Breaking up with Lean Startup
Published in 2011, The Lean Startup by Eric Ries quickly became a cult classic among startups, tech companies, and the design industry. Its influence was so strong that its advice is still widely used today, even in non-lean and non-startup settings. (Thank you, Eric!) It's still marketed as essential reading for startups, and it seems everyone believes a 'Lean Startup' is the answer to every problem. But please, it's time to let it go. It’s 2022—times have changed, and so should we.
And, just to be clear, this isn’t about the famous Toyota version of Lean, which focuses on reducing waste, improving quality, increasing satisfaction, and getting more right the first time. That’s clearly not the same as 'go as fast as possible and ship so investors take you seriously.' The Lean Startup MVP cycle of guess, test, rinse, and repeat has led to something around a 90% failure rate. And, depending on which numbers you choose to believe, around 30% of those fail due to poor product-market fit. (Personally, I believe the actual number is likely much higher.)
So, you might think by now there is enough evidence to say that this model doesn’t work well enough or often enough. However, like eager little lemmings, startups emulate startups and continue to jump off the Lean Startup cliff. But why?
To answer that question, we need to travel back in time to the lates nineties. A time of optimism, when you just needed a half-baked idea, a rough business model, some vaporware and – bang! – you got funding. But, like a knock-off Viagra, it didn’t last, and the market went soft in early 2002, wiping away $5 trillion in value. The NASDAQ plummeted by almost 80%, and half of the dot-com darlings died overnight. It was clear optimism didn’t work and a better and more resilient approach was needed. Enter Eric Ries with two simple ideas in a pithy, well-written book: understand the needs of customers, and don’t waste time – just ship it, then fix it later.
I read it and then read it again before realizing I was looking for something that isn’t there. Eric missed the chapter on the importance of human-centered design practitioners in his approach. You know, those designers and consultant-types who mitigate risk. Who find the magical product-market fit with some research to understand customer needs. It was – and is still – not there. Instead, you are told developers are the magic capability you need to succeed. Find developers and you’ll be set, we are told. (Which, while true in some respects, still makes me smile.)
But the truth is that The Lean Startup has become a relic of the dot-com bubble. And while it was great twelve years ago, here is the worrying thing – you probably still see it being used in your day-to-day, which is unfortunate for many reasons …
MVP (audiences don’t want a Minimum Viable anything anymore)
Rather than wasting time releasing a fully baked version 1, The Lean Startup suggested releasing pieces of an idea to test it with real audiences. That sounds right in theory, but in practice it doesn’t work. If you start with a bad idea, or poorly executed good idea, you’re just wasting time. That was true then, and it remains true today. The difference now is that audiences will just not stomach a minimally viable anything anymore – and they don’t care about your product validation.
Metrics (manipulating them to look great for the investors)
The Lean Startup advocates driving toward traction and adoption metrics, which were demanded by Investors a decade ago (and some still do). Newsflash, people: they’re smoke and mirrors, easily manipulated and distorted. The reality is that smart investors know metrics can be fiddled with and simply want to know why a product might be right or wrong … which means they you need to go back to tried-and-true primary research to create a framework for the metrics.
A/B testing (polishing a crappy idea will not make it a better one)
The Lean Startup is in love with A/B testing. However, you can’t A/B test your way to anything good if the idea you start with is a turd. Manipulating metrics and tweaking results by seeing if by making the button bigger helps won’t fix the real problem. Here is the uncomfortable truth: if business goals don’t align with audience goals, they’re just vanity metrics. Or, to be more blunt, you can’t A/B test your way to a great idea.
Pivot (pivot on this mutha-f@£$*)
Pivoting just means changing … a little or possibly all of your MVP based on user feedback. It’s a term not just used in Lean teams, but in the Agile lexicon, too. And in theory it’s sensible. After all, if the product doesn’t create value for the audience, change it. But the truth is that major pivots are rare simply because businesses do not like killing their babies (which is a much deeper subject). Pivoting is critical, good, and logical … but executing anything is hard.
Conclusion
Customer-centric, employee-centric, and human-centric design are terms I hear bandied about by leaders, but here is the truth: it’s just lip-service, nice words being added to the business jargon glossary. That needs to change because today, if you don’t nail that 5-star rating straight out the gate, you’re doomed. Audience expectations have moved on, but breaking the cycle of “guess the market fit” is daunting as it requires both talent and time. Sounds expensive, right? Not really – it’s far more cost-effective than guessing, which burns time and confidence. Of course, if you wanted to get robust proof, we would need to undertake a cost-benefit analysis, but I would argue there is no need. After all, spending time and money up front to make sure you don’t invest in a folly is just common sense. Or at least it should be.