Like many folks in the startup crowd, I’m a reader of Eric Ries' blog (some links), and I’ve read Steve Blank’s Four Steps to the Epiphany. What I didn’t know is that these guys have joined forces to build a movement they are calling “lean startups.” After attending the Startup Lessons Learned conference last week, I now believe this methodology is on its way to making a major impact on the world of entrepreneurship.

Inspired by the lean manufacturing revolution (and excellent books like Lean Thinking), I started with a first fundamental question: in a startup, what activities are value-creating and which are waste? Usually, new projects are measured and held accountable to milestones and deadlines. When a project is on track, on time, and on budget, our intuition is that it is being well managed. This intuition is dead wrong.

I see video games as a petri dish, a place where the challenges and rewards of the real world are simulated in a simpler, more discrete fashion. Often the challenges faced remind me of the same challenges I face in my work as an entrepreneur. In the spirit of Scott Berkun’s Management lessons from Gears of War 2, I present you three business lessons I’ve learned from video games.

Fast action, or careful planning? Steve Jensen nails it:

In a slowly changing society, which is to say almost all of human history, older people, while they may not run as fast or even think as fast as younger people, knew more. So it makes sense to have institutional structures in which, on average, older people have authority over younger people.

Eric Ries is full of little gems:

Luke Kanies, the author of Puppet, blogs about Chef. I’m impressed by that because Chef is a direct competitor to Puppet. (CFEngine is another, older, product that could be placed in the category with Puppet and Chef. Namely: declarative, recipe-based server configuration systems.)

The best solutions tend to come from people or organizations that are close to the problem. This is true for any complex system: companies, government, and software.

Google Alerts, RSS feeds of Technorati searches, and Twitter trackers like TweetBeep have created a subtle but powerful shift in the flow of information between producers/performers and their audience.

Crossing the Chasm is my favorite book on business. Its pages are packed with little gems, like this:

Joe Krauss says that being early is the same as being wrong. Be a step ahead, not a mile ahead.

Google does a nice job delicately phrasing that they are phasing out their Notebook product.

The leaders whose visions come true build and sustain their people's momentum. They bring it down to earth, focusing on short-term accomplishments - the adrenaline-pumping goals that get scored on the way to winning the game.

Tony Wright identifies the phases of a startup and the relative value of product- vs. business-focused people over time:

If you're starting a company, the route to massive overwhelming success (as opposed to normal success, which is easier) is to correctly predict and bet your product on one of those threshold transitions. Before the transition, your product was impossible, so of course there are no competitors; after the transition, your product is critical, so you'll sell a lot.

Stealth is a customer-free zone. All of the efforts to create buzz, keep competitors in the dark, and launch with a bang had the direct effect of starving the company for much-needed feedback.

Tim O’Reilly delivers his usual keen business wisdom, packaged up into an excellent article.

Eric Ries ponders the hacker's lament:

Successful companies rarely achieve their success on their first idea, says Jason Cohen. Instead, your initial idea causes you to get something out into the marketplace, from which you can discover a truly good idea:

Evan Williams says that new products can be created by removing features from an existing product. Twitter is a blog, but without titles, formatting, comments, or a 141st character.

Planning is priceless, but plans are useless.

From Good to Great by Jim Collins

I’ve moved my comments to Disqus. This is a great service, incredibly easy to integrate (cut and paste two html/javascript snippets), with a simple and attractive UI. It also doesn’t hurt that its founders Jason and Daniel play a mean hand of poker, and that Jason helped me import my historical comments from an XML file.

Everyone loves a good flamewar between opinionated, respected internet personalities. So like everyone else, I pulled up my chair and got out the popcorn when Paul Graham and David Heinemeier Hansson started going at it. Watching these titans hurl boulders at each other is guaranteed to be a good show.

Intrapreneur - someone who launches new initiatives within an established organization, marshalling resources and taking responsibility for the results.

The healthcare industry is starting to see benefits from being honest when they make mistakes. Denying that doctors and hospitals ever screw up has been the historical approach to avoiding malpractice suits; yet by being more honest, hospitals are seeing a decrease in such lawsuits.

Once or twice a week, I get an email from a recruiter looking to hire a Ruby developer. I can spot these within the first half a sentence, and delete them without reading the rest. Obviously they got my name someplace and didn’t stop to notice that I’m the founder of VC-backed startup and am by no means looking for employment. I suspect that most other Rubyists get the same sort of emails, and the better known you are, the more you get.

PG drew this on the whiteboard at the last dinner of our Y Combinator session:

The winter 2008 session of Y Combinator is just about wrapped up. What a great experience. If you’re thinking of applying to the upcoming session but aren’t sure if it’s worth it, let me assure you: it is.

If you’re a hacker that has thought about (but not yet attempted) creating your own startup, you might want to think about attending Startup School in April. It’s in the Silicon Valley area, but even if you’re not local, the list of speakers may be worth the trip. I’ve heard most of these guys speak at some time or another and each of them had extremely valuable wisdom to share.

Prior to the industrial revolution, status in most societies was based on one thing only: heredity. No matter how much you accomplished - or didn’t - you stayed in the same station of life.