For a long time, the standard advice for entrepreneurs was to write a business plan. You were supposed to sit in a room, predict the future for the next five years, and then raise money to execute that plan. The problem is that this approach assumes you know what the customer wants. In a startup, that is a fatal assumption.
The Lean Startup is a methodology for developing businesses and products that aims to shorten product development cycles. Popularized by Eric Ries, it applies the principles of the scientific method to the chaotic world of entrepreneurship. It shifts the focus from “can we build this” to “should we build this.”
Instead of launching a finished rocket ship, the Lean Startup asks you to fly a paper airplane first. If that works, you build a glider. It is about learning what creates value before you run out of money.
The Build-Measure-Learn Loop
#The core engine of this methodology is a feedback loop called Build-Measure-Learn.
- Build: You create a minimum version of the product.
- Measure: You put it in front of customers and collect data on their behavior.
- Learn: You analyze the data to decide if your hypothesis was correct.
The goal is to minimize the total time through this loop. The faster you spin this flywheel, the faster you learn. Traditional companies measure success by how much stuff they produce. Lean startups measure success by “validated learning,” which is learning demonstrated by data rather than opinion.
The MVP Misconception
#Central to this method is the concept of the Minimum Viable Product (MVP). This is one of the most misunderstood terms in business.
Founders often think an MVP is a “bad” version of their product. This is wrong. An MVP is simply the smallest thing you can build to test a specific hypothesis.
Sometimes, an MVP is not even code. It might be a landing page that describes the product to see if anyone clicks “buy.” It might be a manual concierge service where you do the work by hand behind the scenes. The goal of the MVP is not to impress the user. It is to learn from them with the least amount of effort possible.
Pivoting vs. Persevering
#At the end of each learning loop, a founder faces a binary choice.
If the data validates your hypothesis, you persevere. You double down and improve the product.
If the data refutes your hypothesis, you pivot. A pivot is a structured course correction designed to test a new fundamental hypothesis about the product, strategy, or engine of growth. It is not a failure. It is a strategic shift based on evidence.
Lean Does Not Mean Cheap
#A critical distinction must be made regarding the word “lean.” In this context, lean does not mean cheap. It does not mean you starve the company of capital.
It means eliminating waste. In the Toyota Production System, where these ideas originated, waste was physical scrap metal. In a startup, waste is building a feature that nobody uses.
You can spend millions of dollars and still be a Lean Startup if that money is being used to run experiments that validate your business model. Conversely, you can be a bootstrapped team of two and be incredibly wasteful if you spend six months building a product without ever talking to a customer.