68:. According to Blank, startups are not simply smaller versions of larger, more developed companies. A startup operates in a fashion vastly different from that of a large company and employs different methods. While larger companies execute known and proven business strategies, startups must search for new business models. Customer Development guides the search for a repeatable and scalable business model.
46:(who are the customers, what features they want, what channel to use, revenue strategy/pricing tactics, how to get/keep/grow customers, strategic activities needed to deliver the product, internal resources needed, partners needed and costs). Customer development starts with the key idea that there are no facts inside your building so get outside to test them. The hypotheses testing emulates the
344:
The customer development process assumes that most of the initial assumptions of the business model will be wrong. Pivoting involves recognizing that the original business model is not working, then deciding what changes to make and taking action on those changes. This process is easier to visualize
221:
The business model is based on the mantra, “No business plan survives first contact with customers.” The business plan is an operating document that existing companies write to execute known business models. However, for a startup, there are too many unknowns to develop a successful plan. The static
84:
for his memoir, Blank began to notice patterns in the startups he was involved with. Recognizing that startups are not simply smaller versions of large companies, he observed that entrepreneurs need to have a systemized approach to guide their search for “repeatable and scalable business models.”
283:
Osterwalder and Blank have integrated both business model design and customer development hypotheses into the business model canvas. Each of the nine blocks corresponds to one or more
Customer Development hypotheses. When a hypothesis is found to be incorrect, entrepreneurs can apply Customer
248:. The Canvas is a tool to help entrepreneurs structure and plan their business models. It is designed to change rapidly, highlight alternatives, promote a customer focus and encourage testing. It can also be used to set up Customer Development hypotheses and to visually track iterations.
296:(MVP) is “that version of a new product which allows a team to collect the maximum amount of validated learning about customer with the least effort.” The startup releases the most minimal, core product to start testing early and minimize the total development process time.
53:
Many burgeoning startup companies devote all of their efforts to designing and refining their product and very little time “getting out of the building.” The customer development model encourages that more time be spent in the field identifying potential
217:
From the customer development view, a business model is a representation of how organizations create, deliver and capture value. It is designed to change rapidly, reflect customer reality and iterate as new information is discovered.
50:– pose a business model hypothesis, design an experiment, get out of the building and test it. Take the data and derive some insight to either (1) Validate the hypothesis, (2) Invalidate the Hypothesis, or (3) Modify the hypothesis.
340:
The pivot is “a structural course correction to test a new fundamental hypothesis about a product, strategy engine of growth.” It is the process of changing a part or parts of the business model to reflect reality.
299:
The MVP allows entrepreneurs to gather feedback from early adopters to prevent pitfalls and avoid building unwanted products. The MVP also lets customers point out missing features and necessary changes.
311:
Hypotheses are critical assumptions about how a business will work, and include assumptions about target market, pricing, and competitors. Together, hypotheses make up the business model for a startup.
111:
Customer discovery first captures the founders’ vision and turns it into a series of business model hypotheses. Then it develops a plan to test customer reactions to those hypotheses and turn them into
61:
Customer development is the opposite of the “if we build it, they will come” product development-centered strategy, which is full of risks and can ultimately be the downfall of a company.
303:
To successfully use the MVP strategy, entrepreneurs must be committed to iteration. Customer feedback will bring the product or service through several changes before it is finalized.
205:, was first taught has been adopted by more than 75 universities around the globe. In 2011, Blank's curriculum became the new standard for science commercialization in the U.S. as the
348:
While iterating involves small changes like altering a product price, pivoting involves substantial changes like identifying a better target market. The process involves four steps:
229:) to gather customer input and make necessary changes. When a successful, repeatable business model is discovered, the company enters the product execution and business plan phase.
329:
Hypotheses can be tested in several ways. Creating an MVP is one way to quickly test mockups and ideas in the real world, especially with Web and mobile startups.
284:
Development strategies to turn the mistake into a Pivot. As a Pivot, a failed hypothesis becomes a learning strategy, and the business model can be rewritten.
