TL;DR
Lean canvas has a lot of advantages compared to a traditional business plan document but there are three reasons why I think doing anything else at the beginning, is a waste of time.
Lean canvas for me, is an iterative tool. You need to apply it over and over.
This is what I use it for: Analyzing, dissecting and communicating my business idea and follow its evolution, identifying blind spots, identifying assumptions.
Some personal tips.
This is how the initial lean canvas for BARconWIFI.com looked like.

The problems with tradition business model documentation

A couple of years ago when some friends and I started the now defunct Social Fund It, one of the screw ups we did (among many), was to write down an almost 60 pages long business plan.

Isn't that what one is supposed to do, you ask? Well... Now, I don't think so.

Here are some of the reasons why I now think that was a total waste of time:

It was almost "all" fake: Most of the stuff that was supposed to be there, we didn't still have any data about it, so we just made it all up. The cash flows up to 5 years, the marketing strategy, the operations strategy, costs structures, etc. The only thing in that document that was not fake, was the team.

It took far too long to write and maintain: It took us about two weeks to write it, and once we did, we seriously couldn't be bothered with updating it often enough as for it to be of any use. Time is money, even more when you are an entrepreneur.

It took far to long to read: Be real, most people wont read your 10 lines email completely, so why on earth would they read 60 pages of... potentially boring stuff.

In a few words, it was a waste of time and resources with close to 0 return on investment.

The only reason that I would consider doing something like that again is, if its required to get funding and only if based on actual data.

There is another important point here. Although in general I believe it wasn't a good idea. It did get us thinking about the business instead just ignoring important details. However I now know there are better ways to "get myself thinking" about the important stuff and they don't involve hours in front of a Microsoft Word screen.

Enter the dragon

Now, one of the first things I do when I get an idea for a business, or when I am consulting with a client, is to ether write the idea down using the Lean Canvas tool or ask them to walk me through each of the points described in it.

I do this because it helps me decompose and analyse the business model behind the idea, into the pieces that I find the most important at the beginning of the process, fast.

This last part is particularly important. Lean canvas, or it's close relative the business model canvas are in essence a one page overview of your business model. One page you can write down an explain in just a few minutes.

But while small and laconic, I find that it focuses on the key aspects I want to understand and analyse about the business model and therefore, is a good exercise to prevent the idea from changing without noticing, while it is in my head, a way of getting it out there and pinning it to the table.

It also works beautifully when I want to communicate with others what is going through my mind.

Now, there is one catch I find when I talks to people who also use this tool or entrepreneurs who are starting their own thing and are trying this tool out. What I often hear is: "This is fine. I get it. I have done it before and I thought about it a lot, but it is still not helping me."

Well, I think they are missing an important point and that point is: What did you do as a result of what you learned using the tool, and how did that affect your initial canvas? If you answer is... nothing. Well.. you didn't use it right.



Lean Canvas is not supposed to be the tool that tells you what to do next or to help you track which assumptions you already validated. For that you have other tools, like the lean startup machine's validation board. Lean Canvas is more of a pair of goggles through which to look at your business from a different perspective.

In order for you to be able to extract the most value out of it, you need to ask yourself questions. Questions that stir the Martini you had in your mind about how things are supposed to work. Questions to show you what is really happening, out there. The lean canvas helps you finding these questions and then, by answering them, you can actually learn about your business.

To explain what I am trying to say here. If you look at your canvas and don't test the assumptions that you are making, you will not get the value you were aiming for. It will stay as it is, assumptions.

The only way that picture is going to change is, if you learn anything new about the reality you are trying to describe with it. Then, you can use the tool to analyse, learn and adapt based on what you learned. Rinse, and repeat. Build-measure-learn. Inspect and adapt. This mantra is as old as humanity itself and it didn't start with Customer Development or Lean Startup.

Personal do's and don'ts.

The first time you sit down and start filling up the canvas, chances are you are going to be making stuff up.

That is fine. If you feel like you are not sure about something you are putting on paper, well, that's a good sign. It is a sign telling you where you can start learning. So don't sweat it if you don't know everything on each aspect, that just means you are now aware of the stuff you know you don't know. But... don't stop there. Get out of the building and start learning.

