In June I had the opportunity to go to Stanford for a class taught by Steve Blank called the Lean Launchpad Educators program. I was invited to participate by the team running the Startup Weekend Next program since I am helping to lead the effort to bring this program to Tampa in September. It was an incredible experience not only did I get to spend three days on the Stanford campus I also got to meet Tom Byers who started the Stanford Technology Ventures program and is the brother of one of the founders of Kleiner Perkins Caulfied and Byers, one of the more famous Silicon Valley venture capital firms.
There were approximately 100 other students in the class that were primarily university and college professors that run entrepreneurship programs all over the world. The US was well represented with teachers or department heads from the likes of University of Louisville, Darden School at University of Virginia, NYU, Purdue Georgia Tech and a lot of other prestigious schools. There were also people that came from the Middle East, Germany, Canada, and many other countries, about 15 of us were there because of Startup Weekend Next.
Steve Blank had been an extremely successful technology entrepreneur growing his last startup from $0 to $125M in revenue in two years before deciding to retire the day before the company went public in a spectacular IPO. Steve made the decision that he would rather teach what he had learned from the experience gained from 8 startup companies in 21 years.
There were three things that stuck in my head from the Stanford Lean Launchpad experience that Steve is famous for saying.
- Most startups fail not because of product or technology development but because of lack of customer development.
- No business model survives first contact with a customer.
- And I built a company that went from no revenues to $125 million dollars in revenue in 24 months!
At the core of the Lean Launchpad movement are three pillars of entrepreneurial education:
- Customer Development
- Business Model Canvas
- Agile Engineering
The Customer Development pillar is based on Steve’s experience of customer development from his book “Four Steps to the Epiphany” and the followup he co-authored with Bob Dorf called “The Startup Owners Manual”.
The business model canvas was developed by Alex Osterwalder and detailed in the compilation in the book called “Business Model Generation”. Prior to the business model canvas if you asked 10 people in a company “What’s our business model?” you’d more than likely get 10 different answers. The BMC is made up of nine boxes that help you define your customer value propositions, the customers segments you are going to focus on, the cost structure, the revenue structure among others.
Eric Ries is credited with adding the Agile Engineering process for building products to the Lean Startup meme that is propagating in our lexicon.