Steve Blank

SEPTEMBER 3, 2014

I was driving home from the BIO conference in San Diego last month and had lots of time for a phone call with Dave, an ex student and now a founder who wanted to update me on his Customer Discovery progress. Customer Discovery. He worked hard to deeply understand the customer problems of these two customer segments.

Cofounder 336

Cofounder Founder Technical Cofounder Coder 336

Steve Blank

FEBRUARY 11, 2010

The Customer Development process is the way startups quickly iterate and test each element of their business model , reducing customer and market risk. The first step of Customer Development is called Customer Discovery. outside the building and test them in front of customers.

Burn Rate 248

Burn Rate Silicon Valley Marketing Boston 248

YoungUpstarts

JUNE 20, 2019

Specifically, there are five challenges that emerging business typically put on the backburner between funding rounds: Seed to Series A: Customer Testing. Hypotheses should be tested extensively and disproven, which is where customer testing plays a central role for seed-stage startups. Series B: Hiring and Developing Managers.

Technical Cofounder 113

Technical Cofounder Burn Rate Seed Stage Cofounder 113

Steve Blank

FEBRUARY 13, 2024

The moment I saw the product I knew every one of my professional graphics customers (ad agencies, freelancers, photo studios, etc.) But every graphics professional did own a CDROM drive but most didn’t own a high-resolution film scanner – and PhotoCD would have been perfect for them – and the perfect launch customer.

Search 256

Search Marketing Forecast Burn Rate 256

YoungUpstarts

JULY 31, 2019

Compounding the problem, founders often ramp up expenses and their burn rate as they collect fundraising debt, always expecting better performance to be just around the corner, and being prepared for the next round. . Many would argue that even the most theoretically scalable products in healthcare, i.e

Cofounder 127

Cofounder Burn Rate Technical Cofounder Seed Capital 127

Startup Professionals Musings

OCTOBER 16, 2023

Projecting financials is a natural extension of the homework every entrepreneur needs to do on customer opportunity size, product costs, pricing, competition and customer value. Project your cash burn rate to keep at least 18 months between venture capital or angel investments. Doubling revenue each year is a good target.

Forecast 290

Forecast Burn Rate Widget Business Plan 290

Startup Professionals Musings

JULY 2, 2022

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Look at marketing as an investment, not an expense.

Burn Rate 382

Burn Rate Angel Investor Operations Demand 382

View from Seed

OCTOBER 24, 2019

As a first time founder, having a few million dollars in the bank after a successful seed raise may seem like a huge amount of capital, and it’s easy to lose discipline around your burn rate.

Dilution 149

Dilution B2B Burn Rate Early Stage 149

Startup Professionals Musings

FEBRUARY 17, 2021

It wasn’t so many years ago that starting a new e-commerce business on the Internet was a complex custom development project, usually costing a million dollars or more. These steps alone can reduce your monthly burn rate by at least $10K. A programmer can build a new smartphone app for a few thousand dollars.

Cost 405

Cost Entrepreneur Burn Rate Social Media 405

Feld Thoughts

NOVEMBER 18, 2013

One of them used to be a lead developer at [insert hot consumer tech company here]. Early customer development talks are going great which keeps the team really excited. Three months in, the burn is now at $70k/month. Soundbites from potential customers are encouraging. There is $350k left in the bank.

Burn Rate 152

Burn Rate Equity Software Review Early Stage 152

Mucker Lab

MAY 28, 2020

These lost startups land higher valuations, have larger teams, outsource more product development and spend more money on customer acquisition than their peers. You can’t force customers to want solutions to problems they don’t have, but you can fix a flawed execution. More and more investors have begun to shun high burn rates.

Startup 78

Startup Cofounder Burn Rate Technical Review 78

Up and Running

FEBRUARY 20, 2015

However, there are a number of metrics that every business owner should know, including cash flow, accounts payable, accounts receivable, direct costs, operating margin, net profit, and cash burn rate. Accounts receivable is money that is owed to you by your customers for products or services that you’ve sold.

