1 j • J How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses $26.00 (Canada:$30.00) Moststartupsfail. Butmanyofthose failures are preventable. TheLeanStartupis a new approach being adopted acrossthe globe, changingthe way companies are built and new products are launched. EricRiesdefinesastartupas an organization dedicatedtocreating something new under condi tions ofextreme uncertainty.This isjustastrue for one personin agarage asitisin agroupof seasonedprofessionalsinaFortune500board room.Whattheyallhaveincommonisamission to penetratethefogofuncertaintyto discovera successfulpathtoasustainablebusiness. The LeanStartupapproachfosters com paniesthataremorecapitalefficientandthat leverage human creativitymore effectively. Inspiredbylessonsfromleanmanufacturing, itrelieson "validatedlearning,"rapidscientific experimentation,as wellasa numberofcoun terintuitive practices that shorten product developmentcycles, measureactualprogress withoutresortingtovanitymetrics,andhelp us learnwhatcustomersreallywant.Itenables acompanyto shiftdirectionswithagility,alter ingplansinchbyinch,minutebyminute. Ratherthanwastingtimecreatingelaborate businessplans,TheLeanStartupoffers entrepre neurs—incompaniesofall sizes—awaytotest theirvisioncontinuously,toadaptandadjust beforeit'stoolate. Riesprovidesa scientific approachto creatingandmanagingsuccess ful startupsin anage whencompaniesneedto innovatemorethanever. Acclaim for THE LEAN STARTUP "TheLean Startup isn't justabout how tocreate amore success ful entrepreneurial business; its about what we can learn from those businesses toimprove virtually everythingwe do. I imag ine Lean Startupprinciples applied to government programs, to health care, and to solving the worlds great problems. Its ultimately an answer to thequestion How can we learn more quicklywhatworks anddiscardwhat doesn't?" —Tim O'Reilly,CEO, O'ReillyMedia "Eric Ries unravels the mysteries of entrepreneurship and re veals that magic andgenius are not the necessary ingredients for success butinstead proposes ascientific process thatcan be learned and replicated. Whetheryouare astartupentrepreneur orcorporate entrepreneur, there are important lessons here for youonyourquest toward thenewandunknown." —Tim Brown, CEO, IDEO "Theroad map for innovation for the twenty-first century.The ideas in The Lean Startup will help create the next industrial revolution." —SteveBlank, lecturer, StanfordUniversity, UC BerkeleyHaas BusinessSchool "Every founding team should stop for forty-eight hours and read TheLean Startup. Seriously, stopandread thisbooknow." —ScottCase, CEO,StartupAmericaPartnership "The key lesson ofthis book is that startups happen in the present—that messy place between the past and the future where nothing happens according to PowerPoint. Ries's 'read and react' approach to this sport, his relentless focus on vali dated learning, the never-ending anxiety ofhovering between persevere' and pivot,' all bearwitness tohisappreciationfor the dynamics ofentrepreneurship." —GeoffreyMoore, author, Crossingthe Chasm "Ifyou are an entrepreneur, read this book. Ifyou are thinking about becomingan entrepreneur, read this book. Ifyou are just curious aboutentrepreneurship, readthis book. StartingLean is today's bestpracticefor innovators. Doyourselfafavorandread this book." —RandyKomisar, founding director ofTiVoand authorofthebestselling TheMonkandtheRiddle "Howdoyouapply thefifty-year-old ideas ofLean to thefast- paced, high-uncertainty world ofstartups? This book provides abrilliant, well-documented, and practical answer. It issure to becomeamanagementclassic." —Don Reinertsen, author, ThePrinciplesofProductDevelopmentFlow "What would happen ifbusinesses were built from the ground uptolearnwhattheircustomersreallywanted? TheLeanStartup is the foundation for reimaginingalmost everything about how workworks. Don'tlettheword startup inthetitle confuseyou. This is a cookbook for entrepreneurs in organizations of all sizes." —RoyBahat,president, IGN Entertainment uThe Lean Startup is a foundational must-read for founders, enabling them toreduce product failures by bringing structure andscience towhat is usually informal andanart. It provides actionable ways toavoid product-learning mistakes, rigorously evaluate early signals from themarket through validated learn ing, and decide whether to persevere ortopivot, all challenges thatheighten thechance ofentrepreneurial failure." —NoamWasserman, professor, Harvard Business School "One ofthe bestandmost insightful new books on entrepre neurship and management I've ever read. Should be required reading not only for the entrepreneurs that I work with, but for myfriends and colleagues in various industries whohave inevitably grappled withmany ofthechallenges that TheLean Startup addresses." —EugeneJ.Huang, partner,TrueNorthVenture Partners "Every entrepreneur responsible for innovation within their organization should read this book. It entertainingly and me ticulouslydevelops arigorous science fortheinnovation process throughthemethodologyof"leanthinking."This methodology provides novel andpowerful tools for companies toimprove the speedandefficiencyoftheirinnovationprocesses through mini mum viable products, validated learning, innovation account ing, andactionable metrics. These tools will help organizations large and small to sustain innovation byeffectively leveraging thetime, passion, andskill oftheirtalentpools." —AndreaGoldsmith, professorofelectricalengineering atStanfordUniversityandcofounderofseveral startups "In business, a 'lean' enterprise is sustainable efficiency inac tion. Eric Ries's revolutionary Lean Startup method will help bringyournewbusiness ideato anend result that issuccessful and sustainable. You'll find innovative steps and strategies for creating and managing your own startup while learning from the real-life successes and collapses of others. This book is a must-read for entrepreneurs who are truly ready tostart some thinggreat!" —Ken Blanchard, coauthorofThe OneMinuteManager® andThe OneMinuteEntrepreneur "Businessis too importanttobelefttoluck. Ericreveals the rig orousprocessthattrumpsluckintheinventionofnewproducts andnewbusinesses.We'vemadethisacenterpieceofhowteams workinmycompany... itworks!This bookis theguided tour ofthe key innovative practices used inside Google, Toyota, and Facebookthatworkinanybusiness." —ScottCook, founder andchairmanof the ExecutiveCommittee, Intuit The LEAN STARTUP The LEAN STARTUP How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses Eric Ries CROWN BUSINESS NEW YORK Copyright©2011byEricRies Allrightsreserved. PublishedintheUnitedStatesbyCrown Business,animprintofthe Crown PublishingGroup,adivisionofRandomHouse, Inc., NewYork. www.crownpublishing.com CROWN BUSINESSisatrademarkandCROWNandtheRisingSun colophonareregisteredtrademarksofRandomHouse, Inc. CrownBusinessbooksareavailableatspecialdiscounts forbulkpurchases forsalespromotionsorcorporateuse. Specialeditions,includingpersonalized covers,excerptsofexistingbooks,orbookswithcorporatelogos,canbecreated inlargequantitiesforspecialneeds. Formoreinformation,contactPremium Salesat(212) [email protected]. LibraryofCongressCataloging-in-PublicationData Ries,Eric, 1978- The leanstartup/EricRies.— 1sted. p. cm. 1.Newbusinessenterprises. 2.Consumers' preferences. 3.Organizational effectiveness. I.Tide. HD62.5.R545 2011 658.1'1—dc22 2011012100 ISBN978-0-307-88789-4 elSBN978-0-307-88791-7 Printedin theUnitedStatesofAmerica Bookdesign byLaurenDong IllustrationsbyFredHaynes JacketdesignbyMarcusGosling 109876543 For Tara