This document contains notes from Rob Fitzpatrick on lean startup principles and innovation best practices. Some of the key points summarized are: 1. You cannot predict startup winners even for experienced investors and founders. Most returns come from a few big winners. 2. It is important to avoid heavy planning and investment since the future is unknown. Put all ideas on the table and innovate across the entire business model. 3. Fix innovation processes to reduce the cost of trying ideas by leveraging existing assets and byproducts. This allows exploring more concepts with less risk.

1. Rob Fitzpatrick
October 12, 2012
@robfitz
rob@dex.io
Lean startup
& publishing

2. Great
❝
news! ❞

3. 1.Run a tech startup http://dex.io
2.Design & deliver startup education &
support http://foundercentric.com
@robfitz

10. You
can’t
predict
the winners

11. Even the best
can’t! http://venturebeat.com/2011/01/29/yuri-milner-
and-ron-conway-aim-to-disrupt-angel-investing-
with-latest-proposal/

12. ❝
The most important things to
understand about startups:
1. Effectively all the returns are
concentrated in a few big winners
2. The best ideas initially look bad
❞
Paul Graham
YCombinator
http://paulgraham.com/swan.html

13. ❝
There is probably only one company
in each YC batch that will have a
significant effect on our returns...
The rest are just a cost of doing
business.
❞
Paul Graham
YCombinator
http://paulgraham.com/swan.html

14. $4bn -£100

15. So what
not to
do?

16. #1☠?
http://blog.startupcompass.co/pages/summary-of-startup-genome-report-extra-premat

17. Premature scaling
=
Calendar hubris
+
Wrong KPIs

20. 1. 2.
Discovery Validation

21. “Learn” “Confirm”

22. “Ask” “Sell”

23. Do we
understand this
industry?

24. Do we
understand this
industry?
Does anybody
care at all?

25. Do we
Are we building
understand this
industry?
the right product?
Does anybody
care at all?

26. Do we
Are we building
understand this
industry?
the right product?
Does anybody Will they
care at all? pay for it?

27. Unless!

28. ❝
We are coming late, so we need to
be the most aggressive, so
aggressive that every competitor is
surprised because he cannot
imagine that we are SOO aggressive.
❞
Oli Samwer, Rocket Internet
http://techcrunch.com/2011/12/22/in-confidential-email-samwer-
describes-online-furniture-strategy-as-a-blitzkrieg/

30. You
can’t
plan far
when it’s
all unknown

31. What’s
the cost
of trying?

34. 1 3
Surplus of time & talent,
combined with ownership
Funding on demand,
awarded to real progress
2 4
Product, tech & innovation as
in-house core competencies
Minimal overhead when
starting and stopping

36. http://businessmodelgeneration.com

37. x1000?

45. What are
you
keeping
off the
table?

46. Where’s
your
head
start?

65. Don’t
start
from
scratch

66. 1 3
You can’t predict the winners,
so avoid heavy planning &
investment
Innovate on the whole model
2 4
Fix your innovation hygiene
to reduce the cost of trying
Use your assets & by-products

67. 1 3
You can’t predict the winners,
so avoid heavy planning
Put it all on the table &
innovate on the entire model
2 4
Fix your innovation hygiene
to make stuff cheap to try
Abuse your assets
& by-products

68. 1 3
You can’t predict the winners,
so avoid heavy planning
Put it all on the table &
innovate on the entire model
2 4
Fix your innovation hygiene
to make stuff cheap to try
Abuse your assets
& by-products

69. 1 3
You can’t predict the winners,
so avoid heavy planning
Put it all on the table &
innovate on the entire model
2 4
Fix your innovation hygiene
to make stuff cheap to try
Abuse your assets
& by-products

70. 1 3
You can’t predict the winners,
so avoid heavy planning
Put it all on the table &
innovate on the entire model
2 4
Fix your innovation hygiene
to make stuff cheap to try
Abuse your assets
& by-products

71. Thanks!

72. Rob Fitzpatrick
October 12, 2012
How can I help? Internal innovation?
Events? Drinking buddy? Cautionary tale?
rob@dex.io
Slides: dex.io/robfitz