Decentralyze

I’m disappointed in the pace of development of the Semantic Web, and I’m optimistic that the Lean Startup ideas can help us move things along faster.

I’ve been a fan of Eric Ries and the Lean Startup ideas for while, but last night I was lucky enough to get to see him speak, and to chat with some other adherents. There are a lot of ideas here, but the bit that jumps out at me today is this, loosely paraphrased:

Reality distortion fields are bad. Instead of using charisma, style, and emotions to motivate your colleagues to act on faith, motivate them with experimental evidence.

I think we have scant evidence that the Semantic Web will work, and that most of us have been working on this as an act of faith. We believe, without solid evidence, that it can work and will be a good thing when it does. You could say we’re operating in an RDF (resource description framework) RDF (reality distortion field).

The Lean Startup methodology says that we should get out of that field as quickly as possible, doing the fastest experiments possible that will teach us what really works and does not work. On faith we can do 5+ year projects, hoping to show something interesting. Instead, we should be doing ❤ month projects to test a hypothesis about how this is all going to be useful.

It’s a shame that most of us are funded in ways that don’t support or reward this at all. It’s a shame the research funding agencies operate on such a glacial and massive scale; in many ways they seem geared more towards keeping people busy and employed than actually innovating and producing knowledge for the world.

Below are my notes taken during Eric’s talk. I have not cleaned them up at all, so you can see just how badly my fingers spell “entrepreneur” when my brain has moved on to something else. I believe slides and the talk itself are available on line; it’s a talk he often gives, so if you have the time, watch it instead of just skimming my notes. (eg this one at Stanford.) Someone else with much better formatting and spelling posted their notes from last night’s talk. You probably want to read them instead, and then come back here and share your insights with us.

$$ Thu Jan 27 18:20:41 EST 2011 ((( EricReis

2 yrs ago at Hobies in palo alto, 6 people, first talking about this...

silicon valley is parochial, rarely getting out of the bublle.

#leanstartup

new conversation -- what is entrepreneurship.

strsaight from unhear of to overhypes, without people having learned about it.

put entreneurship on a more solid footing.

What is a startup?

     A startup is a human institution deseigned to delivera a new
     product or service under conditions of extreme uncertainty.

Nothing to do with size of company, sector of the economigy, or
industry.

ALL THE BORING STUFF, and how to get better at it.

    Startup = Experiment

Web 2.0 chart --- lots failed at 3 years.

they all failed for BAD reasons.

and how many really lived up to their potential....???!!!   SO FEW.

"If you do everything I did, you can fail like I did."

We need a giant industrial support group.

"Hi, I'm eric, and most of my startups failed."

It's all Taylor's fault.  :-)
father of scientific management.

1911.   birth of management
"In the past, the man was first.  In the future, the system will be first."

"Work should be done efficiently"
"Work should be divided into tasks"
"It's possible to organize craftsmen"
   Management by exception -- only have them report their exceptions.

  Now, decomposing work into tasks is 100 years old.

Everything in this room was constructed under the supervision of managers trained by Taylor and his disciples.

Shadow Beliefs:
   * We know what customers want   (reality distortion field)
   * We can accurately predict the future
          just dont believe the hockey stick spreadsheet
   * Andvancing the plan is progress
         eg keep everyone busy, write code, do your functional job!
	 -- if we're building something no one wants, is it progress!

           [[ NO -- real progress is LEARNING ]]


The Lean Revolution   (Lean Manufacturing)
    W E Demming,    Taiichi Ohno

it's not Tim Quality Money -- pick two

we can get all three by being customer focused.

Agile Development

Alas, Agile development comes out big IT departments.

works IF you know what the customer really needs.


Steve Blank.    
     Customer Development
     Agile (Product) Development

imvu story
      im networks -- join them all.

      he wrote this, in 6 months, to ship to customers.
      5 years before that.

      had to pivot to standalone network.

      GREAT code, but no one wanted it.

claim to have learn something -- about to get fired.  :-)

learning is a 4 letter word in management
     -- bad plan -- fired
     -- failure to execute -- fired

Ask yourself: IF my goal was to learn this, could I have done this
without writing the code?

YES --- just make the landing page!!!