332:
Hypotheses change as a result of testing and customer feedback. The changed hypotheses are incorporated into new iterations of the startup business model.
789:
708:
92:, which served as the course text for his first class and heralded the birth of Customer Development, which in turn spawned the Lean Startup movement.
919:
107:
The customer development method consists of four steps that are designed to help avoid common pitfalls and repeat successful business strategies:
1007:
115:
Customer validation tests whether the resulting business model is repeatable and scalable. If not, founders should return to customer discovery.
681:
409:
439:
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819:
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Startups are involved in searching for the right business model. The business model is tested in the real world (e.g., through a
583:
887:
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Testing hypotheses means that the founder has to “get out of the building” and answer three questions about the business:
1055:
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32:
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561:
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Company building transitions the organization from a startup to a company focused on executing a validated model.
1079:
715:
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482:
58:
and learning how to better meet their needs. The
Customer Development concept emphasizes empirical research.
399:
369:, which famously pivoted from a failed social advocacy campaign into a billion dollar daily deal site, and
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226:
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245:
237:
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Customer development was developed by Blank in the 1990s. While writing about his experiences as an
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business plan necessarily changes as soon as the business comes in contact with its target market.
194:
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Will people care enough to tell their friends, which will help grow the business quickly?
463:
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Do enough people outside of the company care about the problem to deliver huge business?
820:"Part I: Validate Your Business Model Start With a Business Model, Not a Business Plan"
202:
81:
43:
28:
1073:
587:
378:
370:
365:
There are several examples of successful companies that pivoted early on, including
464:"Customer Development: How to develop your customers like you develop your product"
241:
24:
198:
65:
790:"Entrepreneurship as a Science – The Business Model/Customer Development Stack"
740:
39:
193:
Blank began teaching
Customer Development in his entrepreneurship classes at
374:
99:, is a guide to building a startup using customer development principles.
90:
The Four Steps to the
Epiphany: Successful Strategies for Products that Win
55:
20:
1033:
920:"Why Startups are Agile and Opportunistic – Pivoting the Business Model"
23:
and new corporate ventures. It is one of the three parts that make up a
981:
966:
366:
1008:"Live Chat: When to Pivot, When to Persevere With Your Business Idea"
119:
483:"Steve Blank: The Key to Startup Success? 'Get Out of the Building'"
401:
Lean
Customer Development: Building Products Your Customers Will Buy
373:, which pivoted from a social network to a daily deal design site.
154:
No
Business Plan Survives First Contact with Customers So Use a
118:
Customer creation is the start of execution. It builds end-user
440:"Steve Blank Hands A New Owner's Manual to Startup Founders"
175:
Startup Job Titles Are Very
Different from a Large Company's
122:
and drives it into the sales channel to scale the business.
352:
Observe: Observing that the business model isn't working.
319:
Do we really understand the customer's problem or need?
166:
Startup
Metrics Differ from Those in Existing Companies
160:
Design
Experiments and Test to Validate Your Hypothesis
142:
There Are No Facts Inside Your
Building, So Get Outside
358:
Decide: Deciding what to change in the business model.
38:
The process assumes that early ventures have untested
251:
The business model canvas is made up of nine blocks:
1056:"Steve Blank Teaches Entrepreneurs How To Fail Less"
741:"Lean LaunchPad: A Crash Course in Startup Success"
169:Fast Decision-Making, Cycle Time, Speed and Tempo
962:"Steve Blank: Why You Must Test Your Hypotheses"
145:Pair Customer Development with Agile Development
888:"Burn Your Business Plan – Before It Burns You"
542:"A free must-read e-book for all entrepreneurs"
184:Customer Development Success Begins With Buy-In
64:The customer development method was created by
8:
178:Preserve All Cash Until Needed. Then Spend.
163:Agree on Market Type. It Changes Everything
523:"Why the Lean Start-Up Changes Everything"
361:Act: Acting decisively to make the change.
