12min
A startup cannot be built following a traditional business model: The Startup Owner’s Manual lays out the most reliable process by which any business entity can, in fact, be guided on its search for the model which best suits its needs. For company founders, this is a real step by step user guide which takes us through each phase of the transformation from a startup to a fully-fledged company.
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Analysis and key concepts
01.
The traditional model of starting a company can no longer work because it is based on assumptions
02.
Customer development puts the customer at the centre of all planning right from day one
03.
Customer discovery is the first step on a journey that begins with the initial idea, and leads to the building of a company
04.
Customer validation is a process which facilitates quantitative testing of the entire business model
05.
Optimisation of visitor volume, of the cost to the consumer and of the conversion of passers-by into customers: strategies for digital startups
06.
Quotes
07.
Take-home message
When it is just a seedling, a startup is a pure act of faith. At this stage, it is practically impossible for its founders to know who their customers may be and what needs they might have. Yet, armed with their old-style business plan, entrepreneurs begin to try and launch a product, based on pure supposition.
They also plan a launch event, setting a date that cannot be changed, there is hardly ever any time to make improvements to the product, and this forced pace allows no room for tweaks, taking it for granted that customers are going to show up in droves. But what if they don’t? Startups often find out way too far down the line that they do not have many visitors to their site, that their customers will not form part of a large scale market, and that either the product has a low value, or the costs of distribution are too high.
Everyone working with startups thinks that they should follow the “do it and do it fast” motto, believing that they have been hired for what they can do, and not for what they can learn. But a startup is more like a series of hypotheses, many of which will prove to be wrong: offering a product based on these hypotheses is the best way to sink. Blindly marching on, without knowing what you are doing, is nothing short of criminal!
Since a startup is little more than a research unit, we need to avoid using the classic titles for departments, such as the “sales” department, which is normally a team who repeatedly sells a product to a known group of clients, giving presentations, quoting prices and explaining the standard terms and conditions. By their very definition, startups have few or even none of these clearly defined roles, because they are still looking for them! Before hiring other employees, it is important to be sure of the startup’s success: the cost of making mistakes in this area is pretty high.
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The author
Steve Blank is an entrepreneur and an adjunct professor of entrepreneurship at Stanford; he lectures at the UC Berkeley Haas School of business, and is a senior fellow at Columbia University. He is acknowledged as having created the customer development method that launched the lean startup movement. His Lean Launchpad class has become the standard form of commercialisation for all federal research. He has played a role in founding eight tech startups in 21 years.
Bob Dorf is probably the biggest expert in the Lean Customer Development method on the planet; he travels the world, flitting between Russia, Latin America and the United States, working as a consultant, and he teaches at Columbia Business School. He has founded seven companies
Edition
Publishing house:
Wiley
Year:
2020
Pages:
608
ISBN:
978-1119690689