Two weeks ago, at the First Growth Network, we discussed Lean Start Up Methodology – experienced entrepreneurs shared their stories with newer startups to inspire, educate and mentor. Championed by Steven Blank in The Four Steps to the Epiphany, the customer development process gave birth to the lean startup movement over the past year. I have read the books, attended many of the talks and have written about lean before.
Sitting in the conference room hearing some wild stories about the bubble days, I realized all the companies discussed were enterprise companies – not consumer companies.
Enterprises demonstrate a structured way of thinking about problems and products to solve problems (see the diagram above):
- An enterprise can clearly articulate a problem: My database can’t handle the query volumes of the new business intelligence tool.
- An enterprise has a defined budget for solving a problem: The storage budget this year is $5M. We can spend 10 to 20% on new databases, if the database cuts cost elsewhere.
- An enterprise will pilot products and iterate with a vendor: Let’s run a 6 month consulting engagement/pilot to evaluate if this new database solves the problem.
- Enterprise needs tend to be iterative rather than disruptive.
Successful tech consumer products very rarely demonstrate any of these characteristics, let alone all of them. New forms of communication like Facebook, Skype, Twitter, Posterous, Scribd were built by entrepreneurs who had a vision of the way a consumer ought to do something. This vision may have been defined by consumer feedback but the entrepreneur did not have the benefit of the structured thinking and logical decision making of the enterprise. Moreover, brand, positioning and user experience are much more important to consumers than to enterprises, particularly at the early stages of product development.