There are 150 million startups in the world today with 50 million new startups launching every year.
On average, there are 137,000 startups emerging every day. These are huge numbers by any standards.
But the question remains, how many startups tend to survive the violent waves of change that have completely transformed the very nature of today’s startups?
A seminar on the Lean Canvas held at Nairobi University’s C4D Lab on Friday 15th Feb sought to answer this question.
The speaker, Robert Yawe cited that the critical resources for a startup are time, money, workforce, experience, insights are limited and putting pressure on the founders to optimize the efforts and approach.
He, however, introduced the Lean Canvas, an excellent tool, that if well understood and appropriately applied makes a big difference in appropriating the effort of a startup.
So, what does The Lean Canvas entail and mean to a startup? Well, startups businesses face a lot of challenges right from their incubation stage to their maturity and hence the need for the Lean Canvas.
The Lean Canvas entails of ten main stages which are: Problem, customer segments, unique value proposition, solution, revenue streams, cost structure, key metrics, and lastly unfair advantage.
“Most times startup business fails to be successful in the market because they started at the solution level without finding the problem they want to solve.” Said Yawe.
To break it down, at the problem stage the business starter will need to understand that all the customer segments one ought to work with has their unique problems, so they have to figure a way on how to solve them.
While addressing the issue, unique value proposition chips in as this is the promise of value to be delivered. A startup should major on these key stages before now coming to the fourth stage-the solution.
Finding a solution to the problem is the golden egg! A startup is not going to get this right off the first bat, as that’s what Lean is all about. At this stage, a startup should interview the customer segment, asking them questions, and taking those learnings.
“Listening to the customers complains and seek ways to attend to them. This will help in shaping your business to fit your customers” he said.
He, however, emphasized the need for the company to make necessary changes as the business picks.
“As the company grows and makes steps, always change your narrative’ he reiterated.
Every business needs to figure out on it’s own the channels it will use to reach out to their target clients without thinking about scale but to focus on learning.
Under the revenue streams, this is mostly on business pricing. It is highly determined by the model of the business even though most startups consider lowering their prices to attract customers.
A startups’ final stage is the unfair advantage in which can help when it comes to seeking partners & investors. Unfair advantage can be insider information, a dream team, getting expert endorsements, existing customers, etc.
At the operational stage, the startup should list their costs of operation, their total monthly, and the burn rate before starting to monitor the performance of the business-key metrics.
If the startup company uses the above steps well, then they will be able to be successful in their business.