Our Agile/Lean book club is wrapping up The Four Steps to the Epiphany and the author Steve Blank joined us for the last weekly meeting. Here is my transcript of the most important points.

The main takeaways from the book. “There are no facts inside the building, so get the hell out.” The author said startups are not rational projects, if you understood the odds, you’d never do it. Founders have visions of future products and they see things no one else does, but unrestrained passion can lead to two mistakes early on. The first mistake is confusing your vision with facts and the second one is equating understanding of the customer’s problem with understanding the feature set you need to build. Also, almost all investors and venture capitalists come from business schools, but business schools mostly teach to administer and execute business models, while startups are completely different: they’re temporary organizations that search for scalable and repeatable business models.

You should have a co-founder in a technology startup, but you don’t necessarily need an MBA. You have to acknowledge that your technology idea is not a company. You (as a technologist) can teach yourself all the business stuff, but that will take a big chunk out of your “coding.” Out of two or more technical co-founders, someone is naturally the most comfortable outside the building (e.g. Gates, Ellison, etc.).

If you are an employee of a startup and you’ve seen the light of customer development, but your CEO hasn’t, you have two options: shut up or leave. The odds of your being able to educate someone in time are very, very low. As a variation of the same point, if you’re the founders of a startup whose investors unfamiliar with the customer development process and you decided to do it after you’ve taken their money, chances are you’ll be ex-founders pretty soon.

Customer development is not a better version of something that preceded it. It’s very radical to those haven’t exposed to it. The worst way to talk about customer development is to evangelize about it.

Interesting parallels between customer development and agile/lean. You need to know the key concepts and wrap your head around them and it’s OK if you lapse on some corner cases. If you started hiring sales people before you have any proof, you just lapsed out of customer development. If you did a big-bang launch, if you spec’d and started building every possible feature, if your investors tell you “it’s Month 7 and the revenue plan says X”, you’ve dropped it. This is very similar to our Agile redneck jokes.

Customer development and agile/lean engineering really go together. Steve acknowledged that they didn’t go well together in the book, but they really do so in the life. He was blunt about waterfall: if your engineering team is doing waterfall, put down this book and step away from it!

What should engineering team do during the customer discovery phase? Assume they are building the product. Execute the original vision, but as soon as you have feedback from the outside, re-plan and change the direction. Customer discovery is not a focus group!

It is intimidating to start customer development without having a viable product. Steve agreed with it recounted an episode from many years ago when he was an engineer and a founder and being so frightened that he “stared at a telephone for three days hoping it would dial itself.” But it was helpful to remember that the purpose was not to sell anything, but to listen.