Running Lean. 3rd Edition

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• Foreword
• Preface
  • OReilly Online Learning
  • How to Contact Us
  • Acknowledgments
• Introduction
  • A Tale of Two Entrepreneurs
  • One Year Ago
    • Off to the Races
    • Six Months Later
    • Catch-22
  • A Traction-First Approach Is the New Way Forward
  • What Determines Success Isnt Differing Skill Sets But Differing Mindsets
    • The Stakes Are Much Higher This Time
    • Speed of Learning Is the New Unfair Advantage
    • Succeeding in the New World Requires New Mindsets
  • You Cant Afford to Wait for an Idea Whose Time Has Come
    • Steve Learns About Minimum Viable Products
  • Dont Start with an MVP
  • There Is a Systematic Approach to Entrepreneurship
  • About Me
  • How This Book Is Organized
    • Part I: Design
    • Part II: Validation
    • Part III: Growth
  • Is This Book for You?
  • Does It Work for Services and Physical Products?
  • Practice Trumps Theory
• I. Design
• 1. Deconstruct Your Idea on a Lean Canvas
  • Sketching Your First Lean Canvas
    • Customer Segments
      • Distinguish between customers and users
      • Model multiple perspectives
      • Home in on early adopters
    • Problem
      • List the top one to three problems
      • List existing alternatives
      • Steve tackles the Customer Segment/Problem quadrant
    • Unique Value Proposition
      • Connect to your customers number one problem
      • Target early adopters
      • Focus on outcomes
      • Keep it short
      • Answer what, who, and why
      • Create a high-concept pitch
      • Steve crafts his UVP
    • Solution
      • Steve defines a solution
    • Channels
      • Steve outlines some possible paths to customers
    • Revenue Streams and Cost Structure
      • Revenue streams
      • Cost structure
      • Steve thinks through his cost structure and revenue streams
    • Key Metrics
      • List three to five key metrics
      • Prefer outcome metrics versus output metrics
      • Prioritize leading indicator metrics versus trailing indicator metrics
      • Study analogs
      • Steve identifies a few key metrics
    • Unfair Advantage
      • What do you do if you dont have an unfair advantage on day one?
      • Start with an unfair advantage story
      • Leave the unfair advantage blank
      • Embrace obscurity
      • Steve ponders his unfair advantage story
  • Refining Your Lean Canvas
    • So, How Do You Avoid the Goldilocks Problem?
    • How Do You Know When to Split Your Lean Canvas?
      • Direct
      • Multisided
      • Marketplace
    • Steve Splits His Big Idea Canvas into Specific Variants
  • Whats Next?
• 2. Stress Test Your Idea for Desirability
  • Defining Better
  • Our Innovators Bias Gets in the Way
  • Meet the Innovators Gift
    • Unpacking the Innovators Gift
      • All jobs start with a trigger
      • Habits define what we do most of the time
      • Until we encounter a switching trigger
      • Therein lies the opportunity
      • Causing a switch starts with a promise of better
      • Emotionally better versus functionally better
      • Emotionally better lives in the bigger context
      • Getting hired is only the first battle
    • Steve Challenges the Innovators Gift
  • Using the Innovators Gift to Stress Test Your Idea for Desirability
    • Customer Segments: Keep It Simple
    • Early Adopters: Forget Personas
    • Existing Alternatives: Transcend Category
    • Problems: Whats Broken with the Old Way?
    • UVP: How Will You Cause a Switch?
  • Steve Realizes He Has a Hammer Problem
• 3. Stress Test Your Idea for Viability
  • Dont Create a Financial Forecast; Use a Fermi Estimate Instead
    • What Is Traction?
    • Welcome to the Customer Factory
      • Step 1. Acquisition
      • Step 2. Activation
      • Step 3. Retention
      • Step 4. Revenue
      • Step 5. Referral
  • Testing the Viability of Your Idea Using a Fermi Estimate
    • Define a Target Throughput Goal
      • Set your minimum success criteria independently from your idea
      • Frame your goal in terms of annual recurring revenue (ARR)
      • Focus on systems, not goals
      • Your minimum success criteria are determined by your operating environment
      • Dont chase three-digit precision
      • Dont go outside the building without minimum success criteria
      • Steve sets his minimum success criteria
    • Test Whether Your Idea Can Deliver Your Target Throughput Goal
      • Estimate the required number of active customers
      • Steve estimates how many active customers hell need
      • Estimate the required minimum customer acquisition rate
      • Steve estimates his minimum customer acquisition rate
      • Estimate the required number of leads
      • Steve estimates the number of leads hell need to attract
      • Use your referral assumptions to lessen the burden of customer acquisition
      • Steve tries to save his business model
    • Revise Your Goal or Fix Your Business Model
      • Fixing your business model
        • Revisit your pricing
        • Revisit your problems
        • Consider a different customer segment
      • Revising your goal
      • Steve fixes his business model
      • Isnt this just funny math?
