Steve Blank

JUNE 3, 2009

Reducing Risk – Simulation versus Customer Development If you remember the first part of this discussion, startups face two types of risk; invention risk and/or customer/market risk. In either type of startup you want to put in place processes in place to reduce risk.

Vertical 128

Vertical Silicon Valley Marketing RSS 128

Steve Blank

AUGUST 13, 2009

It took me 8 startups and 21 years to get it right, (and one can argue success was due to the Internet bubble rather then any brilliance.) No internet, no blogs, no books on startups, no entrepreneurship departments in universities, etc. It took lots of trial and error, learning by experience and resilience through multiple failures.

Silicon Valley 179

Silicon Valley RSS Technical Review Lean 179

Steve Blank

FEBRUARY 23, 2009

I was between my 7th and 8th and final startup; licking my wounds from Rocket Science, the company I had cratered as my first and last attempt as a startup CEO. I was consulting for the two venture capital firms who between them put $12 million into my last failed startup. (My It was a long way from Ellis Island.)

Silicon Valley 125

Silicon Valley RSS Venture Capital Customer Development 125

Steve Blank

OCTOBER 5, 2009

I had last been in Chapel Hill on a winter’s day in 1986, traveling with the VP of Sales of our new supercomputer startup, Ardent. We were on the University of North Carolina campus to meet with Fred Brooks and Henry Fuchs. We were sitting in our cheap hotel room when the phone rang.

North Carolina 125

North Carolina Silicon Valley Fractional VPE Part-Time VPE 125

Steve Blank

JUNE 25, 2009

Startups and Sales If you read this post you can come away with the impression that every startup with a direct salesforce needs a consultative sales team. what Market Type is your startup? Hiring a VP of Sales in customer discovery typically sets a startup back.

Technology 138

Technology Silicon Valley Fractional VPE Part-Time VPE 138

View from Seed

SEPTEMBER 14, 2021

One thing that jumps out quickly is that TVPI between 2004-2010 (avg 2.6x) has underperformed 2011-2017 (avg 3.0x). Both early- and late-stage startup valuations are currently elevated. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Was this a lost decade for venture capital?

Valuation 319

Valuation Pre-Money Valuation Distribution Early Stage 319

View from Seed

SEPTEMBER 14, 2021

One thing that jumps out quickly is that TVPI between 2004-2010 (avg 2.6x) has underperformed 2011-2017 (avg 3.0x). Both early- and late-stage startup valuations are currently elevated. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Was this a lost decade for venture capital?

Valuation 295

Valuation Pre-Money Valuation Distribution Early Stage 295

Steve Blank

MAY 22, 2009

Steve Blanks 30 years of Silicon Valley startup advice. These two posts were amazing. Now In Print!

Silicon Valley 128

Silicon Valley RSS California Customer Development 128

View from Seed

SEPTEMBER 14, 2021

One thing that jumps out quickly is that TVPI between 2004-2010 (avg 2.6x) has underperformed 2011-2017 (avg 3.0x). Both early- and late-stage startup valuations are currently elevated. For context, seed-stage pre-money valuations are up 24% from H1 2020 to H1 2021. Was this a lost decade for venture capital?

Valuation 156

Valuation Pre-Money Valuation Distribution Early Stage 156

Steve Blank

AUGUST 20, 2009

Resegmentation means these startups are trying to lure some of the current or potential customers away from incumbents by either offering a lower cost product, or by offering features that appealed to a specific niche or subset of the existing users. An Existing Market All four were trying to resegment an “Existing Market.”

Silicon Valley 181

Silicon Valley Startup RSS Customer Development 181

Steve Blank

APRIL 29, 2009

I’ve paraphrased his speech into the language of a startup. Startups are inherently chaos. Every potential startup founder should think about their level of comfort operating in chaos and uncertainty. Both reminded me why National Service would be a very good idea.) It’s eerily similar. It may not be for you.

Silicon Valley 170

Silicon Valley Iraq RSS Vietnam 170

Steve Blank

JUNE 5, 2009

There is no certainty about a startup on day-one. At each startup I couldn’t wait to do this. Fact-based Execution However, successfully executing a startup requires the company to become Fact-based as soon as it can. Faith-based Entrepreneurship At first, entrepreneurship is a Faith-based initiative. Great, sign me up.

