Putting a Pause on the Lean Analytics Backchannel

When you run an experiment, as Alistair and I did with the Lean Analytics Backchannel, you have to be prepared for it to fail. In fact, if you run an experiment that can’t fail, it’s not really an experiment.

Alistair and I launched the Backchannel because we believe that there’s an opportunity to help people over time and consistently with Lean Analytics; the book is great (and we know it’s helped people), but not enough. It’s a reference guide to get you started, but everyone needs help once in awhile, so we came up with the Backchannel as a way of addressing that.

We also setup a pre-order page and decided to charge right away in an effort to de-risk things for us. Ultimately we didn’t get to our threshold of paying customers quickly enough, and so we’ve decided to put the Backchannel on pause and look to new opportunities.

One of the good things about launching experiments is that you’re going to learn something. We learned that there’s a market for Lean Analytics training/help/consulting/etc. (we’ve gotten an increase in speaking/consulting opportunities for example, and we did get quite a few customers pre-ordering) but that the form factor of the Backchannel isn’t the right fit. At least not without rethinking/rejigging it in some way. We also recognized that as a test it had issues. For example, the “product” (a “private community of sorts”) was somewhat vague, which honestly was on purpose because we weren’t 100% sure how the product would manifest itself. The price point was a bit of guesswork on our part, but partially calculated based on the number of customers we wanted signed up and the revenue we wanted to earn from the initiative. Our landing page also wasn’t fantastic. This was all feedback we got from people who signed up, and from people who didn’t. We interviewed and surveyed both groups.

So we learned a lot. And that in fact is the point of an experiment: to learn.

Alistair and I are now taking those learnings and figuring out what’s next. We believe we’ve validated the problem (people want more Lean Analytics information, practical guidance & support), but the solution was wrong. So we’re going to keep experimenting with new solutions. We have a few ideas–nothing we can share immediately–but you’re likely going to see more activity on this site in the near future as we look to find ways of helping people more.

To those of you that did pre-order I want to thank you very much for your support! And I look forward to connecting with you all so Alistair and I can keep learning what you want and how we can serve you.

Introducing the Lean Analytics Backchannel

Lean Analytics has been out for 3 years. It still amazes me how often people reach out to let us know that they’ve enjoyed the book. More importantly, people tell us that it’s helped them. And that’s awesome. Alistair and I wrote Lean Analytics to help people. We weren’t quite sure how good a job we would do, but I think it’s turned out fairly well.

Having said that, we’ve always felt like there’s more to this story than the book. We’ve done a lot of speaking engagements (and continue to do so!) and we’ve presented lots of material, but the world of analytics and Lean Startup continues to grow and evolve. A book isn’t a great medium for shifting ideas, new concepts, more exploration and so forth.

And that’s why Alistair and I are excited to launch the Lean Analytics Backchannel.

Lean Analytics backchannel header-SMALL

The Lean Analytics Backchannel is a private community of sorts (which we’re going to build initially off Slack and a few other tools) to bring together Lean Startup and Lean Analytics enthusiasts and practitioners. We want to go beyond the book and continue to explore how Lean Analytics can help startups and businesses of all sizes succeed using data.

The Lean Analytics Backchannel will be a direct line of communication to Alistair and myself. We’ll be actively participating, answering questions, creating new content and more. But we also believe a community will grow and people will share and help one another in amazing ways.

So what will be included in the Lean Analytics Backchannel?

On a regular basis, Alistair and I will:

  • Run Q&A events where we unpack startup case studies through live business model development.
  • Share new content, case studies, articles, and benchmarks
  • Interview best-in-class data scientists, analytics practitioners, investors, and growth engineers
  • Conduct weekly public consulting sessions in plain view of the community.

Members will also get:

  • Exclusive access to new slides, decks, diagrams, and more
  • Discounts to relevant startup events
  • A weekly newsletter summarizing the best in startup and analytics content
  • A shared table of the latest baselines and metrics from across the Web

Two more important things:

  • The Lean Analytics Backchannel costs $50/month (or $550 for the year)
  • We’re doing this in true Lean fashion as an experiment. We’ve launched a landing page to take pre-orders. If we hit our threshold of orders then we’ll launch the Backchannel. We’re aiming to launch by early April.

We’re excited about taking Lean Analytics to the next level. There’s so much more to do, learn and share, and we think the Backchannel is a great way of doing it. Along the way we’re going to experiment, learn and iterate–eating our own dog food and sharing our experiences throughout.

