Steve Blank is a Silicon Valley serial-entrepreneur and academician who is based in Pescadero, California.
Blank is recognized for developing the Customer Development methodology, which launched the Lean Startup movement. Blank is also the co-founder of E.piphany.
If you’ve received this post in an email the embedded videos and powerpoint are best viewed on www.steveblank.com We have learned a remarkable process that allow us to be highly focused, and we have learned a tool of trade we can now repeat. This has been of tremendous value to us. Andrew Norris, Principal Investigator BCN Biosciences Over the last […]
I-Corps at the NIH: Evidence-based Translational Medicine
If you’ve received this post in an email the embedded videos and powerpoint are best viewed on www.steveblank.com
We have learned a remarkable process that allow us to be highly focused, and we have learned a tool of trade we can now repeat. This has been of tremendous value to us.
Andrew Norris, Principal Investigator BCN Biosciences
Over the last three years the National Science Foundation I-Corps has taught over 700 teams of scientists how to commercialize their technology and how to fail less, increasing their odds for commercial success.
To see if this same curriculum would work for therapeutics, diagnostics, medical devices and digital health, we taught 26 teams at UCSF a life science version of the NSF curriculum. 110 researchers and clinicians, and Principal Investigators got out of the lab and hospital, and talked to 2,355 customers. (Details here)
For the last 10 weeks 19 teams in therapeutics, diagnostics and medical devices from the National Institutes of Health (from four of the largest institutes; NCI, NHBLI, NINDS, and NCATS) have gone through the I-Corps at NIH.
87 researchers and clinicians spoke to 2,120 customers, tested 695 hypotheses and pivoted 215 times. Every team spoke to over 100 customers.
Three Big Questions The NIH teams weren’t just teams with ideas, they were fully formed companies with CEO’s and Principal Investigators who already had received a $150,000 grant from the NIH. With that SBIR-Phase 1 funding the teams were trying to establish the technical merit, feasibility, and commercial potential of their technology. Many will apply for a Phase II grant of up to $1 million to continue their R&D efforts.
Going into the class we had three questions:
Could companies who were already pursuing a business model be convinced to revisit their key commercialization hypotheses – and iterate and pivot if needed?
Was getting the Principal Investigators and CEO out of the building more effective than the traditional NIH model of bringing in outside consultants to do commercialization planning?
Would our style of being relentlessly direct with senior scientists, who hadn’t had their work questioned in this fashion since their PhD orals, work with the NIH teams?
Evidence-based Translational Medicine We’ve learned that information from 100 customers is just at the edge of having sufficient data to validate/invalidate a company’s business model hypotheses. As for whether you can/should push scientists past their comfort zone, the evidence is clear – there is no other program that gets teams anywhere close to talking to 100 customers. The reason? For entrepreneurs to get out of the building at this speed and scale is an unnatural act. It’s hard, there are lots of other demands on their time, etc. But we push and cajole hard, (our phrase is we’re relentlessly direct,) knowing that while they might find it uncomfortable the first three days of the class, they come out thanking us.
The experience is demanding but time and again we have seen I-Corps teams transform their business assumptions. This direct interaction with potential users and customers is essential to commercialize science (whether to license the technology or launch a startup.) This process can’t be outsourced. These teams saved years and millions of dollars for themselves, the NIH and the U.S. taxpayer. Evidence is now in-hand that with I-Corps@NIH the NIH has the most effective program for commercializing science.
Lessons Learned Day Every week of this 10 week class, teams present a summary of what they learned from their customers interviews. For the final presentation each team created a two minute video about their 10-week journey and a 8-minute PowerPoint presentation to tell us where they started, what they learned, how they learned it, and where they’re going. This “Lessons Learned” presentation is much different than a traditional demo day. It gives us a sense of the learning, velocity and trajectory of the teams, rather than a demo day showing us how smart they are at a single point in time.
This video from team BCN Biosciences describes what the intensity, urgency, velocity and trajectory of an I-Corps team felt like. Like a startup it’s relentless.
BCN is developing a drug that increases anti-cancer effect of radiation in lung cancer (and/or reduces normal tissue damage by at least 40%). They were certain their customers were Radiation Oncologists, that MOA data was needed, that they needed to have Phase 1 trial data to license their product, and needed >$5 million and 6 years. After 10 weeks and 100 interviews, they learned that these hypotheses were wrong.
If you can’t see the BCN Biosciences video click here
The I-Corps experience helped the BCN Bioscience team develop an entirely new set set of business model hypotheses – this time validated by customers and partners. The “money slides” for BCN Biosciences are slides 22 and 23.