  • Running a Fermi Estimate on Your Idea
  • Steve Reviews His Business Models with Mary
• 4. Stress Test Your Idea for Feasibility
  • Charting a Traction Ramp
    • Steve Charts His Traction Roadmap
  • Formulating a Now-Next-Later Rollout Plan
    • Stage 1: NowProblem/Solution Fit
    • Stage 2: NextProduct/Market Fit
    • Stage 3: LaterScale
  • Steve Gets a Lesson on Right Action, Right Time
  • Steve Learns About Wizard-of-Oz MVPs
  • Steve Formulates His Now-Next-Later Rollout Plan
• 5. Communicate Your Idea Clearly and Concisely
  • Whats Your Elevator Pitch?
    • Outlining Your Elevator Pitch
  • The Different Worldviews of an Idea
    • The Investor Worldview
    • The Customer Worldview
    • The Advisor Worldview
  • Delivering Your Business Model Pitch
  • The 10-Slide Business Model Pitch Deck
    • Desirability
    • Viability
    • Feasibility
  • Steve Shares His Business Model Pitch with Others
• II. Validation
• 6. Validate Your Idea Using 90-Day Cycles
  • The 90-Day Cycle
    • A Typical 90-Day Cycle
      • Modeling
      • Prioritizing
      • Testing
  • Getting Ready for Your First 90-Day Cycle
    • Assemble the Right Team
      • Forget traditional departments
      • Start with a minimum viable team
      • Good teams are complete
      • Good teams overlap on superpowers
      • Be wary of outsourcing your key skill sets
      • Good teams hold themselves externally accountable
      • Good teams utilize good coaches
    • Establish a Regular Reporting Cadence
  • Seven Habits for Highly Effective Experiments
    • 1. Declare Your Expected Outcomes Upfront
    • 2. Make Declaring Outcomes a Team Sport
    • 3. Emphasize Estimation, Not Precision
      • Search for analogs
      • Use your traction roadmap and customer factory model
      • Start with ranges instead of absolute predictions
    • 4. Measure Actions, Not Words
    • 5. Turn Your Assumptions into Falsifiable Hypotheses
    • 6. Time-Box Your Experiments
    • 7. Always Use a Control Group
  • Steve Establishes an External Accountability Structure
• 7. Kick Off Your First 90-Day Cycle
  • Steve Calls a 90-Day Cycle Kickoff Meeting
  • The Problem/Solution Fit Playbook
    • Customers Dont Buy Products, They Buy a Promise of Something Better
    • How to Make a Promise of Better
    • When Are You Done with Problem/Solution Fit?
  • Steve Calls a 90-Day Cycle Planning Meeting
  • The Mafia Offer Campaign
    • Building a Mafia Offer
      • 1. Problem discovery
      • 2. Solution design
      • 3. Offer delivery
    • Running a Mafia Offer Campaign
    • When to Use a Mafia Offer Campaign
  • Steve Tries Taking a Shortcut
    • Mary Bursts Steves Bubble (Again)
  • No Surveys or Focus Groups, Please
    • Are Surveys Good for Anything?
    • Preemptive Strikes and Other Objections (or Why I Dont Need to Interview Customers)
• 8. Understand Your Customers Better Than They Do
  • The Problem with Problems
    • Case Study: Using Problem Discovery Interviews to Drive New Home Sales
  • Focus on the Bigger Context: The Job-to-be-Done
    • Case Study: Using Problem Discovery Interviews to Build Better Drill Bits
    • Finding the Bigger Context
    • Scoping the Bigger Context
    • Diving Deeper into a Bigger, More Specific Context
  • Running a Problem Discovery Sprint
    • Broad-Match Versus Narrow-Match Problem Discovery Sprints
    • Finding Prospects
    • Steve Kicks Off the First Problem Discovery Sprint
    • Conducting Interviews
    • Steve Creates a Meta-Script for His Interviews
      • Welcome (set the stage)
      • Anchor around the chosen existing alternative (set the anchor)
      • Look for triggering events (first thought to switching trigger)
      • Explore selection process (acquisition)
      • Explore early use (activation)
      • Explore recurring usage (retention), if applicable
      • Whats next? (next summit)
      • Wrapping up (next steps)
    • Capturing Insights
  • Steve Reviews the Results of the Broad-Match Problem Discovery Sprint
  • When Are You Done with Problem Discovery?