If you’re interested, please check out our Lean Analytics Backchannel Pre-order Page and sign-up today!

Traction: A Startup Guide to Getting Customers

“To reiterate, the biggest mistake startups make when trying to get traction is failing to pursue traction in parallel with product development.”

traction-bookThat’s a great quote from a new book called Traction: A Startup Guide to Getting Customers by Gabriel Weinberg and Justin Mares. It emphasizes something we talk a lot about in Lean Analytics–you can’t just build a product in a vacuum without early and frequent customer feedback/engagement. Early traction in Lean Analytics is about proving whether you’ve found a problem worth solving. It’s what we call “Empathy” in the book. And it goes from there through Stickiness, Virality, Revenue and Scale.

In Lean Analytics we went into some of the tactics for acquiring and engaging users/customers, but that wasn’t our full focus. In the book Traction, you’ll get all of the practical how-tos for finding the right customer acquisition (or traction) channels and frameworks for how to discover the best channels, prioritize growth and traction strategies and more.

The authors interviewed 40+ very successful entrepreneurs, marketers, investors and executives to learn the best practices on building traction for your startup.

Traction doesn’t happen by accident. Sure there’s some luck involved in everything, but in my experience it involves a lot of experimentation, iteration and grinding (read: hard work). You could throw a few things on social media, email a couple bloggers and try to get on TechCrunch…*yawn*…and the tumbleweeds will still roll on by. No one will care. The folks that win at growth are those that dig deep, try new things, learn from others, measure things (let’s not forget the analytics!) and work crazy hard. Traction, the book, will be a good guide for anyone that wants to work hard at growth.

To get you started, Gabriel and Justin sent me the first three chapters that you can download for free. Get the first 3 chapters of Traction

Or just go ahead and buy the book directly: Traction: A Startup Guide to Getting Customers

Free Lean Analytics Workshop Now Available

Some time ago, Alistair and I did a live workshop in the UK, sponsored by the good folks at Geckoboard. That workshop is now available, for free, on Udemy.

Check it out here: http://bit.ly/15KWjil.

In the workshop you’ll get 2.5+ hours of content, broken up into 7 sections. We cover all the basics of Lean Analytics and more. It’s a great companion to the book or a primer if you haven’t checked out the book yet.

We hope you’ll enjoy and share with friends!

How Lean Analytics changed our beta launch strategy

This is a guest post from Kyle Racki, co-founder of Proposify. He asked to write a blog post about his experience reading Lean Analytics. We were happy to oblige…

I finished reading Lean Analytics a few short weeks ago. The timing was good, because I just happen to be launching a startup, and the advice I gleaned from the book has been incredible so far.

For starters, Lean Analytics, while being focused on metrics and numbers, is surprisingly approachable for the average person. It isn’t written for data scientists or mathematicians (God knows I am neither of those), it’s written for entrepreneurs — for people who want to build great products and profitable companies.

Due to the applicable nature of the book, the difficult part of reading Lean Analytics was trying to decide if I should keep reading it or put it down and start applying it’s advice immediately. As I read it, tons of ideas came to mind, and I found myself constantly reaching for my laptop or phone to leave notes and reminders of what to do differently.

One of the things I like best about Lean Analytics is that you don’t need to read the whole thing. The authors, Alistair Croll and Benjamin Yoskovitz, have thoughtfully broken the sections out into chapters that each focus exclusively on one type of business model, such as E-commerce, SaaS, free mobile apps and so on. While I would like to one day read all of the chapters for each business model, I’ve got a company to build today, and so I only read the general chapters plus the two chapters that focus on Software-as-a-Service — the business model my company falls under.

I will outline the three major ways I’ve taken the knowledge from the book and applied it to my own startup, but to start, let me give a little background about my company.

Helping companies win new business

My company is called Proposify–online proposal software that helps businesses of all types write, design and manage proposals faster and more easily. We’ve had the idea in the works for over two years, but didn’t really focus on it full-time until late last year when we acquired some capital from ACOA to aid in bootstrapping the product. In the time since then, we built the MVP and released it to a group of private beta testers (in April 2013). That was around the time I started reading Lean Analytics.

I was pretty nervous reading the first couple of chapters, where it asks the reader hard questions like “Should you even be building this product?” The book aptly points out that all of us (entrepreneurs) are liars, and I didn’t want the book to somehow prove me wrong about my business, and my reality distortion field was in high gear.

