National Science Foundation - Innovation Network Meeting 041114

Stanford University
Stanford UniversityLecturer at Stanford University
The Lean LaunchPad
The Story
Steve Blank
@sgblank
www.steveblank.com
National Innovation Network Meeting
April 11, 2014
Time to Celebrate!
• From an idea to a movement!
• Make possible by you
• How did we get here?
• Where are we going?
Rashomon Effect
Part 1:
The Epiphany
Steve Blank
@sgblank
www.steveblank.com
21 Years Executing the Plan
Actual Photo of What Happened
When My Plan Had
First Contact With Customers
National Science Foundation - Innovation Network Meeting 041114
All I Need is the 5- Year Forecast
Previous
5-Year Plans
Is this all there is?
National Science Foundation - Innovation Network Meeting 041114
?
I Started Reading
• 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
It Resulted in a Few Hypotheses
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
Yes
There are no facts inside your building
So get the heck outside
+
+ +
So I Wrote A “Book”
Part 2:
Finding the Words
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
+
+
National Science Foundation - Innovation Network Meeting 041114
+
Hypotheses Testing and Insight
And that Turned into Another Book
Lean Startup = 3 parts
Business Model Canvas
Part 1
Lean Startup
Part 1
Part 2
Customer Development
+
Lean Startup
Part 1
Agile Engineering
+
+
Part 2
Agile Engineering
Part 3
Story 3
Experiential
Existing pedagogy was
designed by theorists not
practitioners
Entrepreneurship is
Experiential
Let’s Teach it That Way
Entrepreneurship is
Experiential
And Then Into Another Class
Engr 245: The Lean LaunchPad
Co-taught with: Jon Feiber @ MDV
Ann Miura-Ko @ Floodgate
Admission By Application and Team
(business model canvas)
Engr 245: The Lean LaunchPad
Co-taught with: Jon Feiber @ MDV
Ann Miura-Ko @ Floodgate
VC’s As Part of the Teaching Team
Engr 245: The Lean LaunchPad
Co-taught with: Jon Feiber @ MDV
Ann Miura-Ko @ Floodgate
Venture Capitalists
One Mentor Per Team
Engr 245: The Lean LaunchPad
Co-taught with: Jon Feiber @ MDV
Ann Miura-Ko @ Floodgate
Venture Capitalists
Mentors
Joint Engineering & MBA Class
Engr 245: The Lean LaunchPad
Co-taught with: Jon Feiber @ MDV
Ann Miura-Ko @ Floodgate
Venture Capitalists
Mentors
Add Teaching Resources
Story 4
The Scientific Method
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
Admission By Application and Team
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
VC’s As Part of the Teaching Team
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
Venture Capitalists
Mentors are Part of the Team
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
Venture Capitalists
Mentors
Add LaunchPad Central
to Monitor and Measure Outcomes
Found a Secret Santa
• Congressman Dan Lipinski (IL-3)
• Flew out to attend a class
• Key supporter on the hill
Vitruvian
• Prevent incisional hernias via wound healing
– Biocompatible microparticles + fibrin sealant
• Team:
– Dr. Hobart Harris Chief of General Surgery
– Dr. David Young, Prof Surgery
– Cindy Chang, Enzymologist
• Went through the CTAS program
• Then took the UCSF class
National Science Foundation - Innovation Network Meeting 041114
Trained the Trainers
Added two More
Schools
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
68
Put the class online
200,000 students
Lean LaunchPad Educators Class
•Train educators each quarter
Story 5
The Real Story is About You
The Genius is in the Nodes/Sites
The Genius is in the Nodes/Sites
5 nodes
15 sites
32 instructors
42 universities
NSF I-Corps /
Lean LaunchPad
General
Single Cohort
General
Single Cohort Multiple Cohorts
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
NSF I-Corps /
Lean LaunchPad
General
Single Cohort Multiple Cohorts
Multiple Sites
of NSF I-Corps /
Lean LaunchPad
NSF I-Corps /
Lean LaunchPad
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
Lean Startup
Business Model
Canvas
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Mentors
LaunchPad Central Software
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
LaunchPad Central Software
DataDataData
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Weekly Progress
LaunchPad Central Software
DataDataData
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Weekly Progress
Experiment
Scorecard
+
LaunchPad Central Software
DataDataData
Lean Startup
Business Model
Canvas
Customer
Development
Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Weekly Progress
Experiment
Scorecard
Data, Experiments,
Trajectory, IRL
+ =
Story 6
Domain Specific Cohorts
NSF I-Corps /
Lean LaunchPad
General
Single Cohort
General
Single Cohort Multiple Cohorts
NSF I-Corps /
Lean LaunchPad
Multiple Sites
of NSF I-Corps /
Lean LaunchPad
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
General
Single Cohort Multiple Cohorts
Domain
Specific
I-Corps L for
Educators Class
NSF I-Corps /
Lean LaunchPad Multiple Sites
of NSF I-Corps /
Lean LaunchPad
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
Lean LaunchPad for Life Sciences
• Therapeutics
• Diagnostics
• Devices
• Digital Health
General
Single Cohort Multiple Cohorts
Domain
Specific UCSF
Life Sciences
NSF I-Corps /
Lean LaunchPad
I-Corps L for
Educators Class
Multiple Sites
of NSF I-Corps /
Lean LaunchPad
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
Early Stage Therapeutic Myths
The Idea is Key
Better ideas create value
Funding Gap
Early Stage
Investment as a
market failure
Data Quality
Findings in preclinical
research are often
not reproducible
Karl@CodonCapital.com
The real gap is the expertise to move early stage
research toward industrial relevance
Early Stage Therapeutic Myths
Karl@CodonCapital.com
Data Quality
Findings in preclinical
research are often
not reproducible
Data addressing key
development criteria
Early Stage Therapeutic Myths
Karl@CodonCapital.com
Data Quality
Findings in preclinical
research are often
not reproducible
Data addressing key
development criteria
The Idea is Key
Better ideas create value
Clear path to
modifying a disease
Early Stage Therapeutic Myths
Karl@CodonCapital.com
Data Quality
Findings in preclinical
research are often
not reproducible
Data addressing key
development criteria
The Idea is Key
Better ideas create value
Clear path to
modifying a disease
Funding Gap
Early Stage
Investment as a
market failure
Operational plan
justifying investment
Story 7
Commercialization Insights
21st Century Commercialization Insight
• Gov’t Commercialization efforts have two
components
– The science/technology
– The business model
• Current Commercialization efforts focus on #1
• Successful efforts require the team to do both
Insight
Technology Evidence but no
Commercialization Evidence
98
physical space
& equipment
seed $’s
Mentorship
Workshops/Webinars
Technology Progress
Clinical Trials, etc.
