Lean Start-Up in Settings of Impoverishment: The Implications of the Context for Theory

Abstract

We examine the application of “lean start-up” in impoverished non-Western contexts. Specifically, we focus on settings of impoverishment in which individuals earn less than $3.65 per day. We focus on how two attributes of these contexts—institutional differences relative to mature economies and resource constraints—affect entrepreneurs’ implementation of lean start-up principles. By focusing our conversation on five components of lean start-up (search for opportunities, business modeling, validated learning, minimum viable products, and the decision to persevere/pivot), we describe how the conditions faced by impoverished entrepreneurs outside the West in impoverished settings present hurdles to some practices of lean start-up while encouraging other practices. We also offer ways entrepreneurs can adapt lean start-up to fit the conditions they face. In addition to advancing our understanding of lean start-up, this article also joins recent work that has critiqued the Western orientation of many management theories and practices and especially their application to people outside the West, where assumptions may not carry over due to institutional differences and resource constraints.