How to build a lean canvas for your startup

Aspiring entrepreneurs often have a great idea for a business, but struggle to turn that idea into a viable plan. This is where the lean canvas comes in. The lean canvas is a one-page business plan that helps entrepreneurs quickly and easily outline their business model. In this article, we will explore the basics of how to create a lean canvas for entrepreneurs in Saudi Arabia.

According to The Small and Medium Enterprises General Authority (Monsha'at) 2022 Q4 SME Monitor Report, a total of 1.14 million SMEs are registered in the Kingdom with a 6% jump in the number of SMEs in the Kingdom between Q3 and Q4 of 2022 indicating a growing interest in entrepreneurship. Creating a lean canvas can help entrepreneurs in Saudi Arabia turn their ideas into actionable plans.

The importance of a lean canvas

It’s essential for entrepreneurs and startups to understand the importance of creating a lean canvas to help them properly plan their business strategies. This lean canvas helps create a concrete roadmap of the company's objectives and can be used as a powerful tool for visualizing and pivoting ideas based on customer feedback. It’s an invaluable asset that helps companies sharpen their competitive edge and make smarter decisions.

Lean canvas is a business model canvas but more entrepreneur-focused and designed for startups at the beginning stage. It helps founders focus on the most important aspects of their product and avoid getting bogged down in unnecessary details. It can be used as a tool to help validate or invalidate a startup's business model while being a valuable resource for communicating with potential investors and customers and allows everyone to be on the same page. 

Here are steps to follow to get started creating your own lean canvas:

1. Start with the problem: The first step in creating a lean canvas is to identify the problem that the business will solve. This is the foundation of the business and should be clearly articulated on the canvas. Entrepreneurs should be able to explain the problem they are solving in a simple and concise manner.
2. Identify the solution: Once the problem has been identified, entrepreneurs need to identify their solution. This can be in the form of a product, service, or combination of both. Entrepreneurs should focus on the unique value proposition of their solution and how it differentiates from existing offerings in the market.
3. Define the customer segments: It is crucial for entrepreneurs to identify their target market on the lean canvas. They should describe their ideal customer and identify their pain points. This information will help entrepreneurs better understand their customers' needs and develop a product or service that addresses those needs.
4. Outline revenue streams: A key aspect of the lean canvas is outlining revenue streams. Entrepreneurs should consider all potential revenue sources, such as sales, subscriptions, or advertising. They should also identify their pricing strategy and how they will generate revenue in the short and long term.
5. Find the unique value proposition: It’s essential to identify and clearly define the unique value proposition of your startup before you embark on the journey of taking it from idea to reality. This is important in order to stand out from the competition, attract customers, and ensure that your business model has a solid foundation. 
6. Map out key channels: Entrepreneurs should map out the key activities necessary to bring their solution to market. This includes product development, marketing, sales, and customer support. This information will help entrepreneurs better understand the resources and team they need to execute their plan.
7. Identify key metrics: Knowing these metrics ahead of time will give you the insight needed to make timely adjustments and ensure that you remain on track for success. Some examples of key metrics include customer acquisition cost, revenue per customer, customer retention rate, and average order value.
8. Evaluate cost structure: It’s important for entrepreneurs to evaluate their cost structure early on. This includes identifying the costs associated with key activities, such as product development and marketing, and determining how they will be funded. Entrepreneurs should also identify potential cost savings opportunities and ways to reduce expenses.
9. Determine your unfair advantage: Finally, before you launch your startup, it’s essential to identify and capitalize on your unfair advantage. This could be anything from an innovative product or service you offer, a unique approach to marketing or customer service, or a more creative way of solving an age-old problem. Consider what sets you apart from the competition and use it as leverage to increase your chances of success.

Creating a lean canvas is a crucial step in turning an idea into a viable business plan. By starting with the problem, identifying the solution, defining the target market, outlining revenue streams, mapping out key activities, identifying key partners and suppliers, and evaluating the cost structure, entrepreneurs can create a clear and actionable plan for their business.

The lean canvas is a powerful tool that can help entrepreneurs in Saudi Arabia turn their ideas into actionable plans. By following the steps outlined in this article, entrepreneurs can create a clear and concise plan that outlines their business model and helps them achieve their goals. As the startup ecosystem in Saudi Arabia continues to grow, creating a lean canvas is a key step in building a successful business.