The Lean Start-Up and Social Enterprises: Lessons from Tendayi Viki
Pivoting; Value Proposition; Iteration; and Innovation. These are only a few of the buzzwords that have become a permanent feature in the start-up sphere, and with good reason. One cannot discuss entrepreneurship in its many forms without alluding to the importance of lean processes and principles as well as the Business Model Canvas. These tools play a crucial role in articulating a company’s vision, goals, plans, and activities. Strategyzer has managed to develop a system that empowers entrepreneurs and enables them to create, visualize and ultimately test their business models in a simple manner. I spoke to Innovation Consultant and renowned author, Tendayi Viki who is also an Associate Partner at Strategyzer and he demystified the Lean Startup methodology and its role in building successful businesses. Here’s what I learned:
Proposition is the Cornerstone
When you’re creating something, whether its a business or your career, the cornerstone of it is the value you’re creating so your Value Proposition is the heart of everything. If you look at the Business Model Canvas, The Value Proposition is the central block and everything else is organized around it. Regardless of what you’re doing, you have to be really thinking about the value that you’re creating for customers, society, family, etc.
Utilise the Business Model Canvas
Think about the customer first, who are they and what value are you creating for them? So do the Customer Segment block followed by the Value Proposition block. Once the two central blocks are in place, you can move on to Channels and Customer Relationships which all come into play when you ask yourself: how do we reach our customers and what relationships do we want to have with them? How do we create value? What activities do we want to do? Who are the partners that are going to help us create value? What resources do we need? How much will it cost? And how much will the customer pay?
Test your ideas
The goal is to find out whether you have a business early. Test your ideas, validate your business model with customers, and then scale. The Build-Measure-Learn-Feedback loop helps you scale in a systematic way that helps you learn. So if you’re thinking customers are going to pay $12.99. Instead of ordering 10,000 products, you order 10 products and then you test whether a customer will pay $12.99. When you have validated that they pay $12.99, you can then order 50 products and then you test again. Its a rhythm for building a business. The goal is not to find out that you don’t have a business after you’ve spent too much money.
Context is key
The Lean Start-Up is based on the notion that you can’t assume that something that has worked for somebody else will work for you. You have to figure out what works in whatever context your business operates. You have to go to the context, start small and test your hypothesis in order to build a model suitable for your context.
The magic usually lies in the pivot
If you look at the history of most of the successful companies in the world, all of them did not become successful at the thing they started out working on. They have an idea in their head and then they go out in the world and figure out what works around that idea.
Tendayi’s parting advice to social entrepreneurs is invaluable,
“The fact that your business is social doesn’t mean it won’t fail. It feels good to say you have a social enterprise and you’re doing something to help people, but if your business side is not solid, you’re not going to be able to help anyone. So it really matters that social entrepreneurs are entrepreneurs and not just social.”
At the core, a social enterprise is a business and it needs to focus on the bottom-line. It is really important for entrepreneurs to operate and formulate strategies with sustainability, impact and scaling in mind.
To find out more about Tendayi’s work and purchase his material visit https://tendayiviki.com/. I also suggest you read Eric Reis’ insightful Book The Lean StartUp as well as Business Model Generation and Business Model You by Alex Osterwalder, Yves Pigneur and Tim Clark.
Be sure to listen to my full interview with Tendayi below for more nuggets on the Lean Startup principles: