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The Story of the
Lean LaunchPad
www.steveblank.com
@sgblank
8 Startups in 21 Years
21 Years Executing the Plan
Actual Photo of What Happened
When My Plan Had
First Contact With Customers
Story of the lean launch pad june 2013
All I Need is the 5-Year Forecast
VC’s and the
Soviet Union
are the only
people to require
5-Year Plans
Is this all there is?
Business
Schools
Students as
Management
Professors
Consulting
Existing
Companies
© 2012 Steve Blank
Business
Schools
Students as
Management
Professors
Consulting
Existing
Companies
© 2012 Steve Blank
Business School Curriculum
• Finance Gov’t& Law
• Leadership  Supply Chain
• Org Behavior  Ethics
• Operations  Global Business
• Marketing  Accounting
• Strategy  Global Mgmt
Business
Schools
Students as
Management
Professors
Consulting
© 2012 Steve Blank
Existing
Companies
Entrepreneurship
small business, family
business, high-tech
business, new product
development
Execute Execute
Business
Schools
Students as
Management
Professors
Consulting
© 2012 Steve Blank Source: Katz, table 1 http://ideas.repec.org/a/eee/jbvent/v18y2003i2p283-300.html
Existing
Companies
1923: Knight: Risk, Uncertainty and Profit
Myles Mace - 1st entrepreneurship course at Harvard1947
19684 schools teaching entrepreneurship
1934 Schumpeter: The Theory of Economic Developmentin english
1945 Weissman: Small Business and Venture Capital
1953 Small Business Administration formed
1954 Small Business Management, first MBA small business course at Stanford
1915: Taussig: Principles of Economics
1952 Kelley & Lawyer: Case Problems in Small Business Management
1953 C. Roland Christensen: Management Succession in Small and Growing Enterprises
1986 First national business plan competition, University of Miami.
1983 First entrepreneurship course in an engineering school, Univ of New Mexico.
1979 Livesay: American Made
1988 von Hippel: The Sources of Innovation
2000 McGrath &MacMilian: The Entrepreneurial Mindset
1997 Christensen: The Innovator's Dilemma
Entrepreneurship
small business, family
business, high-tech
business, new product
development
Execute
1911: Taylor The Principles of Scientific Management
1993 Karl Vesper New Venture Mechanics
Execute
Business
Schools
Students as
Management
Professors
Consulting
© 2012 Steve Blank Sources: Katz, table 1 http://ideas.repec.org/a/eee/jbvent/v18y2003i2p283-300.html
Existing
Companies
Entrepreneurship
small business, family
business, high-tech
business, new product
development
Execute
Business School Curriculum
• Finance Gov’t& Law
• Leadership  Supply Chain
• Org Behavior  Ethics
• Operations  Global Business
• Marketing  Accounting
• Strategy  Global Mgmt
•EntrepreneurshipSmall Business
Story of the lean launch pad june 2013
?
It Resulted in a Few Hypotheses
• Startups were not smaller versions of large companies
• Startups were aboutsearch, not execution
• Entrepreneurs and their VC’s were executing on guesses
• But the facts were outside the building
• Planning needed to come before the plan
Startups Are Not Smaller Versions
of Large Companies
Startups Are Not Smaller Versions
of Large Companies
Large Companies Execute
Known Business Models
Startups Are Not Smaller Versions
of Large Companies
Startups Search for Unknown
Business Models
What’s A Startup?
A temporary organization
designed to search
for a repeatable and scalable
business model
A temporary organization
designed to search
for a repeatable and scalable
business model
A temporary organization
designed to search
for a repeatable and scalable
business model
A temporary organization
designed to search
for a repeatable and scalable
business model
Startups Fail Because They
Confuse Search with Execute
Startups need their own tools,
different from those used
in existing companies
Startups need their own tools,
different from those used
in existing companies
And a Question
Can We Build a Process to
Search?
