I recently had the valuable experience of mentoring six companies, along with other mentors and coaches, through the Lean Startup Machine Toronto hosted by INcubes, the business accelerator at which I am managing director. Lean Startup Machine is a three-day workshop franchise that has spread incredibly fast, to 40 cities in North America, through 109 workshops. The workshops teach a very scientific approach to validating business ideas and creating astoundingly viable business models at a rapid pace.

One of the organizers Jason Cheong-Kee-You said, “If you take the position of an impatient aggressive scientist, and you apply this mindset to a small team in a business context, you end up with Lean Startup. Lean Startup is just a series of hypotheses, and a set of experimental methods. It sounds simple, but knowing which questions are the most important to ask, and what methods to use to answer those questions, can save a dramatic amount of time.”

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The workshops guide aspiring entrepreneurs and seasoned ones, who may have never met, into forming teams around a business concept, and then through an iterative process of validated learning, guided by mentors, and pivots, all culminating in a business pitch to a pannel of judges.

One attendee Edwin Frondozo said, “I am still buzzing from the weekend long event. Meeting with industry and thought leaders, young entrepreneurs, corporate folks, all like minded people who are ready to create a new start-up and world.”

You may have heard of other Startup Events such as Startup Weekend. Lean Startup Machine is a new approach that shows the most “validated” results. This is the reason that I encouraged a sponsorship from INcubes of LSM as a host, because I thought a startup accelerator, that is in the business of validating investment opportunities through due-diligence process, benefits greatly by integrating LSM methods. I encourage this with our mentors during INcubes three month curriculum.

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Peter LePiane of Be In Unison, giving a talk.

Seeing the process of LSM in fast-forward of only three days, while partaking as a mentor, is an extreme value for me; a learning by mentoring experience and a chance to observe and note different startup teams approaches to the iterative process. It’s also fascinating to see teams form and the interpersonal dynamics that happen in such an intense three-day course. There is fast team building and cohesion, then fighting, new friendship, strong new bonds, anger, power struggle, mediation, cooperation, leadership; every team dynamic you can think of, happening in the boileroom environment of an LSM workshop.

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What the term “lean” means in this buzz word context refers to a very structured method, a step by iterative step movement through levels of “hypothesis” and “validation” in cycles of build, measure, learn. The now famous Build Measure Learn Loop illustrates, this cycle of learning, building, and evaluating.

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The Validation Board is what is used during the Lean Startup Machine Workshops, to guide a company through the three day process to the end goal of a plan for a hypothetical business model.

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In my decade-plus experience in tech startups and business development, I don’t find this new fad of “lean” new at all. To me, these methodologies have finally been named, quantified, measured, and structured into a teachable methodology in “lean” which I think is fantastic! All internet business’ have used some pieces of this methodology since the beginning of internet business because they had to, just in order to survive, in such a fast paced volatile industry. These methods have been evolving with the internet. As we move from the industrial age into the information age, everything will need to practice such methods to move quickly enough to stay relevant.  Creating a “minimum”, and testing it, just makes good sense in almost every case when creating an experimental business model. It makes the most of energy, time, and money.

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This “lean” methodology, has merged somewhat with “Agile” software development process, which is also iterative, cyclical, and based around “scrums”; team meetings to review measured data, lead by a Scrum Master, and brutally hash out solutions to problems, and plans to move forward iteratively.  “Lean” actually came from industrial manufacturing originally. The Lean Manufacturing System was a streamlined production philosophy that emerged in the 1980s from Japanese automobile manufacturers. A software developer turned manager named Eric Ries out of San Fransisco, wrote a book which coined this movement, and gave names to practices that were evolving out of the business practices of the information age.

Although this methodology can be applied to any industry, it’s being pioneered by tech startups generally who already are immersed in tools that make it so easily possible.

You may have heard of Startup Weekend vrs Lean Startup Machine. There is a big difference between these two events that have a similar spirit. What’s the difference?

  • Startup Weekend is about building products.
  • Lean Startup Machine is about validating business models.

Startup Weekend is “No talk. All action.” and heads down building, mostly in code, resulting in an actual minimum product (most of which are not “viable”). Lean Startup Machine is a workshop and educational series focused on teaching a hands-on, structured methodology to potential founders, resulting in a validated business models.

  • Startup Weekend happens in the building and mostly onscreen.
  • Lean Startup Machine happens outside the building.

Teams are forced by their mentors to “Get Out Of The Building” for an hour or more at a time, on the street, to jury test, and poll, in an effort to gain validation for their riskiest customer assumptions.

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This is why LSM is such an incredible tool for building actual business models that are “validated” to the fullest extend that time and resources allow.

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Gerard Buckley of Jaguar Capital, providing mentorship on presentations.

At the recent Lean Startup Machine Toronto, one of the teams that participated, was an existing company, that took the workshop to learn these lean methodologies.

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In the three days, the existing company, created an entirely new business model for online sales, which took a real world service online in a new way and during the workshop; during the “Get Out Of The Building” sessions, they brought in $3000 of real sales. I think that’s extraordinary proof of the success of LSMs.

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Another of the teams, after posting a preliminary website, were contacted by the Toronto Sun, and this resulted in a published article! Keep in mind that at this point, the company was only a day old. I find that I see these results again and again from LSM. The speed at which viable business models are created in this process is really unprecedented.

“When I first attended Lean Startup Machine, my team of six invalidated three quarters of our business model in a Friday evening. By Sunday, we had someone purchase our product online for $60…not one line of code was written. That wasn’t validation. That was invalidation. It took us a weekend to invalidate that idea rather than months, or possibly years of software development and then failure.” – Jason Cheong-Kee-You

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The main philosophy of the LSM workshops is to teach potential founders to,

“Fail Fast. Succeed Faster.”

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I recommend the Lean Startup Machine workshops to any aspiring entrepreneur to mitigate your riskiest assumptions, and validate your ideas, or better yet, come alone, with no ideas; come to a workshop fresh, with an open mind, and just learn the process. It will serve you well.

 

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