Back in 2012, I was on a trip to San Francisco and I was recommended by a tech/entrepreneur friend to books to read one was The Four Steps to the Epiphany by Steve Blank and the other The Lean Startup by Eric Ries. Both great books that have created the lean startup movement throughout the tech world and on it way into the mainstream. After dragging myself through Steve Blank’s information filled book, I never expected him to be such an entertaining speaker, filled with antidotes, stories of his own snowden-like experience and educational expertise. If you don’t have time for his delightful 50 min presentation. I urge you to see the highlights below.
What makes the lean start up movement so special?
Before the lean startup movement
The last 100 years in business schools, we have been administering known corporate business models and we saw founder of a Startup to be equal to that of the CEO of a company. We were making our a 5 year business plans for venture capitalists and then would build, build, build. Failure was not allowed. We’d create our products and turned to the VP of sales to executive to make it sell. When that didn’t work we used to “pivot” by firing our sales executive and hiring someone new.
The new customer-focused movement
Recently this has changed. Now instead of firing the executives, we are firing the business plan. Startups evolve from you learning from customers as quickly and as inexpensively as you can. This makes us more efficient with money and time. A startup is nothing like a large company! The more people understand that startups don’t evolve like some 4th or 5th generation of a product in an existing corporation. Startups are searching for business model. The critical thing we are testing is product market fit.
The combination between your value proposition (the thing you are building) and customer segments (who you do you think you are building it for). So if you go to 99design you might not be hitting your target market. You need to nail your product-market fit.
For example let’s take this product Tio Gazpacho. When Tio Gazpacho first came to me they had a label. The appearance of the label look like a value-product, rather than a high-end organic homemade product. After I understand the target market, I create a design that fit the market and attracted the right consumer who would be willing to spend a premium for the product.
How do you decide when to pivot vs following your vision
This depends on type of marketing. Existing marketing: we have data, size, competitors, pricing and best of all customers. The existing customers will tell you…”I wish this was faster” You can go out and talk to them. Resegmenting a marketing and attacking head on is suicidal. There is a niche that the incumbent hasn’t taken.
Can entrepreneurship be taught?
Entrepreneurship is an art. It is like being an artist or designer. You can be taught the tools, but it is the true artists and visionary entrepreneurs that find success. I can’t think of anything more exciting with my life. This is the most exciting thing to do. The most passionate thing. It’s a live this way or die kind of way of life. Just because you want to be a great artist, doesn’t mean you know who is going to be a Michelangelo or Leonardo di Vinci.
lifestyle entrepreneurs – small surf company
small business owners – not for venture capitalist