Lean Canvas Template

The Lean Canvas is a version of the Business Model Canvas optimized for startups. Created by Ash Maurya, CEO and Founder of LEANSTACK, the Lean Canvas follows the idea of the Lean Startup. Eric Reis, who introduced the concept, describes the Lean Startup as an approach to running an efficient new business. Its main principles are

• handling uncertaintly, meaning immediately starting marketing efforts,
• validated learning or making discoveries as you go, and
• innovation accounting by keeping in mind your success metrics.

The Lean Canvas is a one-page diagram consisting of nine boxes, which startup founders can fill to describe, share, and easily adjust their business model. As a more flexible alternative to a business plan, the Canvas allows you to make assumptions about your future business and iterate on the go.

All nine elements of the Lean Canvas include:

1. Problem. Here, you describe what pain points your potential customers have and if there are existing solutions that fail to solve them.
2. Customer segments. This is where you define your target audience by narrowing down your potential customer base to the early adopters.
3. Unique value proposition (UVP). In this section, formulate how your product is different from the alternatives using keywords.
4. Solution. Here, identify the features that will solve the aforementioned problem.
5. Communication channels. Fill this box with ideas on how you will promote your product and spread the news about it.
6. Revenue streams. Use this section to list all the ways your product will be making money. Watch our video on revenue models to help you with that.
7. Cost structure. Here, write your fixed and variable costs.
8. Key metrics. Choose a few product KPIs to focus on and help you evaluate progress.
9. Unfair advantage. Consider what unique features will make your product hard to duplicate, such as exclusive deals and partnerships or cutting edge technology.

Don’t be too contemplating when filling out the Canvas. All ideas will need to be validated so nothing is set in stone before you’ve proven that it works. A good Lean Canvas is the one that will inspire you and your team to look for solution rather than staring at the board for days on end.

Using Lean Canvas offers several advantages:

1. Streamlined and Targeted Approach. Lean Canvas condenses the complexities of a business plan onto a single page, prompting entrepreneurs to concentrate on the crucial aspects of their business model. This streamlined approach promotes clarity and prevents overwhelming information.
3. Swift Adaptation. The design of Lean Canvas facilitates rapid iterations and updates. Entrepreneurs can easily modify and enhance their canvas as they acquire more information, test assumptions, and absorb insights from customer feedback.
5. Hypothesis Examination. Lean Canvas is a valuable tool for formulating and testing hypotheses. Entrepreneurs can articulate their assumptions regarding key elements of their business model and actively seek feedback to either confirm or challenge these assumptions.
7. Optimal Resource Allocation. By concentrating on the fundamental elements of the business model, entrepreneurs can judiciously distribute resources and avoid unnecessary expenses, which is especially beneficial for startups grappling with limited resources.
9. Mitigation of Risks. Lean Canvas advocates a systematic approach to identifying and addressing potential risks early in the business development. Through validating assumptions via real-world feedback, entrepreneurs can diminish the risk of failure.

When creating the Lean Canvas, Ash Maurya used almost the same elements as the Business Model Canvas, apart from Key Partners, Key Activities, Key Resources, and Customer Relationships, which he replaced to capture the uncertainty of the startup environment. Here’s what the new sections were meant to address.

The Problem is meant to prevent startups from making the mistake of not finding the right product/market fit. That’s why you start filling out the Canvas by finding what the market is lacking.

The Solution should be defined after. The limited space in the box should constrain entrepreneurs and make them consider every idea, not just the one they like the most.

The Key Metrics must make you think about how you define success from the ground up. At what point do you know that your startups is going to make it? Or what will help you understand that you’re failing before it’s too late? We talk in detail about measuring product success in our video.

Finally, the Unfair Advantage addresses how the startup today can succeed largely to its difference from similar products and how hard it is to replicate that difference.

1. Failing to articulate your customer segment clearly. Entrepreneurs often fail to use lean canvas properly by not clearly defining their target customer segment, leading to confusion and irrelevance. It’s crucial to narrow down the segment based on shared problems, needs, or desires using criteria like demographics or behaviors.
3. Ignore the need to test your problem hypothesis. In Lean Canvas, a common mistake is assuming that you know customers’ problems and feelings. It is essential to test problem hypotheses by engaging potential customers through interviews or surveys and prioritizing critical issues.
5. Neglecting the verification of your solution hypothesis. After validating the problem hypothesis, entrepreneurs often build a full product without validating the solution hypothesis. It is necessary to create a minimum viable product (MVP) to demonstrate core features and benefits, gathering feedback before investing extensively.
7. Failing to iterate based on feedback. Sticking to initial assumptions can hinder finding a product-market fit. Iterating based on customer feedback, incorporating insights into the lean canvas, and continuously testing assumptions are crucial for achieving a scalable and sustainable business model.
9. Not expressing your value proposition clearly. It is important to articulate the value proposition with simple, specific, and compelling language, supported by stories or testimonials illustrating real-world problem-solving for customers.