There were moments in the book, particularly chapter 15 “Stage One: Empathy” where it suggests that the reader should spend a lot of time “getting out of the building” and talking with potential customers, running surveys, researching competitors and basically trying to figure out if you are building a product that addresses a problem worth solving. It forces you to ask yourself “Will enough people pay me to use this software?” Of course, I did actually do all of this over the last couple of years, but not to the degree outlined in the book.

But I can’t go back in time, all I can do is move forward based on the information I have now. Below are the two major things that changed what we are doing.

1. Knowing what stage we’re at

Like all co-founders of startups, I wear a lot of hats; I’m the product manager, UI designer, UX researcher, QA tester, team and project manager, writer and marketer. I felt a huge amount of pressure in the weeks leading up to our private beta to:

  • design the right product
  • test and find all the bugs
  • drive traffic to the website through
    • Social media
    • Content marketing
    • Paid advertising
    • Offline networking and conferences
  • find and acquire private testers
  • ensure we are tracking the right metrics

That’s a lot of pressure and a lot of different types of skills to have to utilize all at once. However Lean Analytics breaks out the 5 stages of a startup into:

  1. Empathy
  2. Stickiness
  3. Virality
  4. Revenue
  5. Scale

It didn’t take a lot of time to realize that Proposify is at the Stickiness Stage. Right now we have a small base of test users, and I am actively reaching out to them for feedback on our MVP. That means any time or money spent on trying to acquire customers is mostly a waste — at least for right now when we don’t even know if the product has value.

So what I did was stop worrying so much about stuff like customer acquisition or landing page conversion, and instead I put my focus on how to tweak our product so that the users we do have find it more useful and they engage with it.

2. Finding our One Metric That Matters

In order to make our product more sticky, I had to find our OMTM. Originally I had been paying attention to the number of proposals created, thinking that that was some sort of indication of use. There are some problems with this approach though:

  • For starters, a proposal is started with the click of a button, so every user can technically make one immediately after signing into their account, but it will be mostly a blank canvas. That doesn’t mean they used the product.
  • Secondly, the amount of proposals may not be an indicator of engagement, since many small companies don’t need to be constantly producing proposals and may only have one to write every few weeks. As it turned out, many of the beta users didn’t actually create a proposal, because they had to first setup their template, which can take a long time, and doing that alone can give a test user an indication of how the software works.

Instead, I decided to start tracking whether or not a user actually sends a proposal to a client as an indication of whether or not they are using the product. In other words, one or more sent proposals in the given time period (one month) will define that user as active. If they don’t send a proposal, they aren’t active for the given time period. We want to increase our percentage of active users. That’s our One Metric That Matters right now.

After one month of private beta testing, I reached out to our users to get feedback. As you might expect, the responses varied from wildly positive to apathetic. But the consistent theme and likely reason for low usage was that either a user didn’t have any proposals to write at the moment (something we can’t control) or that it takes far too long to setup your template, and aspects of the workflow were unintuitive (something we can control).

So what to do with the data?

Armed with this information, we are implementing a fairly substantial pivot. Whereas before we were targeting firms who have designers on staff and want an online tool to remake their pre-existing proposal online, we are now targeting users without design or proposal writing skills who want a beautiful, ready-made proposal template filled with pre-written content that they can tweak. 

As one of our test users wrote in his survey, “I want you to make me look like a rock star with the least amount of effort on my part.” That has become our company’s mantra and the promise we hope to fulfill. We are reshaping the product to walk users through choosing from a gallery of awesome templates that are designed and written for their industry, and with a few clicks and a drag-and-drop interface a proposal is virtually built in a few minutes. This will take less than a month to implement, but our hypothesis is that this change to the product will drive our engagement metric dramatically.

3. Our line in the sand

As Lean Analytics taught me, I need to create a line in the sand, and then honestly evaluate whether I can reach that line or if adjusting the line is necessary. For now, we need to have a base of early adopters who stay engaged with the product and pay to use it. In order to achieve that, our product needs to solve their problem. We are launching paid plans so that we can begin experimenting with price points and as a way of weeding out casual testers from the real paying users who need to use our software.

Looking forward to the next stages

In the book, there’s a chapter on virality – the third stage in a startup. It sparked a wealth of ideas for my product, because I hadn’t actually realized before that our product is inherently viral–users send proposals to clients with the tool, which is kind of like free marketing as long as the client notices our branding. 

