How To Build a Web Startup – Lean LaunchPad Edition

If you’re an experienced coder and user interface designer you think nothing is easier than diving into Ruby on Rails, Node.js and Balsamiq and throwing together a web site. (Heck, in Silicon Valley even the waiters can do it.)

But for the rest of us mortals whose eyes glaze over at the buzzwords, the questions are, “How do I get my great idea on the web? What are the steps in building a web site?”  And the most important question is, “How do I use the business model canvas and Customer Development to test whether this is a real business?”

My first attempt at helping students answer these questions was by putting together the Startup Tools Page – a compilation of available web development tools. While it was a handy reference, it still didn’t help the novice.

So today, I offer my next attempt.

How To Build a Web Startup – The Lean LaunchPad Edition

Here’s the step-by-step process we suggest our students use in our Lean LaunchPad classes.

  1. Set up the logistics to manage your team
  2. Craft company hypotheses
  3. Write a value proposition statement that other people understand
  4. Set up the Website Logistics
  5. Build a “low-fidelity” web site
  6. Get customers to the site
  7. Add the backend code to make the site work
  8. Test the “problem” with customer data
  9. Test the “solution” by building the “high-fidelity” website
  10. Ask for money

(Use the Startup Tools Page as the resource for tool choices)

Step 1: Set Up Team Logistics

Step 2. Craft Your Company Hypotheses (use the Lean LaunchLab)

Step 3: Write a value proposition statement that other people understand

  • If you can’t easily explain why you exist, none of the subsequent steps matter.  A good format is “We help X do Y by doing Z”.
  • Once you have a statement in that format, find a few other people (doesn’t matter if they’re your target market) and ask them if it makes sense.
  • If not, give them a longer explanation and ask them to summarize that back to you.  Other people are often better than you at crafting an understandable value proposition.

Step 4: Website Logistics

  • Get a domain name for your company. To find an available domain quickly, try Domize or Domainr
  • Then use godaddy or namecheap to register the name. (RetailMeNot usually has ~ $8/year discount coupons for Godaddy You may want to register many different domains (different possible brand names, or different misspellings and variations of a brand name.)
  • Once you have a domain, set up Google Apps on that domain (for free!) to host your company name, email, calendar, etc
  • Read Learning how to code

 For coders: set up a web host

  • Use virtual private servers (VPS) like Slicehost or Linode (cheapest plans ~$20/month, and you can run multiple apps and websites)
  • You can install Apache or Nginx with virtual hosting, and run several sites plus other various tools of your choice (assuming you have the technical skills of course) like a MySQL database
  • If you are actually coding a real app, (rather than for class) use a “Platform As A Service” (PAAS) like Heroku, DotCloud or Amazon Web Services if your app development stack fits their offerings
  • BTW: You can see the hosting choices of YCombinator startups here

Customer Discovery for the Web

Step 5: Build a Low-Fidelity Web Site

  • Depending on your product, this may be as simple as a splash page with: your value proposition, benefits summary, and a call-to-action to learn more, answer a short survey, or pre-order.)
  • For surveys and pre-order forms, Wufoo and Google Forms can easily be embedded within your site with minimal coding.

 For non-coders:

For coders: build the User Interface

Step 6: Customer Engagement (drive traffic to your preliminary website)

  • Start showing the site to potential customers, testing customer segment and value proposition
  • Use Ads, textlinks or Google AdWords, Facebook ads and natural search to drive people to your Minimally Viable web site
  • Use your network to find target customers – ask your contacts, “Do you know someone with problem X? If so, can you forward this message on to them?” and provide a 2-3 sentence description
  • For B2B products, Twitter, Quora, and industry mailing lists are a good place to find target customers. Don’t spam these areas, but if you’re already an active participant you can sprinkle in some references to your site or you can ask a contact who is already an active participant to do outreach for you.
  • Use MailchimpPostmark or Google Groups to send out emails and create groups
  • Create online surveys with Wufoo or Zoomerang
  • Get feedback on your Minimum Viable Product (MVP) features and User Interface

Step 7: Build a more complete solution (Connect the User Interface to code)

