Eric Ries Quotes

The rate of growth depends primarily on three things: the profitability of each customer, the cost of acquiring new customers, and the repeat purchase rate of existing customers. The higher these values are, the faster the company will grow and the more profitable it will be. These are the drivers of the company’s growth model.

Every extra feature is a form of waste, and if we delay the test for these extra features, it comes with a tremendous potential cost in terms of learning and cycle time.

Hidden among these mundane details are a handful of assumptions that require more courage to state — in the present tense — with a straight face: we assume that customers have a significant desire to use a product like ours, or we assume that supermarkets will carry our product. Acting as if these assumptions are true is a classic entrepreneur superpower. They are called leaps of faith precisely because the success of the entire venture rests on them. If they are true, tremendous opportunity awaits. If they are false, the startup risks total failure.

This is an important rule: a good design is one that changes customer behavior for the better.

We must avoid the caricature that science means formula or a lack of humanity in work. In fact, science is one of humanity’s most creative pursuits. I believe that applying it to entrepreneurship will unlock a vast storehouse of human potential.

Compare two startups. The first company sets out with a clear baseline metric, a hypothesis about what will improve that metric, and a set of experiments designed to test that hypothesis. The second team sits around debating what would improve the product, implements several of those changes at once, and celebrates if there is any positive increase in any of the numbers. Which startup is more likely to be doing effective work and achieving lasting results?

What allowed the SnapTax team to innovate was not their genes, destiny, or astrological signs but a process deliberately facilitated by Intuit’s senior management. Innovation is a bottoms-up, decentralized, and unpredictable thing, but that doesn’t mean it cannot be managed. It can, but to do so requires a new management discipline, one that needs to be mastered not just by practicing entrepreneurs seeking to build the next big thing but also by the people who support them, nurture them, and hold them accountable. In other words, cultivating entrepreneurship is the responsibility of senior management. Today, a cutting-edge company such as Intuit can point to success stories like SnapTax because it has recognized the need for a new management paradigm. This is a realization that was years in the making.

Entrepreneurs are everywhere. You don’t have to work in a garage to be in a startup. The concept of entrepreneurship includes anyone who works within my definition of a startup: a human institution designed to create new products and services under conditions of extreme uncertainty. That means entrepreneurs are everywhere and the Lean Startup approach can work in any size company, even a very large enterprise, in any sector or industry.

we could reduce the failure rate by doing fewer projects of higher quality. Others believe that certain people have an innate gift of knowing the right thing to build. If we can find enough of these visionaries and virtuosos, our problems will be solved. These “solutions” were once considered state of the art in the nineteenth century, too, before people knew about modern management.

In my Toyota interviews, when I asked what distinguishes the Toyota Way from other management approaches, the most common first response was genchi gembutsu — whether I was in manufacturing, product development, sales, distribution, or public affairs. You cannot be sure you really understand any part of any business problem unless you go and see for yourself firsthand. It is unacceptable to take anything for granted or to rely on the reports of others.

Once a team is set up, what should it do? What process should it use? How should it be held accountable to performance milestones?

They had “achieved failure” — successfully, faithfully, and rigorously executing a plan that turned out to have been utterly flawed.

Compared to a lot of startups, the Grockit team had a huge advantage: they were tremendously disciplined. A disciplined team may apply the wrong methodology but can shift gears quickly once it discovers its error. Most important, a disciplined team can experiment with its own working style and draw meaningful conclusions.

engineers agree to adapt the product to the business’s constantly changing requirements but are not responsible for the quality of those business decisions.

Because startups often accidentally build something nobody wants, it doesn’t matter much if they do it on time and on budget.