Lean startup - 8 techniques every dev team should know

1. 8 techniques every product development team should know LEAN STARTUP

2. INTRODUCTIONS • Currently CEO of AgileEngine • Co-founder and CTO of Validio (now GlobalLogic Kharkov) • Co-founder and CTO of 2 startups • Author of “Covert Java” book • Developer, architect, entrepreneur, speaker Alex Kalinovsky Agile Engine 2

3. AWARENESS TEST PAY ATTENTION! Agile Engine 3

4. AWARENESS TEST Story of 2 startups Agile Engine 4

5. 5Agile Engine Startup 1 – Boo.com

6. 6Agile Engine ShoeSite.com Startup 2 - Free Shipping on Shoes

7. Which startup did better? 7CreamTec Which one did better?

8. 2 startups side-by-side • 50,000 varieties of shoes • $1 billion in sales • 24 million customers • Acquired by Amazon.com for $1.2 billion 8AgileEngine • $135M spent in 18 months • $500,000 in sales • 609 orders • Liquidated for $250,000

9. Why do it? • The question is not “can this product be built”. In the modern economy, the more pertinent questions are “Should this be built” and “Can we build a sustainable business around it”? 9AgileEngine

10. Introducing Lean Startup • Roots in Toyota • Everyone can be entrepreneur • Startups are best at turning ideas into products in the environment of extreme uncertainty • Lean Startup approach can be used for enterprise architecture, recruiting, QA and sales 10AgileEngine

11. Define Vision 11AgileEngine What do you want to achieve?

12. Establish Strategy • How will you measure progress? • Talk with customers to validate your assumptions • Understand your customer and discover their needs • Value learning over working software 12AgileEngine

13. Lean Approach • What I say is not what I do • Only way to validate is to build and measure • Learn to see waste from value • Lean thinking defines value as providing benefit to the customer; anything else is waste • Ship soon. Learn. Cut waste. 13AgileEgine

14. Build-Measure-Learn Feedback Loop • Core of lean startup • Each iteration tests a hypothesis of value or growth • Minimize time through the loop 14AgileEngine

15. VISION – Experiment • If you cannot fail, you cannot learn • Start with hypothesis/prediction • Test predictions empirically • Science, not alchemy 15AgileEngine

16. Ready to build! 16AgileEngine

17. Dropbox challenge • What to build to test if building Dropbox is a good idea? 17AgileEngine

18. STEER – Leap – MVP • MVP = Minimum Viable Product • Not a prototype – have to measure results • Plan is based on assumptions; goal of iteration is to validate one of more of them • Entrepreneurs dramatically overestimate how many features are need in MVP • When in doubt – simplify 18AgileEngine

19. MVP examples • Video MVP - Dropbox • Concierge MVP – StreetCount • Cheap MVPs allow you to test ideas quickly and iterate. Angry Birds • Low quality is OK for startups because of extreme uncertainty – craigslist.com • Don’t worry about patents, worry about execution • Commit to iteration no matter what for an agreed period of time 19AgileEngine

20. Measure 20AgileEngine

21. Measure • Actionable – must demonstrate clear cause and effect • Accessible – easy to find and understand • Auditable – can be reproduced and verified 21AgileEngine

22. VISION – Experiment – Hypothesis • Value hypothesis tests whether a product really delivers value once users are using it • Measure purchases, returning visitors or contributions • Growth hypothesis tests how new customers will discover product • Measure referrals and invitations 22AgileEngine

23. Measure - Cohort Testing • Which way is this bus headed? 23AgileEngine

24. STEER – Measure – Split Testing • Split Testing to determine a better of 2 versions • Key to validating if something should have been built in the first place • Marketing may be more important than new features 24AgileEngine

25. Learn 25AgileEngine • Was your hypothesis right? • Did metrics improve?

26. PIVOT or PERSEVERE • Pivot – a structured course correction designed to test a new fundamental hypothesis • Don’t get stuck in Zombie land • Example: online activism platform -> The Point -> local pizza coupon -> Groupon 26AgileEngine

27. Lean Approach 27AgileEgine

28. Lean Approach 28AgileEgine Can we improve? • When problem is not really known, we value knowledge over working software • Progress is measured by learning

29. Typical Development Process 29AgileEgine Where is learning?

37. Tendency to overengineer • Interfaces • IOC / DI • Separation of layers and DTOs • Mocks vs test data • (Over)analyzing requirements • Patterns • Excessive use of frameworks 37AgileEngine

38. Agile vs Lean 38AgileEgine • Solution Unknown • Elicit stories from customers • 2-4 week sprints • Continuous integration • Done = working software • Problem Unknown • Validate features with market • Get through the loop as fast as possible • Continuous deployment • Done = validated learning Agile Lean Startup

39. Conclusion 1. Define vision 2. Establish strategy 3. Start with MVP 4. Build a hypothesis 5. Measure metrics 6. Learn from data 7. Build value, cut waste 8. Pivot or persevere 39AgileEngine

40. Credits 1. Eric Ries, Lean Startup 2. Abby Fichter, How Development Looks Different at a Startup 3. The HackerChick Blog 40AgileEngine

41. 41AgileEngine Change the world! Can one person change the world?

42. Company X vs AgileEngine 42AgileEngine • “We hire the best” • “We value our developers” • “We work with latest technologies” • “We innovate” • “Lots of projects” • “Room to grow” • “Trips to US” • “Good work environment” • Pass our development test • Pay at the top end of market • We invent latest technologies • Build products • Interesting projects • Promote from within • Relocation to the US • Best looking girls! Company X AgileEngine

43. 43AgileEngine