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How do entrepreneurs think they create value? A scientific reflection of Eric Ries’ Lean Startup approach

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Abstract

The means with which entrepreneurs create and capture value can be difficult to get a comprehensive picture of. Looking at the tools they use can offer insights, and in this context, the book “The Lean Startup” by Eric Ries has received a tremendous amount of attention. Supposedly, many entrepreneurs have read the book and may have followed his advice. Hence, we investigate the merits and characteristics of the methods detailed by Ries through a comparison with leading theories and empirical evidence found in the scientific literature. The results indicate that overall the methods find considerable backing and can in parts be recognized under already established constructs. Heavy use of effectuation-logic is evident throughout the book, with a clear and explicit emphasis on experimentation over long-term planning. The paper closes with a discussion of the possible broader implications of the methods and effectuation, including the potential impact on corporate strategy.

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Notes

  1. The Lean Startup reached the New York Times Bestseller list in the autumn of 2011 (The New York Times 2011), and received broad media attention following its release at, among many other outlets, The Washington Post (Kolawole 2011) and Forbes (Denning 2011) and still gets featured years after, here in The Wall Street Journal (Silverman 2015). In the spring of 2015 Ries launched a crowdfunding campaign to finance the successor (Ries 2015) and managed to raise over half a million USD. A complimentary Lean book series has also been created, although not written by Ries himself (O’Reilly Media 2015). The series at the time of writing consists of eight books.

  2. Used in this paper as defined by Bicheno & Holweg (The Lean Toolbox: The Essential Guide to Lean Transformation, 2008). Ries appears to subscribe to a very similar definition, although it is not specifically detailed.

  3. The fifth edition, published by K&S Ranch Press, was read for the purpose of this paper, although Ries would presumably have used the first. This newest edition also acknowledges the work of Ries by having a clear banner on the front saying “The book that launched the Lean Startup revolution” and containing an introduction looking back at the impact of the first and subsequent editions.

  4. Google Scholar was included to cover a larger breadth of sources (books, magazines, etc.) that could add additional (practical) perspectives.

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Authors and Affiliations

  1. Faculty of Engineering, Aalborg University, Aalborg, Denmark

    Dennis Lyth Frederiksen

  2. Mads Clausen Institute, University of Southern Denmark, Sonderborg, Denmark

    Alexander Brem

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  1. Dennis Lyth Frederiksen
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  2. Alexander Brem
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Correspondence to Alexander Brem.

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Frederiksen, D.L., Brem, A. How do entrepreneurs think they create value? A scientific reflection of Eric Ries’ Lean Startup approach. Int Entrep Manag J 13, 169–189 (2017). https://doi.org/10.1007/s11365-016-0411-x

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