As an entrepreneur, you NOT LONGER HAVE a FUNCTIONAL DISCINPINE.
   you do whatever you need to to get there

Entreprenursip is management

  + OUR GOAL is to create an institution, not just a product
  * traditona lamangement preactices fail.  (mba)
  * nee entrepeurial managemt -- working under extreme uncertainyu

The Pivot --- SUDDENLY overhyped.

YOU MUST be able to do this.    The successes can do this.
They can find the good ideas from the bad, inside the distortion field.

SPEED WINS.
   how many pivots you have left.

   if we can reduce the time betwwen pivts,
   we can increas the odds of our success.

BUILD -> MEASURE -> LEARN

startup=    turns ideas into code

IF YOU DIDNT BUILD ANYTHING, you cant pivot
IF YOU DIDNT TEST IT WITH CUSTOMERS, you cant pivot

MINIMIZE total time through the loop.  Cycle time dominates.

gnl mgmt is about efficiency, not cycle time.

GOING THROUGH THE LOOP -- thats how you you settle arguments between founders.

How much design -- a reasonable balance.

FIVE principals.

   -- entreps are everywhere
   
         anywhere we seek out uncertainty
	 which is everywhere, given uncertainty from IT rev.

   -- entrp is mgmt
   
   -- validated learning

   -- innovation accounting

        normally just compliance reporting

	but:  drive accountablity -- hold mgrs accountable
	GM = "std volume"  to compute how many cars each division
	is expected to sell.   allows gm to give bonuses.

	NOT good for entreps.

	"success theater"      (cumulative total registrations  Heh.)

	ACTIONABLE METRICS, per customer, NOT VANITY METRICS.

	facebook per-customer behaviors were exciting.  Customers were
	heavily engaged in voluntary exchange with company.  And very
	viral.
	
		NEED an accounting paradigm for entrps to prove
		they've done validated learning.

		so you never take credit for random stuff, but only
		take credit for what you derve it for.

   -- build measure learn


HOW do we know when to pivot?

    as if it were obvious when there's a failure.

    land of the living dead.   

    persevere straight into the ground.

    Right answer: (acocunting)
    	  pattern, like in science, 
	  when the experiments are no longer very productive.
	  If When we can't move the needle very much.

Vision, Strategy, or Product
	- what makes a great company?
	500 Auto companies before Ford!!!
	they didnt have the right process.

	Vision doesnt change.  it's about changing the world.
	Strategy is how to build a business around that.

	product dev == optimization

	pivot is changing strategy, not vision.

	THERE is not testing The Vision.  We're NOT trying to
	elimintate vision.

What should we measure?  How do products grow?

     Entrp. accounting

Are we creating value?

What's in the MVP?

       - should a feature be in or out?  Out.

Can we go faster?

NEW BOOK.

================================================================

lean.st/LeanStartupBos

startuplessonslearned

$$ Thu Jan 27 19:53:19 EST 2011 

How do you keep engineers having faith in the process given MVP.

How to manage engineers under uncertainty?

    1.   Keep them calm.   Heads down, cranking out code.

    [reeks of frd taylor.]

    2.   Enlist all functions in process of discovering if on right track.
    	 
	 ABANDON Reality Distorion Field.

	 People will be way more creative if they know what's going on.

	 The truth will set you free.

================

Q: Newbie: use of the term "movement"

Eric: I dont want other people to to be doing this.

Eric: I used to be a coder.   What do I do now???

there IS something going on worldwide.   this is science, not religion.

lets be careful.

  if it works for entrepreneur, it's part of Lean Startup.

We're learning a lot over the past two years.

The movement is not me -- the movement is you guys testing these ideas, in changing the world.

this is NOT about proprietary advantage.

Eric used to think the right way to change the world was get the VCs to
evangelize.   Sooooo dumb of me.

vc:  "im not that interested in improving the world, just my profolio"

But now, we should do science.  If we all do it, we'll all improve the
world and live in a better world.

Q: how to test ideas people are not searching for.

eg dropbox -- no one knows they want it.

If customers dont know they have the problem and know the name of it,
you have to find a new way.

at imvu, people didnt know it "outbound is the new inbound" we did ad
compaigns, $5/day, buying keywords of every adjacent product, "*" +
chat.  And drove people to our landing page.  We wanted to learning
the differeences in convertion between these channels.

dropbox's MVP was a video, aimed at DIGG users.  Drove people to
waiting list, beta users.
   justin tv  sl conf  video

================

MBAs.

how much do MBAs need to re-learn?

er: I'm doing entreprenur in residence at harvard business school.

but why waste time with MBAs?