Step 8: Test the “Customer Problem” by collecting Customer Data

  • Use Web Analytics to track hits, time on site, source.  For your initial site, Google Analytics provides adequate information with the fastest setup.  Once you’ve moved beyond your initial MVP, you’ll want to consider a more advanced analytic platform (Kissmetrics, Mixpanel, Kontagent, etc)
  • Create an account to measure user satisfaction (GetSatisfaction, UserVoice, etc.) from your product and get feedback and suggestions on new features
  • Specific questions, such as “Is there anything preventing you from signing up?” or “What else would you need to know to consider this solution?” tend to yield richer customer feedback than generic feedback requests.
  • If possible, collect email addresses so that you have a way to contact individuals for more in-depth conversations.

Step 9: Test the “Customer Solution” by building a full featured High Fidelity version of your website

  • Update the Website with information learned in Step 5-8
  • Remember that “High Fidelity” still does not mean “complete product”. You need to look professional and credible, while building the smallest possible product in order to continue to validate.
  • Keep collecting customer analytics
  • Hearing “This is great, but when are you going to add X?” is your goal!

Step 10: Ask for money

  • Put a “pre-order” form in place (collecting billing information) even before you’re ready to collect money or have a full product.
  • When you’re ready to start charging – which is probably earlier than you think – find a billing provider such as Recurly, Chargify, or PayPal to collect fees and subscriptions.

For all Steps: Monitor and record changes week by week using the Lean LaunchLab

For Class: Use the Lean LaunchLab to produce a 7-minute weekly progress presentation

  • Start by putting up your business model canvas
  • Changes from the prior week should be highlighted in red
  • Lessons Learned.  This informs the group of what you learned and changed week by week – Slides should describe:
  1. Here’s what we thought (going into the week)
  2. Here’s what we found (Customer Discovery during the week)
  3. Here’s what we’re going to do (for next week)
  4. Emphasis should be on the discovery done for that weeks assigned canvas component (channel, customer, revenue model) but include other things you learned about the business model.

———

If you’re Building a Company Rather Than a Class Project

———

Thanks for the comments, suggestions, corrections, and additions. Updates added.
Listen to the post here: Download the Podcast here

57 Responses

  1. Thanks Steve for sharing this.

  2. Great information! One more thing that I would add under step 3 is:

    Add deployment process for testing and staging environments which allow you to be super agile. Similar to Google appengine, if updating your environment is a one command step, it greatly helps in the future when you are trying to rapidly release. For Rails there is capistrano, Fabric for Django etc.

  3. Years back they called it vaporware –software sold before it existed. I am of the belief that you sell it first — get a check and then build it.

    So how do you do this. Create a PowerPoint document that shows different features functions and use that as your sales tool. Use it to close on the benefits of the service. You don’t need to build a site to test the viability of your idea or even sign up a customer. (I’m looking at B2B) But you do need something that helps the prospect visualize the product/service.

    The is an approach that a good product manager would use any way and it is a nice first pass at product concepting.

    I’ve used this method a lot and it works well. It allows you to start selling and get a great read on the market before you commit any dollars to development.

    When you do have developers, it gives them a road map to work with. In fact, you can use odesk and find some $15 per hour programers that will quickly work up your PP document into a demo site.

    We’ve used this approach to bring our SaaS site to market.

    • Good info Tim.

      I’ve never farmed out dev work of any significant magnitude. How do you protect the end product? Meaning, how do you prevent the developer from using the idea/code/product themselves or selling it to others? Or is this a moot point in that you just need to do it, hope for the best, and move on?

      Thank you

  4. Invaluable. Thank you.

  5. Sounds like the recipe every entrepreneur is looking for. Thank you so much for sharing this.

  6. Thanks for the link to http://www.kickofflabs.com! My only suggestion would be that it feels like customer validation could be happening sooner to test your hypothesis. :)

  7. Thanks for sharing all these ideas.
    We are following you and these concepts since we launch our last web venture at Spain 2 months ago. These ideas helped a lot since our venture is a new concept that needs to be tested.
    Andy.

  8. [...] to my RSS feed (using BlogBridge, of course) . Welcome, and thanks for visiting!Check this post How To Build a Web Startup – Lean LaunchPad Edition from Steve Blank. Of course you know that Steve Blank is one of the gurus of the Lean Startup. This [...]

