8. Social Entrepreneurship Startups
Social Large
Startup Non-Profit
• Solve pressing social problems
• Social Enterprise: Profitable
• Social Innovation: New Strategies
10. Small Business Startups
Work to Feed the Family
Small
Startup
Business
• Serve known customer with
known product
• Feed the family
11. Small Business Startups
Work to Feed the Family
Small
Startup
Business
Exit Criteria
• known customer - Business Model found
known product
- Profitable business
• Feed the family
- Existing team
< $500K in revenue
12. Small Business Startups
Small
Startup
Business
• 5.7 million small businesses in the U.S. <500 employees
• 99.7% of all companies
• ~ 50% of total U.S. workers
http://www.sba.gov/advo/stats/sbfaq.pdf
14. Scalable Startup
Search Execute
Scalable Large
Startup Company
• In contrast a scalable startup is designed to grow big
• Typically needs risk capital
• What Silicon Valley means when they say “Startup”
15. Scalable Startup
Search
Scalable Large
Startup Company
Goal is to solve for:
unknown customer and
unknown features
16. Scalable Startup
Born to Be Big
Search Execute
Scalable Large
Startup Company
Exit Criteria
- Business model found
- Total Available Market > $500M
- Can grow to $100M/year
18. Buyable Startup
Born to Sell
Search Sell
Scalable $5 to 50M
Startup Acquisition
Typically:
Internet, Mobile, Gaming Apps
19. Buyable Startup
Search Sell
Scalable $5 to 50M
Startup Acquisition
Goal is to solve for: Sell to larger company
Internet and Mobile Apps
20. Large Company Sustaining Innovation
Innovate or Evaporate
Sustaining Innovation
Scalable Large
Transition
Startup Company
• Existing Market / Known customer
•Known product feature needs
21. Large Company Disruptive Innovation
New Large
Transition
Division Company
Disruptive Innovation
•New Market
•New tech, customers, channels
22. Large Company Disruptive Innovation
New Large
Transition
Division Company
Disruptive Innovation
•Build
•Partner
•Acquire
- IP
- Talent
- Product
- Customers
- Business
23. Large Company Disruptive Innovation
New Large
Transition
Division Company
Disruptive Innovation
• Build
• Partner
•Acquire = an internal corporate startup
24. Summary Lesson 1:
Multiple Types of Startups
Policies, Funding and Tactics Differ
Techniques to build them are the same
31. Regulatory Change Accelerates
Venture Capital
1979 – Change in Employee
Retirement Income Security Act
Pension Funds Pile In
32. Culture Embraced
Technology Risk
1958 – Today
Recognized that 90% of startups fail
33. Culture Embraced
Financial Risk
1968 – Today
Experienced Advice
Tolerance For Risk
Long Term Interest Aligned
34. So What Lessons Can We Learn
To Build Innovation?
Without Cold War Funding
35. Technology Ecosystem: Infrastructure
Venture
Entrepreneurs
Finance
Motivation Crisis Profit
Management Customer Agile Business Model
Tools Development Development Design
Culture Risk Taking Entrepreneurial
Outward-Facing Free flow of
Tech Universities People/Info
Infrastructure Research Predictable Stable
24/7 Utilities
Universities Economic System Legal System
36. Technology Ecosystem: Culture
Venture
Entrepreneurs
Finance
Motivation Crisis Profit
Management Customer Agile Business Model
Tools Development Development Design
Culture Accelerators, Outward-Facing Free flow of
Risk Taking
Incubators Tech Universities People/Info
Infrastructure Research Predictable Stable
24/7 Utilities
Universities Economic System Legal System
37. Technology Ecosystem: Tools
Entrepreneurs Risk Capital
Motivation Crisis Profit
Management Customer Agile Business Model
Tools Development Development Design
Culture Accelerators, Outward-Facing Free flow of
Risk Taking Incubators Tech Universities People/Info
Infrastructure Research Predictable Stable
24/7 Utilities
Universities Economic System Legal System
38. Technology Ecosystem: Motivation
Entrepreneurs Risk Capital
Motivation Crisis Profit
Management Customer Agile Business Model
Tools Development Development Design
Culture Accelerators, Outward-Facing Free flow of
Risk Taking Incubators Tech Universities People/Info
Infrastructure Research Predictable Stable
24/7 Utilities
Universities Economic System Legal System
39. Technology Ecosystem
Entrepreneurs Risk Capital
Motivation Crisis Profit
Management Customer Agile Business Model
Tools Development Development Design
Culture Risk Taking
Accelerators, Outward-Facing Free flow of
Incubators Tech Universities People/Info
Infrastructure Research Predictable Stable
24/7 Utilities
Universities Economic System Legal System
67. Summary Lesson 3:
Making Startups Fail Less
1. Startups Are Not Smaller Versions
Of Large Companies
2. Customer Development & Business
Models – Replace Business Plans
85. Recommendation 5
Encourage
Small Business Initiatives
to Adopt these Same Techniques
86. I’ve open-sourced all this material
Happy to share it
www.steveblank.com
sblank@kandsranch.com
Curriculum, Syllabus, Slides, Teaching Guide and On-line Courses
all available for free www.steveblank.com