"what do people say about us when we're not in the room?"

MBAs have one big advantage:  very process and discipline oriented.

if you dont have some failures, yo dont learn.

you need to be able to tell what change to the product/market caused
the numbers to change.  IT HAS TO BE A VALID SCIENTIFIC EXPERIMENT.

================

Some new stuff:

the right things to measure are clear and consistent across all startups.

 1.  value test -- do you know it creates values

 2.  working enging of growth.

two feedback loops:
   -- eg loop in cylendar engine, and driver-and-surroundings
   write down how to get to work == taylor plan

three engines of growth

  -- paid.   you make a $1 per customer, and they cost $0.50 to buy
      (have to be able to buy customers)

  -- viral.   as a necessary consequence of customer using it, they
    get their friends to use it.  "someone has tagged you in a photo"
    you HAVE to click on that.   even some fashion busineses.  
    they "grow themselves" bye xploiting bug in human naturo

   -- sticky, engagment.  addictive, network effects, lockin, ebay,
      wotw, compounding interest.  so small viral can compound it, if
      sticky enough.

================

easily replicated product, get to market first?

fear: someone will steal my idea.

So: take your second best idea, and try to get someone to steal it.
TRY to get them to steal your idea.    PEOPLE dont steal ideas.

IT SEEMS NUTS, BUT ITS TRUE.

You need a good idea.

Threat by big company to clone you -- they poached a co-founder --
came out with exacty product two years delayed.  $100m failure for
them.

FIRST mover advantage is very rare in reality.     (!!!)

================

one person from each company.   how to get whole company to buy in?

people often say: that's a really great idea for someone else to do.

the issue is the WORK is a system.  Your company is a perfect robust
system, stable.  very very hard to change -- must be planned
carefully.

try to find one area where there is painful uncertainty, and say there
is a community of people trying science to solve this problem.

every nods at maximize speed through the loop.

BUT if you do that, you will MAKE PEOPLE FEEL INEFFICNENT.  People
will be interrrupted to do things "not their job".  There will be a
team powwow where people say they hate it making them less efficient.
NEED people bought into theory -- understanfing the value of VALIDATED
LEARNING.  Only do this where you have authority, maybe just yourself.

================

How does Lean Startup affect managment & sales force.  Lab Equipment
company. --- "sales people are whiners" Really, customers were giving
great feedback, and non of that was making it back to management.

4 steps to ephinary -- steve blanks book -- perfect on enterprise sales.

YOU CANNOT DELEGATE customer development.  founders and senior mgmt
have to be in the room with the customers, at least some of the time.

Salespeople arent supposed to be good listeners.

Mgrs should DO THE SALES THEMSELVES.  THe goal is not to make money,
it's to get validated learning....

ONCE we understand how to do the sales, THEN give it to the salesfolk,
as per Steve Blank.

if using sales force, you are doing Paid Engine Of Growth.

================

Q: I have a product that people havnts paid for.  mainstream product.
personal keepsake.  needs to look really good.  hard to measure.
style counts.  what's mvp in that scenario.

why cant you do a landing page.

  keepsake book.

goal of MVP --- least amount of work to learn what needs to be
learned.  such as whether customers will pay.   eg get pre-orders.

you can always test demand through fake landing pages.

"Concierge" from food-on-the-table.  did it all by hand, until they
figured out what folks REALLY wanted.

PEOPLE will not truthfully answer what they would do.  "Would you buy
this" turns out to be TERRIBLE DATA.

**** YOU ALWAYS CAN TEST


requires VERY difficult risking rejections.     CUSTOMER SERVICE HURTS!!!

* Eric *HATEs* customer feedback *

does he really want to know what you thought about today's talk?  No!!!

================

When collective feedback, its NOT ABOUT YOU, it's about the person
giving it to you.

"product is okay" means "product sucks but I'm polite"

================


very very hard.      but rewards are emense.

think about all the people utterly wasting their time.

let's redeem them;  make it happen!.

$$ Thu Jan 27 20:35:27 EST 2011 )))