The Lean StartUp

advertising

Many viral products do not charge customers directly but rely on indirect sources of revenue such as _________________.

one

Successful startups usually focus on ______ engine(s) of growth, specializing in everything that is required to make it work.

True

T/F Entrepreneurs need a personal stake in the outcome of their creations.

True

T/F We must be willing to set aside our traditional professional standards to start the process of validated learning as soon as possible.

Vanity metrics

_________ can allow entrepreneurs to form false conclusions and live in their own private reality.

Innovation accounting

____________ enables startups to prove objectively that they are learning how to grow a sustainable business.

Innovation Accounting

______________ , a quantitative approach that allows us to see whether our engine-tuning efforts are bearing fruits.

strategy

If the numbers for early experiments don't look promising, there is clearly a problem with the _________.

mentors

If the performance of the mentor and mentee are linked, it will ensure that the ___________ take education seriously.

cost per acquisition (CPA)

Suppose and advertisement costs $100 and causes fifty new customers to sign up for the service. This ad has a ____________ of $2.00.

True

T/F Companies are able to design, develop, and ship out new features one at a time, taking advantage of the power of small batches.

True

T/F If we do not know who the customer is, we do not know what quality is.

False

T/F If you are building the wrong thing, optimizing the product or its marketing will yield significant results.

False

T/F If you are causing (or missing) quality problems now, the resulting defects won't slow you down later.

False

T/F Pivots are a permanent fact of life for any growing business. Unless they achieve initial success.

True

T/F Startup organizations must attempt to tune the engine from the baseline toward the ideal.

True

T/F Startup success can be engineered by following the right process, which means it can be learned, which means it can be taught.

False

T/F Startups are different - too much budget is as harmful as too little.

True

T/F Startups need to conduct experiments that help determine what techniques will work in their unique circumstances.

False

T/F Strategic planning takes months to complete and experiments should not begin until it is completed.

True

T/F The amount of time a company can count on holding on to market leadership to exploit its earlier innovations is shrinking.

True

T/F The author felt he had committed the biggest waste of all - "building a product that our customers refused to use."

True

T/F We must learn the truth about which elements of our strategy are working to realize our vision and which are just crazy.

False

T/F With proper managerial structure innovation is a top-down, centralized, and predictable thing that can be managed.

to test fundamental business hypothesis

The MVP's ultimate goal is to ________________.

engine of growth

The ______________ is the mechanism that startups use to achieve sustainable growth.

churn rate

The __________________ is defined as the fraction of customers in any period who fail to remain engaged with the company's product.

synthesis

The author adopted the view that their job was to find ________________ between their vision and what customers would accept.

unrelenting

The imperative for new startups to innovate is ______________.

smaller and larger

The investment shoud be _________ when the symptom is minor and ______ when the symptom is more painful.

you have zero revenue, zero customers, and zero traction

The irony is that it is often easier to raise money or acquire other resources when you have _________________.

waste

The lesson of the minimum viable product is that any additional work beyond what was required to start learning is ___________, no matter how important it might have seemed at the time.

easier

The more specific the symptoms are, the _________ it will be for everyone to recognize when it's time to schedual a Five Whys meeting.

small batches

The one envelop at a time approach is called "single-piece flow" in lean manufacturing. It works because of the surprising power of _______________.

pivot

Without a formal growth model, many companies get caught in the trap of being satisfied with a small profitable business when a ______ might lead to more significant growth.

Delay

______________ prevents many startups from getting the feedback they need.

Engines of growth

________________ are designed to give startups a relatively small set of metrics on which to focus their energies.

analysis paralysis

A common problem entrepreneurs can fall victim to is _______, endlessly refining their plans.

conditions of extreme uncertainty.

A startup is a human institution designed to create a new product or service under ____________________.

pivot or persevere

After the startup has made all the micro changes and product optimizations it can to move its baseline toward the ideal, the company reaches a decision point. At this point they _________________.

All of these are ways past customers drive sustainable growth. Through repeat purchase or use. Word of mouth. As a side effect of product design. Through funded advertising.

All of the following are primary ways past customers drive sustainable growth EXCEPT

economies of scale

Because the Japanese car market after the war was so small and capital was not available, they were unable to do mass production and take advantage of ______________.

run out of resources and die

Startups are in a life-or-death struggle to learn how to build a sustainable business before they ______________________.

True

T/F In the Lean Startup model, an experiment is more than just a theoretical inquiry; it is also a first product.

False

T/F Innovation accounting will still work even if a startup is being misled by vanity metrics such as gross number of customers and so on.

True

T/F Lean Startup is a principled approach to new product development.

True

T/F Most of the time customers don't know what they want in advance.