If you can’t see the BCN Biosciences presentation click here
You Can’t Outsource Customer Discovery What we hear time and again from the Principal Investigators is “I never would have known this” or “I wouldn’t have understood it if I hadn’t heard it myself.” Up until now the NIH model of commercialization treated a Principal Investigator as someone who can’t be bothered to get out of the building (let alone insist that it’s part of their job in commercialization.) In the 21st century using proxies to get out of the building is like using barbers as surgeons.
Clinacuity While the Clinacuity video sounds like an ad for customer discovery, listen to what they said then look at their slides. This team really learned outside the building.
Clinacuity’s technology automatically extracts data in real-time from clinical notes, (the narrative text documents in a Electronic Health Record,) and provides a summary in real time. Their diagrams of the healthcare customer segment in slides 15-18 were outstanding.
If you can’t see the Clinacuity presentation click here
GigaGen The GigaGen team – making recombinant gamma globulin – holds the record for customer discovery – 163 customer interviews on multiple continents.
GigaGen’s learning on customer value proposition and who were the real stakeholders was a revelation. Their next-to-last slide on Activities, Resouces and Partners put the pieces together.
If you can’t see the GigaGen presentation click here
Affinity Therapeutics Affinity came into class with a drug coated Arterial Venous Graft – graft narrowing is a big problem.
One of things we tell all the teams is that we’re not going to critique their clinical or biological hypotheses. Yet we know that by getting out of the building their interaction with customers might do just that. That’s what happened to Affinity.
Affinity was a great example of a team that pivoted their MVP. They realized they might have a completely new product – Vascular wraps that can reduce graft infection. See slides 17-23.
If you can’t see the Affinity presentation click here
Haro Haro is making a drug for the treatment of high risk neuroblastoma, the most common extracranial cancer in infancy and childhood. On day 1 of the class I told the team, “Your presentation is different from the others – and not in a good way.” That’s not how I described them in the final presentation.
After 120 interviews the Haro found that there are oncology organizations (NCI-funded clinical development partners) that will take Haro’s compound and develop it at their own expense and take it all the way into the clinic. This will save Haro tens of millions of dollars in development cost. See slides 12 and 13.
Cardiax Caridax is developing a neural stimulator to treat atrial fibrillation. Their video points out some of the common pitfalls in customer discovery. Great summary from Mark Bates, the Principal Investigator: “You don’t know what you don’t know. Scientific discovery is different than innovation. You as a prospective entrepreneur need this type of systematic vetting and analysis to know the difference.”
After 80 interviews they realized they were jumping to conclusions and imparting their bias into the process. Take a look at slides 8-11 and see their course correction.
If you can’t see the Cardiax presentation click here
The other 15 presentations were equally impressive. Each and every team stood up and delivered. And in ways that surprised themselves.
The Lean Startup approach (hypotheses testing outside the building,) was the first time clinicians and researchers understood that talking to customers didn’t require sales, marketing or an MBA – that they themselves could do a pretty good first pass. I-Corps at NIH just gave us more evidence that’s true.
The team videos and slides are on SlideShare here.
I created the I-Corps/Lean LaunchPad® syllabus/curriculum, and with guidance from Allan May, Karl Handelsman Abhas Gupta and Todd Morrill adapted it for Life Sciences/Health Care/Digital Health. The team from VentureWell provided the logistical support. The I-Corps program is run by the National Science Foundation (Babu Dasgupta, Don Millard and Anita LaSalle.) And of course none of this would be possible without the tremendous and enthusiastic support and encouragement of Michael Weingarten the director of the NIH/NCI SBIR program and his team.
The I-Corps/Lean LaunchPad curriculum works for therapeutics, diagnostics and device teams
Talking to 100 customers not only affected teams’ commercial hypotheses but also their biological and clinical assumptions
These teams saved years and millions of dollars for themselves, the NIH and the U.S. taxpayer
Evidence is now in-hand that the NIH has the most effective program for commercializing science
In the 21st century using proxies to get out of the building is like using barbers as surgeons
The University of Maryland is now integrating the Lean LaunchPad® into standard innovation and entrepreneurship courses across all 12 colleges within the University. Over 44 classes have embedded the business model canvas and/or Customer Discovery including a year-long course taken by every single one of its bioengineering majors. It’s made a big bang. Here’s the story […]
The Big Bang. The Lean LaunchPad explodes at University of Maryland
The University of Maryland is now integrating the Lean LaunchPad® into standard innovation and entrepreneurship courses across all 12 colleges within the University. Over 44 classes have embedded the business model canvas and/or Customer Discovery including a year-long course taken by every single one of its bioengineering majors.
It’s made a big bang.
Here’s the story from Dean Chang, UMD’s Associate Vice President for Innovation and Entrepreneurship.
