The lean startup and successful discontinuous innovations. Exploring the effects of the lean startup method on the success of new ventures developing radically new innovations.

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Issue Date
2019-01-31
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en
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Abstract
This master’s thesis explores the effect of following the Lean Startup method on the success of startups developing discontinuous innovations. More specifically, three concepts described in the Lean Startup by Eric Ries are investigated in-depth: validated learning, build-measure-learn and innovation accounting. Academic research into the widely popular entrepreneurship book is scarce and this paper makes a first step in the exploration of its effect on startup success. By grounding the Lean Startup in several streams of literature, a conceptual model is drawn up and a multiple case study approach validates these findings. This qualitative research uses eight Dutch startup companies that operate in the high-tech industry and further substantiates this data by means of interviewing several experts. The results show a detailed analysis of the implementation of the Lean Startup in practice. The interviews reveal that validating assumptions and conducting experiments have a positive effect on startup success because this reduces technological and commercial risks. In the validation process, timing and sequence of steps are important factors. Moreover, this study identifies a number of success factors in the setup of experiments: external testing, frequency and speed of iteration, decision-making strategies and the type of minimum viable product. With regard to discontinuous startups, the results show that more validation is needed because they operate in a more high-risk context, for example through experimentation. Furthermore, they should balance internal and external sources of information in the decision-making process. The interviews show that minimum viable products can help startups reduce costs and generate revenues earlier. All in all, the findings indicate that startups should not blindly follow the Lean Startup method but ought to carefully assess its implications for it to have a positive impact on startup success.
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Faculteit der Managementwetenschappen