What if you didn't START lean?

I have successfully launched a startup. It is a niche school management system for Montessori Schools. It's profitable but doesn't produce a lot of income (translated: can't quit my day job). My existing clients are happy though they'd like some more/different features.

I currently have three problems:

Problem 1 : My target audience does not respond well to search engine marketing and is not very tech-savvy. This results in VERY slow sales, often requiring a lot of hand-holding.

Problem 2 : I'd never heard of lean anything when I started and, as a result, the product's bloated with tons of features.

Problem 3 : My existing clients want these features but several prospects don't care.

I have determined that at least one module from my overall system would appeal to a much larger audience (all elementary schools in the US and elsewhere). I've several prospective customers ask "Can I just have so-and-so?".

Also, I now have a MUCH better idea of how to start a company using the lean methodology (thanks to Ash Maura's awesome work and Case before him, among many others). I could have the single module pulled out, prettied up, simplified and ready for MVP-level in relatively little time.

What do I do? What would YOU do?

Options:

1. Fix one module at a time on the existing system and just deal with the slow sales cycle.
2. Maintain it but start to build the simpler business on the single module. It's less $$/customer but MUCH larger audience and one that is easier to reach.
3. Run for the hills! The education space is too scary for me! ;-)

Thanks. I look forward to your thoughts and discussion...

Best,

Keyton Weissinger

It is hard to answer your question because really there were about 10 questions in your question :)

In general, lean is about maneuverability and ability to iterate. That is dependent on the founding team. In your case it seems tough to pull off because even as the main founder, you can not dedicate full time work to this.

So in your case, you likely have to say many "no's" to people who ask for stuff, and simplify your path to the most coveted goals. Since you have limited resources, you have to keep things simple, and that means saying no to many good ideas, and only saying yes to the best ideas.

Does that help?

In your place I'd look favourably at:

Orphan the existing product (it didn't work, cost of sales is higher than you expected, sales are harder etc). Satisfy contractual obligations with the intention of giving it the bullet at the first available opportunity. Don't feel guilty at having to cast these customers adrift - you've learnt the market isn't as you hoped.

Meanwhile, look to develop the leaner v2 product for the larger market with the intention of focussing on that market exclusively at the first available opportunity.

Use some of the leads you have for this lean version as customer discovery and beta testing perhaps.

If this works, perhaps pull other features out of the original app as prospects require them, and implement in a lean manner. Perhaps they can be separate products this time around.

I realise that's pretty vague, but there's lots of unknowns in there without knowing your finances, margins and the like. But the opportunity to sell 100x the amount on a more commodity basis with a cheaper simpler product sounds worth pursuing.

Hope something in there helps.

It sounds like you are remarkably well qualified to develop your product for the first time. ;-) Launch a product to compete with your existing product. It sounds like you know everything you need to know bury your "competition". Do it. Be sure and make a way to cleanly migrate from your "competitor". Then let your original client base know that there will be no further updates however you would be happy to help them migrate to the product that will be receiving updates. The sooner you face this reality, the easier it will be. Wait too much longer and even this suggestion will be unachievable.

To take the alternate view for a second.

You don't always have to be lean, you don't always have to do SEO, they are just the new cool shiny things that are becoming best practice if your strating up.

You have a good product, you have a good if not big enough client base. There are heaps of old school marketing techniques which could help target your market.

If it is easy to release a new version back to your users I would put hit counters on every feature/page/form. Basically create a webservice which as they open it calls to say "done this" like a basic google analytics. Collect your stats over time about who uses what, when and how often. That will give you the hit list of what gets kulled and what stays.

Look at building the next round as a Website or Silverlight or something where you don't have the install / training pain use camtasia or something to allow them to self serve and then charge for specilist training on top.

We have old VB6 applications still going strong, with a million features and functions and we still sell that product over our competitors who give it away as part of a larger bundle ... because it saves so much time for the user.

Before killing it completely try and get to a trade show or event where you have a chance to meet and present to a range of prospects. We have been doing this in Australia with one product suite targeted at the Newsprint industry for the last 10 years and 1 show can give us the sales hit list for the year.

That said, if your just not happy doing it, thats a different story, find something that does grab you and ignore my ravings above.