Lean Start Up Quiz

What is a lean start-up?

A lean start-up is a way of starting a business by testing ideas, getting customer feedback, and making changes as you learn, instead of spending a long time creating a detailed plan before knowing what customers actually want.

What is the difference between a start-up and an established company?

A start-up searches for a business model because it is still figuring out what works. An established company executes a business model because it already knows how its business works.

What is a start-up according to the lean start-up approach?

A start-up is a temporary organization designed to search for a repeatable and scalable business model.

Think: It is temporary because once it figures out a successful business model, it moves into running and growing the business.

What are the three key principles of the lean start-up method?

1. Business Model Canvas — write down and test your business ideas and assumptions.

2. Customer Development — get feedback from real potential customers.

3. Agile Development — quickly build, test, and improve the product.

What is the Business Model Canvas?

The Business Model Canvas is a framework that helps entrepreneurs put their business ideas and hypotheses in one place so they can test whether those assumptions are correct.

Think: Instead of writing a huge business plan, you map out your ideas and test them.

What is Customer Development?

Customer Development means “getting out of the building” and talking to potential customers, users, and partners to find out whether your assumptions and business ideas are actually correct.

What does “get out of the building” mean?

It means going directly to potential customers, users, and partners to get feedback, instead of sitting in an office and assuming you already know what they want.

What is Agile Development?

Agile Development means building a product in small steps, testing it, getting feedback, and then improving it.

Think: Build → Test → Get feedback → Improve → Repeat.

What is a Minimum Viable Product (MVP)?

A Minimum Viable Product (MVP) is the simplest version of a product with only the most important features. It is used to test whether customers actually want or need the product.

What is a pivot?

A pivot is when a start-up learns from customer feedback that something isn't working and makes a significant change to its idea, product, customer, or business model.

Think: The company changes direction based on what it learned.

What are the four stages of Customer Development?

Customer Discovery → Customer Validation → Customer Creation → Company Building

Easy memory trick: Discover → Validate → Create → Build

What happens during Customer Discovery?

The founders test their assumptions about what customers need and create a Minimum Viable Product (MVP) to test their solution.

What happens during Customer Validation?

The start-up tests whether customers are actually interested by looking at things like product usage or early orders.

If customers aren't interested, the start-up may pivot.

What happens during Customer Creation?

The product is ready enough to sell, so the company focuses on creating demand, increasing marketing and sales, and scaling the business.

What happens during Company Building?

The business moves from start-up mode, where it is searching for a business model, to a more formal company with departments that execute the proven business model.

Why does Steve Blank criticize traditional business plans?

Because start-ups have too many unknowns, and a detailed business plan is based mostly on assumptions made before talking to real customers.

His main point: Business plans rarely survive first contact with customers.

How is failure viewed differently in a lean start-up?

In a traditional company, failure is often seen as an exception or problem. In a lean start-up, failure is expected because the company is still learning what works.

Instead of just giving up, the start-up iterates or pivots.

What happened with Blue River Technology?

Blue River Technology originally wanted to make robotic lawn mowers for golf courses. After talking to customers, they learned golf courses didn't really value the idea.

They pivoted and focused on helping farmers kill weeds without chemicals.

Why is stealth mode becoming less popular?

Lean start-ups believe that customer feedback is more important than keeping the idea secret from competitors. Getting constant feedback helps companies improve their products faster.

How can lean start-up practices help large companies?

Large companies can use lean start-up practices to test new ideas, get customer feedback, search for new business models, innovate faster, and respond to disruption and change.