Silicon Valley 212

Silicon Valley RSS Vertical California 212

Steve Blank

AUGUST 27, 2009

Thirty years later we now realize that its one the causes of early startup failure. This series of posts is a brief explanation of how we’ve evolved from Product Development to Customer Development to the Lean Startup. It has become an integral part of startup culture.

Silicon Valley 260

Silicon Valley Product Startup Product Development 260

Steve Blank

FEBRUARY 23, 2009

This product development diagram had become part of the DNA of Silicon Valley. This product development diagram had become part of the DNA of Silicon Valley.

Product Development 143

Product Development Developer Silicon Valley Product 143

Steve Blank

NOVEMBER 2, 2009

For those of you who have been following the discussion, a Lean Startup is Eric Ries ’s description of the intersection of Customer Development , Agile Development and if available, open platforms and open source. Over its lifetime a Lean Startup may spend less money than a traditional startup. Lets see why.

Lean 244

Lean Silicon Valley Startup RSS 244

Steve Blank

FEBRUARY 23, 2009

Eighty some pages later I realized that a) I had some great war stories as a good marketeer and failed CEO, b) I’d have to pay my wife and kids to read them, c) the three of them were probably the entire total available market, and d) when I looked at what I had done and what other entrepreneurs had done at their startups, that there was a pattern.

Redemption 126

Redemption Silicon Valley RSS California 126

Steve Blank

NOVEMBER 5, 2009

Unfortunately in early stage startups the drive for financing hijacks the corporate DNA and becomes the raison d’etre of the company. Chasing funding versus chasing customers and a repeatable and scalable business model, is one reason startups fail. The goal of their startup in this stage becomes “getting funded.”

Customer Development 262

Customer Development Developer Customer Silicon Valley 262

Steve Blank

FEBRUARY 23, 2009

Joseph Campbell’s insight of the repeatable patterns in mythology is equally applicable to building a successful startup. All startups (whether a new division inside a larger corporation or in the canonical garage) follow similar patterns—a series of steps which, when followed, can eliminate a lot of the early wandering in the dark.

Silicon Valley 127

Silicon Valley RSS Venture Capital California 127

Steve Blank

SEPTEMBER 17, 2009

In future posts I’ll describe how Eric Ries and the Lean Startup concept provide the equivalent model for product development activities inside the building and neatly integrates customer and agile development. This post describes a solution – the Customer Development Model. Its strength is its rigor and flexibility.

Customer Development 242

Customer Development Developer Customer Silicon Valley 242

Gust

OCTOBER 12, 2011

During the summer of 2010, I developed a workshop, A New ACEF Valuation Workshop for Angels and Entrepreneurs. See the 2010 data reported here: Current Pre-money Valuations of Pre-revenue Companies. See the 2010 data reported here: Current Pre-money Valuations of Pre-revenue Companies. million to $2.1 million to $2.7

Angel Groups 125

Angel Groups Valuation Pre-Money Valuation St. Louis 125

Steve Blank

JULY 9, 2009

Reply steveblank , on July 9, 2009 at 10:44 am Said: Tim, Some entrepreneurs can do a startup based on recognizing an opportunity and executing. I needed a startup where I loved the technology, the opportunity _and_ the customers. Don’t confuse your passion for your tools with why your customers will buy your product.

Silicon Valley 139

Silicon Valley RSS California Video 139

Steve Blank

APRIL 23, 2009

It was a brilliant strategy but Sales screwed it up.&# (My own lame defense here for this behavior is that sales and marketing are always cats and dogs in startups. Historically, these were two guys with high testosterone. They hit each other with baseball bats until one of them dropped.) Ownership and Teamwork not turf.

Silicon Valley 120

Silicon Valley RSS California Customer Development 120

Steve Blank

MAY 26, 2009

The best entrepreneurship textbooks and blogs assume that advice to startups is generalizable. But as I learned from my students this “one-size-fits-all” approach does not work for all startups. Different market opportunities present radically different startup risks and costs.

Vertical 149

Vertical Silicon Valley Intellectual Property RSS 149

Steve Blank

JUNE 22, 2009

Startups have forced an accelerated cycle of creative destruction for large companies that didn’t exist in the first half of the 20th century. Over the last 35 years venture capital has funded nimble new entrants (on a scale never imagined by Schumpeter ) who exist to exploit discontinuities in technology or customer behavior.

Silicon Valley 164

Silicon Valley RSS California Agile 164

Steve Blank

MAY 21, 2009

Steve Blanks 30 years of Silicon Valley startup advice. Plus tips on overall trade show strategy. Now In Print!

