Founders Programme Session 2 - The power of the Lean Canvas when establishing Product-market fit.
Session 2 of this quarter’s Founders Programme was focussed on The Lean Canvas framework and Product-market Fit. We welcomed back Dharmesh Raithatha, former CPO at Forward, who shared some practical guides and advice on how to nail your product strategy in the early days of your startup.
We’ve rounded up our key takeaways on the Lean Canvas framework below.
What is the Lean Canvas?
We use the Lean Canvas framework in the early stages of a startup’s lifecycle to encourage the founder to think about their business holistically and to identify gaps that need further development or testing. The Canvas doesn’t necessarily need to be completed in full straight away, but it can be used as a tool to steer the founding team’s focus to further refine and improve the overall proposition. This exercise provides founders with a simple way to see any potential problematic gaps or challenges in their strategy, which can then be actioned through further research, learning and development.
Forward Partners Lean Canvas Top Tips.
Make Your Proposition Unique: The way you describe your company to others needs to be quick, punchy and easy to understand. This is important for speaking to your clients, your investors and your employees. Ideally, you want to get to a stage where your customers are speaking to their networks about your product, which is made easier by having a clear and simple value proposition. If you are struggling to craft this statement, focus on doing one thing better than anyone else in the market. Your product may be complex underneath the hood, but for external parties, it’s much easier to focus on one core benefit.
Pick One Customer Segment: You may have more than one target audience, which isn’t a negative thing, it’s important to have a big market of potential customers. However, in the early stages of your product and proposition development, focussing on one key segment means you can build a product they will love rather than a generic tool for a broader audience. Hooking your early adopters and then building out additional product capability for other customer segments allows you to cut through the noise and build your initial customer base quickly. Describe Your Unfair Advantage: Often we see Founders add an unfair advantage to the canvas which will only be achieved with scale, such as we’ll be the market leader, or we’ll have the highest number of customers. It’s important when completing this exercise that you think about your unfair advantage today, related to the skills or experience you have in your team now. These could be advantages like:
- Technical skills.
- Highly Relevant network.
- Domain expertise.
- A 10x product offering.
- Sustainable marketing channels.
- Second-time founders with a successful track record.
How to use the Lean Canvas after completing the exercise: We often lead Lean Canvas workshops for pre-seed and seed-stage founders in the early days of their journey. Having gaps on the Canvas isn’t a deal-breaker for your success, it simply means there are areas that need further development. Once you are happy with the first version of your Lean Canvas, we suggest finding a group of people you trust to give you honest feedback and use them to test the assumptions you have added into the framework.
Once a month, we recommend revisiting your Lean Canvas to see how things have progressed.
- Have you learned something new that may have changed your approach, like a new marketing channel or a new customer segment?
- Do the points on your canvas still make sense to you and your team?
- Are there still gaps on there that mean you may need to think about pivoting?
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