Eric Ries

Eric Ries

Author of the Lean Startup

THIS CHAT HAPPENED ON September 04, 2015

Discussion

Eric Ries
Eric Ries@ericries
Hi everyone, I'm Eric. Author of The Lean Startup. here. I'm excited to be answering your questions today, so please fire away.
Startup L. Jackson
Startup L. Jackson@startupljackson · Social Media Expert
@ericries You've been iterating on Lean Startup for a number of years now. You seem to have moved up market from startups to enterprises. Was that a function of finding product-market fit there and were startups the wrong customers? Why the shift?
Eric Ries
Eric Ries@ericries
@startupljackson It's an honor to have the one and only SLJ here, if for not other reason than this proves that we're not the same person and people can stop asking me about it. (Although, to be honest, I'm flattered) If you look at the adoption of Lean Startup, and the people interested in it, it's still massively heavily weighted towards startups and not enterprise. but I do think your observation is right that a lot of us in the community have been talking about enterprise adoption a lot lately. If we're being really honest, that's partly because there are now a large number of Lean Startup consultants, and that's where the money is. But I actually don't believe there's a big a distinction between "enterprise" Lean Startup and "startup" Lean Startup. In fact, I think that false dichotomy gets a lot of people in trouble. If you really take seriously the idea that startups are designed for hypergrowth, than once they have any kind of success, they will have "enterprise" problems. And if you take seriously the idea that 21st century capitalism is all about dynamism and change, then there can't really be "one true best" structure or management system. Every company is going to have to keep evolving. To sloganize it with horrible jargon: continuous innovation via continuous transformtion. So, if you follow all that, you'll see that there's no way to have a management philosophy like Lean Startup if you can't answer to key questions: 1. How do we scale this past a single cohesive small team? 2. How do we adopt new practices across the company in order to continually improve? A lot of founders I know, even ones that were super psyched about Lean Startup five years ago, have gotten back in touch to ask for my help now that they are past product/market fit. In a lot of cases, they want to know how to keep the startup energy they had in the early years now that they are larger. How do they prevent bureaucracy from setting in? How do they teach their employees to act in a more entrepreneurial way? How can they build a company that they themselves would want to work at? So, that's why my thinking has been drawn to those questions. I view it as a necessary evolution of the philosophy as the community grows. Or maybe it's because it's a problem I get paid to think about.
Startup L. Jackson
Startup L. Jackson@startupljackson · Social Media Expert
@ericries following up on that, LS is a methodology that speaks to how to discover and address customer problems. This seems to be universal, in terms of applying to organizations at any stage. That said, a small organization and a large organization presumably have much different organizational contexts. Startups have the benefit of having no incumbent revenue, efficient communication channels (we're all in one room), tend to be risk seeking, etc. While big orgs have other advantages, they tend to bias against innovation structurally. How do we structure teams in 100 person+ organizations to afford innovation, bubble up that innovation to leadership, and encourage scaling (as opposed to smothering) of ideas that achieve product-market fit but aren't meaningful to today's bottom line?
Eric Ries
Eric Ries@ericries
@startupljackson those are questions I think will take an entire book to answer. if you look at the "small organization context" features you mention: no incumbent revenue, efficient comms, risk seeking what I find so striking is how early in a startup's life those contexts start to disappear. Already at 50 people, communication and coordination overhead is polynomially higher, so we start to build silo'd departments. Already at $10MM run rate, there's substantial loss aversion, and we see product managers making more conservative choices. And on and on. So my focus right now is: how do we build a management system that is adaptive enough so that we can enjoy that positive context throughout the whole life of the company, not just in the early days. And I do believe it is possible, but it requires that founders and leaders really shift their own behavior and management style.
Tam Pham
Tam Pham@mrtampham · Community at Mixergy
@ericries Great questions.
