Lean startup, new way to develop a business

#GenerasiPenemu, recently in the startup world, there is a new term called Lean Startup. Do you know what is lean startup? Before moving on to the elements and steps of lean startup, it is better for you to understand first what is the meaning of lean startup.

Lean Startup

Lean startup is a method in the startup industry, created by Eric Ries based on his experiences working as a consultant, employee, and also startup developer. The main point of this lean startup method is to develop products and businesses in a relatively short time to test the assumptions. Later on, after the products and businesses have been tested on the market, the feedback gained from the community will be used for improving the products and businesses, faster than the traditional way.

In the lean startup method, there are seven elements that could represent consumers’ demands to help you answer any needs and failures from startup owners. Here are the elements:

1. Minimum Viable Product (MVP)

Minimum Viable Product (MVP) is the result of creating and developing a simple product from a business that is being built. MVP is made based on the idea of meeting consumers’ needs. After the development, MVP will be tested in the community or on the market to understand whether the product created could really meet the consumers’ needs or demands, or not. By giving MVP to the small group of targeted people on the market in many demography aspects, the MVP is hoped to ease you and your team finalizes the end product from your business.

2. Continuous Development

If your startup needs software usage in the development process, then this element is extremely important to be understood. Continuous deployment is a cycle time-saving process when the written code for an application can be integrated quickly so that the application can be built and released automatically.

3. Split Testing

Besides being called split testing, this term is also known as the A/B test. The definition of split testing is an experiment or a test offered to consumers together with different products. This element needs to be done to know what is the different consumer behavior between two groups or more, and also to measure the impact of each version of the product.

4. Actionable Metrics

Actionable metrics or also called operational matrices are matrices created based on the specialization of your business. With this operational matrix, you can understand what information is needed for business decision making and subsequent actions. Although the description provided by this matrix is not accurate, there is an optimistic business drive in the development of a business.

5. Pivot

In the startup industry, the pivot term means to change the strategy to direct business into a profitable or desirable situation. This element is important to remember when your business idea is not aligned with what you expected and there is no good response from people on the market. If this is the case, then pivot is the only good thing to do and start fixing things up without wasting more time and effort.

6. Innovation Accounting

Just like any other element in the startup industry run with a system, innovation accounting is also a system shaped to gather, analyze, and provide data about a company’s breakthrough and disruptive innovation fund. Even though there is an accounting word in this name, but innovation accounting is not limited only to the accounting itself. In the startup industry, the meaning of innovation accounting is being expanded to measure the overall business ecosystem. Activities that could be used to focus on this element are investment decisions on a different kind of business, measuring the success of a project, and assessing the impact of ongoing business innovations.

7. Build – Measure – Learn

This element emphasizes the turnaround stage and accelerated evolution in business development. The effectiveness of your team or business can be seen in how quickly the process of forming ideas or ideas (build) to become MVP, how effective the product is in the target market (measurement), and how many lessons have been learned from testing MVP in the community (learn). This process can be repeated as many times as possible with the flow of ideas / ideas -> build / build products -> measure / measure product effectiveness -> learn / learn from community feedback.

Once you understand what the elements are in this lean startup method, then you need to understand what stages are needed to run the lean startup method. The stages themselves are divided into 3 (three) stages, namely:

1.Market Validation

Market Validation is a step to ensure that assumptions of the problem you define are really exist, happen to many people, important things, and so on.

2. Product Validation

Product Validation is a step to ensure that the solution concept that is being built is the most effective that could answer people’s problems. Some also called this step as Minimum Viable Product (MVP) creation.

3. Business Validation

Business Validation is a step to ensure that from the process of solving problems with solutions in the form of your product, it has business value. This stage can also find the most suitable business model for the problem-solution scheme that has been valid in the previous two stages.

You can read a more complete explanation of each stage in the next article.

As time goes by, more and more people are trying to build their startup. You as the #GenerasiPenemu must also be one of them, right? Well, things like this are important for you to understand before you run your startup business. For more complete knowledge in startup development, you can also join the Ideanation Competition and win funding opportunities of up to billions of rupiah, as well as mentoring sessions by professionals from the Ideanation team. What are you waiting for? Let’s join the competition and make your #IdeDariAnda come true!

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[…] the Lean Start-Up method, Product Validation is mentioned as the second step of building a start-up. In the previous post, […]


[…] and doing problem validation is a very important step, before doing other steps in the Lean Startup method, such as Market Validation, Product Validation, and Business Validation, or before building any […]

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