal. We’re calling this one a hands-on and minds-on session. We’ll take you through the nine steps related to culture, process, and accountability that lead to successful business innovation. Bring situations from your workplace or side hustle and we’ll work through solutions with you.

For folks who work at legacy companies, Microsoft’s Cindy Alvarez will lead a workshop on Driving Change within the Enterprise where you’ll practice working with skeptics, among other immersive (and entertaining) exercises.

All you design thinkers out there will appreciate these participatory workshops: Shufflebrain’s Amy Jo Kim on the Secrets of Game Thinking, and Wodtke Consulting’s Christina Wodtke joins forces with Users Know’s Laura Klein for Using Design Thinking to Build Creative New Products. Amy Jo will also lead a session on Lightning-Fast Customer Insights that’s especially geared for teams to attend; you’ll leave with an understanding of how to generate actionable customer insights in under three weeks.

For those interested in reading into the numbers, we have two great data-driven workshops on deck. Our longtime Lean Startup friend Alistair Croll of Solve For Interesting is leading two sessions on Using Data to Build a Better Business Faster that connects innovation to analytics. And Intuit Labs’ creators Hugh Molotsi and Bennett Blank will share tricks for creating an innovation lab of your own in the workshop Using Data from Your MVP to Win Support for Your Idea.

Dinadesa’s David Binetti returns with a perennial favorite, A Finance-Approved Approach to Innovation Accounting, which helps product and finance teams work together in assessing risk, avoiding traps, and producing the right valuation for your organization. Binetti will return on Wednesday for a talk about Using Innovation Accounting for Valuation and Risk Management.

On Monday evening, we’re hosting this cool thing called Ignite Opening Reception at Cowell Theater. Drinks and light apps start at 5:30 p.m.; Ignite talks kick-off at 6:30 p.m. This is where 11 brave entrepreneurs each get five minutes (and 20 fast-paced slides) in which to share the big lessons they’ve learned. Think of it as a lightning round of business insights.

Then on Tuesday, Nov. 17, we have all this and then some:

We’ll kick things off with a keynote talk by GE’s Mark Little, who will discuss the ways GE used Lean Startup techniques to achieve radical innovation and speed up production time. Then later Tuesday afternoon, we’ll continue on the theme of GE insight when Janice Semper takes us through the company’s Culture of Simplification efforts during her presentation on Getting Lean to Stick. The triple shot of GE will close with a presentation on Wednesday by Johanna Wellington on GE-Fuel Cells, the company’s internal startup working on clean, reliable local power that’s based on manufacturing MVP.

Our Tuesday morning sessions will focus on matters of size. Dropbox’s Aditya Agarwal will discuss Managing Through Hyper-Growth. And at the other end of the spectrum, Users Know’s Laura Klein will provide insight into the value of starting small and growing thoughtfully during So You Want to Be the Next Facebook. Speaking of cultivating things, Product Hunt’s Ryan Hoover will share his expertise on moving from an email list to a coveted digital hub during his presentation on The Building Blocks of Community.

After lunch, we’ll be hosting the first of two days of Office Hours from 2-5 p.m., available to Platinum & Gold badge holders. You’ll get to sign up in advance for these one-on-one mentoring sessions. Choose up to three mentors (from our list of 30), with whom you’ll have 20 minutes to ask all your burning questions.

We also have a full afternoon of breakout sessions tailored to specific themes and topics, including a live Q&A with Eric Ries for Platinum badge holders. During the Q&A, all you entrepreneurs and intrapreneurs can ask our Lean Startup mastermind specific questions about your situation, with the added bonus of hearing his solutions for others making their way through the methodology as well.

Plus, we’ll have lots of Lean Startup case studies, including Harvard Business Review’s Digital Transformation, Transavia’s How Lean Startup Accelerates (Open) Innovation, Adobe’s How to Build the Right Product That People Will Love, Techstars & CA Technologies’ Accelerate Beyond the Lean Startup, Hotel Tonight’s Lean Startup Story, and some social enterprise advice from ArtLifting’s Re-imagining Job Creation: Using Paint.

Speaking of mission-driven organizations, leaders from ArtLifting, Bidhaa Sasa, and Cooler will drive a discussion around Social Good Startups, putting Lean Startup practices to work for humanitarian and environmental causes. Cooler’s Michel Gelobter will also lead social sector innovators through the “pivot, proceed, or quit” conundrum with his session on Lean Metrics for the Social Sector.

