9 out of 10 new startups fail either because they do not build a product, which solves a problem for their target audience or because it does not do so enough for their target audience to pay for it. This is not only an issue for startups but also for established organisations, which spend a lot of money in research and development to disrupt and change markets. Therefore to mange the time to market is crucial for any product development.
Finding a product that actually disrupts the market seems to rely purely on luck for most organisations. Writing a business plan in order to reduce the risk of building a failing product seems to be a valid strategy for most organisations. Most business plans try to predict how a market will react to the certainties given the context of what is visible at the time though. But as we learnt in 2008, the world has advanced into too much of a complex environment. Predictions drawn out today are usually not valid anymore in six months: That is how long it took for the 4 big investment banks and a market capitalisation of several hundred billion dollars to vanish.
The Lean Startup
Eric Ries disrupted the startup market in 2011 when he published his book “The Lean Startup”. It describes a framework that helps you quickly learn both how to build a product that solves a problem for the customer and whether they are willing to pay for it or not. Many people saw Lean Startup as a model to faster create a product which they then call Minimum Viable Product (MVP). But Lean Startup is merely a framework to help you reduce the cost of failure to a minimum. It will minimise the time to market.
In the wake of Lean Startup, Alex Osterwalder and Ash Maurya developed the approach of the Business Model Canvas or Lean Canvas. Those canvases can be understood as a minimum approach to your business plan: Instead of assuming for weeks what the next 5 years will hold up for you, they encourage you to write down your assumptions within minutes and then experiment on those assumptions until you either understand that you will have a successful product or until you invested enough money to have learnt that your vision is not feasible.
Manage your time to market
Therefore, managing your time to market is not determined by a timeframe, for which you need to provide money through your organisation or investments, but rather by the money commitment your idea is worth to you. You set a budget which you define as your runway: You either find the market for your idea with your product, or you have an easily calculated risk of losing money.