Is Eric Ries’ lean start-up ideology an effective way to build a start-up?
I would say ‘Yes’.
Let’s dive deep into few lean start-up concepts which are highly effective;
Minimum viable product & market
This idea helps a start-up to quickly find a small addressable market and check the product-market fit. I assume the start-up has less resources (in terms of time and money) so targeting a various market segments at the beginning might not be a great idea.
In order to accomplish the product-market fit, the start-up has to understand the needs, pain points and preferences of its target market. So keeping the market small helps the Founding team to interact with the early adopters in real time (to test, learn and adapt).
(Ex:- Facebook was first launched only for Harward students —- a small viable market for Mark Zuckerberg. The best part is, he was part of the target market, an insider. So, he was able to understand the psycho-graphic needs of his market first hand)
Early adopters and innovators
Mass market (early and late majority) may not show interest on a breakthrough innovation. Early adopters who are looking for something new and cool is always the right choice to test a new value proposition which is not present in the market.
The problem with the conventional market research methods like Focus group is it doesn’t show the actual customer behavior. (i.e how they react to the product/service in real time).
So, It’s always better to ask the consumer to use the product and check their willingness to pay for the service.
This would be useful to test the hypothesis in real time so that the Founder can decide either to ‘pivot’ or ‘persevere’.