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The Lean Startup: A contrarian view

30 points by saurabh 14y ago

doctorwho 14y ago
The top down approach requires you to have deep domain knowledge to build a successful product around your idea. The bottom up (lean) approach starts the same way but is based on measurable feedback. In both approaches, you still start with the idea. Domain knowledge MAY improve your odds of creating a good product but plenty of people have done/tried this and failed miserably. The lean approach improves your odds of success by actually trying to measure success whenever possible and use those measurements to validate or improve the process. The days of "if you build it, they will come" are numbered in the face of more data driven methodologies.
- khitchdee 14y ago
  On the flip side, the lean approach typically results in a new product that is only incrementally different than the one it replaces whereas in a more top-down approach, there is the possibility of creating something game changing.
aytekin 14y ago
This is actually a pretty traditional model. It even has a name: waterfall. :) If you have a great team you can probably pull it off with a waterfall method. Team almost always beats the methodology used. A bad team will still fail following the latest leanest meanest methodology.
ricardobeat 14y ago
If there is no market for it, it will die. There's a bit of arrogance in the idea that you know better and can do things from the "top-down". Getting user feedback doesn't mean replacing your ideas with whatever John Doe thinks he likes, but finding out how your ideas fit (or not) the users' needs. Before someone starts misquoting, even Apple did user testing, although not in the traditional format; there is no point in building someone that suits nobody.
- paul_f 14y ago
  This is correct. Without customer interaction, there are no good ideas, only lucky ideas and failed ideas.
  - skanga 14y ago
    So you contend that Apple must be one helluva lucky company since ALL of their popular products are famously built without customer interaction.
basicallydan 14y ago
There's a place for every approach and the one you mention works well in many situations. Look at Apple! However, Lean handles one of the great problems with this one (which is quite traditional as aytekin has already pointed out): it can take more resources than your typical startup might have. Sure, they can raise capital somehow, but that too could require more resources than are available. Often, an entrepreneur will want to start from scratch, and may have no experience building a product or a business. That's where the Lean Startup approach does well.
- DividesByZero 14y ago
  Apple is smart in that they let everyone else do the iterating for them, then extract the parts that work best with a laser beam focus. Apple have no original, 'top down' ideas.
  - basicallydan 14y ago
    Ah yeah, good point - that's mostly true yeah :)
benjaminsull 14y ago
>That assumption is that you have something to learn from the market that you don't already know. In the Lean Startup book, Eric Ries defines a startup as "a human institution designed to create a new product or service under conditions of extreme uncertainty". "That you have something to learn from the market that you don't already know" isn't an assumption, it's a premise. If you already know about the market, then you aren't facing conditions of extreme uncertainty and you aren't, by Ries' definition, involved in a startup. Lean startup doesn't claim to be the solution to every business' problems in the world. It's a solution that works really well when you're dealing with a lot of unknowns. One way that entrepreneurs deal with unknowns is by speculating and acting on assumptions, which often turn out to be wrong resulting in waste. Ries argues that this excessive waste is avoidable by taking a more scientific approach: identify your assumptions, validate them through measurement, adjust your product/strategy according to results, and let that process of validated learning pave a clear path for your business through the shadowy unknowns.
- khitchdee 14y ago
  If you're planning to startup, what you'll here from most people is how you should follow lean startup principles. The point of this writeup is to give some breathing space to those entrepreneurs who have a top down idea. It's to encourage them to go for it instead of questioning themselves. Typically, the game changing ideas come top down and not bottom up. If you want to change the game everyone's playing, you have to step out of it first.
  - jacques_chester 14y ago
    The central question of the Lean Startup book is: how do you know that your top down idea is correct? Strictly speaking, until you go to market ... you don't. There are two basic classes of strategy to doing anything: * Commit all your resources in advance * Incrementalism In situations of uncertainty, the latter is a simple risk management strategy. Armies have scouts, marketers work in test markets, engineers build prototypes. What Eric Ries is selling isn't strictly new. But it's a cohesive repackaging of extant ideas that in my opinion is useful for making a single universal feedback loop the basis of a business.
