Lean Startup methodology : An exploratory study of the principles applied by South African e-retailers

Abstract

In 2011 Eric Ries wrote a book called “The Lean Startup” in which he documented inexorable logical and lean concepts applicable to start-up businesses. The Lean Startup principles are not yet widely understood and very little research has been conducted on this topic. This qualitative study explores which principles of the Lean Startup methodology young South African e-retail businesses apply during the start-up phase of the business. By applying a qualitative research strategy, six South African e-retail businesses from different sectors were interviewed. The results from the interviews were compared to the Lean Startup approach and it was concluded that South African e-retail businesses applied nearly all the principles of the Lean Startup methodology and philosophy in the start-up phase of their businesses in the following ways: preferred experimentation to elaborate business plans and forecasts; made use of validated learning in order to test the vision of their start-ups; applied the Minimum Viable Product concept to test their vision; applied Actionable metrics during the measure phase of the build-measure-learn feedback loop; did not apply Innovation Accounting convincingly during the measure phase of the build-measure-learn feedback loop; pivoted or persevered in some way or form during the start-up phase of their business; applied all three of the engines of growth as defined by the Lean Start-up.