  9. Mr. Blank,

    I just wanted to thank you for this information. I don’t think you really understand how valuable something like this is for someone like me: a non-coder on the other side of the country where I don’t know any other coders. I’m originally from Compton California, but I’m currently at UNC Greensboro finishing up my thesis. I’ve been developing a web startup idea for the past five months and “The Four Steps to the Epiphany” has been helping me a lot so far. I just purchased Eric Ries’s “Lean Startup” so I know that will give me great insight, but the information you just posted here has really given me great information that appears to be able to help connect where I am now to where I will be when I start applying the knowledge presented in “The Lean Startup”. I just wanted to thank you for this because for someone like me I always ask myself “what’s next” and according to your steps I would say that I’m in the beginning of step 5.

    I had two questions.
    1.) I was wondering if you had any advice for finding a cofounder, specifically a technical cofounder. I know this is something that will have to be done sooner rather then later if I wish to really pursue this.

    2.) Would it be possible to meet up with you? I will be in the Bay Area in October the week of the 17th. If it was at all possible to meet and talk with you in person that would be great, even if it was only for thirty minutes. Let me know if this is possible.

  10. Steve, this is great stuff

  11. My favorite wireframing tool of all time is OmniGraffle: http://www.omnigroup.com/products/omnigraffle/

    It’s much more powerful than simple tools like Balsamiq and even as a non-graphic designer, it allows me to create much more rich UI’s, which I then hand off to a designer to “make it pretty”.

    The designer delivers layered PSD files which I then get “sliced up” into HTML/CSS but cheap online services like CodeMyConcept.com or HTMLBurger.com.

  12. STEP 5. A warning.

    Google Adwords terms doesnt allow you to “harvest information”. I once set up a site on a sub domain to unbounce, selling product x.

    Adwords shut my account down. They said it looked like I was trying to get leads only. I wasnt, i was trying to to get orders to see if there was a demand.

    Adwords can be very strict. I would also recommend you tell your students to copy and paste “personal information text”. Not sure what the name is. But info what you do with customers information (mails etc). Adwords demands that too.

    At least warn them about adwords being able to Ban them for life and that they should read the terms.

    STEP 4:

    “Create a “viral” landing page, with LaunchRock or KickoffLabs”

    Why do you recommend this instead of a fake sign up/order form? Wouldnt the latter give more reliable data to decide if there is a demand. Is it moral reasons?

  13. [...] I did find a good article today that gives you a good lean web startup, with an amazing list of tools and resources to help you. Tweet Posted in Startups – Tagged [...]

  14. I am in the midst of building my own lean startup, and having a list of resources like this is very helpful. I got your link from micropreneur.com.

  15. ++++1? +1,000,000,000 Flipp’n AWESOME!!

    Now even an old non-coding Army guy like me can have hope. As Mr Ezell said above, this sort of thing can really mean a lot to non-coders, and especially to us born-before-the-internet types. The problem for us age-enhanced heroes is not just the buzzwords, but the fact that there is SOoo much material available to try to choose from and learn that it becomes an off-putting task just to think about it.

    It may not seem like a big deal to folks in the Valley, but I think you’ll discover that it is very meaningful to the rest of the world. (Of course there will be some who will try to see it as a “carved-in-stone” set of “commandments” rather than a game plan, but that’s always the case.)

    Please, Please ,Please archive this post so I can refer folks to it.

    Paul Hazel

  16. I forgot to say thank you.
    Thank you, sir.

    Paul Hazel

  17. When searching for profile handles check out knowem.com. Checks the availability on a whole bunch of sites. Good for branding.