For those interested in a global perspective on Lean Startup techniques, we’ll have an interactive panel on Lean Startups Around the World as well as a presentation from Japan’s Learning Entrepreneur’s Lab on their Lean Startup Accelerator for Enterprises to Create New Businesses.

Since so much of the Lean Startup ethos focuses on understanding the users, we’re hosting a number of panels delving into the granular bits of user experience. NYU’s Frank Rimalovski will guide a workshop on Talking to Humans: Success Starts with Understanding Your Customers. Former Googler and now WeWork’s Tomer Sharon will demonstrate the philosophy of Don’t Listen to Users, Sample Their Experience! (Hint: This involves a little thing they use at Google called the Experience Sampling Method.) And Huge’s Patricia Korth-McDonnell will talk about the concept of anticipatory design in smart products and services for her session on Applying Lean Principles to Anticipatory Experiences.

For the best advice from the product-market fit arena, we have a few different options. The Lean Product Playbook’s Dan Olsen will break down his six-step methodology in A Playbook for Achieving Product-Market Fit. Nowhere Digital’s Mark Bidwell is an expert in catalyzing change with market leaders. He’ll be presenting some of his findings during his talk on Building a Culture of Innovation: An Example from Agribusiness. And Femgineer’s Poornima Vijayashanker will pull from her book, How to Transform Your Ideas into Software Products, during her master class on How to Ship Your Ideas. How do you effectively bring new experiences to life for your customers? Thing Tank LLC’s Chris Luomanen will offer answers to that question during his session on Prototyping Your Experiences.

Lean Startup techniques are being adapted before the next generation of business leaders has even grabbed their diplomas. Educators are embracing innovation in schools, an exciting development that thought leaders from NYU, M34 Capital, and Neon will be diving into during their discussion From Campus to Startup.

We’ll close Tuesday’s afternoon sessions with a Conversation Between Eric Ries and Chris Dixon from Andreessen-Horowitz, where they’ll be mapping out the future of the Lean Startup community and what’s next on the horizon for entrepreneurs everywhere.

Here’s what’s on tap for Wednesday, Nov. 18:

On Wednesday morning, we’re thrilled to have Strategyzer’s Alexander Osterwalder as our keynote speaker, marking the business model guru’s premiere at the Lean Startup Conference. Later that day, we’ll have another big picture conversation with Andreessen Horowitz’s Frank Chen (and some special guests) about what it takes to be a modern entrepreneur. And we’ll close out the Wednesday sessions with final remarks from Eric Ries.

Good reasons to arrive before noon on Wednesday: we’ll be hosting talks ranging from the silver screen to market-strong products. Shufflebrain’s Amy Jo Kim will break down five early design hacks that’ll help in Getting to Alpha: Turbo-Charge Your Early Product Development, while Sprig’s Gagan Biyani will discuss the multiple pivots he navigated on the way to founding his dine-on-demand meal service for Eliminating Your Ego: Product Market Fit.

Art and analytics aren’t enemies. Telepathic’s Prerna Gupta will show how the two can actually aid one another, using case studies from the movie industry during How Data Can Save Hollywood. Spoiler alert: This one involves using metrics to analyze Tinseltown’s biggest duds and future blockbusters.

In the afternoon, we’ll look at Lean Startup experiments in the religious arena. Yes, you read that right. We’re excited to examine new territory at this conference — proving that innovative strategies really do transcend mission or industry — with Exploring the Fertile Boundaries Between Faith and Business, when speakers from FaithX, UpStart Bay Area, and Hatchery LA will be discussing the intersection of faith-based organizations and progressive organizational methodologies.

In Minimum Viable Taxes: Lessons Learned Building an MVP Inside the IRS, Andrea Schneider of the IRS and Lauren Gilchrist of Pivotal Labs will discuss how an organization not known for swiftness is releasing a new MVP, and how to create a lasting culture of experimentation inside a bureaucratic organization.

