Next, define your activation event. This is ideally the point when your users have their first aha moment with your product. Think: taking your first ride in a theme park.

2. Convert Your Minimum Success Criteria to Customer Throughput In order to calculate the customer throughput needed, the first critical input we need is a pricing model. I review lots of Lean Canvases where this isn’t specified. Even at the early ideation stage, you need to get specific on pricing. The biggest objection I often hear is: “How can I

Again, precision here is not the goal but an estimate. First estimate to an order of magnitude. Is your solution potentially worth $1/month, $10/month, $100/month, $1,000/month, $10,000/month? Then use your knowledge of your customers’ existing alternatives to get more specific. That is how I estimated my $50/month starting price point. The best

As part of my consulting practice, I advise entrepreneurs in accelerators who are usually working frantically on many things at once. I often find that they have a few paying customers, which is a great start. My next question to them is: “Do you know how you’re going to get your next ten paying customers?” Often they don’t have a good answer.

That metric is traction: the rate at which a business model captures monetizable value from its users. We’ll expand upon this definition in chapter 1.

as we strengthen this link and reapply stress to this chain, the weakest link moves to a different, and often unpredictable, link in the system.

When you are pursuing something new and innovative, people don’t see what you see, which is the first battle. If you talk to ten people and none of them are interested in your idea, that is a statistically significant outcome that you need to address before tackling the thousands or millions of customers in your business model projections.

We can map the three stages of a business model to this S-curve: 1. The Problem/Solution Fit stage is the flat portion of the curve when you validate customer demand for your value proposition. 2. The Product/Market Fit stage is the inflection point which marks the rapid or exponential growth stage of the business model. 3. Because it is hard to

The singularity moment of a product is not when you write your first line of code or raise your first round of funding, but when you create your first customer. You go from nothing to creating value. Every business, whether it’s Amazon, Google, or Facebook, started this way—with one before the millions (or billions). While one might seem too simple