Ovi Negrean
Ovi Negrean@ovinegrean · Founder @SocialBeeHQ
Hey @ericries - I am a fan of the Lean methodology and of your book. I would be interested in getting your view on Peter Thiel's - Zero to One . Do you feel that the Zero to One approach that is stating that sometimes you can't just start with an MVP and the Lean way are opposing methodologies, or that they can actually build one on top of the other?
Eric Ries
Eric Ries@ericries
@ovinegrean I've read Z2O and seen Peter interviewed about it many times. He and I have talked about our differences many times. And, to be honest, I still don't really understand the point of disagreement. Many of the examples he cites positively (like Facebook and Paypal) seem like they followed lean startup principles like MVPs and pivots to the letter. In fact, a lot of my own thinking has been influenced by studying those case studies in the first place. I do think that part of the challenge in being a well-known contrarian is that you have to come to new ideas pretty early. once they are already popular, you can't really be a contrarian and adopt them any more. it's not like Peter is resigning from the Facebook board because it's no longer contrarian to want to be there ;)
Ryan Hoover@rrhoover · Founder, Product Hunt
Hey, Eric! Glad to have you here and I'm even more excited to speak at the Lean Startup Conference in November (plug!) as someone that attended three years ago. If you were to stop what you're doing now and found a new startup, what problem would you solve?
Eric Ries
Eric Ries@ericries
@rrhoover welcome back! we're psyched to have you. No better feeling than when an attendee goes on to become a rock star. this isn't a hypothetical question (other than the stopping part). I'm working on a startup called the Long-Term Stock Exchange. Trying to solve the problem of excess short-termism on the part of public investors & managers. I think that's one of the biggest problems messing up not just the startup ecosystem but our whole global economy. I don't have a lot to share about it right now, but stay tuned.
Alex Devkar
Alex Devkar@alexdevkar
Hi Eric, what are the most common mistakes/misunderstandings/misapplications you see startups make in applying the Lean methodology?
Eric Ries
Eric Ries@ericries
@alexdevkar most common is thinking that Lean means you don't need a vision: http://www.startuplessonslearned...
Erik Torenberg
Erik Torenberg@eriktorenberg · Former Product Hunt
Hey Eric - Thanks for joining us. If you were writing the Lean Startup in 2015, what would you add to it?
Morgan Beller
Morgan Beller@beller · Corporate Development, Facebook
@eriktorenberg, alley-oop: You can make an argument that your book is more relevant now than ever - recent discussions on high burn, etc. Do you plan to come out with a sequel? And if so, ____ (see Erik's question above)
Eric Ries
Eric Ries@ericries
@eriktorenberg Glad to be here - big fan (as you know) One of my big takeaways of the past five years is how much detail is required to adopt Lean Startup at scale. It's not enough to put up posters and slogans on the wall, fun as that is sometimes. In the book I make a lot of sweeping statements about what you need to do, and in a lot of cases what I've realized is that those statements are just the tip of the iceberg. In several places I cover in one paragraph topics that I think could be a whole book.
Eric Ries
Eric Ries@ericries
@beller Yes, working on it as we speak. A little bit of detail is available here: https://www.kickstarter.com/proj...
Morgan Beller
Morgan Beller@beller · Corporate Development, Facebook
@ericries - can't wait to read it!
Aaron Gopp
Aaron Gopp@aaron_gopp · co-founder Triipmates
Hi @ericries, thank you for taking the time to jam with us today! Like many people here, my introduction to the startup community was “The Lean Startup”. It is an amazing framework to assist in building a revolutionary company, however, there are quite a few terms that have become buzzwords and are often times misunderstood… “pivot” and “MVP” immediately come to mind. They are important concepts but part of a bigger methodology. Does it worry you that many startup founders are spending a lot of time “building MVPs” and “pivoting” without understanding what they mean and their role? How do you help to convey the value of these concepts as part of the bigger picture?
Eric Ries
Eric Ries@ericries
@aaron_gopp it used to bother me a great deal. TechCrunch declared "pivot" officially overused before, as far as I can tell, they ever learned to use it correctly: http://techcrunch.com/2011/01/03... now I don't mind so much. It's like any new idea or concept. There's going to be a lot of BS out there, but all that matter is: is the core community of people who really get it growing & having an impact? If so, ignore the hype.