rmoriz 14y ago
If you do a copycat with the sole goal to copy a business model that works for someone else or might work for someone else in the future (exit driven) it might be a "top-down" situation. Let me make an example: There is Stripe.com and some German clone called paymill. Of course the clone didn't need to start lean because Stripe already validated the market for them. On the other hand beeing non-lean and non-agile will be very painful, when the "original" pivots or expands into new markets/offer products that are not validated yet)…
- deleted 14y ago
  [deleted]
jacques_chester 14y ago
Some context here: http://khitchdee.forumatic.com/viewtopic.php?f=21&t=297 http://khitchdee.forumatic.com/viewtopic.php?f=21&t=297 (The site is a forum being used as a blog / CMS.) I have my own reservations about the Lean Startup book -- but most of it comes down to an allergy to it that I developed from reading HN. I got around to it last week on a personal recommendation and it wasn't half bad. I'd say the biggest problem with how people approach it is that they fixate on the MVP rather than the cycle. The MVP is just a particular cycle. As benjaminsull pointed out, the Lean Startup disclaims coverage of domains with well understood product models and mature feature-development ecosystems.
- adrianhoward 14y ago
  I'd say the biggest problem with how people approach it is that they fixate on the MVP rather than the cycle. The MVP is just a particular cycle. It's even worse than that. The problem I see is folks who focus on particular forms of the MVP. Not every damn product starts best with a launch page of some Google Adwords. Lean Startup is neat. I'm finding a bunch of ideas from it stupidly useful. But it's going throught the Hype Cycle (http://en.wikipedia.org/wiki/Hype_cycle http://en.wikipedia.org/wiki/Hype_cycle) amazingly quickly.
  - jacques_chester 14y ago
    Yeah, it's not half bad. Like I said, I tend to instinctively avoid whatever book is being waved like a bible in HN circles. So as I say, it was a surprise to see how different the expressed vision of MVP seems to be from what I got from the book. I got the impression that it was the first thing you could actually give to a user and have them use. Even if it was buggy and had a single feature. The launch-page "MVP" isn't actually a product. It's market research.
    - adrianhoward 14y ago
      I know this is somewhat heretical - but I don't actually like The Lean Startup book that much. I was pointed to Lean Startup back in 2010 as a solution to some of the problems I was looking at. The folk I talked to, places like the LSC mailing list, and reading the online/offline writings of Steve Blank, Eric Ries and many others helped a lot. I was really looking forward to Eric's book - but it didn't really hit the spot I was hoping it would hit. It's very much aimed (I think) at explaining the ideas to the world in general - rather than being a guide to folk who want to apply the ideas. There's nothing wrong with the former, but I was hoping for the latter.
gfodor 14y ago
The biggest problem with the lean startup stuff is it results in this ridiculous false dichotomy. There is no "top down" or "bottom up" thing. If you assume you are in one of these two buckets you already lose because you either are abandoning your creative thinking (bottom up) or abandoning listening to what customers are telling you (top down.) I realize the common retort to this is that all startups need to have top down thinking ("vision") but the bottom line is the lean startup philosophy is at the very least poorly communicated because the large takeaway from all the writing on it is that startups should simply perform customer development and let the market dictate most of the actions they take and the products they build. It's always a matter of deciding when to ship and how much time and resources to commit between data collection points (ie, releases.) This is a higher order function and changes as well in reaction to how you explore the solution space. Different domains have different constraints as to how fast you can iterate. Tesla, for example, is forced to iterate much more slowly than your average social gaming app can. Shipping too early, or shipping too late can result in wildly different outcomes. Drawing the line correctly is a matter of experience, taste, common sense, and luck. Everyone knows you should try to minimize waste. Everyone knows you should prefer iteration over big releases. The question is always what constitutes "viable". A car that has three tires is not viable, and would be a market failure. The fourth tire takes a little more effort but makes the difference between success and failure. The problem is it takes some intuition to know people need all four tires to be willing to pay for a car. It also takes