Metrics 60

Metrics Burn Rate .Net Churn Rate 60

Both Sides of the Table

NOVEMBER 3, 2009

That died with waterfall software development. It should talk about how many customers you think you will acquire and how much you’ll charge for your product. Do you really want to spent $100k building a product to discover through Customer Development that the market is too small? Do so at your peril.

Business Plan 334

Business Plan AJAX Venture Capital Technical Review 334

Startup Professionals Musings

FEBRUARY 5, 2021

If you don’t have a destination, don’t waste your money trying to get there, and don’t expect anyone to support you along the way Projecting financials is a natural extension of the homework every entrepreneur needs to do on customer opportunity size, product costs, pricing, competition and customer value. Quantify overhead costs.

Forecast 369

Forecast Burn Rate Startup Widget 369

Steve Blank

SEPTEMBER 17, 2009

This post describes a solution – the Customer Development Model. 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.

Customer Development 242

Customer Development Developer Customer Silicon Valley 242

Up and Running

APRIL 27, 2020

Current businesses are finding ways to pivot their business models, revisiting their budgets, and developing new forecasts to minimize their burn rate and maximize their available cash runway. That combination puts you in a great position to provide an inexpensive solution and win over customers.

Software Review 113

Software Review Lean Forecast Business Plan 113

Both Sides of the Table

OCTOBER 12, 2010

Even if you don’t have “direct&# sales I would tell you that “everything is a sale&# including fund raising, hiring, getting press and doing business development. Spending time selling to customers is the best way to find out what their problems are and how good your solution currently is at mapping to their needs.

Hiring 346

Hiring Sales Startup Early Stage 346

Feld Thoughts

SEPTEMBER 16, 2011

Since SayAhh is in the pre-launch development stage, the company doesn’t have any revenue yet. A company at this stage could also face product development costs from consultants if they decided to outsource product development. Once these were up Dick launched several AdWords campaigns to test customer interest.

Balance Sheet 125

Balance Sheet Fractional CTO Burn Rate Salary 125

Up and Running

APRIL 22, 2020

They want to understand your burn rate and cash runway to see how likely you are to pay back the loan, and in a crisis, a hit in sales, revenue, and overall cash flow can help prove that you were affected by COVID-19. If your cash flow history is inconsistent or mismanaged, take steps now, even in a crisis, that shows an upward trend.

SBA 139

SBA Forecast Software Review Business Plan 139

The Next Web

DECEMBER 2, 2013

Could $100,000 and the right developer skills make you an overnight billionaire? With mobile development agencies and product incubators on the rise and more corporate “labs” spinning out each day, there’s no shortage of talent to help you build the next great Web or mobile app. But a good developer could make it quicker.”.

Cost 168

Cost San Francisco New York City Ruby 168

Startup Professionals Musings

SEPTEMBER 30, 2019

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Look at marketing as an investment, not an expense.

Entrepreneur 267

Entrepreneur Burn Rate Angel Investor Operations 267

VC Adventure

MARCH 17, 2022

With the markets down significantly, financings (at least at the later stages) slowing down, and inflation and interest rates on the rise, perhaps now is a good time to talk about your burn rate. Hopefully, you took advantage of the robust financing markets of the past few years to put some money on your balance sheet.

Balance Sheet 121

Balance Sheet Burn Rate Valuation Metrics 121

Both Sides of the Table

DECEMBER 16, 2009

.&# They know instinctually how customers buy and how to excite them. Because they’re street smart, most great entrepreneurs tend to prefer getting out and talking with real customers rather than sitting in a cubicle all day doing beautiful PowerPoint slides. We couldn’t cut product development (we had 23 people!)

Entrepreneur 306

Entrepreneur Burn Rate Cofounder Sales 306

crowdSPRING Blog

SEPTEMBER 19, 2014

Are startup burn rates out of control? Voice of the Customer: The Secret of Great Landing Page Copy | WordStream – crowdspring.co/1rgMIOC. Designing Custom iOS App Interface Elements using Photoshop – crowdspring.co/X7LhFm. Designing Custom iOS App Interface Elements using Photoshop – [link] crowdspring.co/X7LhFm.

Social Media 94

Social Media Small Business Design Media 94

Steve Blank

NOVEMBER 18, 2010

In an existing company with existing customers you 1) understand the customers problem and 2) since you do, you can specify the entire feature set on day one. In fact, for decades if you drew this diagram on day one of a startup VC’s would nod sagely and everyone would get to work heading to first customer ship.