The question is, how do we encourage free promotion without alienating our customers? After all, I want Proposify to make our users look great and keep their clients’ attention focused on their brand, not ours. There are some ideas we have written down, but the great thing is that we aren’t even at that stage yet. For now, I’m going to focus on product/market fit, and user-engagement/stickiness, and once we reach or exceed our OMTM – 50% active users, we’ll move on to goals like lowering churn, improving conversion-to-paid and viral coefficient. Once those metrics are as good as we can get them, we’ll start looking at CAC (Customer Acquisition Cost) and LTV (Lifetime Value), and then look to drive revenue and growth.

The greatest thing I learned from the book is: we can’t focus on everything now — doing so will actually shoot us in the foot. All we need to do is focus on the One Metric That Matters right now. Once that goal is reached, or we learn what we need to from it, we can then focus on the next metric. 

This has given me a huge amount of confidence moving forward, and I wouldn’t have gained it without reading Lean Analytics.

Great feedback about Lean Analytics

The positive feedback we’ve gotten about Lean Analytics has been awesome. Not everyone thinks the book is great (that’s fine, Alistair and I have thick skin, and we know it’s not perfect!), but for those of you that have read it and shared your feedback with us, thank you.

I wanted to share some of that feedback with everyone, to give you a sense of how people are reacting to the book. It’s interesting to see what resonates with different audiences. The reviewers are a mix of entrepreneurs, marketers, analysts and more. You might also discover some new blogs that you find interesting…

  • Lean Analytics Book Holds Secret To Quickly Building A Better Business by Kevin Kauzlaric. (I couldn’t have written a better headline myself!) “For all this book has provided me with, I sincerely believe this might be the best book for entrepreneurs in 2013. I think you ought to read this book at least once and probably should have a copy handy for when you change your OMTM as you successfully move along in your startup or new business project.”
  • Lean Analytics: Snapshot Review by Christopher Millard. “There were a number of small but important facts scattered throughout the book that elicited a small “huh” from me as I read. For example, I learned the speed at which a user invites a friend to try a service is an order of magnitude more important than the number of friends he or she invites total, and without taking this speed into consideration the Viral Coefficient is relatively pointless.”
  • Book Review — Lean Analytics by Christa. “Owning a copy of Lean Analytics is like having a management consultant / cheerleader / truth sayer right by your side every step of the way. Get it and use it well.”
  • Practice to Theory and Back Again by Matt Heusser. “There is one chapter that is worth its weight in gold [in part, about the Lean Canvas], that has broad general applicability. It is advice on how to define and position your business, regardless of if you are a startup, an IT shop, or a lawn mowing service.
  • Book review: Lean Analytics by Marc Abraham. “Lean Analytics is a great book for anyone who wishes to learn more about validating an idea, building the right product and measuring growth.”
  • Book Review – Lean Analytics by Richard Brock. “Lean Analytics is packed to the rafters with great real world examples making it easy to translate theory into practice. If there is one book you read this year that will accelerate you I would recommend Lean Analytics.”

Thanks again to everyone that’s bought the book, read it and shared their feedback. Alistair and I really appreciate it.

We hope to have more stories from people that have used the book to improve their businesses in the near future. Those anecdotes and case studies are starting to emerge, which is very exciting for us, and will be worthwhile to share as additional examples that can help everyone.

Lean Analytics and Football


Although Lean Analytics focuses mostly on tech companies, Alistair and I quickly realized while doing our research that the principles and tactics of Lean Analytics apply to many types of businesses. We managed to highlight a few examples in the book, including Solare, a San Diego-based restaurant that uses two key metrics to guide their decision-making.

Recently, Curtis Peterson reached out to us about a blog post he wrote, Lean Football Play Calling. The basic premise is that Lean Analytics can be used to make better plays during a football game. Curtis talks about a couple of hypotheses that he has around “explosive plays” and the use of play action passing.

It’s fascinating to see Lean Analytics applied in areas outside of technology. It’s not surprising though, because the challenges remain the same. And the way to get things accomplished remains the same. You have a goal. You need hypotheses on what to do (experiments to run) that you think help you achieve your goal. And you need to measure your progress.

Curtis hasn’t tested his theories out (it’s the offseason!) but I’m hoping he will, and I’m hoping others will as well. It’d be fascinating to see if a structured approach like the one he’s proposing can help in winning football games. Wouldn’t that be something?

Photo from Flickr.

Lean Analytics Sweepstakes Complete! Big Winner Announced

The Lean Analytics sweepstakes was a great event with thousands of dollars in prizes from a bunch of great companies. In total we’ll be giving away 56 prizes ranging from t-shirts to a free trip.