Two decades ago, Steve Blank completely changed the course and fortunes of a Stanford spinout startup called Immersion. I was lucky to be one of the very early people at Immersion and met Steve when he came on as one of our first board members. It was Steve who first brought Will Harvey to visit Immersion, which led to a strategic investment in There.com, Will’s stealth-mode but sure-fire, can’t-miss startup.
Present at the Creation We didn’t know it at the time, but with that investment we had paid for front-row VIP seats to witness the origins of Customer Development and the Lean Startup. There.com is where Will first met and hired Eric Ries and had the painful and formative experiences that directly led to them starting over and co-founding IMVU while auditing Steve’s Lean LaunchPad course. With Eric Ries as the first practioner of Customer Development, Steve wrote Four Steps to the Epiphany, Eric wrote Lean Startup, and – BANG – Customer Development and Lean Startup were born!
Twenty years and 100,000’s of copies of those books later, my life has fortuitously intersected with Steve Blank once again now that we’ve both become educators. In my second go-around with Steve Blank, he’s still changing the course and fortunes of startups everywhere, but perhaps more profoundly, he’s now also changing the course of universities and students everywhere as a result of a program he developed with the National Science Foundation (NSF).
It’s a Capitol Idea The DC, Maryland, and Virginia (DMV) region represents the most fertile science and technology region in the country with about $30 billion in federally-funded R&D. However, the region has historically underperformed in translating its enormous R&D output into impact.
When Steve and NSF created the I-Corps™
program in 2011, I approached Edmund Pendleton from University of Maryland, Jim Chung from George Washington University and Jack Lesko from Virginia Tech with the idea that together we could leverage the respective strengths of our institutions, and catalyze the region through I-Corps. In 2012, we applied for and then were awarded a grant from NSF to do just that. We created the DC I-Corps Regional Node to teach the Lean LaunchPad curriculum to top scientists, innovators, and students from around the country and from our region. Since 2013, DC I-Corps has trained over 150 teams with the kind of impact NSF and Steve envisioned when they launched the program. That impact is now accelerating with the DC I-Corps node’s addition of the #1 research university in the country (Johns Hopkins) in 2014.
Teaching the Big Bang to Undergraduates University of Maryland’s President Wallace Loh’s commitment to engage every student in all 12 colleges in innovation and entrepreneurship resulted in UMD aggressively leveraging its I-Corps and Lean LaunchPad experience inside undergraduate classrooms.
Our FedTech class pairs students with some of the most promising technologies from NASA, DOD and several other of the 87 federal labs located in the DMV region. Federal labs like DOE literally have tens of thousands of inventions that they’d like to have vetted for commercial potential, so FedTech students search for a repeatable and scalable business model for those fed lab technologies using the Lean LaunchPad framework. Students get course credit, a fantastic learning experience, and in some cases, even a job offer or career opportunity with the federal lab or with an industry contact made during interviews.
Elements of the business model canvas and/or discovery-based interviews of stakeholders have already been incorporated into 44 other classes at UMD. But the biggest impact of 2014 has been from incorporating the Lean LaunchPad curriculum into our signature, year-long senior capstone course in bioengineering. This means that every single University of Maryland student in the Fischell Department of Bioengineering is now required to not only design a real biomedical device but also take that design through rigorous, evidence-based Customer Development in order to graduate.
Truth be told, we took a page out of Frank Rimalovski’s playbook at NYU and paid for Yang Tao to attend the Lean LaunchPad Educators Program. He’s the professor who teaches the bioengineering capstone course, and he returned from Steve’s ranch inspired and determined to weave the Lean LaunchPad into the fabric of the capstone course. So what’s happened so far?
Impact of the Big Bang on University of Maryland Bioengineering In this capstone course students visit the University of Maryland medical school and shadow doctors, nurses, and other hospital workers to learn about problems and needs, which is an ideal set up for customer interviews and discovery. They spend the year working with the doctors and the life sciences venture community to design devices and other solutions to those problems and needs.
Before Lean LaunchPad was added to the bioengineering capstone class, some beautiful devices were designed and manufactured with many students never knowing whether the value proposition for what they made was beneficial enough to all the right people to warrant adoption or if the customer segment they targeted was the right one and made financial sense.
Now the students spend time in customer discovery and learn why validating the business model for their device is so important. As they target the different parts of the canvas, they begin to understand how things like improved healthcare, purchasing, reimbursement, and regulatory must fit into a successful business model.
Some students will find that their device is an engineering marvel but would never fly in the market for reasons they weren’t even aware of until they did their “outside of the classroom” customer interviews. Co-instructor Martha Connolly thinks that’s a perfectly good outcome because they’ve still learned the process of designing and making a biomedical device but they’ve also learned equally valuable lessons from the Lean LaunchPad process that will be applicable in any future endeavors, whatever they may be.
