When The Boardroom is Bits<br
/>Steve Blank<br />www.steveblank.com<br />Twitter: sgblank<br />

This Talk<br /><ul><li>10 Things We
Learned in the Last Year ………………………

Experienced Advice Matters

Solving the Early Stage-Experience Gap

The Boardroom is Bits</li></li></ul><li>First<br />10
Things We Learned in the Last Year<br />

#1<br />Business Schools turned 300
years of business experience into an MBA<br />

#1<br />Business Schools turned 300
years of business experience into an MBAMBA = Masters of Business Administration<br />

#2<br />Tech Entrepreneurship + Venture
Capital is ~50 Years OldStartups are Smaller Versions of Large Companies<br />

#2<br />Tech Entrepreneurship + Venture
Capital is ~ 50 Years OldStartups are Smaller Versions of Large Companies<br />

#2<br />×<br />Tech Entrepreneurship +
Venture Capital is ~ 50 Years OldStartups are Smaller Versions of Large Companies<br />oops<br />

#3<br />Companies execute business modelsStartups
search for business models<br />

#3<br />Companies execute business modelsStartups
search for business models<br />

#3<br />Companies execute business modelsStartups
search for business models<br />✓<br />

#4<br />A startup is a
temporary organization designed to search for a scalable and repeatable business model<br />

#5<br />Startups need their own
tools, different from those used in existing companies<br />

#5<br />Startups need their own
tools, different from those used in existing companies<br />

#6<br />Customer Development = process
to searchBusiness Model Canvas is the ScorecardAgile Engineering is How We Build Startups<br />

#7<br />Customer Development =process to
searchBusiness Model Canvas =the ScorecardAgile Engineering is How We Build Startups<br /><ul><li>Farming conventions.

Demo, demo, and demo!!

Proximity is paramount

Technology Design

Marketing

Demo and customer feedback

Research Labs

Equipment Manufacturers

Distribution Network

Service Providers

Cost Reduction

Remove labor force pains

Eliminate bio-waste hazards

Organic Farmers

Weeding Service Providers

Conventional Farmers

IP – Patents

Video Classifier Files

Robust Technology

Dealers

Direct Service

Indirect Service

… then Dealers

Asset Sale

Direct Service with equipment rental

… then Asset Sale</li></ul>Value-Driven<br />

#8<br />Customer Development is the
process used to searchBusiness Model Canvas is the ScorecardAgile Development is How We Build Startups<br />

#9<br />Startups that pivot 1
or 2 times:<br /><ul><li> raise 2.5x more money

have 3.6x better user growth

52% less likely to scale
prematurely</li></ul> than startups that pivot more than 2 times or not at all<br />Startup Genome Report<br />

#9<br />Startups that pivot 1
or 2 times:<br /><ul><li> raise 2.5x more money

have 3.6x better user growth

52% less likely to scale
prematurely</li></ul> than startups that pivot more than 2 times or not at all<br />Startups that have:<br /><ul><li> helpful mentors

listen to customers,

learn from startup thought leaders</li></ul>Raise
7x more money and have 3.5x better user growth<br />Startup Genome Report<br />

#10<br />We’ve cracked the code
in teaching entrepreneurship<br />

#10<br />We’ve cracked the code
in teaching entrepreneurship<br />http://steveblank.com/category/lean-launchpad/<br />

What Have We Learned in
the Last Year?<br /> Startups ≠ MBA toolset<br /> Startup Toolset<br />Customer Development<br />Business Model Canvas<br />Agile Development<br />We have real data that this works<br />A Better Way to Teach Entrepreneurship<br />

What’s Next?<br />

Hypothesis:Experienced Advice Matters<br />

Hypothesis:Experienced Advice Matters<br />

You1board at a time<br />

You1board at a time<br />VC’s6
- 12 boards at a time<br />

You1board at a time<br />VC’s6
- 12 boards at a time<br /> X<br />Avg 4 years per board<br />

You1board at a time<br />VC’s6
- 12 boards at a time<br /> X<br />Avg 4 years per board<br /> X<br />2 VC’s per board<br />

You1board at a time<br />VC’s6
- 12 boards at a time<br /> X<br />Avg 4 years per board<br /> X<br /> 2 VC’s per board<br />=<br />~50-100x Pattern Recognition<br />

