How to Fail Less  Business Models andCustomer Development        Steve Blank     www.steveblank.com         @sgblank
What We Used to Believe        Strategy
All I Need to Do is Execute the Plan
All I Need to Do is Execute the Plan
All I Need to Do is Make the Forecast
All I Need to Do is Make the Forecast
What We Now Know     Strategy
Planning comes before the plan
Business Models
Business Models
Search          Execution           Business Model   Operating Plan +Strategy            Hypotheses      Financial Model
What We Used to Believe        Process
We Built Startups byManaging Processes  Product Management            +  Waterfall Engineering
Product Introduction Model Concept/    Product   Alpha/Beta   Launch/Seed Round    Dev.        Test      1st Ship
Product Introduction Model Concept/    Product   Alpha/Beta   Launch/Seed Round    Dev.        Test      1st Ship
Waterfall / Product Management                                    Execution on Two “Knowns”                               ...
Waterfall / Product Management                                    Execution on Two “Knowns”                               ...
What We Now Know     Strategy
More startups fail froma lack of customers than from afailure of product development
Customer Development  A Search Strategy
Search             ExecutionStrategy    Business Model                                 Operating Plan +              Hypot...
What We Used to Believe      Organization
Hire and Build aFunctional Organization
What We Now Know    Organization
Founders run a Customer Development TeamNo sales, marketing and business          development
Search                      Execution Strategy     Business Model                                           Operating Plan...
SearchStrategy     Business Model               HypothesesProcess           Customer Development,             Agile Develo...
Search                      ExecutionStrategy     Business Model                                         Operating Plan + ...
Part 2 Business Models andCustomer Development
What’s A Startup?
A temporary organization      designed to searchfor a repeatable and scalable       business model
A temporary organization      designed to searchfor a repeatable and scalable       business model
A temporary organization      designed to searchfor a repeatable and scalable       business model
A temporary organization      designed to searchfor a repeatable and scalable       business model
A temporary organization      designed to searchfor a repeatable and scalable        business modelA Startup aims to becom...
What’s a Business Model?
But,Realize They’re Hypotheses
Business Model Canvas              building               block                                 building                  ...
9 Guesses                            GuessGuess    Guess                                     Guess                  Guess ...
Turning Hypotheses Into Facts
The Four Steps – The Startup Path        Customer Development
Customer DevelopmentTest the Problem, Then the Solution
Customer Development  The Minimum Viable Product
Customer Development       The Pivot
Customer Development ishow you search for the model
Customer Discovery
Web/Mobile Versus Physical                    Customer            Customer                    Discovery           Validati...
Customer DiscoveryStep 1: State Your Hypotheses
Customer DiscoveryStep 2: Test the Problem
Customer DiscoveryStep 3: Test the Solution
Customer DiscoveryStep 4: Pivot or Proceed
Customer Validation
Customer                 ValidationStep 1: Get Ready to Sell
Customer                 ValidationStep 2: Sell to EarlyVangelists
Customer                ValidationStep 3: Develop Positioning
Customer               ValidationStep 4: Pivot or Proceed
How to Build A Startup             Idea        Business Model       Size Opportunity    Customer Development
How to Build A Startup        Business   Size of the   Customer    CustomerIdea    Model(s)   Opportunity   Discovery   Va...
How to Build A Startup        Size of the         Business     Size of the                       Business     Customer    ...
How to Build A Startup       Size of the        Business     Size of the                      Business     Customer    Cus...
How to Build A Startup              Size of the               Business      Size of the                              Busin...
How to Build A Startup       Size of the        Business     Size of the                      Business     Customer    Cus...
Additional Resources• I-Corps class summary:http://steveblank.com/2012/03/26/the-national-science-foundation-innovation-co...
Steve blank latino startups 051512
Steve blank latino startups 051512
Steve blank latino startups 051512
Steve blank latino startups 051512
Steve blank latino startups 051512
Steve blank latino startups 051512
Steve blank latino startups 051512
Steve blank latino startups 051512
Steve blank latino startups 051512
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Steve blank latino startups 051512

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Latino Startup Alliance May Meetup with Steve Blank @ Mozilla MV

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  • 320 SBIR Phase 2 companiesGot $500K50% from academiaMix of technologies20% of you will get phase 2b20% of those will succeed13 of you will succeedMost of you think you are in execution modeMost will be a few years old – thinking they are in execution~25 will be a lot olderNot all in the audience will be founders, some will be employeesGraphene Frontiers is the perfect exampleStart with their slidesEmphasize that this process not just works for software but anything with customer/market riskFix the serendipitous DOW meetingGroun flour pharma as a backup
  • Transcript of "Steve blank latino startups 051512"