Tom Redman
Tom Redman@redman · Technical Product Manager, Buffer
@ericries Hi Eric, thank you so much for the AMA and the Lean Startup. I'm reading it again right now and have recommended it to several people. I recently watched Peter Thiel's lecture in Sam Altman's Stanford "startup class", and he mentioned that he's skeptical about lean methodologies in general, that the biggest "monopoly" startups do something truly novel that couldn't be achieved by only talking with customers. I was a bit surprised (for some reason, I think of lean startup as universally accepted theory), but I was immediately curious about what your thoughts on that perspective might be? Is he right? Found the quote from Peter Thiel: "I am personally quite skeptical of all of the lean startup methodologies. I think the really great companies did something that is more of a quantum improvement that really differentiated them from everybody else. They typically did not do massive customer surveys. ... I do think we're way too focused on iteration as a modality and not enough on trying to have a virtual ESP link with the public and figuring it out ourselves. ... I think it's often the case that you don't have the time to mitigate the risk. If you take the time to figure out what people want, you risk missing the boat on something."
Eric Ries
Eric Ries@ericries
@redman I already addressed this earlier. The mention of "customer surveys" is the giveaway that we're talking past each other. Lean Startup is vehemently opposed to surveys & (in general) to asking what customers want. Your question prompted me to grab a copy of the book off my shelf; I was curious on what page I cover this topic first. On page 4 (!) I wrote: "we often talked to them and asked them for their feedback. But we emphatically did not do what they said ... we were much more likely to experiments on our customers than we were to cater to their whims." So anyone who's read at least the first 4 pages of The Lean Startup should know at least that much. PS. Anytime I have to go back and read my own writing, I cringe. What was I thinking? that's the glamorous life of an author :)
Eric Willis
Eric Willis@erictwillis · Working on something new
@ericries Hello, Eric. Thanks for doing the AMA. Your Kickstarter campaign was very successful. Congrats. I have a two questions related to it. What was the most important lesson you learned from the campaign and what would you do differently with the campaign if you could do it all over again?
Eric Ries
Eric Ries@ericries
@erictwillis Kickstarter was a huge amount of fun - and also a giant amount of work. One big lesson I learned is that even on a successful campaign, people can find an awful lot to complain about. It's just the law of large numbers, I guess. Have enough backers and even a small % of vocal critics can really get you down. I wish I'd realized that was going to happen so I could have prepared myself emotionally for it. In terms of what to do again, I didn't realize how many people would be backing a campaign like this for the first time. So I wish I had done more education about how crowdfunding works, what to expect, what a KS "survey" is, etc.
Jeff Needles
Jeff Needles@jsneedles · Data @ Houseparty & Maker of Things
@ericries Hey Eric, thanks for taking the time! What is the fastest you've every seen anyone take the lean startup methodology and turn it into a successful business? Any examples? How about companies that were overzealous and failed because of it?
Eric Ries
Eric Ries@ericries
@jsneedles I don't like to name names and cite specific companies. I'd rather let them speak for themselves. We regularly feature both kinds of stories at the Lean Startup Conference, and we post the videos for free on youtube. Take a look and decide for yourself which companies really used the method.
Danil
Danil@danilka · Founder, AlienDevs
@ericries what is your take on YC? They seems to be doing the same thing, but stressing the growth part a lot. What else am I missing here?
Eric Ries
Eric Ries@ericries
@danilka I love & admire YC, but from a distance. I haven't been invited behind the scenes, so I don't really know what they are teaching (other than what they say publicly).
Danil
Danil@danilka · Founder, AlienDevs
@ericries makes sense, thanks! Maybe @rrhoover can add to this?
