Startup Essentials
by Steve Blank & Bob Dorf
What is a start-up actually for?
Steve Blank and Bob Dorf define a start-up as a temporary organisation searching for a business model that's repeatable, scalable and profitable. A big company executes a model it already knows. Run a start-up like a small big company, with a plan to execute, and it usually fails.
Blank says there are no facts inside your building, only opinions. Every part of a new business model starts as a guess. The founders themselves, rather than hired researchers, have to go and talk to customers to turn those guesses into facts.
Customer development has four steps. Customer discovery tests whether customers care about the problem and your product. Customer validation tests whether the business model can be repeated and scaled. Only then come customer creation, which builds demand, and company building, where the search turns into a company.
Blank and Dorf replace the five-year business plan with Alexander Osterwalder's business model canvas. Its nine boxes cover customers, value, channels, revenue, costs and more. Each box starts as a hypothesis to test, and you redraw it as you learn.
After each round of tests, the team asks whether its hypotheses held up. If they didn't, it pivots, changing one or more parts of the business model, and tests again. Blank and Dorf treat failure and pivots as a normal part of the search.
Agree early on what kind of market you're entering. It might be an existing market, a resegmented one, a brand-new market, or a clone of a model proven in another country. Each needs different spending, timing and selling, and a new market takes years to build.
The search
A start-up's first job is hunting for a way to make money that can repeat and grow.
Guesses
On day one, your business plan is a list of untested guesses.
Get out
The answers aren't in the office. Get out and talk to customers.
Earlyvangelists
Find earlyvangelists, people who feel the problem so badly they've already tried to fix it.
Pivot
When customers prove a guess wrong, change it quickly. That's a pivot, and it's normal.
One thing to try
This week, talk face to face with five people who'd be your customers. Ask how they handle the problem now. Listen, and don't pitch.
Knotd has the key ideas from 250+ non-fiction books, each in a few minutes, in plain words. The Startup Owner's Manual comes with a Name That Idea round and a Spot the Trap case to make it stick.
Get the whole book on KnotdOpen in the appWhat is a start-up actually for? Steve Blank and Bob Dorf define a start-up as a temporary organisation searching for a business model that's repeatable, scalable and profitable. A big company executes a model it already knows. Run a start-up like a small big company, with a plan to execute, and it usually fails.
Get out of the building; Four steps; Swap the plan for a canvas; Pivot or proceed; Know your market type.
This week, talk face to face with five people who'd be your customers. Ask how they handle the problem now. Listen, and don't pitch.
Yes. Knotd has the key ideas from The Startup Owner's Manual in a few minutes, in plain words, plus a Name That Idea round and a Spot the Trap case to test them. It's one of 250+ non-fiction books in the app.