Enterprise intrapreneurs, we’ll have multiple sessions analyzing legacy organizations. American Express’ Andrew Breen will offer tips from his company’s journey through corporate innovation. Garrett Dunham of DunhamLabs will help us figure out how to span team schisms with How Enterprises & Startups Can Accelerate Innovation Together. And, because we can learn from failings as much as we can from successes, we’re very happy to have Ericsson’s Ken Durand open up about his View From the Trenches: What Went Wrong With Our Lean Startup Program. Plus, we’ll dig into enterprise marketing with Ritika Puri’s (Storyhackers, Lean Startup Company) talk about Minimum Viable Marketing.

What kinds of people should be on your team — and how should you best manage them in order to maximize Lean Startup principles? These questions are fodder for our Wednesday management track workshops. Alan Lobock of Spartacus Muse LLC will offer actionable advice during his session on Management Framework for Fast-Growing Early Stage Companies, where he’ll discuss how to build adaptive teams rather than manage by crisis. Scripps Networks Interactive’s Freyja Balmer and Michael Greene will also get into office DNA with their talk on The Human Side of Lean Startup: Functional Team Culture, which rewards engaged staffers over teams that cling to vanity metrics. And ReadyTalk’s Andrea Hill will lead a how-to on finding project sponsorship within a larger organization using Internal Customer Development.

Just because an industry is heavily regulated doesn’t mean organizations working in those markets are stuck in the old ways of doing things. In Lessons on Lean Collaborations in Health, Energy & Talent Markets, leaders from Hunch Analytics, Workday Inc., and PG&E discuss how they were able to drive change in sectors ranging from government to veteran care and energy.

The hardware industry is embracing innovation in some really interesting ways too. Just ask Marcus Gosling of Highway1, who’ll be presenting the experimental methodologies hardware engineers are investing in during his presentation on The Lean Hardware Toolbox.

We’ll also continue the conversations about customer discovery on Wednesday. LensBricks’ Gaurav Agarwal will share his hacks and tips in a hands-on session of Customer Development Power-Ups. For those working in the service industry, you’ll want to check out the interactive workshop with gravitytank’s Lauren Braun focused on Lean Experiments for Services, while Share More StoriesJames Warren will examine The Startup Storyteller: Using Stories to Learn. If you haven’t yet used LinkedIn for user information, Brandy Nagel of Georgia Tech VentureLab has some neat hacks to share during her session on Using LinkedIn for Customer Discovery.

The Return of Attendee Networking Dinners

We know you don’t just go to conferences to hear people speak, you wanna meet them and exchange ideas with them too. We’re enabling some solid networking after hours again with the return of our Networking Dinners on Tuesday, Nov. 17 & Wednesday, Nov. 18. Registered attendees can can grab a seat at a table full of small business owners, corporate innovators, government and educational intrapreneurs, and international entrepreneurs — we have all sorts of groups you can join, depending on your industry (and the type of cuisine you prefer). This deal is available to all badgeholders for only $55 per person.

Thursday bonus: Startup Tours

Platinum pass holders are invited to join our Startup Tours on Thursday, Nov. 19. We’ll be visiting some of San Francisco’s leading edge companies: Pivotal Labs, General Assembly, Eatsa, and Highway1 and learning about their processes, their offices, and other fun details about how they operate. More info here. And if you’re not Platinum but would love to upgrade your badge, no problem. Contact [email protected] and we’ll help you out.

It’s not too late to attend the 2015 conference

If you like what you just read, but have yet to grab your ticket to attend, you can still join us. Register here for your conference ticket today.

The Lean Startup Conference. Nov. 16-19, 2015 in San Francisco, CA.

How Lean Startup Is Changing High School Education

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!) We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts all in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is Erica Swallow, VP of Product at education non-profit Noble Impact. She’ll be giving a talk on Lean Startup in the High School Setting at the 2015 Lean Startup Conference. Learn more about her here.

Noble Impact facilitator Chad Williamson sketches a Lean Canvas at the first-ever High School Startup Weekend in Little Rock, Arkansas.

All across the world, educators are seeking ways to better engage students and prepare them for life after high school. In poll after poll, students tell us that their education doesn’t seem relevant; they don’t see a purpose behind the daily grind, the homework, the standardized tests.

For some, Lean Startup is a part of the solution.

The Problem

So, what is it about high school that disengages students? Take a look at most high school classrooms across America, and you’ll find the answer. Students sit chair behind chair, desk behind desk, in a seemingly endless matrix, wall to wall, while at the front of the room, a teacher commands the class and delivers content, only stopping to answer the occasional question.

