Steve Blank

FEBRUARY 25, 2010

The next step in the Customer Development process is Customer Validation – making sure that there really is a repeatable and scalable revenue and business model before you turn up your cash burn rate.

Customer Development 266

Customer Development Web Developer Customer 266

Steve Blank

APRIL 26, 2022

At the turn of the century after the dotcom crash, startup valuations plummeted, burn rates were unsustainable, and startups were quickly running out of cash. This article previously appeared in TechCrunch. Cram downs are back – and I’m keeping a list. But now with the economic conditions changing, that’s no longer true.

Cram Down 404

Cram Down Founder Venture Capital Recapitalization 404

Steve Blank

NOVEMBER 18, 2010

For decades startups were managed by pretending the company would follow a predictable path (revenue plan, scale, etc.) The Revenue Plan – The Third Fatal Assumption. Notice that the traditional product introduction model leads to a product launch and the execution of a revenue plan. Albert Einstein. Ritualized Crises.

Burn Rate 247

Burn Rate Management Business Model Customer Development 247

Steve Blank

SEPTEMBER 7, 2009

Instead of a Sales team and organized to sell with a consistent and successful sales roadmap generating revenue, it is a disorganized and unhappy organization burning lots of cash. Because the company based its headcount and expenses on the expectation that the Sales organization will bring in revenue according to plan.

Customer Development 224

Customer Development Developer Customer Silicon Valley 224

Steve Blank

FEBRUARY 22, 2010

I had been confused for years why I had to update an income statement each board meeting that said zero for 18 months before we had any revenue. 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. Retained 90+ Days.

Balance Sheet 298

Balance Sheet Startup Burn Rate Metrics 298

Steve Blank

AUGUST 27, 2012

Other weeks Yuri would be buffeted by the realities of his burn rate, declining bank account and depressing comments from customers. He should make sure that there aren’t other parts of the business model (revenue model, pricing, partners, channel, etc.)

Founder 316

Founder Cofounder Advisory Board Burn Rate 316

Steve Blank

NOVEMBER 2, 2009

And I can even imagine cases where it might burn more cash than a traditional startup. The key contributors to an out-of-control burn rate is 1) hiring a sales force too early, 2) turning on the demand creation activities too early, 3) developing something other than the minimum feature set for first customer ship. Lets see why.

Lean 244

Lean Silicon Valley Startup RSS 244