    1. 1. How to Fail Less Business Models andCustomer Development Steve Blank www.steveblank.com @sgblank
    2. 2. What We Used to Believe Strategy
    3. 3. All I Need to Do is Execute the Plan
    4. 4. All I Need to Do is Execute the Plan
    5. 5. All I Need to Do is Make the Forecast
    6. 6. All I Need to Do is Make the Forecast
    7. 7. What We Now Know Strategy
    8. 8. Planning comes before the plan
    9. 9. Business Models
    10. 10. Business Models
    11. 11. Search Execution Business Model Operating Plan +Strategy Hypotheses Financial Model
    12. 12. What We Used to Believe Process
    13. 13. We Built Startups byManaging Processes Product Management + Waterfall Engineering
    14. 14. Product Introduction Model Concept/ Product Alpha/Beta Launch/Seed Round Dev. Test 1st Ship
    15. 15. Product Introduction Model Concept/ Product Alpha/Beta Launch/Seed Round Dev. Test 1st Ship
    16. 16. Waterfall / Product Management Execution on Two “Knowns” Requirements Product Features: known Design Implementation Verification Customer Problem: known MaintenanceSource: Eric Rieshttp://startuplessonslearned.blogspot.com
    17. 17. Waterfall / Product Management Execution on Two “Knowns” Requirements Product Features: known Design Implementation Verification Customer Problem: known MaintenanceSource: Eric Rieshttp://startuplessonslearned.blogspot.com
    18. 18. What We Now Know Strategy
    19. 19. More startups fail froma lack of customers than from afailure of product development
    20. 20. Customer Development A Search Strategy
    21. 21. Search ExecutionStrategy Business Model Operating Plan + Hypotheses Financial ModelProcess Customer & Product Management & Agile Development Agile Development
    22. 22. What We Used to Believe Organization
    23. 23. Hire and Build aFunctional Organization
    24. 24. What We Now Know Organization
    25. 25. Founders run a Customer Development TeamNo sales, marketing and business development
    26. 26. Search Execution Strategy Business Model Operating Plan + Hypotheses Financial Model Customer Development, Product Management Process Agile Development Agile or Waterfall Development Customer Functional OrganizationOrganization Development Team, by Department Founder-driven
    27. 27. SearchStrategy Business Model HypothesesProcess Customer Development, Agile DevelopmentOrganization Customer Development Team, Founder-driven
    28. 28. Search ExecutionStrategy Business Model Operating Plan + Hypotheses Financial ModelProcess Customer Development, Product Management Agile Development Agile or Waterfall DevelopmentOrganization Customer Development Functional Organization Team, Founder-driven by Department
    29. 29. Part 2 Business Models andCustomer Development
    30. 30. What’s A Startup?
    31. 31. A temporary organization designed to searchfor a repeatable and scalable business model
    32. 32. A temporary organization designed to searchfor a repeatable and scalable business model
    33. 33. A temporary organization designed to searchfor a repeatable and scalable business model
    34. 34. A temporary organization designed to searchfor a repeatable and scalable business model
    35. 35. A temporary organization designed to searchfor a repeatable and scalable business modelA Startup aims to become a company
    36. 36. What’s a Business Model?
    37. 37. But,Realize They’re Hypotheses
    38. 38. Business Model Canvas building block building building building block block building blockbuilding block block building building block building block building block block building building building building block block block block
    39. 39. 9 Guesses GuessGuess Guess Guess Guess Guess Guess Guess Guess
    40. 40. Turning Hypotheses Into Facts
    41. 41. The Four Steps – The Startup Path Customer Development
    42. 42. Customer DevelopmentTest the Problem, Then the Solution
    43. 43. Customer Development The Minimum Viable Product
    44. 44. Customer Development The Pivot
    45. 45. Customer Development ishow you search for the model
    46. 46. Customer Discovery
    47. 47. Web/Mobile Versus Physical Customer Customer Discovery Validation Pivot• Web/Mobile startups run faster• Different process steps for web vs. physical• Customer Relationships are radically different
    48. 48. Customer DiscoveryStep 1: State Your Hypotheses
    49. 49. Customer DiscoveryStep 2: Test the Problem
    50. 50. Customer DiscoveryStep 3: Test the Solution
    51. 51. Customer DiscoveryStep 4: Pivot or Proceed
    52. 52. Customer Validation
    53. 53. Customer ValidationStep 1: Get Ready to Sell
    54. 54. Customer ValidationStep 2: Sell to EarlyVangelists
    55. 55. Customer ValidationStep 3: Develop Positioning
    56. 56. Customer ValidationStep 4: Pivot or Proceed
    57. 57. How to Build A Startup Idea Business Model Size Opportunity Customer Development
    58. 58. How to Build A Startup Business Size of the Customer CustomerIdea Model(s) Opportunity Discovery Validation
    59. 59. How to Build A Startup Size of the Business Size of the Business Customer CustomerIdea Opportunity Model(s) Opportunity Model(s) Discovery Validation Theory Practice
    60. 60. How to Build A Startup Size of the Business Size of the Business Customer CustomerIdea Opportunity Model(s) Opportunity Model(s) Discovery Validation
    61. 61. How to Build A Startup Size of the Business Size of the Business Customer CustomerIdea Opportunity Model(s) Opportunity Model(s) Discovery Validation • First test the problem • Next test the solution
    62. 62. How to Build A Startup Size of the Business Size of the Business Customer CustomerIdea Opportunity Model(s) Opportunity Model(s) Discovery Validation
    63. 63. Additional Resources• I-Corps class summary:http://steveblank.com/2012/03/26/the-national-science-foundation-innovation-corps-what-america-does-best/• I-Corps team presentations:http://www.slideshare.net/sblank/tagged/i-corps• Resources for startups: http://steveblank.com/tools-and-blogs-for-entrepreneurs/• Books for startups: http://steveblank.com/books-for-startups/• Additional resources: http://steveblank.com/slides/

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