Teamwork is practically unheard of, and students are asked to memorize formulas and historical dates to regurgitate on tests that will rank them within their class, school, and the entire national education system.

Students aren’t ignorant, though – they see the difference between the education system and what the “real world” looks like. They want an education that will set them up for success in life after high school, not one that will deflate their creativity year-by-year, until their only hope is to graduate and go to college or get a job.

We must give students a better system, one that is deserving of their time, efforts, and talents.

Coach Up the Classroom

Noble Impact scholars choose words that resonate with them about the entrepreneurial journey.

What would it look like if we flipped the classroom equation and put students at the center of their education? What if we challenged students to determine the course of their own educational journeys, to customize it based on their interests and the problems they ultimately want to solve in the world? Instead of teachers, we’d act more as coaches, facilitators of learning.

Students at Noble Impact take a purposed-based approach to their work, and they frequently ask, “Why?” We train students to dig deep – whether they are in the classroom, at one of our out-of-school events, or at home – to question the purpose behind what they’re doing. When students see the purpose in their work, they find relevance, and they’re excited to contribute.

The Lean Canvas and Lean Startup methodology have been invaluable tools for those exercises.

Applying Lean Startup to the High School Setting

Noble Impact scholars Greta Kresse and Olivia Fitzgibbon white board at an event about challenging the existing opportunity gap in education.
Noble Impact scholars Greta Kresse and Olivia Fitzgibbon white board at an event about challenging the existing opportunity gap in education.

Lean Startup as a business development philosophy prioritizes speed and learning over perfection – it asks the entrepreneur to define success in terms of “learning how to solve the customer’s problem,” as Eric Ries, author of “The Lean Startup,” puts it.

Lean Startup, then, is a natural fit in a project-based learning environment, where students are challenged to work on projects in line with their interests and the problems they want to solve. Lean Startup teaches students to focus on people, to understand what a customer is and how to solve his or her problems.

Instead of sitting in chairs all day long, students are asked to “get out of the building” to do customer research, define a problem, build MVPs (minimum viable products), and validate the assumptions their business models rely upon. Students aren’t used to adults handing over the reigns, but with the right facilitation, students can and do shine when they’re asked to build, measure, and learn.

Building Noble Impact Initiatives

At Noble Impact, students work in many different environments with Lean Startup methodology, both in the classroom and beyond.

Last year, in partnership with the Clinton School of Public Service, for example, we launched the country’s first-ever High School Startup Weekend, devoted solely to high school entrepreneurs. With 80 student participants in grades 9-12, the event saw ideas that included an online homework management tool, a portable storage locker company for outdoor events, a nail polish pen, and a “don’t forget your cell phone” smartwatch app, among others.

Innovation isn’t just an after-hours affair, though. Students also work on business ideas in class using Lean. At eStem Public Charter Schools in Little Rock, Arkansas, for example, Noble Impact scholars work with local businesses and on their own ideas, interviewing customers, mocking up MVP ideas, and actually building their own businesses. In fact, we currently expose Lean Startup to students in grades 5-12 and will soon expand all the way to kindergarten.

Bolstering High School Entrepreneurs


High school entrepreneur Sydney Brazil founded her own “donut holery” called The Hole Thing through her Noble Impact coursework.
High school entrepreneur Sydney Brazil founded her own “donut holery” called The Hole Thing through her Noble Impact coursework.

High school entrepreneurs are treated as rare creatures in our society, probably because we crush the creativity out of them in their day-to-day schoolwork. I get to work with a lot of fresh minds through Noble Impact, though, and we teach them that anyone can contribute to society or solve a problem, as long as they’re willing to put in the work and research.

I’ve had particular glee watching one entrepreneur, Sydney Brazil, flourish in our entrepreneurial environment. She used Lean Canvas to turn her idea for a donut hole business into a reality by founding The Hole Thing, Little Rock, Arkansas’s first “donut holery.” She makes the most delicious donut holes to ever grace the earth, from lemon lavender to chocolate chip cookie.

