In the first of two blogs, Philip Letts, Founder and CEO of blur Group, takes us through the traits of a lean startup. In the second he’ll be talking about the characteristics of the lean start-up as it moves to lean business.
What makes a start-up truly ‘lean’?Lean startups are getting a lot of attention right now. Perhaps it’s a cultural nod to the post Lehman, pro-austerity climate mirrored through the latest business winnows. Or a desire by new breed entrepreneurs to do their bit for occupy Wall Street – a two fingers to yet more slush fees handed to bankers, brokers or VC’s. The counter culture to cash gorged, venture capital primed, one hit wonders.
At blur Group we believe so strongly in lean that we wrote our own framework for it called Innovate – which is now freely available on the Web at http://Innovate.blurgroup.com. Because so often the most successful innovators have succeeded long term without being propped up by artificial chubbiness.
But what makes a startup truly lean? Put most simply lean means that you are laser focused on what really matters. On the process for building a great business: Understanding a real market need, building the exact right solution, cost effectively discovering the early adopter market for it and using this traction to chart the most direct route to sustainable growth and profits via satisfied customers, partners and employees. Lean businesses care as much about the bottom line as the top – in everything they do, at all times. They get that turnover at any cost is the business equivalent of gross obesity. That capital raisings are distractions from the core and that lean is a long hard slog. Succeed at it and you probably build a longer term, more valuable business with the right economics to make it through thick and thin.
A truly lean startup is as passionate about being lean as they are about their brand and products. It is a way of life – an ‘organic’ business. Corporate retro – back to basics. Where your number one goal is cash generation, your best route to this is a total customer focus and your surest path to failure being poor products and weak cost controls.
I leave you with one last thought – is venture capital the greatest enabler or distraction to building a truly authentic, lasting business? Is lean the real answer.