My last startup was a lean startup. We had a tiny team (1 founder, 1 designer and then me the engineer) we failed because we just didn’t have the resources and spread ourselves thin. Coupled with the fact we opted to wait and raise revenue once we reached a certain amount of users, so all we had was the initial fundraising and YCs lump sum (which just went up) and we really didn’t stand a chance. We had almost no investors interested in the product and I can’t say I blame them.
My current startup has went the other way, initially I thought it was too far in the other direction. But because we have enough people we are hitting our milestones, we are able to have a few people who only interact with customers and investors and that really does make all of the difference.
It sounds like you failed for many reasons, lean being the least of them. "Lean Startup" doesn't mean you should wait to raise, it means that you can get more "at bats" with the money you do have. Just because "lean" made it possible to not raising more money right away, that doesn't mean it's part of lean - that was a bad idea by the founder. And think about it this way, let's say you decided to "go big" and not raise right away - how much faster would you have gone bankrupt? The issue here is the lack of fundraising, not lean.
It feels like you took a bootstrapper approach to building your company, but within a YC incubator talking to VC investors.
No matter what methodology you use, that team sounds very small. I really hope the "1 founder" was a developer and an amazing design was crucial for your companies success.... :)
I just resigned from an early stage startup where I was the CTO. I burned out. Last summer I started asking our CEO if we should raise money to help us (basically me) deliver but he said it's too early as we didn't have many paying customers back then and the valuation and terms wouldn't be optimal. I hanged there 6 more months but in the end was so exhausted I took one month of sick leave and during that I decided it's not worth it to keep on fighting. Now he's raising money with a new CTO-candidate. Lean is good but I wish it wasn't my mental health we paid the leanness.
but he said it's too early as we didn't have many paying customers back then and the valuation and terms wouldn't be optimal
The last time I tried to raise anything it was pretty much impossible to do pre-revenue. Even a small seed round has expectations that you'll have launched already[1]. Obviously it depends on a lot of factors, but there's a chance your CEO was right.
[1] ...which defeats the point of it being a seed round in my opinion. If you've proven the model and you have money coming in then you're raising a Series A. rant rant
When I read the book I never got the impression that lean methodology required a lean (as in small) team.
It was more about being lean (as in efficient) in the development, iteration and pivoting between ideas. Don't waste time and resources on an idea that customers don't want, cut your losses and pivot toward an idea that has been validated.
Indeed. Lean is about constantly eliminating waste, i.e. spending as much as possible of your effort on things that will truly take you closer to profitability.
A lot of things that look like work are actually not earning you any money, just costing you valuable life-hours. The Lean Startup contains some tips for figuring out which is which.
I would say that should be the going framework regardless. Having come from a failing startup thanks to being lean, I think the lesson I’ve learned is mostly “it depends.” The company I’m at now went on a hiring spree once we landed in YC and got our first few investors. We then ended up having too many engineers, at least for the problems we could reasonably expect people to pay us for, and had to let two people go.
I think Lean Startup has fallen out of favor in recent times and hasn’t kept up with modern trends.
Lean Startup can be boiled down to: don’t waste time and resources on things that are not necessary or that people don’t actually want. Wow, such wisdom.
In old days, a lean startup looked much different, more rough and scrappy. Nowadays that doesn’t really fly, and everything comes with polished facades straight out the gate, or else you have no chance.
Lean startup was meant for a time when building big things upfront was difficult and time consuming. Nowadays if you know how to leverage technology, you can build impressive things very quickly, and you must, because if you don’t your competitors will and they will win because today’s consumer is too burnout from cheap looking startups that disappear overnight because they decide they had the “wrong assumptions” about their customers.
In a world where building things gets increasingly cheaper and easier, Lean Startup is too cautious and slow and has no value.