Before we Execute
Yes
• Lead User Research - Von Hippel
• Crossing the Chasm - Moore
• Entrepreneurial Mindset - McGrath/MacMillan
• Innovators Dilemma - Christensen
• Profitable Value - Lanning
•Lanchester Strategy - Yano
• High Tech Marketing - Davidow
• OODA Loop - Boyd
• Question-based Selling - Freese
• Solution Selling - Bosworth
• Conceptual/Strategic Selling - Heiman
• Spin Selling - Rackham
• US Marine Corps Warfighting Manual
• Tipping Point - Gladwell
Customer Development Process
+
+ +
So I Wrote A “Book”
And Then A Class
MBA 295: Customer Development
Co-taught with: Rob Majteles @ Treehouse Ventures
Eric Ries Extends the Model
• Took my class at U.C. Berkeley
• Co-founded IMVU, I sat on his board
– 1st implementation of Customer Development
– Paired it with an Agile Development Model
• Called it the Lean Startup
Which Turned Into A Better Model
+Agile Development
Alex Osterwalder - Business Model
• Business Model Generation
• Defines what the “search” is about
Which Turned Intoan Even Better Model
+
+
Story of the lean launch pad june 2013
+
Story of the lean launch pad june 2013
And that Turned into Another Book
We now know how to make
startups fail less
How?
Teach Them the
Entrepreneurial API
Entrepreneurial API = 3 parts
Business Model Canvas
Part 1
Entrepreneurial API
Part 1
Part 2
Customer Development
+
Entrepreneurial API
Part 1
Agile Engineering
+
+
Part 2
Agile Engineering
Part 3
What I Used to Believe
Education
Entrepreneurial Education was
about execution
Entrepreneurial Education was
about execution
What We Now Know
Education
Entrepreneurial Education
begins with the Search for a
business model
Putting Search first is a
radical change
It’s not just one more methodology
What We Used to Believe
Instructional Strategies
Cases and a Business Plans were
good entrepreneurial teaching tools
Cases and a Business Plan were
good teaching tools
What We Now Know
Instructional Strategies
Big Idea - Pedagogy
• From Simulated Entrepreneurship
– Textbooks the content was front and center
– Moved to case studies and business plans
– Internships in startups
• To Hands-On Entrepreneurship
– Content is the passive part – the experience is now
the front end
– Faculty has to be prepared
Big Idea - Curriculum
• Separating Search from Execution
• Revolution not evolution
• Huge impact on real world practice
• It will touch all parts of the entrepreneurship
curriculum
~100 GOOTB connections
Experiential Immersion
Business Model Patterns
Replace Cases
63
Nespresso
machines
Nespresso
.com
1 x machine
sales
distribution
channels
coffee
production
facilites
B2C
distribution
production
Nespresso
club
Nespressopo
ds
Business Model Competitions Replace
Business Plan Competitions
Business Model Competitions Replace
Business Plan Competitions
http://www.businessmodelcompetition.com/
Business Model
Hypotheses
Strategy
OrganizationCustomer Development
Team, Founder-driven
Process Customer Development,
Agile Development
Education Business Model
Design, Customer
Development, Startup team
building, Entrepreneurial
Finance, Agile
Development, Marketing
Instructional
Strategies
Experiential, constructivist, l
earner-centered,
inquiry-based
Search
Operating Plan +
Financial Model
Product Management
Agile or Waterfall Development
Functional Organization
by Department
Organizational
Behavior, HR
Mgmt, Accounting, Modeling
, Strategy, Operations, Lead
ership, Marketing, Manufact
uring
Case, Lecture, Small
Group, Mentorship
Execution
Where Does this Class Fit?
