Lean Startup Movement

The movement began in Silicon Valley and takes its name from a book by technology entrepreneur Eric Ries. He describes Lean Startup as a fundamental re-examination of how to work in our complicated, faster-moving world.  It’s not about starting a business, but a philosophy. It’s not about searching for the natural entrepreneur: it is about nurturing entrepreneurship. Learning by doing is an imperative, not an option. It’s by entrepreneurs for nascent and establishing entrepreneurs. Universities are welcome as equal partners.

The movement first gained traction amongst new technology startups following Ries’s blog (startuplessonslearned.com), now there are Meetups all around the world. In 2012 an estimated 20,000 people were involved in city based Meetups, when 100s get together for a couple of days of intense business creation, and to learn from each other. Lean Startup Machine (http://leanstartupmachine.com) organises Meetups in major world cities with the aim of creating new businesses in 3 days. In mid 2012 it claimed to have helped start over 600 new businesses. Internet courses are abundant, of good quality, offered by highly reputable U.S. universities, often free. Ries and his fellow travellers appear to have done something that regional and central governments all around the world have been trying to do—create an entrepreneurial culture.

The two other stars of the movement are Steve Blank and Alex Osterwalder (steveblank.com and alexosterwalder.com). Blank, like Ries, is a successful technology entrepreneur, and a radical. He says a startup is not a company, but a temporary organisation formed to search for a repeatable and scalable business model around which a true company might then form.  A company is an outcome of implementing the business model, which is how value is created, captured, and delivered.  Value is expressed in the form of the value proposition, the central element of an exciting alternative to the business plan, at least until the company stage, called the Business Model Canvas (BMC). The BMC is Osterwalder’s contribution to the movement, A graphical approach to capturing and expressing a business prototype,[i] the BMC is conceived by Lean Starters as the alternative to the business plan, but it’s not, neither is it a strategy for competing. However, to my mind, business modelling is less important in driving the movement than the emotioning collective spontaneity of creating a canvas during a Meetup. Key to the BMC is the value proposition. It reflects the benefits to the customer, the way in which the existence of a product-enterprise entity transforms the manner of living of its customers.

[i] Osterwalder, A. Pigneur, Y. and Smith, A (2010). Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ: John Wiley and Sons Inc

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