  18. Benn there, done that – thinking out loud… There is a lot of more labor involved here. For example, “embed a video” means a video has to be shot. This is days, sometimes weeks of labor even for a totally amateurish production – script, shoot, edit (and better not with free software, it either embed watermarks or just sucks), throw the result away, redo. Buy adwords – means you need to cough out a few ’00s each, customers, even test ones, cost a few bucks each. Time and money on every iteration, and typically more than you want…

  19. Great resource. I put all the tools up on Gangaroo.com for future reference by other lean startup fans.

    http://www.gangaroo.com/users/453e8e85

  20. Steve,

    It felt good to read this post since we, at CloudBees, followed many of the steps outlined here. Not all of them though but it’s never too late! One word on where startups can run their applications => CloudBees is ‘the’ PaaS for Java apps or any language that is compatible with the JVM. As important, if not more, is that our PaaS has a unique and compelling capability, startups can store their code (safely), build their application (with a Jenkins-based SaaS), test it and auto-deploy (to staging or production), and obviously run their application and scale DUO (down up out) all from the same platform. And still be 100% Java compatible, no lock-in, all 100% Java and MySQL standards.

    We are happy to host already a few interesting startups and/or mobile back-end services.

    Did I say I just love your blog posts? I do.

    Francois
    CloudBees co-founder & VP

  21. Thanks for sharing the great article Steve.

    There’s a minor typo (missing 2nd “s”) in the link to Slideshare.

  22. Steve,

    thank you very much for sharing with all of us. Your blogs are of great help for me. I would say you are my remote consultant. I am not doing exactly the same but something similar with my MSc students in Prague (https://sites.google.com/a/via.felk.cvut.cz/via/). My course focus is on a development of mobile internet applications. The apps should help university students, who are the customers. The course is combining business and technology. I have started this week and I am looking forward what will happend. I am reporting here (http://jsedivy.blogspot.com/). I’ll be grateful for any suggestions, comments, …

    Jan

  23. http://domai.nr/ Domainr is another great domain search tool. Plus my friend built it. :)

  24. Hi Steve,

    This seems like a wonderful class. We are also in an just the right place to start on this class. I am curious if any of your student groups are willing to partner with start ups like us to go through the customer development process. We can act as their technical implementation wing and they can assist us with brainstorming ideas and analyzing feedback.

    We have developers and designers on board and are currently using lot of the tools that you have mentioned and planning to use the others that you have mentioned as we go through the process.

    Thanks,

    Senthil

  25. Hi Steve,

    Great step by step guide! Sounds like a good course. Thanks for all the links to the various resources.

    I get most of the steps, but as a non-coder, what do you recommend as a real life approach to taking on ‘Step 6: Build a more complete solution’.

    Using somewhere like Elance to outsource?
    Taking some time to learn PHP, SQL? How long would be a realistic ‘training’ period?
    Finding a local business to meet face-to-face and take your specification to build the basics?
    Getting a technical person into the startup team full time/as a contractor?

    Thanks,

    Ben

  26. [...] the position where you are trying to prioritize which thing to do first, second, and so on, go read this post by Steve Blank. From hypothesis testing to getting customers to the last step which most people try [...]

  27. Being a developer I just wanted to say that this advice is spot on. Also for Step 7: Build a more complete solution – You don’t need to go into this with a bunch of features / bells and whistles, pound steps 8-9 into your head… “continue to validate.”, “Keep collecting customer analytics”, “Hearing ‘This is great, but when are you going to add X?’ is your goal!”

  28. [...] customers actually want. Check out his posts on topics like building a web startup, the lean way: http://steveblank.com/2011/09/22/how-to-build-a-web-startup-lean-launchpad-edition/ I know this was a massive post, but hopefully you’ve found any useful tidbits in here. [...]

  29. Thank you for putting this post (and this list) together! This post will save many months of searching&wasting time for many startups hopefuls.

    p.s.
    The correct URL for Google Hangouts is http://www.google.com/tools/dlpage/res/talkvideo/hangouts/ (the URL in the post goes to a dead page

  30. Excellent and informative post. Thanks for sharing.

  31. Thanks, Steve. Great list!

    A couple of typos: it’s Node.js (not Nodes.js) and it’s jQuery (not Jquery). I know it probably doesn’t matter in your world, but for technical people (who you write these sections for) it does.

  32. Thanks for “step-by-step guide”. I want to translate this into ukrainian for my blog. Can i do it?

  33. What a great resource! I’m providing this to my marketing students, many who have web start-up aspirations.

  34. [...] How To Build a Web Startup – Lean LaunchPad Edition by Steve Blank [...]