Something that I see often also, is that, as masters of self deception that we are. We tend to avoid difficult questions. What do I mean by that?

Well, if we have a two sided market, we would start developing the canvas for one side, usually the one we know about, while the greatest potential risk is somewhere else... (in the part we don't know about!)

For instance, if we are creating a marketplace for handmade artistic products, and we know a lot of craftsmen/craftswomen it's easy to start thinking about getting them on board, and doing that canvas first, while neglecting to pay attention to the people looking for the crafted products, or vice versa.

But why does this happen? I think this happens because we feel bad about not knowing, so we avoid feeling uncomfortable. This is a big red flag. If you don't like reality hitting you in the face, don't use customer development or lean startup, or agile software development for that matter.

Somehow we have ingrained this idea that "If you build it... they will come". Do not engage on wishful thinking.



Last but not least. Don't forget about the questions. For me this tool is mostly about the questions. What I usually do once I am "comfortable" with what I wrote or while filling it in, is to make notes of which assumptions I am making.  I do that in form of questions. Once I have those assumptions, I can start exploring and finding out the answer.
Then, after you go out and learn something new, come back and revisit the canvas. Better yet, fill in another one and keep the previous as a measure of how the landscape has shifted. You can then start getting the most out of the tool, and then I'll believe you if you tell me it didn't work for you.

The BARconWIFI.com initial canvas.

I you don't want to read the whole post here is the TL;DR version.

Flashbacks

When I was 16 years old back in Cuba, around 2001. I remember being talking to my good friend Nelson about what would it take for us to "hit the jackpot" and make tons of money. I remember in that particular occasion Google (which was something new back then) came up in the conversation and the whole story of how the Page Rank algorithm came to be and how these two guys had just, made it.

The conclusion we arrived to back then was that we needed to "invent" something. We didn't know exactly what, but in any case, it needed to be good. It needed to be unique. We needed a "great" idea.

If we have that, the path to fame and glory is set.

Years after that, I think back to that day, and realise that if current me could talk to past me, the conversation would have gone a lot different.

How much is an idea worth?

You see, I now know, that having a great idea is not everything. In fact, I now believe that having a great idea, alone, is worth nothing. An idea alone is worth nothing without its execution. I believe having an average idea with great execution triumphs any idea with poor execution no matter how great it is.

History is full of good ideas that went nowhere, and average ideas that made it all the way to the top.

Before Facebook, there where other social network sites like MySpace or Friendster. When Google showed up, the search engine market seemed to be such a crowded space that it was unimaginable to think about competing with Yahoo! or Altavista. Today, Google's search engine market share, accounts for  68.11% worldwide. Something similar can be said about Chrome vs Firefox, IE and Opera.

Now, knowing wether something is a good idea or not, depends on who you ask. However the fact remains that, the innovative aspect of the idea or being first, doesn't seem to matter that much, unless you are in some specific contexts like: developing a totally new market.

And by new market I mean that your idea is really a ground-breaking, earth-shattering, drop-a-bombshell kind of thing. In that case, it matters because the market you are focusing on affects everything else in your business in a substantial way. You are asking your customers to do something they haven't or couldn't do before. It affects the way you position your product, the way you market your product, your customer adoption and acceptance rates, the money you are going to need, etc, etc, etc.

This is how I like to assess my ideas.

All that being said, here is what I think good ideas for a startup need to have as a must. This is my own personal point of view, and it may be different from yours.  If so, I invite you to share it in the comments.

Is it of practical value to your potential customer?

By that I mean it needs to provide actual value to whomever you decide your customers are going to be. In which way does it improve your customer's life? Which problem does it solve?

This is tricky because, in the beginning you don't really know who your customers are or even if they have the problem you are trying to solve. You may have some ideas. You may have talked some friends or colleagues. But chances are, you won't know anything about them just yet. These are all hypotheses.

Usually there is no other way of knowing but to try it out. This is the main reason why I use customer development and lean startup. I use it in order to assess the "practicality" of it all. Most of the time, by acting and avoiding paralysis by analysis.

















In other words I need to try it out and find out. Like Eric Ries likes to say: convert market risk into technical risk. There are lots of tools and techniques that can be used: interviews, mockups, landing pages, paid ads, fake ads... you name it. And while I am answering those questions I keep one thing in mind, always: Is this the cheapest quickest way to find out if my hypothesis is true?