She started her journey much like any other entrepreneur twice her age (she was 15 when she got started) – she built a business plan, pitched at some local startup pitch competitions, caught the eye of potential partners, and launched a minimum viable product. Instead of buying a store location and setting up shop, Sydney went lean. Her MVP came in the form of a partnership with local restaurant Copper Grill, in which her company’s donut holes appeared on the restaurant’s dessert menu, alongside their house ice cream. Copper Grill also let Sydney use their professional grade kitchen to prepare the holes. The partnership enabled her to test her concept for donut holes, see if there was actually demand, and collect sales data about which donut holes were selling better. Build, measure, learn.

In Sydney’s words, the “grown up business community” has completely embraced her, Copper Grill and beyond. That’s what excites me as an education reformer. We need more connectivity between students and their communities, because business leaders and mentors are the ones who open up opportunities for students to learn and get experience. When a student has an idea for an MVP through a Lean Canvas exercise, it is local community that can help make that plan a reality.

Lean Startup Around the Country

Entrepreneur and educator Jeanine Esposito presents a Business Model Canvas at Hawken School’s summer entrepreneurship educators workshop.
Entrepreneur and educator Jeanine Esposito presents a Business Model Canvas at Hawken School’s summer entrepreneurship educators workshop.

Entrepreneur and educator Jeanine Esposito presents a Business Model Canvas at Hawken School’s summer entrepreneurship educators workshop.

Noble Impact isn’t the only organization teaching Lean Startup in the K-12 education system.

DECA, one of the largest co-curricular student club organizations, rolled out the Lean Canvas this school year for all of its state and national competitions related to entrepreneurship. Students used to write full 20+ page business plans, and now they’re going lean.

Likewise, educators at Hawken School, a private PS-12 school in Gates Mills, Ohio, is one of the first organizations I’ve worked with that not only teaches students about Lean Startup, but also trains teachers from across the country how to use and teach Lean Startup in their own schools. This summer, Hawken educators Doris Korda and Tim Desmond held the first-ever Hawken School Educators Workship for Entrepreneurial Studies at Babson College and made sure that each educator left having built at least one Lean Business Model Canvas.

Preparing Students For Their Futures

I strongly believe that it is our duty as world citizens to make sure that our children have the best education possible, so that they are prepared to thrive in an ever-changing society after they leave the halls of their hometown high schools.

From what I’ve witnessed, there are educators all across this country, focused on changing the education system, so that our students are prepared to not only thrive in, but also change the world.

Lean Startup, for many students, is the catalyst that gets them engaged and on that path. I encourage all educators to give it a try and to consider what it means when we ask students to take the reigns of their own educational journey. To build, to measure, to learn, and to rise to their fullest potential.

Erica Swallow is a 2015 Education Pioneers Fellow and a status quo wrecker, currently helping reimagine America’s education system as VP of Product at Noble Impact, an Arkansas-based social enterprise that aims to provide every student with a relevant and purpose-driven education. She is a first generation college student, alumna of MIT and NYU, and has written for Forbes, Fortune, and The Wall Street Journal, among other publications. Find her on Twitter and Instagram.

Internal Customer Development: Get Back in the Building!

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!) We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts all in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is Andrea Hill, who is a Product Strategist at ReadyTalk. She’ll be giving a talk on Internal Customer Development at the 2015 Lean Startup Conference. Learn more about her here.


Get Back in the Building

Yes, you read that right.

If I learned one thing from launching the first internal startup at my company ReadyTalk, it’s that you have to focus on your most important relationships first: those who are going to support your venture until you’re up and running.

Out in the “real world” of startups, you’d be working on getting support from venture capitalists (and if you’re bootstrapped, your family and friends). In the enterprise, that support needs to come from management of various levels, and may not solely be in the form of financial support.

Consider securing internal support as your first biggest risk, and approach it as such. Who are your customers? What are their biggest pain points and concerns, and how can you address those problems in a way they will invest in?

At ReadyTalk, our management team had varying levels of exposure to the lean startup methodology. I talked with each of the key stakeholders to understand what a successful pilot meant for them, and what concerns and fears they had.

That deeper understanding about each of our key customers allowed us to engage with them and share our progress in a way that resonated with them.

We had two stakeholders who were excited about the prospect of new product development, but were unfamiliar with, and a bit skeptical about, the lean process. We engaged with them frequently so they could fully understand the approach and feel actively involved in the initiative.

We had two others who bought into the approach, and trusted the team, they just didn’t understand how this approach would impact our core business. In this case, frequent communication allayed their fears and kept them satisfied.

