Entrepreneurship has changed dramatically in recent years. Through the advancement of technology, what used to be a multimillion dollar development process, can now be developed rather cheaply with a PC and some open-source software. Starting a company now could cost you as much as your credit card limit. The one thing that is still present, however, is the fact that startups can fail. In fact, more startups fail from a lack of customers rather than from a failure of product development.
In the following video from the Stanford Graduate School of Business, entrepreneur Steve Blank talks about how to lower this rate of failure. He focuses on the “Customer Development” model of entrepreneurship and advocates that it is a much safer model than traditional ones. He compares the goals between different startup models versus the goals and expectations of the larger corporations. Finally, he discusses nine building blocks that can describe any company and suggests that companies use it to test their hypotheses. Here are a few highlights that Blank shares with his audience:
- A startup (as defined by him) is a temporary organization used to search for a scalable and repeatable business model
- The purpose of a large company is to execute on a known business plan.
- The goal of a startup is to build a minimum viable product
- No business plan survives first contact with customers
- It’s okay to get your (business) hypotheses wrong.
The video is long, but worth every minute of your time.