The Lean Startup — Eric Ries
Core Thesis
Startups operate under extreme uncertainty. The goal is not to build a perfect product — it’s to LEARN as fast as possible through the Build-Measure-Learn loop. Everything else is waste.
Key Principlesflashcards
What is the Build-Measure-Learn loop? ?
- Build — create a minimum viable product (MVP)
- Measure — collect data on how customers actually use it
- Learn — did we validate or invalidate our hypothesis? Then decide: persevere or pivot. The goal is to minimize TOTAL TIME through this loop, not to optimize any single step.
What is an MVP and what is it NOT? ? An MVP is the smallest thing you can build to learn whether your hypothesis is true. It is NOT:
- A crappy version of your full vision
- A prototype to impress investors
- A feature-reduced product It’s an experiment. It can be a landing page, a concierge service, a video, a spreadsheet. The question is: what do I need to learn, and what’s the cheapest way to learn it?
What is the difference between “vanity metrics” and “actionable metrics”? ? Vanity metrics: total signups, page views, downloads — they go up and to the right and feel good but don’t tell you if your business is working. Actionable metrics: conversion rate, retention, revenue per user — they tell you if a specific change had a specific effect. If a metric doesn’t change your behavior, it’s vanity.
What is a “pivot” and how do you know when to do one? ? A pivot is a structured course correction — changing one element of your strategy while keeping what you’ve learned. Signs you need one:
- Experiments show diminishing returns
- Metrics plateau despite effort
- You’re growing but customers aren’t retaining Types: zoom-in, zoom-out, customer segment, channel, technology pivot. A pivot is NOT failure — it’s learning operationalized.
What is “innovation accounting”? ? A framework for measuring progress in a startup where traditional accounting doesn’t work:
- Establish the baseline — where are your metrics today?
- Tune the engine — run experiments to move the metrics
- Decide: pivot or persevere — are the metrics improving toward the business model you need? This replaces “trust me, it’s going well” with actual evidence.
Situations
- product-strategy, experimentation, prioritization, decision-making, stakeholder-communication, roadmap-planning, killing-projects