We were able to personalize the introduction of lean to each stakeholder to address his specific concerns, to garner the support we needed to move forward. With the big risk of funding and support out of the way, we could turn our focus to our specific project.

I look forward to sharing my experiences – including how the introduction of a Project Sponsor dramatically altered our relationship with our internal stakeholders – at the Lean Startup Conference 2015.

Andrea Hill is a Product Strategist at ReadyTalk, an audio and web conferencing provider out of Denver, CO. There she she serves as the General Manager of UbiMeet, the first company-sponsored internal startup. She is a jill-of-all-trades, able to craft falsifiable hypotheses, design functional wireframes, write customer discovery scripts, chat it up with customers, and analyze and interpret the findings to drive product decisions. She tweets at @afhill and embraces hashtags as an alternative to stringing full sentences together. #left-handed #Canadian #INTJ #marathoner

Large & Lean: Enterprise Marketing Transformation the Lean Startup Way

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!) We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts all in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is Rishi Dave, who is Chief Marketing Officer at Dun & Bradstreet. He’ll be giving a talk at the 2015 Lean Startup Conference. Learn more about him here.

Dun & Bradstreet does not exactly qualify as a startup in the traditional sense. After all, we have thousands of employees in offices around the world and will be celebrating our 175th anniversary in 2016.

But at the same time, we are rapidly modernizing, and many of our employees feel like they are working at a large startup. As part of this, I have been leading the marketing transformation, and in many places we are leveraging Lean Startup principles to drive our strategy.

Our CEO, Bob Carrigan, had joined the company five months before me and had begun aligning the organization around an aggressive growth mandate. Marketing would need to transform to be a key spark for that growth.

We would first focus on culture, working with our People team to develop a modernized brand purpose and values that rallied employees around a simplified approach to our business: It wasn’t about the intricacy of “big data”; it was about the relationships that data enables. It focused a complex business and a complex organization on what we truly did to make a difference for our customers.

But that was merely the beginning. The other two parts of our marketing transformation would build on that foundation. We had to refine our go-to-market strategy to be about people not products, so we developed a persona-based approach that let us elevate the conversation to the needs and opportunities of our customers and prospects instead of what we wanted them to buy from us.

And most importantly, we had to be relentless about focusing on the customer and prospect relationships that were most valuable for our business. That’s where we have most leveraged Lean.

Our Version of MVP

Minimum viable product is a key Lean principle, and for us, MVP became a guiding approach for how we identified and engaged a customer, learned from the customer, and began to apply those learnings to other, similarly important accounts. In this way, MVP for us could be also seen as most valuable prospect. Not valuable simply from the sense of return on relationship but also from the standpoint of what we could learn to improve our business.

We started with a small set of accounts – using our analytics to prioritize which accounts we focused on – and then rolled out a series of tactics to create a meaningful experience. Content, in-person workshops, events, and so on would be generated for that account. Based on the results we optimized how we approached the next set of accounts.

Lessons Learned

One of the main things we have learned during this process is that you can be nimble, you can experiment – be Lean –in a large, global company.

Four things we learned through this work:

  1. It’s not about scale at first. Take the time to prove strategies and ideas on a smaller level before scaling. Don’t feel pressure to get too big too fast.
  2. Technology isn’t a substitute for culture. Invest time and resources in people before other things to lay the groundwork for change. But realize that where technology can help is in keeping everybody’s attention on the most important activities. And it can help cut through bureaucracy
  3. Measure, measure, measure. To understand what to scale, when and how, you must measure every aspect of your operation – and not be afraid to act on what the analysis tells you.
  4. Communication is critical. You must actively communicate with your key internal colleagues on what’s working in the smaller-scale experiments, gaining their advocacy as you roll out the successful tactics more broadly.

There’s a lot more detail behind this. That’s why I look forward to my talk at the Lean Startup conference later this month. See you there!

Speaker Spotlight: Using Data to Build a Better Business Faster

Big data is changing the way everything from government organizations to international record labels operate. We can access sophisticated analytics about our businesses from our laptops, making it easier to understand our customers at a granular level — in theory, that is. But for startup and enterprise companies alike, discerning the exact metrics to evaluate, and knowing when it’s time to talk to users face-to-face, can be confusing. That’s where our good friend Alistair Croll comes in.