You1<br />

You1<br />VC’s50 - 100<br />

You1<br />VC’s50 - 100<br />(Discount
for 7 Deadly Sins)<br />

50 - 100 ≥ 1<br
/>

50 - 100 ≥ 1<br
/>The Early Stage-Experience Gap<br />

Solving the Early Stage-Experience Gap<br
/>

Venture Funded companies have boards<br
/>Angel Funded companies often do not<br />Experienced Advice is sparse outside of technology clusters<br />

Venture Funded companies have boards<br
/>Early Stage companies often do not<br />Experienced Advice is sparse outside of technology clusters<br />

Venture Funded companies have boards<br
/>Angel Funded companies often do not<br />Experienced Advice is sparse outside of technology clusters<br />

Why Have a Board Meeting?Investor<br
/>Fiduciary Responsibility<br />Company has asymmetric information<br />Board has legal responsibility to their Limited Partners<br />Maximize Investment Potential<br />Board has asymmetric knowledge 50-100x experience <br />Good board asks hard questions<br />

Why Have a Board Meeting?Founder<br
/>Board Guidance<br />50-100x more experience = Pattern recognition<br />Multiple opinions across VC’s<br />Board Network <br />Customers, Partners, Recruiting, Financing <br />Obligation<br />It came with the check<br />

Board Meetings Are Heavyweight Processes
Antithesis of Lean<br />

Board Meetings Are Heavyweight Processes
Antithesis of Lean<br />

Board Meetings Haven’t Evolved<br />

We Act Like It’s the
19th Century<br />Why do we need to get together in one room?<br />Why do we need to wait a month to see progress?<br />Why don’t we have standards for what you want?<br />Why haven’t we adopted the tools we build/sell?<br />

How to Run a Board
Meeting<br />Logistics<br />Send out board materials 2 days before, have board dinner<br />Approve minutes, stock grants<br />Business Highlights/Lowlights<br />summary of key events since last meeting<br />Financials versus Budget<br />waterfall charts<br />Management asks the board to help<br />strategy, markets, key hires, introductions.<br />Executive session<br />Meet without management to discuss performance<br />

How to Run a Board
Meeting<br />Logistics<br />Approve minutes, stock grants<br />Business Highlights/Lowlights<br />summary of key events since last meeting<br />Financials versus Budget<br />waterfall charts<br />Management asks the board to help<br />strategy, markets, key hires, introductions.<br />Executive session<br />Meet without management to discuss performance<br />Misc<br />Send out board materials 2 days before, have board dinner<br />Why?<br />

What’s Wrong With a Board
Meeting?<br />Time between meetings (every 4-6 weeks)<br />Strategy-to-tactic-to implementation lag<br />Often no follow-up on the outcomes<br />Diffuse board member attention (sits on 6-12 boards)<br />Punctuated Exec Staff Performance<br />“The Get Ready for the Board Meeting” drill<br />It’s often a performance rather than a snapshot<br />No standards for what each side does<br />What is the entrepreneur supposed to be doing?<br />What are the board members supposed to be contributing?<br />

What’s Wrong With a Board
Meeting?<br />Time between meetings (every 4-6 weeks)<br />Strategy-to-tactic-to implementation lag<br />Diffuse board member attention (sits on 6-12 boards<br />Punctuated Exec Staff Performance<br />“The Get Ready for the Board Meeting” drill<br />It’s often a performance rather than a snapshot<br />No standards for what each side does<br />What is the entrepreneur supposed to be doing?<br />What are the board members supposed to be contributing?<br />Why?<br />

Solution:Make The Boardroom Bits<br />

We Can Do This Via
the Net<br />

We Can Do This Via
the Net<br />24/7<br />

We Can Do This Via
the Net<br />Connecting Advisors to/from Anywhere<br />

Focus on What’s Important<br />It’s
about the search for the business model<br />Not income statement, cash flow, balance sheet<br />Advice/Guidance about metrics around the search<br />What are the Business model hypotheses?<br />What are the most important hypotheses to test now?<br />Progress of validating each hypotheses<br />What are the iterations and Pivots – and why?<br />

Continuous Information Access<br />Founders /
mgmt team invest 1 hour a week<br />Structured blog<br />Unstructured data<br />Formal business model canvas<br />Real-time advisor/board feedback<br />