Technology Progress ≠
Commercialization
100
Current Thinking about
Translational Medicine
Research Performing Institutions
Technology
(diagnostic, device, therapeutic)
Solicit &
Select
Develop Technology
Obtain Additional
Capital
Research Institutions
Technology
(diagnostic, device, therapeutic)
Solicit &
Select
Existing
Company
New
Company
Technology
Development Process
Regulatory
Intellectual
Property
Business
Development
Project
Management
Medical, Scientific,
and Business Review
Licensing and Exit
Accepted
independent financing
Product
Development
Additional
Capital
Current Thinking about
Translational Medicine
Mentors
Insight
Add a 2nd, Path for
Commercialization Evidence
102
physical space
& equipment
seed $’s
Mentorship
Workshops/Webinars
Technology Progress
Clinical Trials, etc.
Commercialization
Progress –
reducing market risk
Accelerating Commercialization:
– Requires Parallel Paths
Insight
Commercialization Evidence
Require Outward Focus
104
Research Institutions
Technology
(diagnostic, device, therapeutic)
Solicit &
Select
Add Evidence-based Commercialization
Medical, Scientific,
and Business Review
Accepted
Additional
Capital
Inward-facing
Research Institutions
Technology
(diagnostic, device, therapeutic)
Solicit &
Select
Add Evidence-based Commercialization
Medical, Scientific,
and Business Review
Accepted
Additional
Capital
Reimburse
-men
Partners
Customers
(users, payers,
etc.)
Commercialization
Development
Process
Value
Propositio
n
Distribution
Channels
Add a parallel
Commercialization
Process
Inward-facing Outward-facing
Research Performing Institutions
Technology
(diagnostic, device, therapeutic)
Solicit &
Select
Add Evidence-based Commercialization
Medical, Scientific,
and Business Review
Accepted
Additional
Capital
Customers
Value
Proposition
Channels
Partners
Reimburse-
ment
Intellectual
Property
Commercialization
Magnamosis
• Create a magnetic compression
anastomosis with improved outcomes
• Team:
– Michael Harrison, MD, Pediatric Surgeon
– Elisabeth Leeflang, MD, General Surgery Resident
– Michael Danty, MS, Business Development
– Dillon Kwiat, BS, Medical Device Engineer
109
NSF I-Corps /
Lean LaunchPad
General
Single Cohort
General
Single Cohort Multiple Cohorts
NSF I-Corps /
Lean LaunchPad
Multiple Sites
of NSF I-Corps /
Lean LaunchPad
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
General
Single Cohort Multiple Cohorts
Domain
Specific
I-Corps L for
Educators Class
NSF I-Corps /
Lean LaunchPad Multiple Sites
of NSF I-Corps /
Lean LaunchPad
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
Lean LaunchPad for Life Sciences
• Therapeutics
• Diagnostics
• Devices
• Digital Health
General
Single Cohort Multiple Cohorts
Domain
Specific UCSF
Life Sciences
NSF I-Corps /
Lean LaunchPad
I-Corps L for
Educators Class
Multiple Sites
of NSF I-Corps /
Lean LaunchPad
Multiple Nodes
of NSF I-Corps /
Lean LaunchPad
Story 8
What’s Next?
OSTP – Secret Santa II
• From Lab to Market: Accelerating Research
Breakthroughs and Economic Growth
Lean LaunchPad for the NIH
• NCATS
• NCI
• NHLBI
• NINDS
25 Teams fall 2014
Pivoting the SBIR Process
• SBIR grants describe a commitment to execute
• How do you Pivot after a grant?
Change the grant process!
Making the Network a Network
• Share, share, share
– Resources
– Expertise
– Mentors
– Best practices
• Create a Nation of Innovators
– Integrate experiential entrepreneurship on all levels
The Future Is Now in Your Hands
5 nodes
15 sites
32 instructors
42 universities
1 of 120

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National Science Foundation - Innovation Network Meeting 041114