When the Boardroom is Bits
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When The Boardroom is Bits Steve Blank www.steveblank.com Twitter: sgblank
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Transcript of When the Boardroom is Bits
When The Boardroom is Bits
Steve Blank
www.steveblank.com
Twitter: sgblank
This Talk
• 10 Things We Learned in the Last Year
………………………
• Experienced Advice Matters
• Solving the Early Stage-Experience Gap
• The Boardroom is Bits
First
10 Things We Learned in the Last Year
Business Schools turned 300 years of business experience into an MBA
#1
Business Schools turned 300 years of business experience into an MBA
MBA = Masters of Business Administration
#1
Tech Entrepreneurship + Venture Capital is ~50 Years Old
Startups are Smaller Versions of Large Companies
#2
Tech Entrepreneurship + Venture Capital is ~ 50 Years Old
Startups are Smaller Versions of Large Companies
#2
Tech Entrepreneurship + Venture Capital is ~ 50 Years Old
Startups are Smaller Versions of Large Companies
#2
×oops
Companies execute business models
Startups search for business models
#3
Companies execute business models
Startups search for business models
#3
Companies execute business models
Startups search for business models
#3
✓
A startup is a temporary organization designed to search
for a scalable and repeatable business model
#4
Startups need their own tools, different from those used
in existing companies
#5
Startups need their own tools, different from those used
in existing companies
#5
Customer Development = process to search
Business Model Canvas is the Scorecard
Agile Engineering is How We Build Startups
#6
Customer Development =process to search
Business Model Canvas =the Scorecard
Agile Engineering is How We Build Startups
#7
• 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
#8
Startups that pivot 1 or 2 times:
• raise 2.5x more money
• have 3.6x better user growth
• 52% less likely to scale prematurely
than startups that pivot more than 2 times or not at all
#9
Startup Genome Report
Startups that pivot 1 or 2 times:• raise 2.5x more money• have 3.6x better user growth • 52% less likely to scale prematurely than startups that pivot more than 2 times or not at all
Startups that have:
• helpful mentors
• listen to customers,
• learn from startup thought leaders
Raise 7x more money and have 3.5x better user growth
#9
Startup Genome Report
#10
We’ve cracked the code in teaching entrepreneurship
#10
We’ve cracked the code in teaching entrepreneurship
http://steveblank.com/category/lean-launchpad/
1. Startups ≠ MBA toolset
2. Startup Toolseta) Customer Development
b) Business Model Canvas
c) Agile Development
3. We have real data that this works
4. A Better Way to Teach Entrepreneurship
What Have We Learned in the Last Year?
What’s Next?
Hypothesis:
Experienced Advice Matters
Hypothesis:
Experienced Advice Matters
You 1 board at a time
VC’s 6 - 12 boards at a time
You 1 board at a time
VC’s 6 - 12 boards at a timeX
Avg 4 years per board
You 1 board at a time
VC’s 6 - 12 boards at a timeX
Avg 4 years per boardX
2 VC’s per board
You 1 board at a time
VC’s 6 - 12 boards at a timeX
Avg 4 years per boardX
2 VC’s per board=
~50-100x Pattern Recognition
You 1 board at a time
You 1
VC’s 50 - 100
You 1
VC’s 50 - 100
You 1
(Discount for 7 Deadly Sins)
50 - 100 ≥ 1
50 - 100 ≥ 1
The Early Stage-Experience Gap
Solving the Early Stage-Experience Gap
Venture Funded companies have boards
Angel Funded companies often do not
Experienced Advice is sparse outside of technology clusters
Venture Funded companies have boards
Early Stage companies often do not
Experienced Advice is sparse outside of technology clusters
Venture Funded companies have boards
Angel Funded companies often do not
Experienced Advice is sparse outside of technology clusters
Why Have a Board Meeting?Investor
• Fiduciary Responsibility– Company has asymmetric information– Board has legal responsibility to their Limited Partners
• Maximize Investment Potential– Board has asymmetric knowledge 50-100x experience – Good board asks hard questions
Why Have a Board Meeting?Founder
• Board Guidance– 50-100x more experience = Pattern recognition– Multiple opinions across VC’s
• Board Network – Customers, Partners, Recruiting, Financing
• Obligation– It came with the check
Board Meetings Are Heavyweight Processes
Antithesis of Lean
Board Meetings Are Heavyweight Processes
Antithesis of Lean
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!
Show Me the Money
This Solves A
Real Problem
This Solves A
Real Problem
I thought it was such a good idea I Just funded the Lean LaunchLab
Email me:[email protected]
Thanks