intuition to know that the three-tired car being a failure does not mean you should throw in the towel. I don't care how many metrics you measure, you can't use metrics to determine where an asymptote is going to appear because it's not going to be a part of any logical predictive model. Disruption is just that, disruption, and usually comes about due to a synergy of several things that were previously unknown to have magical properties when combined. You generally can't hill climb to find to these things, unless you set your step size (alpha) to a "Goldilocks" value: not too large and not too small. I understand the appeal of creating a mental framework and slapping a label on it to help people think about and communicate ideas clearly. I think there are definitely some important ideas contained in the lean startup philosophy. But in the interest of creating a conceptual framework of absolutes like any other dogma the lean startup philosophy has large gaps in it's methodology that fail to explain for the large number of startups that launched products that many people would consider well beyond "viable", but were successful because their definition of "viable" happened to be the right one.
noelwelsh 14y ago
The opening two sentences are this: "The basic idea is that to get a startup of the ground, you don't need much. In particular you don't need much money and its possible and even desirable to grow your startup organically from the ground up instead of trying to get a cash infusion from a VC." This is incorrect. The basic idea is that you can apply the scientific method to a startup. It has absolutely nothing to do with avoiding investment.
yurylifshits 14y ago
Top down is also covered in Peter Thiel's course under the name of 'determinate optimism'. http://blakemasters.com/post/23435743973/peter-thiels-cs183-startup-class-13-notes-essay http://blakemasters.com/post/23435743973/peter-thiels-cs183-... Big multi-year projects like Tesla Model S or Tony Hsieh's Downtown Project are much more top down than bottom up.
- DividesByZero 14y ago
  This is merely a reflection of the amount of resources required to build a valid MVP of a product like an electric car, revitalising an urban space or building a space launch vehicle.
  - ericb 14y ago
    So, no true Scotsman?
    - DividesByZero 14y ago
      In what sense? No true scot would be excluding these examples from consideration based on unrelated information. If anything, I'm skirting whether or not the lean startup model is actually falsifiable (it is).
dasil003 14y ago
The Lean Startup took off when it did because it represented a new way of building a business. Before the open source stack got deep enough and servers got cheap enough, there was no room for low-capital startups. Then we hit an inflection point where it became increasingly possible to bootstrap highly scalable businesses. The Lean Startup is simply an old world entrepreneur discovering the possibilities in the new world. It's not that it's better, it's just been more fertile ground over the last several years. However, as more and more smart kids show up on the scene, I think the pendulum will swing back because the stuff that can be done without capital or investment is going to get tapped out by armies of ramen-eaters. There's always room for a great new idea, but if you have access to capital a little barrier to entry is not a bad thing.
- lifeisstillgood 14y ago
  This And capital need not necessarily be direct financial in vestment. For example any Web 2.0 ramen startup will have 15+ years of computer and software experience and education as its capital base. Throw in a hardware need, like making thermostats and the rarity of the education and thus capital Increases Last weeks demo day highlighted this for me - UAV hardware and software plays - that's gonna be a rare combo in any market, and guys trying to offer easy divorce web sites - the capital needed there is quite low I think if we look at capital as previously invested education for skills needed, the fill in the gaps websites have no moats, the arduino is about to be the biggest barrier to entry for the Web 3.0
- codyZ 14y ago
  I also feel like The Lean Startup really isn't anything new. Its just articulated and repackaged in a different way that's more sexy, or tech-y. God forbid any of my peers start reading Drucker...
  - jacques_chester 14y ago
    I was actually reminded of Peter Senge's Fifth Discipline.
    - 14y ago
doctorwho 14y ago
No methodology is going to be perfect in every situation. Take what can (if anything) from every new methodology you encounter and mold it into something that works for you and your team. The key concept I took from the lean movement was "continuous validation" for your ideas, like continuous integration for your code. Also known as fail faster, ship often, etc. If you're going to do something risky, measure the results and react as quickly as possible. The sooner you discover you're heading down a dead end, the sooner you can perform a course correction.

