The Lean Startup

owever, learning is cold comfort to employees who are fol owing an entrepreneur into the unknown. It is cold comfort to the investors who al ocate precious money, time, and energy to entrepreneurial teams. It is cold comfort to the organizations—large and smal —that depend on entrepreneurial innovation to survive. You can’t take learning to the bank; you can’t spend it or invest it. You cannot give it to customers and cannot return it to limited partners. Is it any wonder that learning has a bad name in entrepreneurial and managerial circles?

Unfortunately, “learning” is the oldest excuse in the book for a failure of execution. It’s what managers fal back on when they fail to achieve the results we promised.

What if we found ourselves building something that nobody wanted? In that case what did it matter if we did it on time and on budget?

It’s a combination of a whole bunch of innovation happening, but that’s the kind of stuff that’s creating some energy for us, that we think we can truly short-circuit the ramp by kil ing things that don’t make sense fast and doubling down on the ones that do.”

Startups are designed to confront situations of extreme uncertainty. To open up a new business that is an exact clone of an existing business al the way down to the business model, pricing, target customer, and product may be an attractive economic investment, but it is not a startup because its success depends only on execution—so much so that this success can be modeled with high accuracy.

Yet successful startups are ful of activities associated with building an institution: hiring creative employees, coordinating their activities, and creating a company culture that delivers results.

startup is a human institution designed to create a new product or service under conditions of extreme uncertainty

Startups also have a true north, a destination in mind: creating a thriving and world-changing business. I cal that a startup’s vision. To achieve that vision, startups employ a strategy, which includes a business model, a product road map, a point of view about partners and competitors, and ideas about who the customer wil be. The product is the end result of this strategy

We must learn what customers real y want, not what they say they want or what we think they should want. We must discover whether we are on a path that will lead to growing a sustainable business.

Unfortunately, “learning” is the oldest excuse in the book for a failure of execution. It’s what managers fal back on when they fail to achieve the results we promised. Entrepreneurs, under pressure to succeed, are wildly creative when it comes to demonstrating what we have learned.