148:Failure is an Integral Part of the Search
853:
134:The Customer Development Manifesto from
886:Osterwalder, Alexander (Nov 26, 2012).
881:
879:
877:
875:
873:
860:"Part II: Validate Your Business Model"
851:
849:
847:
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843:
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839:
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813:
811:
809:
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663:"The Rise of the Fleet-Footed Start-Up"
390:
209:adopted it for their Innovation Corps.
1001:
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345:when the business model is drawn out.
88:The revelation led to his first book,
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151:Make Continuous Iterations and Pivots
19:is a formal methodology for building
7:
433:
431:
429:
427:
425:
423:
421:
1006:Gallegos, Demetria (Apr 25, 2012).
682:"Debe ser un problema de marketing"
381:platform into a photo application.
355:Orient: Orienting to the new facts.
14:
948:"Minimum Viable Product: a guide"
788:Blank, Steve (October 25, 2010).
758:Blank, Steve (6 September 2012).
138:written by Blank and Bob Dorf:
1054:Andersen, Derek (Apr 15, 2012).
709:"Customer Development Manifesto"
918:Blank, Steve (April 12, 2010).
584:"WHAT IS CUSTOMER DEVELOPMENT?"
562:"What is customer development?"
560:Ries, Eric (November 8, 2008).
540:StackSocial (15 October 2012).
661:Lohr, Steve (April 24, 2010).
181:Communicate and Share Learning
130:Customer Development Manifesto
31:design, customer development,
1:
946:Ries, Eric (August 3, 2009).
858:Blank, Steve (Nov 29, 2012).
818:Blank, Steve (Nov 26, 2012).
739:Tice, Carol (June 13, 2011).
680:Blank, Steve (Feb 11, 2010).
398:Alvarez, Cindy (2017-08-30).
611:Alvarez, Cindy (June 2014).
760:"The Lean Launchpad online"
207:National Science Foundation
136:The Startup Owner's Manual,
1096:
404:. "O'Reilly Media, Inc.".
97:The Startup Owner’s Manual
613:Lean Customer Development
521:Blank, Steve (May 2013).
462:Nivi (5 November 2008).
1012:The Wall Street Journal
892:The Wall Street Journal
864:The Wall Street Journal
824:The Wall Street Journal
527:Harvard Business Review
633:"Steve Blank – 1 of 5"
377:pivoted from a mobile
294:minimum viable product
288:Minimum viable product
267:Customer relationships
227:Minimum Viable Product
172:It's All About Passion
1026:"Definition of pivot"
707:Blank, Steve (2012).
246:Business Model Canvas
238:Alexander Osterwalder
233:Business model canvas
156:Business Model Canvas
103:The four-step process
95:Blank's second book,
17:Customer development
195:Stanford University
688:on October 5, 2016
667:The New York Times
264:Value propositions
203:the Lean Launchpad
411:978-1-4920-2375-3
273:Customer segments
48:scientific method
1087:
1064:
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1051:
1045:
1044:
1042:
1041:
1032:. Archived from
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986:The Lean Startup
978:
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684:. Archived from
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82:Silicon Valley
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44:business model
35:engineering).
29:business model
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1038:. Retrieved
1034:the original
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985:
982:"Principles"
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745:Entrepreneur
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723:. Retrieved
716:the original
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686:the original
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641:the original
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78:entrepreneur
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42:about their
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25:lean startup
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15:
615:. O'Reilly.
199:UC Berkeley
66:Steve Blank
1060:Techcrunch
1040:2016-10-07
725:2018-05-22
692:October 7,
647:2016-10-07
594:2016-10-07
487:Inc. Video
385:References
307:Hypotheses
40:hypotheses
637:Founderly
375:Instagram
189:Teachings
56:consumers
1074:Category
270:Channels
21:startups
967:YouTube
444:Xconomy
371:Fab.com
367:Groupon
72:History
631:matt.
408:
120:demand
112:facts.
719:(PDF)
712:(PDF)
336:Pivot
33:agile
694:2016
406:ISBN
292:The
240:and
197:and
80:in
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