Startups Transition
Large
Company
Search Build Execute
Startups Transition
Large
Company
Search Build Execute
Business School Curriculum
• Finance Gov’t& Law
• Leadership  Entrepreneurship
• Org Behavior  Ethics
• Operations  Global Business
• Marketing  Accounting
• Strategy  Global Mgmt
• Supply Chain Small Business
•Entrepreneurship
Introduction to
Startups
Startups Transition
Large
Company
Search Build Execute
ENTR 100
Lean LaunchPad
Experiential Entrepreneurship
ENTR 200 (or ENTR 090 for 5-day)
Business School Curriculum
• Finance Gov’t& Law
• Leadership  Supply Chain
• Org Behavior  Ethics
• Operations  Global Business
• Marketing  Accounting
• Strategy  Global Mgmt
•EntrepreneurshipSmall Business
Creativity &
Innovation
Business Model
Design
Customer Discovery
Markets/Opportunities
Introduction to
Startups
Startups Transition
Large
Company
Search Build Execute
ENTR 100 ENTR 101
ENTR 102 ENTR 103
ENTR 150
Lean LaunchPad
Experiential Entrepreneurship
ENTR 200 (or ENTR 090 for 5-day)
Business School Curriculum
• Finance Gov’t& Law
• Leadership  Supply Chain
• Org Behavior  Ethics
• Operations  Global Business
• Marketing  Accounting
• Strategy  Global Mgmt
•EntrepreneurshipSmall Business
Creativity &
Innovation
Business Model
Design
Metrics That Matter
Startup Finance
Customer Discovery
Markets/Opportunities
Building the Team
Startup HR and Culture
Startup Patent Law
Get, Keep and Grow
Startup Marketing
Introduction to
Startups
Startups Transition
Large
Company
Search Build Execute
ENTR 100 ENTR 101
ENTR 102 ENTR 103
ENTR 104 ENTR 105
ENTR 106 ENTR 107
Lean LaunchPad
Experiential Entrepreneurship
ENTR 200 (or ENTR 090 for 5-day)
Agile Development
Lean Engineering
ENTR 108
User Design
Web/Mobile U/I
ENTR 109
Finding Fuel
Funding for Startups
ENTR 110
Business School Curriculum
• Finance Gov’t& Law
• Leadership  Supply Chain
• Org Behavior  Ethics
• Operations  Global Business
• Marketing  Accounting
• Strategy  Global Mgmt
•EntrepreneurshipSmall Business
Business Model
Hypotheses
Strategy
Organization Customer Development
Team, Founder-driven
Process Customer Development,
Agile Development
Education Business Model Design,
Customer Development,
Startup team building,
Entrepreneurial Finance, Agile
Development, Marketing
Instructional
Strategies
Experiential, constructivist, lear
ner-centered, inquiry-based
Search
Business Model
Hypotheses
Strategy
Operating Plan +
Financial Model
Organization Customer Development
Team, Founder-driven
Process Customer Development,
Agile Development
Product Management
Agile or Waterfall Development
Functional Organization
by Department
Education Business Model
Design, Customer
Development, Startup team
building, Entrepreneurial
Finance, Agile
Development, Marketing
Organizational Behavior, HR
Mgmt, Accounting, Modeling,
Strategy, Operations, Leadersh
ip, Marketing, Manufacturing
Instructional
Strategies
Experiential, constructivist,
learner-centered, inquiry-based
Case, Lecture, Small
Group, Mentorship
Search Execution
And Then Into Another Class
Engr 245: The Lean LaunchPad
Co-taught with: Jon Feiber @ MDV
Ann Miura-Ko @ Floodgate
Add LaunchPad Central Software to to
improve the outcomes
Taught by Takashi Tsutsumi@ Hosei
Co-taught with Murray Low @ Columbia
Bob Dorf Co-taught with: Jon Feiber @ MDV
Taught by Jim Hornthal
And Four More Schools
Add 5-day version of the class
5-day Version
Then It Turned Into Another Class
Co-taught with: Jon Feiber @ MDV
Jim Hornthal @ CMEA
John Burke @ True Ventures
Jerry Engel @ Haas/Monitor Ventures
Bhavik Joshi @ Better Place
Oren Jacob @ Pixar
79
Put the class online
110,000 students
Trained the Trainers
Added two More
Schools
Train 9 More Universities
And Then Use it as a
“flipped classroom”
Lean LaunchPad Educators Class
•Train educators each quarter
5-week hands-on course
Curriculum = Stanford, Berkeley, Columbia
Lean LaunchPad for Life Sciences
Therapeutics, Diagnostics, Devices and E-Heath

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Story of the lean launch pad june 2013

  • 1. The Story of the Lean LaunchPad www.steveblank.com @sgblank
  • 2. 8 Startups in 21 Years
  • 4. Actual Photo of What Happened When My Plan Had First Contact With Customers
  • 6. All I Need is the 5-Year Forecast
  • 7. VC’s and the Soviet Union are the only people to require 5-Year Plans
  • 8. Is this all there is?
