Essence of Lean Startup

Many of the Lean Startup entrepreneurial principles can be applied to companies of any size, from early-stage startups to established multi-national corporations.

We will take a look at some of Lean Startup key methods and tools. In Part 1 of this series, we will examine the Leap-of-Faith Assumptions (LOFA).

Leap-of-Faith Assumptions (LOFA)

Whether it's startup founders or senior executives of corporations, often they assume they know exactly what the market wants. They will make plans for new products and services based on their assumptions of what the market wants and jump into spending significant amount of resources to start developing these products/services, without actually first talking to the customers they are targeting.

Or they might conduct market research to test their assumptions by asking the customers what they want through individual customer interviews, focus group or surveys. There is a problem with this approach: people often think they know what they want but it turns out otherwise.

These leap-of-faith assumptions are only hypothesis, not facts. It's important to “get out of the building” to interact with your target customers. It would be wiser to test these leap-of-faith assumptions by designing experiments that allow you to observe it.

Validate the assumptions with these key questions:

1. Do people really have the problem you think they have?

2. How do they approach the problem now?

3. Is your new product/service concept a better alternative for them?

From the feedbacks, rank the impact each of these leap-of-faith assumptions would make for your customers, the growth potential and the time and effort needed. Keep it simple.

Once you have identified what your customers feedback as the concepts that will make the highest impact, you can then develop minimal viable products (MVP) which are quick release of new product/service that serves the purposes of enabling you to learn and iterate with real-life inputs.

Khengwah Koh