New business ventures often face the challenge of how to be truly differentiated. In his book Running LeanAsh Maurya offers a new take on differentiation by introducing the concept of unfair advantage. He quotes Jason Cohen: A real unfair advantage is one that cannot easily be copied or bought.
Lately, this question has bubbled up in frequency which is why I decided to take the time to outline the thought process that went into creating Lean Canvas.
First a quick timeline. Many of the examples in the book illustrated the business models of well known companies like Apple and Skype — after they were successful. The thought of capturing business model hypotheses on a single page seemed killer. Aug I shared my adaptation Lean Canvas in a post I published: This post quickly rose to become one of my top posts of all time.
Sep I recruited the help of other entrepreneurs to start building an online version of Lean Canvas with the initial goal of facilitating more of these learning conversations in my workshops, and subsequently opening it up to everyone.
Feb Lean Canvas also became a critical part of the methodology described in my book: Design Goals My main objective with Lean Canvas was making it as actionable as possible while staying entrepreneur-focused.
The metaphor I had in mind was that of a grounds-up tactical plan or blueprint that guided the entrepreneur as they navigated their way from ideation to building a successful startup.
I had already been working with Lean Startup principles which had a big influence on the design. Uncertainty The lack of complete certainty, that is, the existence of more than one possibility. Risk A state of uncertainty where some of the possibilities involve a lean stack business plan, catastrophe, or other undesirable outcome.
Because the canvas is already quite space constrained, it was important to maximize on the signal-to-noise ratio. So I started trading boxes. Problem Most startups fail, not because they fail to build what they set out to build, but because they waste time, money, and effort building the wrong product.
Solution Once you understand the problem, you are then in the best position to define a possible solution. That said, I purposefully wanted to constrain entrepreneurs through the use of a small box on the canvas because the solution is what we are most passionate about.
Left unchecked, we often fall in love with our first solution and end up cornering ourselves into legacy. Key Metrics Startups often drown in a sea of numbers in an attempt to bring order to the chaos of uncertainty.
At any given point in time though, there are only a few key actions or key macro metrics that matter. So you have to decide what that is and ignore everything else. Failure to identify the right key metric can be catastrophic — leading to wasteful activities like premature optimization or running out of resources while chasing the wrong goal.
Initially these key metrics should center around your value metrics and later they shift towards your key engines of growth. Unfair Advantage This is another name for competitive advantage or barriers to entry often found in a business plan.
I was cognizant of the fact that few startups have a true unfair advantage on day one which means this box would be blank. Once a startup achieves some level of initial success, it is inevitable that competitors and copy-cats will enter the market. The addition of four new boxes meant I needed to take out four other boxes.
I also found some overlap with the boxes I already added: With the advent of the Internet, Open Source, Cloud computing, and globalization, we need fewer resources than ever to get a product to market — making Key Resources align more closely with Unfair Advantage.
This seemed better captured by the existing Channels box. Yes, success for some types of products is predicated on first establishing the right key partners. For example, building a global solar energy grid platform which has huge capital and regulatory requirements would probably require establishing key partnerships in place first.
When you are an unknown startup with an untested product, pursuing key partnerships from day one can be a form of waste. Other questions Why did you choose to extend the Business Model Canvas versus create something new?
Who is the audience for Lean Canvas? Lean Canvas was designed for entrepreneurs, not consultants, customers, advisors, or investors. That said, the entrepreneur can greatly benefit by engaging all of those people while validating their canvas.
What is the best medium for creating a Lean Canvas? Use whatever is most natural to you.Lean Canvas is an adaptation of Business Model Canvas by Alexander Osterwalder which Ash Maurya created in the Lean Startup spirit (Fast, Concise and Effective startup).
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Extensive set of terms and definitions in relation to lean manufacturing. Includes both useful tools and (formerly) popular buzzwords, including sometimes an opinion or comment on then.