Ash Maurya is the author of two best-selling books, Running Lean and Scaling Lean, and is the creator of the popular one-page business modeling tool Lean Canvas. Maurya is also the CEO and Founder of LEANSTACK, which helps startup accelerators grow their pipeline and create more successful startups. The company provides world-class tools, courses, and training that help early-stage entrepreneurs find repeatable and scalable business models.
The MassChallenge 2021 cohort had the privilege to hear from Ash Maurya and ask him a few questions. Here is a preview of his Q&A with Senior Vice President Cait Brumme. Video below!
Cait Brumme: Let’s start with your big insight. The idea of the lean startup is one that's become common among founders, but when you started, it wasn’t. What's the definition of lean that's important for founders to really center around? How does this change as founders and companies grow?
Ash Maurya: I'll first talk about where the word lean comes from. Eric Ries, who wrote the lean startup book, led the way, and proposed that name. He was inspired by Toyota waste as it was lean thinking and had a big emphasis on waste reduction, so trying to be more efficient and less wasteful.
A lot of people characterize money as being one of those resources to optimize for and that in many ways is not what the lean startup is about. Yes, money is a resource, and we want to be efficient but it's not necessarily bootstrapping or not spending money. When we look at what's the biggest risk in a startup it ends up not being really about money but about learning insights, and so the way that we characterize a lean startup is an organization or a startup that prioritizes what's riskiest in the business as quickly as possible.
For some, that could very well be being cash efficient but it's different for everyone. That's just the big umbrella definition: look at your business model and try to identify the weakest link, the single domino that that if it were to fall your whole business model comes crumbling down and then work on that first. That's how I like to simplify my understanding of lean and how you get to being efficient and less wasteful.
Cait Brumme: Is the Toyota/Andon Cord concept incorporated into the lean methodology… the idea of sort of also calling out error issue as soon as it's visible?
Ash Maurya: There’s the mantra of tolerating a failure only once, so yes. As soon as you see something - and this goes into good systems building - calling out the error. The next step is getting to root causes, because oftentimes we will misdiagnose an error, or we'll only solve a surface issue and not get to the root of the issue. Not unsurprisingly, most problems out there come down to the human level.
There's something that usually must be changed, a mindset that must be affected. If we are not getting to that level, oftentimes we're only fixing a surface issue. So yes, all of those were huge inspirations in the early thinking and building of what became the lean startup.
Cait Brumme: Can you share more about how you guide startups to get to that root cause? As you’re trying to focus on that most critical question and drive rapid learning, how do you coach startups to get below the surface?
Ash Maurya: First is recognition that we are, as humans, but especially as entrepreneurs, I sometimes joke that as humans we can post-rationalize everything, but as entrepreneurs, we are especially gifted at that. We see a problem and surely, it's all these other things – it’s the pandemic, it's the holiday, it's the summer, it's too hot, it's so cold. We come up with all these reasons for bad things happening.
First, you must recognize that that's our instinct, but then you have to go one level deeper. In the Toyota Way, there are the five “why” types of exploration, which is ‘let's ask why this a problem is and go deeper.’ That’s a good logical way to start, but there are some other tools that you can layer on.
Metrics is a big one and in the early stages maybe not as much. I do find that many startups get a bit premature on relying on metrics. In the early days when you've got fewer customers, I would prefer that everyone go and just do more qualitative learning. Go and talk to your customers. In other words, if you can count your customers on your fingers and toes, there's no need for a metrics dashboard. You should just be talking to them almost every day if you can, and the learnings come way faster. That’s another way of getting to those root causes.
You have to be naturally curious. Many times, even a customer will say ‘this is a problem’ and if it aligns with our worldview, we quickly take that and use it as a justification for us to build this next thing. You must go a level deeper.
Watch the full interview with Ash Maurya to learn much more about Lean strategies and the landscape of corporate-startup relationships.