> if you know how to leverage technology, you can build impressive things very quickly
I worked at a start-up for 18 months at the start of 2020. I look at it as the best experience of "flow" I'm ever likely to have. I come from an infrastructure/devops background, the two other engineers were developers (one with significant management experience) and the rest were data scientists. Within a crazy short time we had CI/CD, separate environments for dev, testing and production, extremely scalable infrastructure in multiple regions. We set up kanban, daily standups, weekly design meetings. We considered logging and metrics from the start. Product development was insanely quick, and there were essentially no infrastructure blockers because I was able to produce IaC and deploy it as it was required. We put heavy focus on minimizing cost to increase runway (ie: scale to zero, free services like gitlab & Cloudflare). In under a year we had an MVP that we could deploy to any region from scratch with two commands (terraform apply and a script to helm install the rest).
I'll add one thing: while you can spin up impressive things quickly, it's easy to screw up. Like deciding you can ignore environments, regions and scalability "for now". You think you can do it later? You can't. Not when you've got a shitload of customers running in your one big janky data center.
I know. Right now I'm working for a company who did this. There are no naming conventions. Deploying a new data center is a nightmare. I want to throw out all of their shitty code and start over, but I can't. The company is doing well but the VCs want to see rapid expansion into different regions and they're simply unable to do it.
They're still doing well. I got to a point where I needed to take time out, spend time with family, do gardening, lie out in the lawn looking at the sky. I did that for 8 blissful months before a guy I know pulled me into this dumpster fire.
Agree very much with this sentiment. Lean Startup advise is quite outdated these days. Shipping a lean product... was a total disaster for us. Nobody wanted to adopt us since we were hardly competitive. We solved one problem but customers wanted the product to also do 100 things. We did 50 things and only then could we get customers to stick and even give constructive feedback.
Preach. I agree with both comments. The reality is that we need at least something to differentiate ourselves from the competition and that cost money/resources/time.
The era of "ugly but functional to a certain extent" is dead. Customers want good solutions right out the bat.
It's also worth keeping in mind that the 'lean startup' methodology was mostly proven out by Eric in the games space, which is VERY different from trying to sell a product to businesses or doctors or whatnot. The way customers make purchasing decisions is different.
Inevitably startups these days must be willing to waste some resource, maybe time or money, in order to truly iterate toward solutions that customers want. Anything else is too slow.
Lean startup is not about building something bad and ugly. Although the core process is named Build-Measure-Learn-Loop, it really starts with "Learn". You've got to define hypotheses about your business model (e.g. customer pain points) and build experiments to validate. A MVP is the product with the narrowest set of features that predictably converts a target into a paying customer. From the customers perspective, you think of a MVP as a minimal lovable product (MLP).
I think more people need to talk about "how lean should you be while still being competitive". I think that's really hard and that's very different depending on what the startup is doing. I think there's a lot of nuance / opportunity there to figure out "how lean is lean enough"
The core takeaway from the Lean Startup is about learning. Everything should be aimed at learning more about your business and how to make it successful. That point really has very little to do with building products; it's precisely the "wrong assumptions" bit that the approach targets.
It feels like everyone has read The Lean Startup but hasn't understood the key message. I read it a few years ago, and I still ended up wasting too much of my time building something that no one wanted. Then I started advising other founders, and I see that most of them are still failing exactly how the book describes failing.
It apparently takes multiple exposures to the Lean Startup concept from different angles for people to get the core message. My own attempt to teach Lean Startup from another angle is called Bloated MVP [0]
I like your message of avoiding MVP bloat. It’s an important one for sure.
In your blog examples you showcase both true positives and true negatives (services that succeeded and failed respectively). It would be especially interesting to also show cases of good mvps that failed and bad ones that ultimately succeeded.
Of course “execution is key”, but it would still give some valuable insights into your methodology.
Maybe "build one to throw away" extends more broadly than we tend to suppose.
You always are gonna screw up the first one, and the second one can go Second System, so maybe the third time is the charm. If so, then what you'd want is a lot of first time startups getting a little money, with a very, very low expectation of success.
But if you are quite certain the first ones are likely to fail, you'd need some incentive to give them even a little money. Maybe with some sort of Right of First Refusal on your next couple of enterprises. Though that's easy enough to game by making a BS proposal, or working for someone else for a year and then trying again. Maybe 2 years and two enterprises, whichever is greater.
My current startup has went the other way, initially I thought it was too far in the other direction. But because we have enough people we are hitting our milestones, we are able to have a few people who only interact with customers and investors and that really does make all of the difference.