Why accountants don’t run startups sllc

Small Business & Entrepreneurship

steve-blank
  • Why Accountants Don’t Run Startups Steve Blank Stanford - School of Engineering U.C. Berkeley - Haas School Of Business www.steveblank.com Twitter: sgblank
  • I Drew This Customer Discovery Customer Validation Company Building Customer Creation Pivot
  • I Called It: Customer Development Customer Discovery Customer Validation Company Building Customer Creation Pivot
  • I Wrote This
  • A Few People Read It
  • I Write a Blog www.steveblank.com
  • When the Student is ready, the Master appears. Buddhist proverb
  • When the Student is ready, the Master appears. Buddhist proverb When the Master is ready, the Student appears. Steve Blank proverb
  • Five Short Stories
  • Tectonic Shifts in Entrepreneurship
  • The Silicon Valley Funding Pyramid Small VC Funds ($50-250M) Union Square Ventures First Round Capital Traditional VC Funds (>$250M) Benchmark Sequoia Angels & Incubators ($0-10M) Y-Combinator TechStars Seed Funds ($10-50M) SoftTech (Clavier) Floodgate Felicis (Senkut) SV Angel (Conway) Source: Dave McClure 500hats.com
  • Innovation in Financing Small VC Funds ($50-250M) Traditional VC Funds (>$250M) Angels & Incubators ($0-10M) Seed Funds ($10-50M) Source: Dave McClure 500hats.com Innovation is happening here
  • New Trends In Silicon Valley •  Internet startups - $500K is the new $5M –  Driven by the top of the pyramid •  Seed Funds providing entrepreneurial education* –  Ycombinator, TechStars, SeedCamp, LaunchBox, etc •  Customer Development/Lean Startup adoption –  Methodology to test hypothesis and business model *~100 startup accelerator programs: http://blog.shedd.us/321987608/
  • Not All Startups Are Equal
  • !"#$$% &'()*+((% !"#$"%&' Small Business Startups
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M in revenue Small Business Startups
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M in revenue Small Business Startups •  5.7 million small businesses in the U.S.
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M in revenue Small Business Startup: Internet Edition •  The Internet allows a new class of Small Businesses •  Not all businesses on the Internet are “Scalable Startups”
  • !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% ,-.//012+#$' Scalable Startup
  • !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% ,-.//012+#$' -  Total Available Market > $500m -  Company can grow to $100m/year -  Business model found -  Focused on execution and process Scalable Startup
  • !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% ,-.//012+#$' -  Total Available Market > $500m -  Company can grow to $100m/year -  Business model found -  Focused on execution and process -  Typically requires “risk capital” Scalable Startup •  In contrast a scalable startup is designed to grow big •  Typically needs risk capital •  What Silicon Valley means when they say “Startup”
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% -  Total Available Market > $500m -  Company can grow to $100m/year -  Business model found -  Focused on execution and process -  Typically requires “risk capital” Very Different Startup Goals
  • !"#$$%&'()*+((%!"#$"%&' !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% Silicon Valley Venture Firms Invest in Scalable Startups
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 3-#*()40*% What VC’s Don’t Tell You: The Transition Search Build Grow
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 3-#*()40*% -  Founders depart -  Professional Mgmt -  Process -  Beginning of scale What VC’s Don’t Tell You: The Transition – Founders Leave
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • Plan versus Model
  • No Business Plan survives first contact with customers
  • So Search for a Business Model
  • The Search for a Business Model •  A Business Plan is static • A Business Model diagrams how a company creates, delivers and captures value – it’s dynamic •  Or in English: How a company makes money
  • Emphasis On Hypotheses Testing
  • Startups Continually Pivot (Iterate)
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • How Do Startups Search For A Business Model? •  The Search is called Customer Development •  The Implementation is called Agile Development
  • The Lean Startup •  The Search is called Customer Development •  The Implementation is called Agile Development
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • 562%!7#-7'1(%8-+*97%:'*%&2% 8;;0'*7#*7(%
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • Durant Versus Sloan •  Dies, rich, honored and famous
  • Durant Versus Sloan •  Dies, rich, honored and famous •  Dies managing a bowling alley
  • Durant Versus Sloan •  Dies, rich, honored and famous •  Dies managing a bowling alley Accountant
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • E-School instead of B-School
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • E-School Will Emerge •  Entrepreneurial Education will change radically •  E-School Students are not B-School Students •  Y-Combinator/Techstars first inkling •  Today ~100 startup accelerator programs *~100 startup accelerator programs: http://blog.shedd.us/321987608/
  • E-School – Let’s Help Build It •  Startup Accelerators - great coaching/networking but minimal methodology •  Lean/Customer Development - great methodology but no education •  Need to be connected to Engineering School •  Stanford, Harvard and others get it…but… *~100 startup accelerator programs: http://blog.shedd.us/321987608/
  • Durant School of Entrepreneurship
  • The Durant School of Entrepreneurship http://www.cafepress.com/durantschool
  • The Durant School of Entrepreneurship http://www.cafepress.com/durantschool
  • The Durant School of Entrepreneurship http://www.cafepress.com/durantschool
  • Thanks ===>:"+?+*)#8@>(67'
