when the boardroom is bits finland 090611
TRANSCRIPT
When The Boardroom is Bits
Steve Blank
www.steveblank.com
Twitter: sgblank
Slides: www.slideshare.net/sblank
Reminder about the Speaker
W.T.F.D.I K. About Angel Investing
Role of an Angel
• Dumb Money• Smart Money• Connections• Connections to more money• Advice• Good Advice• Wisdom
First
Observations From Abroad
Startups are Smaller Versions of Large Companies
#1
Startups are Smaller Versions of Large Companies
#1
×oops
A startup is all about focus and execution of the business plan
#2
A startup is all about focus and execution of the business plan
#2
No business plan survives first contact with customers✓
A startup is all about a great idea
#3
A startup is all about a great idea
#3
An A-team with a B-product always beats a B-team with an A-product✓
Companies execute business plans
Startups search for business models
#4
Companies execute business plans
Startups search for business models
#3
Companies execute business plans
Startups search for business models
#4
✓
A startup is a temporary organization designed to search
for a scalable and repeatable business model
#5
Startups need their own tools, different from those used
in existing companies
#6
Startups need their own tools, different from those used
in existing companies
#6
Customer Development = process to search
Business Model Canvas is the Scorecard
Agile Engineering is How We Build Startups
#7
Customer Development =process to search
Business Model Canvas =the Scorecard
Agile Engineering is How We Build Startups
#8
• Research Labs
• Equipment Manufacturers
• Distribution Network
• Service Providers
• Technology Design
• Marketing
• Demo and customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents
• Video Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Organic Farmers
• Weeding Service Providers
• Conventional Farmers
• Dealers• Direct
Service• Indirect
Service• … then
Dealers
• Asset Sale• Direct Service with
equipment rental• … then Asset Sale
Value-Driven
Customer Development is the process used to search
Business Model Canvas is the Scorecard
Agile Development is How We Build Startups
#9
Startups that pivot 1 or 2 times:
• have 3.6x better user growth
• 52% less likely to scale prematurely
than startups that pivot >2 times or not at all
#10
Startup Genome Report
Board Meetings Haven’t Evolved
We Act Like It’s the 19th Century
• Why do we need to get together in one room?
• Why do we need to wait a month to see progress?
• Why don’t we have standards for what you want?
• Why haven’t we adopted the tools we build/sell?
How to Run a Board Meeting
• Logistics– Send out board materials 2 days before, have board dinner– Approve minutes, stock grants
• Business Highlights/Lowlights– summary of key events since last meeting
• Financials versus Budget– waterfall charts
• Management asks the board to help– strategy, markets, key hires, introductions.
• Executive session– Meet without management to discuss performance
How to Run a Board Meeting
• Logistics– Approve minutes, stock grants
• Business Highlights/Lowlights– summary of key events since last meeting
• Financials versus Budget– waterfall charts
• Management asks the board to help– strategy, markets, key hires, introductions.
• Executive session– Meet without management to discuss performance
• Misc– Send out board materials 2 days before, have board dinner
Why?
What’s Wrong With a Board Meeting?
• Time between meetings (every 4-6 weeks)– Strategy-to-tactic-to implementation lag– Often no follow-up on the outcomes
• Diffuse board member attention (sits on 6-12 boards)
• Punctuated Exec Staff Performance– “The Get Ready for the Board Meeting” drill– It’s often a performance rather than a snapshot
• No standards for what each side does– What is the entrepreneur supposed to be doing?– What are the board members supposed to be contributing?
What’s Wrong With a Board Meeting?
• Time between meetings (every 4-6 weeks)– Strategy-to-tactic-to implementation lag
• Diffuse board member attention (sits on 6-12 boards
• Punctuated Exec Staff Performance– “The Get Ready for the Board Meeting” drill– It’s often a performance rather than a snapshot
• No standards for what each side does– What is the entrepreneur supposed to be doing?– What are the board members supposed to be contributing?
Why?
Solution:Make The Boardroom Bits
We Can Do This Via the Net
We Can Do This Via the Net
24/7
We Can Do This Via the Net
Connecting Advisors to/from Anywhere
Focus on What’s Important
• It’s about the search for the business model– Not income statement, cash flow, balance sheet
• Advice/Guidance about metrics around the search– What are the Business model hypotheses?– What are the most important hypotheses to test now?– Progress of validating each hypotheses– What are the iterations and Pivots – and why?
Continuous Information Access
• Founders / mgmt team invest 1 hour a week• Structured blog• Unstructured data• Formal business model canvas• Real-time advisor/board feedback
We Made Students Blog Their Progress
How?
• Customer Development– The Process
• Narrative– Interviews– Surveys– Videos– Prototypes
• Business Model Canvas– Scorekeeping
• Real-time Feedback• Physical Reality Checks
– Skype– Face-to-face
We Made Students Blog Their Progress
It Changed Everything
Interview
Photos Videos
Surveys
Interview& Photos
Competitive Analysis
Key Findings
A/B Test Results
Key Question
Strategy
Business Model Canvas as the Scorecard
Business Canvas Change Progress
1
Business Canvas Change Progress
2
Business Canvas Change Progress
3
Business Canvas Change Progress
4
Business Canvas Change Progress
5
Business Canvas Change Progress
6
Business Canvas Change Progress
7
Demo
Ben Mappen
Lean LaunchLab
Product Demo
CANVAS diagram is interactive and “stateful”
CANVAS diagram is interactive and “stateful”
Enter your hypotheses here
CANVAS diagram is interactive and “stateful”
Test your hypotheses andrecord learnings in blog format
CANVAS diagram is interactive and “stateful”
Test your hypotheses andrecord learnings in blog format
InterviewsSurveysVideosPhotosetc
CANVAS diagram is interactive and “stateful”
Test your hypotheses andrecord learnings in blog format
Invite your advisors and investors to your project
CANVAS diagram is interactive and “stateful”
Test your hypotheses andrecord learnings in blog format
Invite your advisors and investors to your project
They can view progressby flipping thru your CANVAS diagrams
CANVAS diagram is interactive and “stateful”
Test your hypotheses andrecord learnings in blog format
Invite your advisors and investors to your project
They can view progressby flipping thru your CANVAS diagrams
They can post feedback and leave comments inline
CANVAS diagram is interactive and “stateful”
Test your hypotheses andrecord learnings in blog format
Invite your advisors and investors to your project
They can view progressby flipping thru your CANAVAS diagrams
They can post feedback and leave comments inline
Get email alert when newfeedback comes in
CANVAS diagram is interactive and “stateful”
Test your hypotheses andrecord learnings in blog format
Invite your advisors and investors to your project
They can view progressby flipping thru your CANAVAS diagrams
They can post feedback and leave comments inline
Get email alert when newfeedback comes in
The LeanBoard
Meeting
Sign up for private beta (FREE)http://www.leanlaunchlab.com
@leanlaunchlab
What Does this Change?For Angel-Funded Startups
• Angel funded startups can now get experienced advice– No longer requires board commitment for involvement
– Encourages investors who need visibility
– Ends repetition at each investor coffee
• Turns adhoc startups into strategy-driven startups– Invites investor participation in the process
– Professionalize the “throw it against the wall and see if it sticks”
• Highly time-efficient for investor and founders
• Eliminates Geography as a barrier to investment!
What Does this Change?For VC’s and Angels
• For the first time a structure for “search”
• Real-time monitoring of startup progress
• Zero-lag for coaching and course-correction
• Immediate follow-up on board meeting outcomes
• Allows a single VC to multiply their reach and/or depth
• Eliminates Geography as a barrier to investment!
Thanks