Start-Up Chile entrepreneurs are always looking for new ways to learn more, faster, and in a fun way. The latest initiative on this is the SUP Academy, where peers train eachother in specific subjects. We thought it would be great to blog each lesson of the SUP Academy so you can take advantage of the content. This blog post was written by Jennifer Blumberg. She writes PHP and travel stories for 36hrs (SUP Round 6). You can find her on Twitter.
As part of the new “SUP Academy” initiative, about 30 entrepreneurs convened to hear Santiago Bravo (Azonia) and Komal Dadlani (LAB4U) present lessons from Eric Ries’ bestselling book, “The Lean Startup”.
In this two-hour session we sorted through myths and facts, unraveled buzzwords and worked in teams to develop “lean” methodologies for our own startups.
The two main topics of the day were (1) The Leap of Faith and (2) the Minimum Viable Product.
1. Leaps of Faith
The Leaps of Faith are the fundamental business hypotheses. Every entrepreneur makes assumptions about what consumers want or what problem they think they are solving.
To provide us with examples, we heard from the founders of Appetite+, a “simple and fun way to discover and share apps with your friends.”
Appetite+’s Leaps of Faith
#1. Users want to know what apps their friends have.
#2. Users want to share their own apps with friends.
#3. Users will download and use apps that their friends have.
Figure 1: SUP Leaps of Faith
2. Minimum Viable Product
The lean methodology involves proving your hypotheses through “validated learning”, which is, quite simply, the process of trying out a new idea and measuring the results.
The way to do this in the startup world is via the MVP.
A minimum viable product (MVP) is the “version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.” In other words, if your hypothesis, or Leap of Faith, is “People will buy coupons online” then you don’t need to spend a year building Groupon first. Rather, you can make a quick-and-dirty blog and post your offers online right away. Once you see that people are buying your coupons, then you’ve validated your hypothesis – and then build Groupon.
One cool thing we learned today was that the minimum viable product doesn’t even have to be a product!
Let’s take Dropbox as a case in point. Dropbox’s MVP was a simple three-minute video demonstration of how the product works. After watching the video, people were given the option of signing up for the Beta waiting list.
It was a huge hit. Signups jumped from 5,000 to 75,000. According to Eric Ries, the video MVP “validated Drew’s leap- of- faith assumption that customers wanted the product he was developing”.
If the biggest risk of a startup is building something that no one wants, then the Dropbox team could keep on coding – safe in knowledge that they had 75,000 people signed up for a product that they hadn’t even built yet.