The Lean Analytics author and Solve for Interesting founder is one of our featured speakers at this month’s Lean Startup Conference Nov. 16-19 in San Francisco (and hey, if you haven’t registered to attend yet, grab a ticket while we still have spots left). Alistair will be leading a session on using data to build better businesses faster.

To offer a taste of Alistair’s expertise, we offer an edited interview with this esteemed entrepreneur and author — who knows many important things about web performance, analytics, cloud computing, and business strategy — around best practices for using big data.

Alistair ran Year One Labs using a tailored methodology that put customer discovery first.

“We ran Year One Labs as an incubator more than an accelerator. We chose startups through hackathons that showed they could build new things, rather than for a specific idea. We knew we needed a methodology that would force them to do a lot of customer discovery — in fact, we didn’t let them code for the first few weeks! We recognized that at the start of a startup’s life, it doesn’t know what problem it’s trying to solve, much less how to solve it. Lean Startup fit the bill perfectly.”

Data collection should be built into startups’ DNA.

“Analytics need to be in the entire lifecycle of a product. You have to build data collection into the product roadmap; measure it in real time and in the aggregate; and learn by following up on the data to better understand your market. We often say that in a Lean Startup you aren’t building a product — you’re building a product to figure out what product to build.

So here are three examples from Alistair of companies that successfully used Lean Startup and Lean Analytics methods to determine the best metrics for their operations.

“Localmind, a Year One Labs company later acquired by AirBnB, had a business around asking questions about a place. One of their big assumptions was that strangers would answer questions. Because we wouldn’t let them code, and because this was a big, risky assumption, they decided to go on Twitter and geofence all tweets coming from Times Square and ask those people questions.

“They figured if you can get an answer from New York, you can get one from anywhere. And it turned out their assumption was valid — over 95% of people would respond to a question like ‘Is there WiFi?’ or ‘Where’s good coffee?’ That was enough to move ahead, in a day, without coding. It’s a great example of minimal data.

“We’ve seen big companies do this too. One global maker of paper products (that I can’t name) noticed a discrepancy between what men and women were searching for on their site, and used this to introduce an entirely new class of personal hygiene product that’s worth millions today. It turns out that unfulfilled searches on a website are an excellent open survey of what customers want you to sell them, but you don’t currently offer.

“Finally, consider David Boyle, who was then the head of analytics at EMI. The label wouldn’t let him see the huge hoard of transactions they had on record, so he decided to grab data himself instead, and ran over a million surveys worldwide about how people consume music. When he brought that data back to the company and its artists, it went well. Here’s a talk of David explaining how the BBC uses analytics today.

“He recently told me that when he showed [EMI artist] Snoop Lion that he had a burgeoning audience of ‘gadgeteers,’ or tech-friendly listeners, Snoop changed his entire attitude to the online world and social media. With these changes underway, David finally got access to the hoard of transactions, letting him to even better analysis.”

The data your organization generates could be its biggest asset.

“Computers today can surface unexpected correlations that marketers can then test for causality. The entire field of growth hacking is really about finding a thing you can change today which causes a change in some desirable metric down the road — and then optimizing that metric.

“But it’s getting even smarter. There are a number of systems that can outperform data scientists on the ‘intuition’ part of analyzing data, deciding what metrics matter automatically. That’s transformative. You only need to look at Tesla’s self-driving cars to see what happens when you can push machine learning and data into a hardware product to see how different the world will be.

“Data is also changing regulations and governance. Essentially, it’s squeezing arbitrage out of industries, because everyone has the same information at the same time. To combat this, many online services are guarding their data jealously, or erecting garden walls around their users, making it harder for upstarts to break in. But that also means that if you can create a valuable data set, your best asset may be the data you generate.

“Consider Shazam, which can tell you what track is playing in seconds on a mobile device. Their service is free — but their data can predict what song will be the next big hit, and that’s invaluable for the music industry, which is where they make their money.”

You can hear more from Alistair about using data to build a better business faster at The Lean Startup Conference Nov. 16-19 in San Francisco. Grab a ticket while they’re still available here.