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  • Why Accountants Don’t Run Startups Steve Blank Stanford - School of Engineering U.C. Berkeley - Haas School Of Business www.steveblank.com Twitter: sgblank
  • I Drew This Customer Discovery Customer Validation Company Building Customer Creation Pivot
  • I Called It: Customer Development Customer Discovery Customer Validation Company Building Customer Creation Pivot
  • I Wrote This
  • A Few People Read It
  • I Write a Blog www.steveblank.com
  • When the Student is ready, the Master appears. Buddhist proverb
  • When the Student is ready, the Master appears. Buddhist proverb When the Master is ready, the Student appears. Steve Blank proverb
  • Five Short Stories
  • Tectonic Shifts in Entrepreneurship
  • The Silicon Valley Funding Pyramid Small VC Funds ($50-250M) Union Square Ventures First Round Capital Traditional VC Funds (>$250M) Benchmark Sequoia Angels & Incubators ($0-10M) Y-Combinator TechStars Seed Funds ($10-50M) SoftTech (Clavier) Floodgate Felicis (Senkut) SV Angel (Conway) Source: Dave McClure 500hats.com
  • Innovation in Financing Small VC Funds ($50-250M) Traditional VC Funds (>$250M) Angels & Incubators ($0-10M) Seed Funds ($10-50M) Source: Dave McClure 500hats.com Innovation is happening here
  • New Trends In Silicon Valley •  Internet startups - $500K is the new $5M –  Driven by the top of the pyramid •  Seed Funds providing entrepreneurial education* –  Ycombinator, TechStars, SeedCamp, LaunchBox, etc •  Customer Development/Lean Startup adoption –  Methodology to test hypothesis and business model *~100 startup accelerator programs: http://blog.shedd.us/321987608/
  • Not All Startups Are Equal
  • !"#$$% &'()*+((% !"#$"%&' Small Business Startups
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M in revenue Small Business Startups
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M in revenue Small Business Startups •  5.7 million small businesses in the U.S.
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M in revenue Small Business Startup: Internet Edition •  The Internet allows a new class of Small Businesses •  Not all businesses on the Internet are “Scalable Startups”
  • !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% ,-.//012+#$' Scalable Startup
  • !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% ,-.//012+#$' -  Total Available Market > $500m -  Company can grow to $100m/year -  Business model found -  Focused on execution and process Scalable Startup
  • !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% ,-.//012+#$' -  Total Available Market > $500m -  Company can grow to $100m/year -  Business model found -  Focused on execution and process -  Typically requires “risk capital” Scalable Startup •  In contrast a scalable startup is designed to grow big •  Typically needs risk capital •  What Silicon Valley means when they say “Startup”
  • !"#$$% &'()*+((% !"#$"%&' - Business Model found - Profitable business -  Existing team < $10M !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% -  Total Available Market > $500m -  Company can grow to $100m/year -  Business model found -  Focused on execution and process -  Typically requires “risk capital” Very Different Startup Goals
  • !"#$$%&'()*+((%!"#$"%&' !(#)#*)+' !"#$"%&' ,#-.+% /0"1#*2% Silicon Valley Venture Firms Invest in Scalable Startups
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 3-#*()40*% What VC’s Don’t Tell You: The Transition Search Build Grow
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 3-#*()40*% -  Founders depart -  Professional Mgmt -  Process -  Beginning of scale What VC’s Don’t Tell You: The Transition – Founders Leave
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • Plan versus Model
  • No Business Plan survives first contact with customers
  • So Search for a Business Model
  • The Search for a Business Model •  A Business Plan is static • A Business Model diagrams how a company creates, delivers and captures value – it’s dynamic •  Or in English: How a company makes money
  • Emphasis On Hypotheses Testing
  • Startups Continually Pivot (Iterate)
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • How Do Startups Search For A Business Model? •  The Search is called Customer Development •  The Implementation is called Agile Development
  • The Lean Startup •  The Search is called Customer Development •  The Implementation is called Agile Development
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • 562%!7#-7'1(%8-+*97%:'*%&2% 8;;0'*7#*7(%
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • Durant Versus Sloan •  Dies, rich, honored and famous
  • Durant Versus Sloan •  Dies, rich, honored and famous •  Dies managing a bowling alley
  • Durant Versus Sloan •  Dies, rich, honored and famous •  Dies managing a bowling alley Accountant
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • E-School instead of B-School
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • !(#)#*)+' !"#$"%&' 3#$4+' 567R' 9$#8:;
  • E-School Will Emerge •  Entrepreneurial Education will change radically •  E-School Students are not B-School Students •  Y-Combinator/Techstars first inkling •  Today ~100 startup accelerator programs *~100 startup accelerator programs: http://blog.shedd.us/321987608/
  • E-School – Let’s Help Build It •  Startup Accelerators - great coaching/networking but minimal methodology •  Lean/Customer Development - great methodology but no education •  Need to be connected to Engineering School •  Stanford, Harvard and others get it…but… *~100 startup accelerator programs: http://blog.shedd.us/321987608/
  • Durant School of Entrepreneurship
  • The Durant School of Entrepreneurship http://www.cafepress.com/durantschool
  • The Durant School of Entrepreneurship http://www.cafepress.com/durantschool
  • The Durant School of Entrepreneurship http://www.cafepress.com/durantschool
  • Thanks ===>:"+?+*)#8@>(67'
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