  • The Altverse Team Uncovers Several Additional Jobs-to-be-Done
• 9. Design Your Solution to Cause a Switch
  • Steve Learns About the Concierge MVP
  • Running a Solution Design Sprint
    • Addressing Desirability
      • Step 1: Identify the primary struggle
      • Step 2: Craft a compelling promise
    • Addressing Viability
      • Step 1: Set a fair price
      • Step 2: Identify your ideal early adopters
    • Addressing Feasibility
  • The 5 Ps of MVP
  • Steve Takes a Stab at the 5 Ps of MVP
• 10. Deliver a Mafia Offer Your Customers Cannot Refuse
  • Case Study: The iPad Mafia Offer
  • Running an Offer Delivery Sprint
  • Assembling Your Offer
    • Define the Characters in Your Customer Story Pitch
    • Outline the Structure of Your Customer Story Pitch
      • Act 1: Setup (share the bigger context)
      • Act 2: Confrontation (break the old way)
      • Act 3: Resolution (demo your new, better way)
      • Act 4: Call-to-action (ask for the switch)
    • Steve Shares His Customer Story Pitch Outline with the Team
  • Delivering Your Offer
  • Optimizing Your Offer
    • Measure Your Customer Factory Metrics Weekly
    • Identify Your Key Constraint
    • Formulate Ways of Breaking the Constraint
  • Steve Meets with the Team to Review the Results of Their First Offer Delivery Sprint
  • When Are You Done with Offer Delivery?
• 11. Run a 90-Day Cycle Review
  • Steve Calls a Pre-Review Meeting Just with Mary
  • Preparing for the Meeting
    • Collect/Update Artifacts
      • Elevator pitch
      • Lean Canvas
      • Traction roadmap
    • Assemble a Progress Report Pitch Deck
      • Set context
      • What we thought
      • What we did
      • What we learned
      • Whats next
  • Running the Meeting
  • Steve Calls a 90-Day Cycle Review Meeting
• III. Growth
• 12. Get Ready to Launch
  • The Altverse Team Prepare for Launch
  • Keep Your Customer Factory Running
    • Look for Ways to Automate Your Customer Factory
  • Race to Value Delivery
  • Extend Your Customer Factory Metrics Dashboard
  • Roll Out Your MVP in Batches
  • The Altverse Team Launch Their Concierge MVP
• 13. Make Happy Customers
  • The Altverse Team Learns About Behavior Design
  • The Happy Customer Loop
    • Dont Be a Feature Pusher
    • Implement an 80/20 Rule
    • Prevent a Switch
    • Outlearn the Competition
    • Reduce Friction
      • Theres more to reducing friction than improving your products UX
    • Learn the Science of Habits
      • Going from the habit loop to behavior design
      • The Customer Forces Model is a behavior model
    • Chart a Customer Progress Roadmap
    • Trigger Your Customers
    • Help Your Customers Make Progress
    • Reinforce Progress
  • The Altverse Team Calls a 90-Day Cycle Review Meeting
• 14. Find Your Growth Rocket
  • The Altverse Team Learns About Growth Rockets
  • The Rocket Ship Growth Model
    • Launching Rocket Ships
      • Part 1: Design (Mission Design)
      • Part 2: Validation (Ignition)
      • Part 3: Growth
        • Liftoff
        • Achieve escape velocity
        • Fire your growth rocket
  • The Three Types of Growth Loops
    • The Revenue Growth Loop
    • The Retention Growth Loop
    • The Referral Growth Loop
    • Can You Have Multiple Growth Rockets?
  • Finding Your Primary Growth Rocket
    • Short-Listing Growth Rocket Candidates
    • Validating Your Growth Rocket
    • Optimizing Your Growth Rocket
  • Steve Makes Mary an Offer She Cant Refuse
• 15. Epilogue
  • The BOOTSTART Manifesto
    • 1. Entrepreneurs Are Everywhere
    • 2. The Persona of the Garage Entrepreneur Has Changed
    • 3. There Is No Better Time to Start
    • 4. Most Products Still Fail
    • 5. A Dozen Reasons Why Products Fail
    • 6. The Number One Reason Why Products Fail
    • 7. The Number Two Reason Why Products Fail
    • 8. You Dont Need Permission to Start
    • 9. Love the Problem, Not Your Solution
    • 10. Dont Write a Business Plan
    • 11. Your Business Model Is the Product
    • 12. Focus on Time, Not Timing
    • 13. Not Acceleration, but Deceleration
    • 14. Not Faux Validation, but Traction
    • 15. Remove Failure from Your Vocabulary
    • 16. Its Time to Act on Your Big Idea
• References and Further Reading
• Index

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