Do you feel passionate about it?

The second question I ask myself is this: Is it something I feel passionate about? Is it something I am willing to spent countless hours working on, without getting any money, and without any kind of security that it will indeed succeed.

For me this is important, because when things get though THAT is going to be the energy that is going to keep things running. That is what is going to make the difference between making it or not.

This is sort of a Damocles sword. It is great to have this energy and passion when things don't go as expected, but they also act as a reality distortion field. We human beings have an almost infinite capacity for self deception, but with entrepreneurs, the chances of that happening are 100%. The question is if you are going to be able to stop it in time.

There is no spoon.

The thing is, we love self deception. There is nothing better than having an idea in your head you can toy with without having to put it down and seeing it for what it is. It is that fear of finding out if it may not work. It is the feeling we get stepping out of out confort zone and doing the things that minimize the most risk first, the one where you learn the most, not the most rewarding, not the one we know how to do. That is how we fall in the trap of subconsciously avoiding it, sometimes by procrastinating others by simply avoiding it completely.

For instance, with BARconWIFI.com my first instinct was to start writing code. I come from a technical background. So it came natural for me to enter "product development mode" and start asking away: How am I going to build it? Which frameworks am I going to use to develop? Where should I host it?

You see, these questions, although important, don't shed any light on the riskiest assumptions that I was making like: How am I going to make money out it? How am I going to find and curate the contents? How do I get people to find and use the platform? Are there even enough people interested in this to be worth the time and effort?

What the first group of questions has that the second doesn't is that I already knew I could answer those. I felt comfortable there in the known-knowns zone. It took some cold showers and some inner reflection to see that I was being a victim of my own eagerness and biases.

Know yourself. It goes along way fighting your own worst enemy. Follow the signals. Read about cognitive biases and how to break them.

Eating your own dog food.

Where do you find an idea then. Well... anywhere, but I particularly like to start by looking at my every day life.

When I first moved to Barcelona eight years ago, I didn't have wifi at home so I was constantly looking for bars where I could just sit down and do my thing.

Then three months ago, it started happening again. I changed flats and while I was getting internet installed at home (which took ages for one reason or another) I had to make due with whatever I could find. Same thing has happened before when I wanted to meet clients and didn't have an office, or simply wanted to get things done outside the house to avoid distractions.

There you have it! Finding a nice, tranquil location, with free wifi has always being a problem (for me).

The whole scratch your own itch is not as weird as it sounds. When Ash Maurya talks about how CloudFire came to be, or his book, or workshops, etc. They all came naturally from a need he had. Same thing with 37signals and BaseCamp. The list goes on and on...

Flashforward

Yes. You can now follow up on updates and other content through twitter at @planbexperiment on Twitter.

I don't like to think in terms of tools, because I believe tools are just a means to an end. That being said, here are 10 tools I am using right now to develop BARconWIFI.com and that you could benefit from.

The best part... they are all free to use.

1. InstaPages: Generate landing pages for conversion. Free trial. Integrates with GA and allows for A/B testing. Tried  LaunchRock also, but I liked this one better because of the functionalities. LeadPages' policy of give me your credit card before I show you anything scared me off, although it seems to have a more complete feature set.
2. Name Checker: Find out if your name is taken (twitter, facebook, others..)
3. SumoMe Tools and small plugins to improve CRO, signups, virality of your content, etc.
4. Google Analytics: Googles Analytics tool for websites and other kinds of products. A must to track conversion and other useful statistics.
5. SocialBro: Analyse twitter social network accounts, hashtags, etc. Get best times to tweet etc.
6. BufferApp:  Buffer your tweets and other message you want to send to your social network.
7. Canvanizer:  Create your own business canvas online, share it and collaboratively edit it.
8. Mail Chimp: Email marketing with analytics. Free. Lets you A/B test.
9. Rapportive: Gather information about people through social networks and their emails. Check this article to find out more about how you can use it to develop contacts and do PR.
10. If This Then That: Automate the internet. Make it work for you. Create triggers for when you do certain things like posting to Twitter, or publishing and article in your blog.

This is all folks!

There are a few things that bother me in life, but there are three in particular that provide me with the energy to finally start writing this blog.