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Thank you so much for coming. I'm actually really honored to be here, so thanks to Chad and Ben and to the O'Reilly team for inviting me.
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You're not going to believe this, but I know other speakers dream about speaking at TED and going to Davos and whatever, but I've been sitting by my phone for a long time wondering when I would be invited to RailsConf.
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I know you might think I'm kissing your ass, but it's really the truth. Rails has done more for startups than a whole boatload of venture capitalists.
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Rails has had an incredible impact on the startup ecosystem, and I see it every day. I learned a tip from Gary Vaynerchuk, which is to make sure they know who the hell you are before you start talking.
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I write a blog called Startup Lessons Learned. Do we have any readers in the audience? Wow, thank you so much! That's exciting!
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For the rest of you, how many of you are entrepreneurs or in a startup right now? Just a quick show of hands. Wow, okay, yes, thank you! That's what I expected.
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Everywhere I’ve seen Rails, especially in Silicon Valley, startups spring up everywhere. I just wanted to share a few thoughts about why that is.
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The Lean Startup is now a movement. As you heard, I've been traveling all over the place talking about a different way of building startups and a different way of thinking about entrepreneurship.
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I think it's very compatible with what you guys talk about in the Rails community. I say 'you guys' because I'm kind of a faker. I was an engineer and I was the CTO of several companies, most of which have failed.
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Hi, I'm a professional startup expert, but the truth is most of my companies have failed. I know you're not supposed to start that way, but that's the truth.
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Anyone willing to tell you the truth about entrepreneurship—not the stories you read in the press, but the real stories—will show you that there is a lot of failure.
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When I first wrote code, there wasn't much going on with Rails. Now to see it grow into such an incredible community has really been cool.
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Let’s just set some quick ground rules. First, who has a mobile phone? Just kidding!
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But if you're paying attention, could you take it out of your pocket and make sure it’s on? I do not want your undivided attention. Please tweet amongst yourselves as much as you like.
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All I ask is that you use the Lean Startup hashtag while you do so to join the worldwide conversation about Lean Startup.
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I have a new book coming out, and you know when you're writing a book, you're pretty much obligated to go everywhere and tell people they should buy it.
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It’s coming out in September, but don’t worry, you can pre-order it now at lean.st. I can wait while you do that. Just take a moment.
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I really appreciate everyone who has pre-ordered. It’s incredibly supportive, thank you!
00:02:03.719
I want to give a quick shout out to Pivotal Labs, who built this website for me at lean.st, on Rails, of course.
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It’s hosted on Heroku, so thanks to Pivotal and Heroku. My friends at Pivotal heard I was speaking here and said, "If you just happen to run into a couple of thousand Rails developers, could you tell them that we're hiring?"
00:02:15.360
So Pivotal is hiring; I thought I’d plug that. Lean.st is not just a website to sell the book; it's also a fully-featured experimental platform for testing.
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It's about Lean Startup, as you'll see in a minute, and we built it to make experiments as easy as possible.
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If you pre-order at lean.st, you can actually go behind the scenes and see every single experiment we have run, all the data about customer behavior.
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You can actually watch us experimenting in real time. I’ll stop plugging things now.
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These are some principles from the book that I wanted to share with you: entrepreneurs are everywhere, entrepreneurship is management.
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This concept of validated learning, which is the unit of progress for startups, the feedback loop we call 'build, measure, learn', and something called Innovation accounting.
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At this point, I should probably apologize because you came for an exciting talk about entrepreneurship, which is the coolest topic ever.
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Now I'm telling you we're going to talk about management and accounting, probably the most boring topics imaginable. So I apologize.
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But if we're going to get good at entrepreneurship, we have to make it a lot more boring. Let me explain.
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Who saw the social network? Just a quick show of hands. Okay, who saw Ghostbusters II? Great entrepreneurship movies.
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People forget that much of Ghostbusters II plots around these crazy guys with new technology who are thrown out of a university.
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It shows how they're going to build their fledgling business and make it successful.
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Like all great entrepreneurship movies, they follow a story in three acts. Act One: The plucky protagonists, their character strengths and defects.
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They have the great idea, maybe get their first customer, and then we shift into Act Two, what I call the photo montage.
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It usually lasts about two minutes, like in the social network, where they pound on keyboards, or in Ghostbusters, where they bust a ghost or two.
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Suddenly they're on the cover of magazines, and everything seems really successful.
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Then we go into Act Three, the really interesting part: how to divide up the spoils, who sues who, and what happens to the Stay Puft Marshmallow Man.
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These movies are great for a reason. When you read stories about entrepreneurs in magazines, you see those great stories—it's really fun.
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I have this question: how come the photo montage is so short and has no dialogue?
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In my opinion, every important decision that determines the outcome of a startup's success or failure happens during that photo montage.
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The answer is because all that work is too boring for a movie.
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Who has ever sat through a product prioritization meeting? Does that seem like movie material to you? No, of course not!
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And yet, product prioritization decisions—what features to build, what bugs to fix, which customers to listen to—those are the really important yet boring topics in entrepreneurship.
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As an industry, we have to get better at not just doing that stuff, but also talking about it.
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The exciting stuff—how to get your great idea, how to divide up the spoils—requires serious planning and consideration.
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Those of you who are entrepreneurs already have worked it out in great detail what you're going to do once you get very rich.
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These questions are very exciting, but they represent only 5% of entrepreneurship; the other 95% consists of those boring, day-to-day details.
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Sorry to disappoint you if you were looking for something exciting.
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Entrepreneurs are everywhere, and what's amazing about asking that question is that, every time, people raise their hands.
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I've done that in countless cities and countries around the world; I've never had someone say, "Excuse me, I'm not sure whether to raise my hand or not."
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Everyone thinks they know what entrepreneurship is. If I'm doing that crazy thing like in Ghostbusters, then I'm an entrepreneur.
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If I have a regular job at a normal office where there’s no poll to slide down, then no.
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Yet I think we need to do better than that. If we're going to start making our practice of entrepreneurship more rigorous, here’s my definition of a startup.