30 points by saurabh 14y ago

The top down approach requires you to have deep domain knowledge to build a successful product around your idea. The bottom up (lean) approach starts the same way but is based on measurable feedback. In both approaches, you still start with the idea. Domain knowledge MAY improve your odds of creating a good product but plenty of people have done/tried this and failed miserably. The lean approach improves your odds of success by actually trying to measure success whenever possible and use those measurements to validate or improve the process. The days of "if you build it, they will come" are numbered in the face of more data driven methodologies.

khitchdee 14y ago
On the flip side, the lean approach typically results in a new product that is only incrementally different than the one it replaces whereas in a more top-down approach, there is the possibility of creating something game changing.

aytekin 14y ago

This is actually a pretty traditional model. It even has a name: waterfall. :) If you have a great team you can probably pull it off with a waterfall method. Team almost always beats the methodology used. A bad team will still fail following the latest leanest meanest methodology.

ricardobeat 14y ago

If there is no market for it, it will die. There's a bit of arrogance in the idea that you know better and can do things from the "top-down". Getting user feedback doesn't mean replacing your ideas with whatever John Doe thinks he likes, but finding out how your ideas fit (or not) the users' needs. Before someone starts misquoting, even Apple did user testing, although not in the traditional format; there is no point in building someone that suits nobody.

paul_f 14y ago
This is correct. Without customer interaction, there are no good ideas, only lucky ideas and failed ideas.
- skanga 14y ago
  So you contend that Apple must be one helluva lucky company since ALL of their popular products are famously built without customer interaction.

basicallydan 14y ago

There's a place for every approach and the one you mention works well in many situations. Look at Apple! However, Lean handles one of the great problems with this one (which is quite traditional as aytekin has already pointed out): it can take more resources than your typical startup might have. Sure, they can raise capital somehow, but that too could require more resources than are available. Often, an entrepreneur will want to start from scratch, and may have no experience building a product or a business. That's where the Lean Startup approach does well.

DividesByZero 14y ago
Apple is smart in that they let everyone else do the iterating for them, then extract the parts that work best with a laser beam focus. Apple have no original, 'top down' ideas.
- basicallydan 14y ago
  Ah yeah, good point - that's mostly true yeah :)

benjaminsull 14y ago

>That assumption is that you have something to learn from the market that you don't already know. In the Lean Startup book, Eric Ries defines a startup as "a human institution designed to create a new product or service under conditions of extreme uncertainty". "That you have something to learn from the market that you don't already know" isn't an assumption, it's a premise. If you already know about the market, then you aren't facing conditions of extreme uncertainty and you aren't, by Ries' definition, involved in a startup. Lean startup doesn't claim to be the solution to every business' problems in the world. It's a solution that works really well when you're dealing with a lot of unknowns. One way that entrepreneurs deal with unknowns is by speculating and acting on assumptions, which often turn out to be wrong resulting in waste. Ries argues that this excessive waste is avoidable by taking a more scientific approach: identify your assumptions, validate them through measurement, adjust your product/strategy according to results, and let that process of validated learning pave a clear path for your business through the shadowy unknowns.

khitchdee 14y ago
If you're planning to startup, what you'll here from most people is how you should follow lean startup principles. The point of this writeup is to give some breathing space to those entrepreneurs who have a top down idea. It's to encourage them to go for it instead of questioning themselves. Typically, the game changing ideas come top down and not bottom up. If you want to change the game everyone's playing, you have to step out of it first.
- jacques_chester 14y ago
  The central question of the Lean Startup book is: how do you know that your top down idea is correct? Strictly speaking, until you go to market ... you don't. There are two basic classes of strategy to doing anything: * Commit all your resources in advance * Incrementalism In situations of uncertainty, the latter is a simple risk management strategy. Armies have scouts, marketers work in test markets, engineers build prototypes. What Eric Ries is selling isn't strictly new. But it's a cohesive repackaging of extant ideas that in my opinion is useful for making a single universal feedback loop the basis of a business.