Silicon Valley 178

Silicon Valley RSS California Customer Development 178

Austin Startup

OCTOBER 13, 2010

StoredIQ has rapidly gained traction with customers across several vertical industries, including financial services, healthcare and oil and gas. “Buddy has substantial channel and business development experience working with a range of companies, from early stage to multinational corporations.

Vertical 59

Vertical Early Stage Cofounder Channel 59

Steve Blank

NOVEMBER 12, 2009

After these slides, these VC’s recognized that this company had dramatically reduced risk and built a startup that was agile, resilient and customer-centric. The presentation didn’t have a single word about Lean Startups or Customer Development.

Venture Capital 209

Venture Capital Silicon Valley RSS Hockey Stick 209

Steve Blank

MAY 18, 2009

It’s why all of you operated so well in the unpredictable environment that all startups face.” What makes an individual a great startup founder (versus an employee) has been something I had been thinking about since I retired. I couldn’t figure out if I was more perturbed about how casual the comment was or how insightful it was.

Founder 297

Founder Silicon Valley RSS China 297

Steve Blank

JULY 20, 2009

Our salesmen focused on accounts that ordered the largest number of chips and ignored tiny little startups that wanted to build personal computers around these chips (like Cromemco, Osborne, Kaypro, Coleco, Radio Shack, Amstrad, Sinclair, Morrow, Commodore, Intertec, etc.) Keep in mind this is still several years before the IBM PC and DOS.

Silicon Valley 175

Silicon Valley Chad RSS San Francisco 175

Steve Blank

MAY 7, 2009

Over scrambled eggs and diet coke, I listened to this seasoned startup veteran describe the excitement of his students who came to the U.S. Win, lose or draw, these students have a life changing experience where they can network and get smarter as they see what good startup thinking looks like. to compete.

Business Plan 140

Business Plan Silicon Valley RSS Venture Capital 140

Steve Blank

JULY 2, 2009

Reply Mark Essel , on July 2, 2009 at 9:14 am Said: Reality distortion field isn’t the basic technique covered in startups 101? Reply Wyatt ODay , on July 2, 2009 at 8:18 am Said: Great post, Steve. I love all these war stories. If entrepreneurs can’t imagine and convince us that we can achieve the impossible, who will?

Silicon Valley 120

Silicon Valley Technical Review RSS Software Review 120

Steve Blank

JULY 16, 2009

Customer Development says having a vision, faith and a set of hypotheses are a normal part of the startup experience. It’s nothing personal, but your interests and your VC’s may not be aligned. More on this in future posts.)

Silicon Valley 207

Silicon Valley RSS Video San Diego 207

Steve Blank

JULY 13, 2009

Rocket Science 4: The Press is Our Best Product « Steve Blank >>The Customer Validation lesson of, “no formal launch until you have early sales validating the product and sales process” was also born here.<< << (tags: startups) [.] Reply Dan L , on July 13, 2009 at 7:32 pm Said: Interesting story.

Silicon Valley 122

Silicon Valley Product RSS California 122

Steve Blank

APRIL 7, 2009

I love Google. I think its one of the smartest companies out there. And it hires very smart people from the best schools. And if you meet their criteria of a “good student”, you ought to go to work there. You don’t get grades for having resiliency, curiosity, agility, resourcefulness, pattern recognition and tenacity. You just get successful.

Silicon Valley 327

Silicon Valley RSS California Customer Development 327

Steve Blank

OCTOBER 22, 2009

Getting Out of the Building Wasn’t Entertainment – Discovery and Validation Now that I was the master of the “facts” about customer needs in these specialized vertical markets , and with my team of vertical marketers , I thought I had achieved absolution and redemption. But there was one fatal flaw.

Silicon Valley 172

Silicon Valley RSS Vertical California 172

Steve Blank

MAY 4, 2009

In an early stage startup, instead of sales being up front, the point departments are likely to be product development and customer development. Their own internal culture would tie them up in knots, and agile startups could run rings around them. No one was confused after that. Who’s on the Sharp End?

Silicon Valley 126

Silicon Valley RSS Non-Compete California 126

Steve Blank

OCTOBER 8, 2009

For this startup we had assembled some of the best and brightest hardware and software engineers in the computer industry. He continued yelling, “We have a technical team assembled in this room that has more knowledge of scientific customers and scientific computers than any other startup has ever had.

Silicon Valley 271

Silicon Valley RSS Customer Development California 271