False

T/F Most tools from general management are designed to flourish in the harsh soil of extreme uncertainty in which startups thrive.

True

T/F New start-up organizations should be committed to making mistakes.

True

T/F Once IMVU's efforts were aligned with what customers really wanted, their experiments were much more likely to change their behavior for the better.

True

T/F One of the most vexing aspects of the minimum viable product is the challenge it poses to traditional notions of quality.

False

T/F The author Eric Ries explains "hard work and perserverance does lead to success.

False

T/F The author agrees that a good plan, a solid strategy, and thorough market research works for startups.

True

T/F The challenge of entrepreneurs is to find ways to achieve the same amount of validated learning at lower cost or in a shorter time.

True

T/F The goal of a startup is to figure out the right thing to build - the thing customers want and will pay for - as quickly as possible.

True

T/F The higher-quality of the existing playbook is, the easier it will be for it to evolve over time.

True

T/F The importance of small-batch approach produces a finished product every few seconds, whereas the large-batch approach must deliver all the products at once, at the end.

tests

The "growth hypothesis" _______ how new customers will discover a product or service.

tests

The "value hypothesis" __________ whether a product or service really delivers value to customers once they are using it.

continuous

The Build-Measure-Learn feedback loop is a __________ process.

customers often don't know what they want.

The Lean Startup Model often works because _______________.

thoroughly immediately rigorously

The Lean Startup model offers a way to test an organization's hypotheses __________.

the challenges it faces

The Lean Startup works only if we are able to build an organization as adaptable and fast as ____________.

managerial discipline

Entrepreneurship requires a ______________ to harness an entrepreneurial opportunity.

worse, better

The author finds that when switching to validated learning, it feels ________ before it feels ___________.

most extreme position

The best way to influence the boss and get what you want is to take the ___________ possible.

quality problems can be identified much sooner

The biggest advantage of working in small batches is that ___________________.

which activities create value and which are a form of waste?

The critical first question for any lean transformation is:

a clear-eyed and objective mind-set

The decision to privot requires a ___________________.

larger

The focus of each team is iterating with customers as rapidly as possible, running experiments, and then using validated learning to make real-time investment decisions about what to work on. No team is _________ than five people.

a crisis

If you reach the limits for new customer growth (they are exhausted) and the growth suddenly slows, it provokes ______________.

product/market fit

Marc Andreessen coined the term ___________ to describe the moment when a startup finally finds a widespeard set of customers that resonate with its product.

more

On an average each person who signs up will bring, on an average _______ than one other person with him or her.

faster than anyone else can

The reason to build a new team to pursue an idea is that you believe you can accelerate through the Build-Measure-Learn feedback loop __________.

time

Under pressure, teams may feel that they don't have _______ to waste on analyzing root causes even though it would give them more time in the long term.

pivot

The more money, time, and creative energy that has been sunk into an idea, the harder it is to _________.

early adopters

The point is not to find the average customer but to find ___________: the customers who feel the need for the product most acutely.

learning

__________ is the oldest excuse in the book for failure of execution.

value

The __________ hypothesis tests whether a product or service really delivers value to customers once they are using it.

delaying the decision to pivot

The following are all examples of ______________: 1. Vanity metrics 2. Unclear hypothesis 3. Fear

vision

The goal of every startup experiment is to discover how to build a sustainable business around the entrepreneur's ______________.

adaptive

A ___________ organization is one that automatically adjusts its process and performance to current conditions.

minimum viable product

A ______________ is the fastest way for entrepreneurs to learn.

at the same time

As startups grow, entrepreneurs can build organizations that learn how to balance the needs of existing customers with the challenges of dinding new customers to serve, managing existing lines of business, and exploring new business models - all ____________.

ground rules

It is important to focus on establishing the _________ under which autonomous startup teams operate.

whole process

Lean Management requires treating work as a system and then dealing with the batch size and cycle time of the ___________.

False

T/F A head start is usually large enought to matter, and tyime spent in stealth mode - away from customers -is likely to provide a head start.

True

T/F A solid process lays the foundation for a healthy culture, one where ideas are evaluated by merit and not by job title.

a "just do it" attitude

This approach leases to chaos more often than it does success.

the right things to build

This is true startup productivity: systematically figuring out _______________.

to pivot or persevere

Upon completing the Build-Measure-Learn loop, startups confront the most difficult question any entrepreneur faces:

pivot

When a company _______, it starts the process all over again, reestablishing a new baseline and then tuning the engine from there.

classic startup trap

When an organization is successful in their early efforts and ignore the principles behind their success, they have fallen into the ______________.

feedback loop

When an organization starts making cuts that result in a slowdown of the ___________, all they have accomplished is to help the startup go out of business more slowly.