rmoriz 14y ago

If you do a copycat with the sole goal to copy a business model that works for someone else or might work for someone else in the future (exit driven) it might be a "top-down" situation. Let me make an example: There is Stripe.com and some German clone called paymill. Of course the clone didn't need to start lean because Stripe already validated the market for them. On the other hand beeing non-lean and non-agile will be very painful, when the "original" pivots or expands into new markets/offer products that are not validated yet)…

deleted 14y ago
[deleted]

jacques_chester 14y ago

Some context here: http://khitchdee.forumatic.com/viewtopic.php?f=21&t=297 http://khitchdee.forumatic.com/viewtopic.php?f=21&t=297 (The site is a forum being used as a blog / CMS.) I have my own reservations about the Lean Startup book -- but most of it comes down to an allergy to it that I developed from reading HN. I got around to it last week on a personal recommendation and it wasn't half bad. I'd say the biggest problem with how people approach it is that they fixate on the MVP rather than the cycle. The MVP is just a particular cycle. As benjaminsull pointed out, the Lean Startup disclaims coverage of domains with well understood product models and mature feature-development ecosystems.

adrianhoward 14y ago
I'd say the biggest problem with how people approach it is that they fixate on the MVP rather than the cycle. The MVP is just a particular cycle. It's even worse than that. The problem I see is folks who focus on particular forms of the MVP. Not every damn product starts best with a launch page of some Google Adwords. Lean Startup is neat. I'm finding a bunch of ideas from it stupidly useful. But it's going throught the Hype Cycle (http://en.wikipedia.org/wiki/Hype_cycle http://en.wikipedia.org/wiki/Hype_cycle) amazingly quickly.
- jacques_chester 14y ago
  Yeah, it's not half bad. Like I said, I tend to instinctively avoid whatever book is being waved like a bible in HN circles. So as I say, it was a surprise to see how different the expressed vision of MVP seems to be from what I got from the book. I got the impression that it was the first thing you could actually give to a user and have them use. Even if it was buggy and had a single feature. The launch-page "MVP" isn't actually a product. It's market research.
  - adrianhoward 14y ago
    I know this is somewhat heretical - but I don't actually like The Lean Startup book that much. I was pointed to Lean Startup back in 2010 as a solution to some of the problems I was looking at. The folk I talked to, places like the LSC mailing list, and reading the online/offline writings of Steve Blank, Eric Ries and many others helped a lot. I was really looking forward to Eric's book - but it didn't really hit the spot I was hoping it would hit. It's very much aimed (I think) at explaining the ideas to the world in general - rather than being a guide to folk who want to apply the ideas. There's nothing wrong with the former, but I was hoping for the latter.

gfodor 14y ago

The biggest problem with the lean startup stuff is it results in this ridiculous false dichotomy. There is no "top down" or "bottom up" thing. If you assume you are in one of these two buckets you already lose because you either are abandoning your creative thinking (bottom up) or abandoning listening to what customers are telling you (top down.) I realize the common retort to this is that all startups need to have top down thinking ("vision") but the bottom line is the lean startup philosophy is at the very least poorly communicated because the large takeaway from all the writing on it is that startups should simply perform customer development and let the market dictate most of the actions they take and the products they build. It's always a matter of deciding when to ship and how much time and resources to commit between data collection points (ie, releases.) This is a higher order function and changes as well in reaction to how you explore the solution space. Different domains have different constraints as to how fast you can iterate. Tesla, for example, is forced to iterate much more slowly than your average social gaming app can. Shipping too early, or shipping too late can result in wildly different outcomes. Drawing the line correctly is a matter of experience, taste, common sense, and luck. Everyone knows you should try to minimize waste. Everyone knows you should prefer iteration over big releases. The question is always what constitutes "viable". A car that has three tires is not viable, and would be a market failure. The fourth tire takes a little more effort but makes the difference between success and failure. The problem is it takes some intuition to know people need all four tires to be willing to pay for a car. It also takes intuition to know that the three-tired car being a failure does not mean you should throw in the towel. I don't care how many metrics you measure, you can't use metrics to determine where an asymptote is going to appear because it's not going to be a part of any logical predictive model. Disruption is just that, disruption, and usually comes about due to a synergy of several things that were previously unknown to have magical properties when combined. You generally can't hill climb to find to these things, unless you set your step size (alpha) to a "Goldilocks" value: not too large and not too small. I understand the appeal of creating a mental framework and slapping a label on it to help people think about and communicate ideas clearly. I think there are definitely some important ideas contained in the lean startup philosophy. But in the interest of creating a conceptual framework of absolutes like any other dogma the lean startup philosophy has large gaps in it's methodology that fail to explain for the large number of startups that launched products that many people would consider well beyond "viable", but were successful because their definition of "viable" happened to be the right one.