Burn Rate 247

Burn Rate Management Business Model Customer Development 247

Tim Keane

DECEMBER 14, 2009

   We worked all day building market strategies for customers while we tried to embody our expertise on software that would expand the company's reach.    Paul goes on to develop the story of "vanilla" documents prepared by the angel's attorney.    (This was 1989.) 

Burn Rate 60

Burn Rate Angel Groups Seed Stage Startup 60

Up and Running

JULY 27, 2020

This is due to the simple fact that most businesses need to wait for customers to pay while at the same time needing to purchase more inventory, pay payroll, or fulfill other obligations. Develop your cash flow forecast. You’ll understand your cash burn rate and runway which is a critical prediction of how long your cash will last.

Forecast 83

Forecast Management Cash Position Software Review 83

Startup Professionals Musings

DECEMBER 11, 2017

From my perspective, projecting financial returns is part of the homework every business person needs to do in sizing customer opportunity, product costs, pricing, competition and customer value, before expending their own resources in a highly risky venture. Calculate cash-burn rate and investment timing.

Burn Rate 144

Burn Rate Forecast Angel Investor Revenue 144

Steve Blank

AUGUST 27, 2012

It was great to watch him embrace the spirit and practice of customer development. He was constantly in front of customers, listening, selling, installing and learning. It seemed like once a week Yuri would come back from a customer meeting brimming with new insights. And that’s where the problem was. A Pivot a Week.

Founder 316

Founder Cofounder Advisory Board Burn Rate 316

Startup Professionals Musings

OCTOBER 22, 2017

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Look at marketing as an investment, not an expense.

Burn Rate 170

Burn Rate Angel Investor Operations Demand 170

Steve Blank

FEBRUARY 22, 2010

As a founder you are testing a series of hypotheses about all the pieces of the business model: Who are the customers/users? An early indication that you’ve found the right business model is when you believe the cost of getting customers will be less than the revenues the customers will generate. Who are our partners?

Balance Sheet 298

Balance Sheet Startup Burn Rate Metrics 298

Both Sides of the Table

MAY 2, 2015

What I love about my job is getting to see teams of super-early-stage companies develop ideas that while raw have potential to make an impact on the market. They can show the projections on what this does to burn rate. What if you are measuring CAC wrongly and you’re really not acquiring customers cost effectively?

Operations 150

Operations Metrics Early Stage Non-Compete 150

Startup Professionals Musings

JULY 27, 2014

It wasn’t so many years ago that starting a new e-commerce business on the Internet was a complex custom development project, usually costing a million dollars or more. These steps alone can reduce your monthly burn rate by at least $10K. A programmer can build a new smartphone app for a few thousand dollars.

Entrepreneur 260

Entrepreneur Burn Rate Social Media LLC 260

Both Sides of the Table

FEBRUARY 25, 2019

I work hard to create working relationships with my fellow non-management board members in the same way that every investor ultimately works to develop strong working relationships with founders. What should the cash burn rate of the company be and how long of a cash runway should the company maintain?

LP 269

LP Startup Burn Rate Stock Options 269

Startup Professionals Musings

JANUARY 17, 2014

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Look at marketing as an investment, not an expense.

Burn Rate 234

Burn Rate Angel Investor Entrepreneur Operations 234

Steve Blank

FEBRUARY 16, 2010

In my last post I described what happened when a company prematurely scales sales and marketing before adequately testing its hypotheses in Customer Discovery. But the VC’s kept coming back to the lack of adoption of the product, the floundering sales force, the burn rate – and “the plan.&#. They don’t.

Revenue 230

Revenue Balance Sheet Hockey Stick Burn Rate 230

YoungUpstarts

JUNE 17, 2019

Attracting new customers to grow any online business can be tough. Startups are regarded for their embrace of industry disruption, all the while constantly trying to limit their burn rate and conserving their capital for future growth. by Boris Pfeiffer , CEO and Founder of Riddle. Marketing: startup style. corporations.

Marketing 147

Marketing Startup Burn Rate Advertising 147