Entrepreneurial Management

• General management over the last century has provided unprecedented material abundance, but those management principles are ill suited to handle the chaos and uncertainty that startups must face.
• We are finding some ways to make money, but for every success there are far too many failures: products pulled from shelves mere weeks after being launched, high-profile startups lauded in the press and forgotten a few months later, and new products that wind up being used by nobody.
• What makes these failures particularly painful is not just the economic damage done to individual employees, companies, and investors; they are also a colossal waste of our civilization’s most precious resource: the time, passion, and skill of its people.

The Roots of the Lean Startup

• Lean thinking is radically altering the way supply chains and production systems are run. Among its tenets are drawing on the knowledge and creativity of individual workers, the shrinking of batch sizes, just-in-time production and inventory control, and an acceleration of cycle times.

• The Lean Startup adapts these ideas to the context of entrepreneurship, proposing that entrepreneurs judge their progress differently from the way other kinds of ventures do. Progress in manufacturing is measured by the production of high-quality physical goods.

• The Lean Startup uses a different unit of progress, called learning. With scientific learning as our yardstick, we can discover and eliminate the sources of waste that are plaguing entrepreneurship.

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• The goal of a startup is to figure out the right thing to build—the thing customers want and will pay for— as quickly as possible.

• In other words, the Lean Startup is a new way of looking at the development of innovative new products that emphasizes fast iteration and customer insight, a huge vision, and great ambition, all at the same time.

• Unless the timing of this feedback loop is managed precisely, the engine will sputter and break down. Startups have a similar engine that I call the engine of growth.

• Every new version of a product, every new feature, and every new marketing program is an attempt to improve this engine of growth.

• The Lean Startup method, in contrast, is designed to teach you how to drive a startup. Instead of making complex plans that are based on a lot of assumptions, you can make constant adjustments with a steering wheel called the feedback loop.

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• Throughout the process of driving, you always have a clear idea of where you’re going. If you’re commuting to work, you don’t give up because there’s a detour in the road or you made a wrong turn. You remain thoroughly focused on getting to your destination.

• Startups also have a true north, a destination in mind: creating a thriving and world-changing business. I call that a startup’s vision. To achieve that vision, startups employ a strategy, which includes a business model , a product road map, a point of view about partners and competitors, and ideas about who the customer will be. The product is the end result of this strategy.

• Products change constantly through the process of optimization, what I call tuning the engine. Less frequently, the strategy may have to change (called a pivot, view bellow). However, the overarching vision rarely changes.

• The challenge of entrepreneurship is to balance all these activities. Even the smallest startup faces the challenge of supporting existing customers while trying to innovate. And failure to deliver results is due to either a failure to plan adequately or a failure to execute properly.