noelwelsh 14y ago

The opening two sentences are this: "The basic idea is that to get a startup of the ground, you don't need much. In particular you don't need much money and its possible and even desirable to grow your startup organically from the ground up instead of trying to get a cash infusion from a VC." This is incorrect. The basic idea is that you can apply the scientific method to a startup. It has absolutely nothing to do with avoiding investment.

yurylifshits 14y ago

Top down is also covered in Peter Thiel's course under the name of 'determinate optimism'. http://blakemasters.com/post/23435743973/peter-thiels-cs183-startup-class-13-notes-essay http://blakemasters.com/post/23435743973/peter-thiels-cs183-... Big multi-year projects like Tesla Model S or Tony Hsieh's Downtown Project are much more top down than bottom up.

DividesByZero 14y ago
This is merely a reflection of the amount of resources required to build a valid MVP of a product like an electric car, revitalising an urban space or building a space launch vehicle.
- ericb 14y ago
  So, no true Scotsman?
  - DividesByZero 14y ago
    In what sense? No true scot would be excluding these examples from consideration based on unrelated information. If anything, I'm skirting whether or not the lean startup model is actually falsifiable (it is).

dasil003 14y ago

The Lean Startup took off when it did because it represented a new way of building a business. Before the open source stack got deep enough and servers got cheap enough, there was no room for low-capital startups. Then we hit an inflection point where it became increasingly possible to bootstrap highly scalable businesses. The Lean Startup is simply an old world entrepreneur discovering the possibilities in the new world. It's not that it's better, it's just been more fertile ground over the last several years. However, as more and more smart kids show up on the scene, I think the pendulum will swing back because the stuff that can be done without capital or investment is going to get tapped out by armies of ramen-eaters. There's always room for a great new idea, but if you have access to capital a little barrier to entry is not a bad thing.

lifeisstillgood 14y ago
This And capital need not necessarily be direct financial in vestment. For example any Web 2.0 ramen startup will have 15+ years of computer and software experience and education as its capital base. Throw in a hardware need, like making thermostats and the rarity of the education and thus capital Increases Last weeks demo day highlighted this for me - UAV hardware and software plays - that's gonna be a rare combo in any market, and guys trying to offer easy divorce web sites - the capital needed there is quite low I think if we look at capital as previously invested education for skills needed, the fill in the gaps websites have no moats, the arduino is about to be the biggest barrier to entry for the Web 3.0
codyZ 14y ago
I also feel like The Lean Startup really isn't anything new. Its just articulated and repackaged in a different way that's more sexy, or tech-y. God forbid any of my peers start reading Drucker...
- jacques_chester 14y ago
  I was actually reminded of Peter Senge's Fifth Discipline.
  - 14y ago

doctorwho 14y ago

No methodology is going to be perfect in every situation. Take what can (if anything) from every new methodology you encounter and mold it into something that works for you and your team. The key concept I took from the lean movement was "continuous validation" for your ideas, like continuous integration for your code. Also known as fail faster, ship often, etc. If you're going to do something risky, measure the results and react as quickly as possible. The sooner you discover you're heading down a dead end, the sooner you can perform a course correction.