Talking to Humans: Success Starts with Understanding Your Customers

Editor’s note: The 2015 Lean Startup Conference is just around the corner (it’s from November 16-19th in San Francisco, and there’s still time to get your ticket!). We have dozens of excellent speakers and mentors who are eager to share their product development, entrepreneurship, and innovation stories–you’ll never see these experts in one place ever again. Learn more about them in our ‘Lean Startup Speakers’ series.

Next up is Frank Rimalovski, who is managing director of the NYU Innovation Venture Fund at New York University. He’ll be giving a talk called “Talking to Humans: Success Starts with Understanding your Customers” at the 2015 Lean Startup Conference. Learn more about him here.


In my 16 years as a venture capitalist, I have observed countless teams draft a business plan, build their product, and only after they built it, seek customer feedback. Unfortunately, this “if you build it, they will come” approach almost never works. By the time you have built your product, you have fallen in love with it and likely become deaf to (negative) customer feedback, or you have sunk all your precious time and resources into something few people care about.

The Lean Startup turned this decades-old formula on its head. By securing customer feedback before building your product, entrepreneurs can dramatically increase the likelihood that you build products that customers actually want, and do it more quickly and cheaply.

Since Steve Blank first penned The Four Steps to the Epiphany in 2003, thousands of startup teams have been “getting out of the building” with the intention of testing their minimum viable products (MVPs) in search of product/market fit. While many entrepreneurs have achieved a level of lean startup buzzword compliance, most do not know how to effectively conduct the kinds of interviews and experiments that will lead to the insights they seek (and need). It is amazing to watch even the most introverted engineers, scientists and MBAs all become shameless salespeople as they misinterpret “getting out of the building” with asking customers if they like, or worse, would buy their product. This rarely yields useful insights. In the early stages of customer development the goal is not to validate if someone wants your product, but rather to search for who your initial target customer is, and to gain a deeper understanding of the problems you are solving for these customers.

When I taught lean startup classes and programs to students and faculty at NYU or to NSF I-Corps teams, I saw teams struggle with this time and again, and felt that we needed a way to more explicitly guide entrepreneurs through the process of securing, conducting and synthesizing early customer discovery interviews. I tested this hypothesis the need with my colleagues at the NYU Entrepreneurial Institute, as well as with my fellow I-Corps instructors…and it was clear I had identified a pain point.

Last year, I approached Neo CEO Giff Constable with the idea to turn his blog posts about customer discovery into a short book. He loved the idea, and from there, Talking to Humans: Success Starts with Understanding Your Customers was born.

FR2While not a text in the academic sense, Talking to Humans was written to complement the other seminal writings on customer development and lean startups: Blank & Dorf’s The Startup Owner’s Manual, and Osterwalder & Pigneur’s Business Model Generation and of course Eric Ries’ The Lean Startup, among others.

I wrote the outline. Giff did the heavy lifting and actually wrote the book (thank you Giff!). I recruited Tom Fishburne to draw these awesome cartoons and Steve Blank to write the foreword. Lindsey Gray and Jerry Hao of the NYU Entrepreneurial Institute provided extensive, invaluable early feedback. We tested our rough draft MVP with 10 student teams in our 2014 Summer Launchpad accelerator, and subsequent draft with another 11 teams in the 5-day Lean Launchpad class I taught that August. We shared early drafts with my fellow I-Corps instructors and other practitioners and educators across the country, and incorporated their feedback and suggestions. It has earned praise from early stage VCs at Flybridge Capital, True Ventures and First Round Capital, as well as from our colleagues at UC Berkeley, University of Maryland, MIT, and of course NYU, among many others. We knew we were on to something when educators and accelerators across the globe were asking to use Talking to Humans in their classes and programs before the book was finished. I am confident we have achieved product-market-fit and found our earlyvangelists!

Giff and I thought long and hard about whether to charge for the book or not, and how that might impact how Talking to Humans was perceived. In the end, we decided to put it out into the world for free, which was consistent with our original goal of giving back to the community. You can get Talking to Humans in PDF or ePub (iBook) for free, on Kindle for 99¢ (Amazon insists we charge something), and in print (at our cost). Order or download it, along with other useful materials, at

During my talk on Tuesday afternoon at the 2015 Lean Startup Conference I’ll share actionable advice from the book, and lead some useful exercises we’ll do together. Whether you’re an entrepreneur or an educator seeking to share this with other students or startups you work, you’ll leave with a new set of tools to put immediately into practice and/or more effectively share with others.