  • 10. Business Schools Students as Management Professors Consulting Existing Companies © 2012 Steve Blank Business School Curriculum • Finance Gov’t& Law • Leadership  Supply Chain • Org Behavior  Ethics • Operations  Global Business • Marketing  Accounting • Strategy  Global Mgmt
  • 11. Business Schools Students as Management Professors Consulting © 2012 Steve Blank Existing Companies Entrepreneurship small business, family business, high-tech business, new product development Execute Execute
  • 12. Business Schools Students as Management Professors Consulting © 2012 Steve Blank Source: Katz, table 1 http://ideas.repec.org/a/eee/jbvent/v18y2003i2p283-300.html Existing Companies 1923: Knight: Risk, Uncertainty and Profit Myles Mace - 1st entrepreneurship course at Harvard1947 19684 schools teaching entrepreneurship 1934 Schumpeter: The Theory of Economic Developmentin english 1945 Weissman: Small Business and Venture Capital 1953 Small Business Administration formed 1954 Small Business Management, first MBA small business course at Stanford 1915: Taussig: Principles of Economics 1952 Kelley & Lawyer: Case Problems in Small Business Management 1953 C. Roland Christensen: Management Succession in Small and Growing Enterprises 1986 First national business plan competition, University of Miami. 1983 First entrepreneurship course in an engineering school, Univ of New Mexico. 1979 Livesay: American Made 1988 von Hippel: The Sources of Innovation 2000 McGrath &MacMilian: The Entrepreneurial Mindset 1997 Christensen: The Innovator's Dilemma Entrepreneurship small business, family business, high-tech business, new product development Execute 1911: Taylor The Principles of Scientific Management 1993 Karl Vesper New Venture Mechanics Execute
  • 13. Business Schools Students as Management Professors Consulting © 2012 Steve Blank Sources: Katz, table 1 http://ideas.repec.org/a/eee/jbvent/v18y2003i2p283-300.html Existing Companies Entrepreneurship small business, family business, high-tech business, new product development Execute Business School Curriculum • Finance Gov’t& Law • Leadership  Supply Chain • Org Behavior  Ethics • Operations  Global Business • Marketing  Accounting • Strategy  Global Mgmt •EntrepreneurshipSmall Business
  • 15. ?