Ryan Hoover@rrhoover · Founder, Product Hunt
@danilka we went through Y Combinator's Summer 2014 batch. It was extremely helpful and at a high level, YC help in these five ways: 1) Execution - You only have 3 months at YC. The partners are militant in their support and pressure to ship and grow. Working among dozens of other (often early stage) startups with some of the brightest minds is incredibly inspiring and motivating. 2) Raising Money - Demo Day is designed to make the fundraising process easier and quicker than traditional approaches. The "YC badge" doesn't guarantee that you'll raise beyond the $120k SAFE they provide, it does increase your chances and often times valuation. 3) BD/Partnerships - The partners are very well connected to a wide range of companies and people. They'll make warm intro's and YC's backing adds a level of legitimacy that opens doors. 4) Press - YC companies get covered. This is probably the least important benefit but in a world where getting attention is arguably the hardest part, it's helpful. 5) Network - YC isn't really done after the 3 months. Alumni still have access to request office hours with partners and like a their massive founder network continues to support each other months and years after the batch. BONUS: The food at Tuesday's dinners is pretty darn good. 😊 While not every startup should go through YC (and remember, not every startup needs to raise money but that's another blog post 😜), I'd highly recommend applying. They ask all the right questions that elicit new thoughts and might even make you question how you're approaching everything. I wrote a short piece on this here if interested. cc @alexisohanian @ilikevests @qasar
Eric Ries
Eric Ries@ericries
@rrhoover I've heard PG say that the 4% that YC asks for is an "IQ test" for founders. If you don't think #1-5 will increase your startup's worth by at least 4% then you have some kind of mental block.
Danil
Danil@danilka · Founder, AlienDevs
@rrhoover that's a great pitch for YC. How about the actual advice that YC partners generally give in terms of running a startup? In particular, how does it differ from what @ericries suggests in The Lean Startup? * I don't mean to be rude, just want to get to the bottom of this. I know that one of the current YC goals is to scale and that's great.
Enrique Benitez
Enrique Benitez@bntzio · 🦄 Full-Stack Developer and Maker
@ericries Hello Eric! I'm applying the Lean methodology in my recent startups, and what I get more confused is when dealing with the MVP, I understand that the MVP should be very very very simple, but if my app or startup idea needs a complex feature in order to be kind of valuable and differentiate from the competitors, what should I do?
Eric Ries
Eric Ries@ericries
@bntzio if complexity is needed to be viable, build the complexity. HOWEVER, how sure are you that the complexity is needed? 100% sure? What could it hurt to double-check?
tom britton
tom britton@tombritton · Co-founder at SyndicateRoom
@bntzio I know this question is to Eric but have you done a paper proto-type of the app. I find that helps quite a bit.
Jeff Umbro
Jeff Umbro@jeffumbro · CEO of The podglomerate
@ericries a few years ago I saw you speak at Book People in Austin outside of SXSW and you had a full house. Working in publishing I know how hard that is to achieve. Did you expect this book to be such a success and how has that helped you in your work since?
Eric Ries
Eric Ries@ericries
@jeffumbro I am a very happy traditionally-published author. It's been absolutely fantastic to me. I honestly had no idea how big it was going to become. Mostly, that's because I grossly underestimated the power of a global grassroots community. They are the ones who deserve the credit for its impact and success. Because of those thousands of evangelists, the book has opened a lot of doors to me, and I've learned a ton about how to apply Lean Startup principles at scale and in really varied situations, industries, sectors, etc. That's why I wanted to give back to the community via the Leader's Guide.
V.S.VIVEK
V.S.VIVEK@vsvivek93 · Unoccupied
When you are trying to build a non revenue generating starter ,We want to create a site where the founders talk to us on the basics and the essentials and make the videos more interactive rather than talking about all the whistles and bells of their offering. This is one of the products alone, the basic ideology is start a video and visual information concept unlike the typical media but with the ethos of starting a business and following your ideologies. How do we structure a business about it ? Thanks a lot for taking your time. Vivek from India
Eric Ries
Eric Ries@ericries
@vsvivek93 I don't totally understand your vision - but that's OK! It only matters that you understand it. Think like a scientist: what has to be true about the world to prove that this is a good idea? How can you learn that as quickly as possible? Run that experiment and take it from there.
