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Educating Entrepreneurs
 

Educating Entrepreneurs

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    Educating Entrepreneurs Educating Entrepreneurs Presentation Transcript

    • Educating Entrepreneurs Who? What? Why? Steve Blank Stanford Technology Ventures Program
    • News From Silicon Valley Angels & TechStars Incubators Y-Combinator ($0-10M) Maples Investments Seed Funds SoftTech (Clavier) ($10-50M) SV Angel (Conway) Felicis (Senkut) First Round Capital Small VC Funds Union Square Ventures ($50-250M) Sequoia Benchmark Traditional VC Funds (>$250M) Source: Dave McClure 500hats.com
    • News From Silicon Valley Angels & Incubators ($0-10M) Innovation is Seed Funds happening here ($10-50M) Small VC Funds ($50-250M) Traditional VC Funds (>$250M) Source: Dave McClure 500hats.com
    • News From Silicon Valley •  Internet startups - $500K is the new $5M –  Driven by the top of the pyramid •  Seed Funds providing entrepreneurial education –  Ycombinator, TechStars, SeedCamp, LaunchBox, etc •  Customer Development/Lean Startup adoption –  Methodology to test hypothesis and business model
    • Some Definitions
    • Small  Business  Startups   Startup   Small  Business  
    • Small  Business  Startups   Startup   Small  Business   - Business Model found - Profitable business -  Existing team < $10M in revenue
    • Small  Business  Startups   Startup   Small  Business   - Business Model found - Profitable business -  Existing team < $10M in revenue •  5.7 million small businesses in the U.S. <500 employees •  They employ 99.5% of our workforce
    • Scalable  Startup   Scalable   Large   Startup   Company   >$100M/year  
    • Scalable  Startup   Scalable   Large   Startup   Company   >$100M/year   -  Total Available Market > $500m -  Company can grow to $100m/year -  Known business model -  Focused on execution and process
    • Scalable  Startup   Scalable   Large   Startup   Company   >$100M/year   -  Total Available Market > $500m -  Company can grow to $100m/year -  Known business model -  Focused on execution and process •  In contrast a scalable startup is designed to grow big •  It typically needs risk capital •  These are what Silicon Valley means when they say “Startup”
    • Very  Different  Startup  Curriculums     Startup   Small  Business   - Business Model found - Profitable business -  Existing team < $10M Scalable   Large   Startup   Company   >$100M/year   -  Total Available Market > $500m -  Company can grow to $100m/year -  Known business model -  Focused on execution and process
    • Silicon  Valley  Startup  Curriculum   X X X Startup   Small  Business   - Business Model found - Profitable business -  Existing team < $10M Scalable   Large   Startup   Company   >$100M/year   -  Total Available Market > $500m -  Company can grow to $100m/year -  Known business model -  Focused on execution and process
    • The  Transi0on   Scalable   Large   Transi9on   Startup   Company   -  Founders depart -  Professional Mgmt -  Process -  Beginning of scale
    • Startups  Search,  Companies  Execute   The Search for the Business Model The Execution of the Business Model Scalable   Large   Transi<on   Startup   Company   -  Business Model found - Cash-flow breakeven -  Product/Market fit - Profitable - Repeatable sales model - Rapid scale - Managers hired - New Senior Mgmt ~ 150 people
    • E-School instead of B-School
    • What’s  A  Startup?   Scalable   Large   Transi<on   Startup   Company   -  Business Model found -  Product/Market fit - Repeatable sales model - Managers hired A Startup is the organization used to search for a scalable business model
    • Teach the Business Model Not the Plan •  No Business Plan survives first contact with customers •  A Business Model diagrams how a company creates, delivers and captures value •  Or in English: How a company makes money
    • Emphasis On Hypotheses Testing
    • How Do Startups Search For A Business Model? •  The Search is called Customer Development •  The Implementation is called Agile Development
    • Startups  Don’t  Last  Forever   Scalable   Large   Transi<on   Startup   Company   -  Business Model found - Cash-flow breakeven -  Product/Market fit - Profitable - Repeatable sales model - Rapid scale - Managers hired - New Senior Mgmt ~ 150 people You fail if you remain a startup!
    • Durant  Versus  Sloan   Scalable   Large   Transi<on   Startup   Company  
    • Entrepreneurship  School   Entrepreneurship School Scalable   Large   Transi<on   Startup   Company   -  Hypothesis testing -  Business Model testing -  Customer Development -  Agile Development -  Metrics -  Venture Finance -  Hands-on
    • Business  School  Versus   Entrepreneurship  School   Entrepreneurship School Business School Scalable   Large   Transi<on   Startup   Company   -  Hypothesis testing -  Execution -  Business Model testing -  Accounting -  Customer Development -  Products -  Agile Development -  Engineering -  Metrics -  Management -  Venture Finance -  Administrative -  Hands-on
    • Business  School  Versus   Entrepreneurship  School   Entrepreneurship School Business School Scalable   Large   Transi<on   Startup   Company   Courses Courses -  Entrepreneurial Management -  Managerial Finance/Accounting -  Creativity and Innovation -  Managing Groups and Teams -  Technology Entrepreneurship -  Financial Accounting -  Patent Law for Entrepreneurs -  Operations -  Global Entrepreneurial Marketing -  Modeling for Optimization -  Entrepreneurial Finance -  Global Value Chain Strategies