  • 16. It Resulted in a Few Hypotheses • Startups were not smaller versions of large companies • Startups were aboutsearch, not execution • Entrepreneurs and their VC’s were executing on guesses • But the facts were outside the building • Planning needed to come before the plan
  • 17. Startups Are Not Smaller Versions of Large Companies
  • 18. Startups Are Not Smaller Versions of Large Companies Large Companies Execute Known Business Models
  • 19. Startups Are Not Smaller Versions of Large Companies Startups Search for Unknown Business Models
  • 21. A temporary organization designed to search for a repeatable and scalable business model
  • 22. A temporary organization designed to search for a repeatable and scalable business model
  • 23. A temporary organization designed to search for a repeatable and scalable business model
  • 24. A temporary organization designed to search for a repeatable and scalable business model
  • 25. Startups Fail Because They Confuse Search with Execute
  • 26. Startups need their own tools, different from those used in existing companies
  • 27. Startups need their own tools, different from those used in existing companies
  • 29. Can We Build a Process to Search? Before we Execute
  • 30. Yes • Lead User Research - Von Hippel • Crossing the Chasm - Moore • Entrepreneurial Mindset - McGrath/MacMillan • Innovators Dilemma - Christensen • Profitable Value - Lanning •Lanchester Strategy - Yano • High Tech Marketing - Davidow • OODA Loop - Boyd • Question-based Selling - Freese • Solution Selling - Bosworth • Conceptual/Strategic Selling - Heiman • Spin Selling - Rackham • US Marine Corps Warfighting Manual • Tipping Point - Gladwell
  • 32. +
  • 33. + +
  • 34. So I Wrote A “Book”
  • 35. And Then A Class MBA 295: Customer Development Co-taught with: Rob Majteles @ Treehouse Ventures
  • 36. Eric Ries Extends the Model • Took my class at U.C. Berkeley • Co-founded IMVU, I sat on his board – 1st implementation of Customer Development – Paired it with an Agile Development Model • Called it the Lean Startup
  • 37. Which Turned Into A Better Model +Agile Development
  • 38. Alex Osterwalder - Business Model • Business Model Generation • Defines what the “search” is about
  • 39. Which Turned Intoan Even Better Model + +
  • 41. +
  • 43. And that Turned into Another Book
  • 44. We now know how to make startups fail less
  • 45. How?
  • 47. Entrepreneurial API = 3 parts Business Model Canvas Part 1
  • 48. Entrepreneurial API Part 1 Part 2 Customer Development +
  • 49. Entrepreneurial API Part 1 Agile Engineering + + Part 2 Agile Engineering Part 3
  • 50. What I Used to Believe Education
  • 53. What We Now Know Education
  • 54. Entrepreneurial Education begins with the Search for a business model
  • 55. Putting Search first is a radical change It’s not just one more methodology
  • 56. What We Used to Believe Instructional Strategies
  • 57. Cases and a Business Plans were good entrepreneurial teaching tools
  • 58. Cases and a Business Plan were good teaching tools
  • 59. What We Now Know Instructional Strategies
  • 60. Big Idea - Pedagogy • From Simulated Entrepreneurship – Textbooks the content was front and center – Moved to case studies and business plans – Internships in startups • To Hands-On Entrepreneurship – Content is the passive part – the experience is now the front end – Faculty has to be prepared
  • 61. Big Idea - Curriculum • Separating Search from Execution • Revolution not evolution • Huge impact on real world practice • It will touch all parts of the entrepreneurship curriculum
  • 63. Business Model Patterns Replace Cases 63 Nespresso machines Nespresso .com 1 x machine sales distribution channels coffee production facilites B2C distribution production Nespresso club Nespressopo ds
  • 64. Business Model Competitions Replace Business Plan Competitions
  • 65. Business Model Competitions Replace Business Plan Competitions http://www.businessmodelcompetition.com/
  • 66. Business Model Hypotheses Strategy OrganizationCustomer Development Team, Founder-driven Process Customer Development, Agile Development Education Business Model Design, Customer Development, Startup team building, Entrepreneurial Finance, Agile Development, Marketing Instructional Strategies Experiential, constructivist, l earner-centered, inquiry-based Search Operating Plan + Financial Model Product Management Agile or Waterfall Development Functional Organization by Department Organizational Behavior, HR Mgmt, Accounting, Modeling , Strategy, Operations, Lead ership, Marketing, Manufact uring Case, Lecture, Small Group, Mentorship Execution
  • 67. Where Does this Class Fit?