V.S.VIVEK
V.S.VIVEK@vsvivek93 · Unoccupied
@ericries Sorry if i wasn't clear enough, But thanks a lot for your kind words
Rory McLaughlin
Rory McLaughlin@txredking · Javascript Developer, Aspiring Maker.
@ericries Hey Eric! Thank you for your time today. What is most common argument you hear against the Lean Startup methodology and how do you usually respond?
Eric Ries
Eric Ries@ericries
@txredking "But Steve Jobs wouldn't do that!" I used to respond, "even if that's true, you ain't no Steve Jobs, buddy" but now I point people to these two stories: http://andrewchen.co/apples-mini... and http://www.nytimes.com/2013/10/0...
Brian Mayer
Brian Mayer@brian_mayer
@ericries Since your book came out, how would say that "viable" has changed in the marketplace?
Eric Ries
Eric Ries@ericries
@brian_mayer it's always changing, and it's different by industry. I don't know who said this originally, but "the problem with MVP is you decide what's minimum but your customer decides what's viable"
Jay Mutzafi
Jay Mutzafi@jaymutzafi · iOS Developer
@ericries Should one ignore the competition? I'm building something unique, and as far as I can tell only one more company is working on something similar. They are better funded and further along in development. Should their (apparent) progress and stage inform in any way what I do or how I do it? And how important is it being first to market? Thanks.
Eric Ries
Eric Ries@ericries
@jaymutzafi ignore them, it's totally unimportent. serve your customers better and learn faster* than them, and enjoy watching them fail despite their "first mover advantage" * you are learning faster, though, right? that's kind of an important detail
Patant Consultants
Patant Consultants@patantconsult · E-commerce Consultants
@jaymutzafi Great question. I'm very curious about how @ericries will respond to this question. This is particularly concerning to startups where the competitor is better funded, has an established brand, a more influential social media presence or following. It is often said that execution is everything. But the question which you have raised is a recurring concern. This is particularly challenging when its easy for the bigger more established competitor to copy or improve on new features of the startup, faster than the up and coming lean startup founders can.
Jay Mutzafi
Jay Mutzafi@jaymutzafi · iOS Developer
@ericries I believe I am, it is a big part of my focus. Thanks for the answer!
Eric Ries
Eric Ries@ericries
@patantconsult "This is particularly challenging when its easy for the bigger more established competitor to copy or improve on new features of the startup, faster than the up and coming lean startup founders can." <-- this is almost never true
AJ
AJ@alanaut24 · Engitrepresigner
@ericries Huge fan! After all these years of preaching the Lean Startup, are there any new innovative approaches to launching startups that you have seen emerge that could potentially replace the Lean Startup methodology?
Eric Ries
Eric Ries@ericries
@alanaut24 Lean Startup is overrated, you should probably just do Fat Startup instead: http://allthingsd.com/20100317/t...
AJ
AJ@alanaut24 · Engitrepresigner
@ericries Thanks Eric. If only I wasn't on the four hour body.
Nicholas Spinazze
Nicholas Spinazze@spinoodle · CEO, Lynxus
@ericries Thanks very much for making time to chat with us Product Hunters! Do you plan on building upon the principles you outlined in Lean Startup with a second book? Have you learned anything since writing Lean Startup that you wish you would have included in your original?
Matti Heubner
Matti Heubner@mattiheubner · Marketing at Iris Health
@ericries Hi Eric! What do you regret most in your life?
Eric Ries
Eric Ries@ericries
@mattiheubner I have no idea how to answer this question without writing a treatise on existentialism and I only have 30 mins left. can you be more specific?
Matti Heubner
Matti Heubner@mattiheubner · Marketing at Iris Health
@ericries alright :) so what do regret most on the business side of your life? Any missed opportunities or something?