Name an entrepreneur who doesn’t want to breathe life into a startup that becomes the next Airbnb-level unicorn. Unfortunately for many startup creators, they can’t follow the same...
Think about your startup realistically. Remember that you’re not looking to confirm your assumptions, but want to test the validity of your idea.
Concentrate on main points, make sure to be concise and don’t take too long considering what goes into sections. Use guiding questions to help you not to get stuck and learn more about what Lean Startup Canvas segments represent.
Canvas creation is an iterative process. Print or send your Canvas to the team and come back with corrections and suggestions.
What is a lean canvas?
The Lean Canvas is a version of the Business Model Canvas, that was optimized for startups. Created by Ash Maurya, CEO and Founder of LEANSTACK, the Lean Canvas follows the idea of the Lean Startup. Eric Reis, who introduced the concept, describes the Lean Startup as an approach to running an efficient new business. Its main principles are
- handling uncertaintly, meaning immediately starting marketing efforts,
- validated learning or making discoveries as you go, and
- innovation accounting by keeping in mind your success metrics.
The Lean Canvas is a one-page diagram consisting of nine boxes, which startup founders can fill to describe, share, and easily adjust their business model. As a more flexible alternative to a business plan, the Canvas allows you to make assumptions about your future business and iterate on the go.
What are the elements of Lean Canvas?
All nine elements of the Lean Canvas include:
- Problem. Here, you describe what pain points your potential customers have and if there are existing solutions that fail to solve them.
- Customer segments. This is where you define your target audience by narrowing down your potential customer base to the early adopters.
- Unique value proposition (UVP). In this section, formulate how your product is different from the alternatives using keywords.
- Solution. Here, identify the features that will solve the aforementioned problem.
- Communication channels. Fill this box with ideas on how you will promote your product and spread the news about it.
- Revenue streams. Use this section to list all the ways your product will be making money. Watch our video on revenue models to help you with that.
- Cost structure. Here, write your fixed and variable costs.
- Key metrics. Choose a few product KPIs to focus on and help you evaluate progress.
- Unfair advantage. Consider what unique features will make your product hard to duplicate, such as exclusive deals and partnerships or cutting edge technology.
What makes a good Lean Canvas?
Don’t be too contemplating when filling out the Canvas. All ideas will need to be validated so nothing is set in stone before you’ve proven that it works. A good Lean Canvas is the one that will inspire you and your team to look for solution rather than staring at the board for days on end.
What’s the difference between Lean Canvas and Business Model Canvas?
When creating the Lean Canvas, Ash Maurya used almost the same elements as the Business Model Canvas, apart from Key Partners, Key Activities, Key Resources, and Customer Relationships, which he replaced to capture the uncertainty of the startup environment. Here’s what the new sections were meant to address.
The Problem is meant to prevent startups from making the mistake of not finding the right product/market fit. That’s why you start filling out the Canvas by finding what the market is lacking.
The Solution should be defined after. The limited space in the box should constrain entrepreneurs and make them consider every idea, not just the one they like the most.
The Key Metrics must make you think about how you define success from the ground up. At what point do you know that your startups is going to make it? Or what will help you understand that you’re failing before it’s too late? We talk in detail about measuring product success in our video.
Finally, the Unfair Advantage addresses how the startup today can succeed largely to its difference from similar products and how hard it is to replicate that difference.