Prize winners were selected at random.

If you won a prize you were notified by Twitter or email, so please check those carefully. I’ve heard back from a lot of the winners, but not all of them. I’ll reach back out in another week or so to those remaining winners that didn’t respond.

The grand prize is a free trip to the International Startup Festival in Montreal. It includes a free ticket, $1,500 for travel/hotel and a few other goodies.

So who won?

Our grand prize winner is: Damian Matheson!

damian mathesonDamian (@iamdamian) is a 23-year old entrepreneur living in Toronto. He got the entrepreneurial bug thanks to attending the Digital Specialization program at Ryerson University (inside the Digital Media Zone). Previously, he was studying Criminal Justice at the University of Guelph.

Damian is the co-founder of FoodStory, which aims to bring farmers’ markets online and into the 21st century. Consumers will be able to log onto the website, see a profile of each of the attending farmers/vendors at the market, connect with them, learn their story (so they know they’re truly supporting a real local farm), and then see what will be available.

“Ultimate, we are creating a service that allows consumers to receive a completely customizable weekly box of farm-fresh goods right from the farmers’ markets, delivered right to consumers doors,” says Damian. “Think of it as a customizable, multi-farm online shopping experience with a strong emphasis on the connection between consumer and producer.”

Congrats Damian, and congrats to all the other winners!

Let me thank each and every one of you for buying Lean Analytics–the response has been awesome. Alistair and I are blown away and really appreciate it.

Meet us in London for the Lean Analytics Workshop hosted by Geckoboard

geckboard lean analytics workshop

The folks at Geckoboard are awesome. They’ve contributed to our sweepstakes, where you can win awesome prizes (including a free trip). I did an extensive interview with Geckoboard’s CEO, Paul Joyce, which you can watch on Vimeo. And now, they’re hosting a 1-day workshop event for Alistair and I in London.

The event is on Friday, June 7, 2013.

They put together an awesome site (better than anything we could do ourselves!), which you can see here: http://www.geckoboard.com/lean-analytics-london/.

Tickets are £120 and space is limited.

Alistair and I are very excited about going to London and sharing Lean Analytics with the community. It’s going to be a great, interactive format where we work with local startups and help them out with their analytics. If you’re in the area or nearby and want to hang out, we hope you’ll attend!

The 7 Myths of Lean and How Analytics Can Help

I recently did a presentation on the 7 myths of Lean Startup and how analytics can help. You’ll find it embedded below, since I’ve shared it on Slideshare.

It was a fun presentation, the first time I’ve given it (since I often redo my presentations each time!) and I got some great feedback. Briefly, here are the 7 myths:

  1. Lean = Cheap. Sure it’s cheaper to start companies but it still costs money to scale them. The lesson is simply this: know when to hack (do something quick, cut corners, cheaply) and know when to scale.
  2. Lean = Small. You need a big vision to win. I’ve said that before. And you use Lean Startup best practices and analytics to zig zag your way towards that vision.
  3. Lean = Crappy. An MVP is meant to be a minimalistic version of your product, but it also has to be viable. The key is that an MVP has to provide you with meaningful learning and insights, and it also has to provide the value you’ve promised customers. There’s no “shitty” in MVP and I use Sincerely, Inc. as a great example of building smart MVPs.
  4. Pivot is a bad word. I did an entire presentation just on pivots and brought some of that into this presentation. The key to a pivot is that it’s a shift in one aspect of your startup’s focus based on validated learning.
  5. Lean is only for consumer startups. Lean Startup has gained most of its adoption amongst consumer startups, but it applies across the board. I shared some quick examples from consumer products companies, a church, a restaurant and more. Many of these examples are in the book.
  6. Lean = Easy. We all know startups are hard. Lean Startup helps mitigate risk and clear the path a bit more, but it’s not easy. And that flows into the final myth…
  7. Lean = Auto win. Simply by following the Lean Startup steps (or Lean Analytics methodologies) doesn’t guarantee success. You can’t walk through the process and expect to win. It takes guts, luck, brains and much, more more.

I hope you find the presentation helpful. I also shared some thoughts about how I believe metrics can be the common language used by entrepreneurs and investors to bring them together more often than not and keep them on the same side of the table. It’s clear that entrepreneurs are concerned about reporting numbers to investors, and it’s clear investors want more numbers.

Metrics –used properly– can cut through a lot of bullshit on both sides, which I think is a good thing if everyone is willing to participate. If you have any questions about the presentation or what I rambled on about during my talk, please let me know!