We Made Students Blog Their
Progress<br />

How?<br />Customer Development<br />The Process<br
/>Narrative<br />Interviews<br />Surveys<br />Videos<br />Prototypes<br />Business Model Canvas<br />Scorekeeping<br />Real-time Feedback<br />Physical Reality Checks<br />Skype<br />Face-to-face<br />

We Made Students Blog Their
Progress<br />It Changed Everything<br />

Interview<br />

Photos<br />Videos<br />

Surveys<br />

Interview<br />& Photos<br />

Competitive Analysis<br />

Key Findings<br />

A/B Test Results<br />

Key Question<br />

Strategy<br />

Business Model Canvas as the
Scorecard<br />

Business Canvas Change Progress <br
/>1<br />

Business Canvas Change Progress <br
/>2<br />

Business Canvas Change Progress <br
/>3<br />

Business Canvas Change Progress <br
/>4<br />

Business Canvas Change Progress <br
/>5<br />

Business Canvas Change Progress <br
/>6<br />

Business Canvas Change Progress <br
/>7<br />

Demo<br />Ben Mappen<br />Lean LaunchLab<br
/>

Product Demo<br />

CANVAS diagram is interactive and
“stateful”<br />

CANVAS diagram is interactive and
“stateful”<br />Enter your hypotheses here<br />

CANVAS diagram is interactive and
“stateful”<br />Test your hypotheses and<br />record learnings in blog format<br />

CANVAS diagram is interactive and
“stateful”<br />Test your hypotheses and<br />record learnings in blog format<br />Interviews<br />Surveys<br />Videos<br />Photos<br />etc<br />

CANVAS diagram is interactive and
“stateful”<br />Test your hypotheses and<br />record learnings in blog format<br />Invite your advisors and investors to your project<br />

CANVAS diagram is interactive and
“stateful”<br />Test your hypotheses and<br />record learnings in blog format<br />Invite your advisors and investors to your project<br />They can view progress<br />by flipping thru your CANVAS diagrams<br />

CANVAS diagram is interactive and
“stateful”<br />Test your hypotheses and<br />record learnings in blog format<br />Invite your advisors and investors to your project<br />They can view progress<br />by flipping thru your CANVAS diagrams<br />They can post feedback and leave comments inline<br />

CANVAS diagram is interactive and
“stateful”<br />Test your hypotheses and<br />record learnings in blog format<br />Invite your advisors and investors to your project<br />They can view progress<br />by flipping thru your CANAVAS diagrams<br />They can post feedback and leave comments inline<br />Get email alert when new<br />feedback comes in<br />

CANVAS diagram is interactive and
“stateful”<br />Test your hypotheses and<br />record learnings in blog format<br />Invite your advisors and investors to your project<br />They can view progress<br />by flipping thru your CANAVAS diagrams<br />They can post feedback and leave comments inline<br />Get email alert when new<br />feedback comes in<br />The Lean<br />Board Meeting<br />

Sign up for private beta
(FREE)<br />http://www.leanlaunchlab.com<br />@leanlaunchlab<br />Ben Mappen<br />benmappen@gmail.com<br />

What Does this Change?For Angel-Funded
Startups<br />Angel funded startups can now get experienced advice<br />No longer requires board commitment for involvement<br />Encourages investors who need visibility<br />Ends repetition at each investor coffee<br />Turns adhoc startups into strategy-driven startups<br />Invites investor participation in the process<br />Professionalize the “throw it against the wall and see if it sticks”<br />Highly time-efficient for investor and founders<br />Eliminates Geography as a barrier to investment!<br />

What Does this Change?For VC’s
and Angels<br />For the first time a structure for “search”<br />Real-time monitoring of startup progress<br />Zero-lag for coaching and course-correction<br />Immediate follow-up on board meeting outcomes<br />Allows a single VC to multiply their reach and/or depth<br />Eliminates Geography as a barrier to investment!<br />

Show Me the Money<br />

It’s about time!<br />Email me
<br />jdf@mdv.com<br />

Great Experiment<br />Email me <br
/>ann@floodgate.com<br />

This Solves A Real Problem<br
/>

This Solves A Real Problem<br
/>I thought it was such a good idea I Just funded the Lean LaunchLab<br />Email me:<br />shawn@menloventures.com<br />

Lets experiment with the idea<br
/>Now at Gould Investments<br />Email me:<br />Kathryn@gouldinvestments.com<br />

Wouldn’t miss trying this!<br />Email
me:<br />eric@ingroup.com<br />

Thanks<br />