  • 69. Startups Transition Large Company Search Build Execute Business School Curriculum • Finance Gov’t& Law • Leadership  Entrepreneurship • Org Behavior  Ethics • Operations  Global Business • Marketing  Accounting • Strategy  Global Mgmt • Supply Chain Small Business •Entrepreneurship
  • 70. Introduction to Startups Startups Transition Large Company Search Build Execute ENTR 100 Lean LaunchPad Experiential Entrepreneurship ENTR 200 (or ENTR 090 for 5-day) Business School Curriculum • Finance Gov’t& Law • Leadership  Supply Chain • Org Behavior  Ethics • Operations  Global Business • Marketing  Accounting • Strategy  Global Mgmt •EntrepreneurshipSmall Business
  • 71. Creativity & Innovation Business Model Design Customer Discovery Markets/Opportunities Introduction to Startups Startups Transition Large Company Search Build Execute ENTR 100 ENTR 101 ENTR 102 ENTR 103 ENTR 150 Lean LaunchPad Experiential Entrepreneurship ENTR 200 (or ENTR 090 for 5-day) Business School Curriculum • Finance Gov’t& Law • Leadership  Supply Chain • Org Behavior  Ethics • Operations  Global Business • Marketing  Accounting • Strategy  Global Mgmt •EntrepreneurshipSmall Business
  • 72. Creativity & Innovation Business Model Design Metrics That Matter Startup Finance Customer Discovery Markets/Opportunities Building the Team Startup HR and Culture Startup Patent Law Get, Keep and Grow Startup Marketing Introduction to Startups Startups Transition Large Company Search Build Execute ENTR 100 ENTR 101 ENTR 102 ENTR 103 ENTR 104 ENTR 105 ENTR 106 ENTR 107 Lean LaunchPad Experiential Entrepreneurship ENTR 200 (or ENTR 090 for 5-day) Agile Development Lean Engineering ENTR 108 User Design Web/Mobile U/I ENTR 109 Finding Fuel Funding for Startups ENTR 110 Business School Curriculum • Finance Gov’t& Law • Leadership  Supply Chain • Org Behavior  Ethics • Operations  Global Business • Marketing  Accounting • Strategy  Global Mgmt •EntrepreneurshipSmall Business
  • 73. Business Model Hypotheses Strategy Organization Customer Development Team, Founder-driven Process Customer Development, Agile Development Education Business Model Design, Customer Development, Startup team building, Entrepreneurial Finance, Agile Development, Marketing Instructional Strategies Experiential, constructivist, lear ner-centered, inquiry-based Search
  • 74. Business Model Hypotheses Strategy Operating Plan + Financial Model Organization Customer Development Team, Founder-driven Process Customer Development, Agile Development Product Management Agile or Waterfall Development Functional Organization by Department Education Business Model Design, Customer Development, Startup team building, Entrepreneurial Finance, Agile Development, Marketing Organizational Behavior, HR Mgmt, Accounting, Modeling, Strategy, Operations, Leadersh ip, Marketing, Manufacturing Instructional Strategies Experiential, constructivist, learner-centered, inquiry-based Case, Lecture, Small Group, Mentorship Search Execution
  • 75. And Then Into Another Class Engr 245: The Lean LaunchPad Co-taught with: Jon Feiber @ MDV Ann Miura-Ko @ Floodgate
  • 76. Add LaunchPad Central Software to to improve the outcomes
  • 77. Taught by Takashi Tsutsumi@ Hosei Co-taught with Murray Low @ Columbia Bob Dorf Co-taught with: Jon Feiber @ MDV Taught by Jim Hornthal And Four More Schools Add 5-day version of the class 5-day Version
  • 78. Then It Turned Into Another Class Co-taught with: Jon Feiber @ MDV Jim Hornthal @ CMEA John Burke @ True Ventures Jerry Engel @ Haas/Monitor Ventures Bhavik Joshi @ Better Place Oren Jacob @ Pixar
  • 79. 79 Put the class online 110,000 students
  • 80. Trained the Trainers Added two More Schools
  • 81. Train 9 More Universities
  • 82. And Then Use it as a “flipped classroom”
  • 83. Lean LaunchPad Educators Class •Train educators each quarter
  • 84. 5-week hands-on course Curriculum = Stanford, Berkeley, Columbia
  • 85. Lean LaunchPad for Life Sciences Therapeutics, Diagnostics, Devices and E-Heath