  35. [...] model canvas and Customer Development lessons. After graduating he put together a prototype and had quickly marched through Customer Discovery, iterating his product with the help of CIOs and Fortune 1000 IT [...]

  36. Thanks Steve – An excellent and practical guide as usual! We’ve started GetViable to do exactly this – accelerate idea to MVqP using crowd-sourcing and offshoring. The idea is to get more startups to the ‘pivot or proceed’ stage in 8 to 12 weeks.

    We’re finding many non tech founders with awesome ideas but unable to get started, and we’re helping them get a product out there to attract tech co-founders and check viability.

    We’ll definitely be pointing them to this excellent resource for context and guidance.

    Thanks again,
    Leslie
    GetViable.com

  37. [...] here for the lean business model canvas. Here for a link to Steve Blank’s guide to building startups. Share this:TwitterFacebookLike [...]

  38. [...] While challenging, this is pretty doable for startups, and there are a lot of resources designed to help you do precisely that. [...]

  39. Steve, that’s just awesome…. thanks for sharing. Namestation.com and nameboy.com can also help should your desired domain name not be available.

  40. Not all of them though but it’s never too late! One word on where startups can run their applications => CloudBees is ‘the’ PaaS for Java apps or any language that is compatible with the JVM.

  41. [...] How To Build a Web Startup – Lean LaunchPad Edition Gostar disso:GostoSeja o primeiro a gostar disso post. Esta entrada foi publicada em Uncategorized. Adicione o link permanente aos seus favoritos. ← Running Lean by @ashmaurya [...]

  42. [...] This post by Steve Blank provides a step-by-step guide to launching a web startup and was very helpful. Tons of great links and pointers to tools. The most useful tool I found linked to in the article was the Lean Launch Lab. Stepping back a little, there is some classic work on business models by Alexander Osterwalder in his book Business Model Generation. The main premise is that you can lay out an entire end-to-end business model in nine small boxes on one sheet of paper. Layer Steve Blank’s Customer Development work on top of Alexander’s Business Model Canvas and you get what Steve Blank has been teaching in his entrepreneurship classes at Stanford and elsewhere – the Lean Launchpad.  Leanlaunchlab.com was built to turn this whole process into a simple to use web app. Watch the 1-minute video at the site to get the sense for how the process flows. I completed the entire Business Model Canvas on my iPhone while feeding a 1 and a 3-year old breakfast on a lazy Sunday morning. I switched over to a browser to write an initial hypothesis to test, design a test, establish some metrics and write a list of to-do’s to execute the test. A day later, I’ve got 5 of my 7 initial Tasks completed and have my first test underway. [...]

  43. [...] of the exciting trends in innovation right now is the lean startup idea.  The basic premise is that when ventures are starting out, building a scalable business model [...]

  44. Great article. As a teacher of “german start-up courses” i see a huge issues compared to english speaking countries:
    The described point 10: “Ask for money” is much harder to be successful. To gain a bank credit in germany currently your businessplan has to include too many details, which slows up your start-up. In the meanwhile your start-up idrea has not seldonly its copy allready in the net!

  45. Hi Steve,

    Many thanks indeed for sharing such vast resource pool.

    Its certainly a very exhaustive list of resources I have ever found on the net. I am sure its just not an effort of days and nights rather years.

    We are also trying our level best to provide valuable resource to start-ups and individuals who are sincerely doing hard work and want to succeed.

    Best Regards,

  46. How about some options for a decent looking WordPress theme?

  47. Someone looking to start a business will be drowning in minutae and inactivity if they tried following even half those steps. Name ONE successful business that has actually done those steps Steve. Name one!

  48. Great post nicely laying out the major steps of the lean startup process as they apply to specific technology.

    I would also add that PaaS platforms are now expanding to go beyond just hosting and thus covering more and more phases of the cycle.

    WSO2 App Cloud: http://wso2.com/cloud/app-cloud (disclosure: I work for the company) is one such example, covering now: issue/task/feature tracking, development (including in-browser IDE), testing, operations, application lifecycle management, version switching, continuous integration / continuous deployment, etc.

    So for technical startups, tools are getting more and more comprehensive.

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