The real proof of Lean LaunchPad’s impact is that the students are clamoring for it.
Can I Have More? In fact, two UMD bioengineering students, Shawn Greenspan and Stephanie Cohen, went through the capstone course last year before Lean LaunchPad was integrated. They were so upset that they missed out on the Lean LaunchPad version of the course that they teamed up with Dr. Ron Samet, a very entrepreneurial professor of anesthesiology from the medical school, to take the class through this fall’s National Science Foundation I-Corps regional program taught in the D.C. area.
According to Shawn and Stephanie, I-Corps taught them what they didn’t get from the traditional capstone course without Lean LaunchPad:
“I-Corps finally put us on the road to real customer discovery. Our initial business plan started with an incorrectly identified buyer, value propositions that were wrong, and guesses everywhere else. Fortunately after 67 interviews we now have a fully developed customer segment identifying each customer type, the key value propositions, and a developing revenue model.
We still have lots of work to do. The left side of our canvas has more questions than answers. Five weeks ago, that was scary to admit, but now we know where our answers lie: outside the building.”
This kind of feedback from students is particularly gratifying. Not only did the experience have the kind of impact we had hoped for, but it’s also turned into a potential career opportunity for Shawn and Stephanie as they’re completing their master’s programs.
What’s Next? Four more Lean LaunchPad initiatives are either on tap or about to be scaled up:
to the U.S. Department of Energy’s National Clean Energy Business Competition.
Being a node instructor in the I-Corps @ NIH program has allowed me to work with some terrific experts in life sciences and healthcare ventures and spread that expertise to DC I-Corps and UMD programs. Next month, I’ll be a node instructor in NSF’s upcoming I-Corps for Learning program where we aim to teach STEM educators how to scale their teaching innovations to a wider audience. That experience should again result in great learnings to bring back and apply at UMD.
When I witnessed the Big Bang origins of Customer Development and Lean Startup 20 years ago during my first encounter with Steve Blank, I could not have guessed how fast it would impact the startup world, and now universities and students. If the past is prologue, the future is going to be fantastic!
University of Maryland has gone “all in” with the National Science Foundation Innovation Corps and discovery-based learning from stakeholders
I-Corps has been a great investment for the country. Regardless if they take startup path, students gain invaluable skills
Elective courses are great, but the big win comes from embedding Lean LaunchPad in existing required courses
Students can create job and career opportunities through their customer discovery interactions
The impact on life sciences and healthcare is evident in the UMD bioengineering program and in the NIH program
The Lean LaunchPad process is equally well-suited to areas like STEM education and government (e.g., fed labs, HHS)
In 1976 Saul Steinberg created the March 29th cover of the New Yorker and created a visual meme of a city who was completely self-absorbed. Kirby Scudder, a neighbor on the California coast just did a poster of the view of Palo Alto as the center of universe. Kirby has done several of these city posters […]
In 1976 Saul Steinberg created the March 29th cover of the New Yorker and created a visual meme of a city who was completely self-absorbed.
Kirby Scudder, a neighbor on the California coast just did a poster of the view of Palo Alto as the center of universe.
Kirby has done several of these city posters here. I thought it was a fun poster given its unique vantage point from the Pacific Ocean looking towards San Francisco Bay.
I was wondering where our ranch would be on the map until I looked closer.
NYU has adopted the Lean LaunchPad® class as a standard entrepreneurship course across twelve different schools/colleges within the University. Over 1,000 students a year are learning lean startup concepts. Impact! —– In August 2011 I received an email from someone at NYU I never heard of. Frank Rimalovski, the Executive Director of the NYU Entrepreneurial Institute, had just […]
Impact! NYU Scales the Lean LaunchPad
NYU has adopted the Lean LaunchPad® class as a standard entrepreneurship course across twelve different schools/colleges within the University. Over 1,000 students a year are learning lean startup concepts.
In August 2011 I received an email from someone at NYU I never heard of. Frank Rimalovski, the Executive Director of the NYU Entrepreneurial Institute, had just read about the National Science Foundation Innovation Corps (I-Corps) in my blog, and he absolutely had to meet me. To Frank’s credit he wouldn’t take no for an answer. When I said, “I’m too busy,” Frank said he’d fly out to fit into my schedule. When I said, “I’m at my ranch on the coast,” Frank promised to drive to Santa Cruz as soon as he get off the plane.
I figured any academic who was as persistent as an entrepreneur had earned my time.
So we met, and I learned a lot. First, I learned that Frank was not your typical academic. He was a career VC, now at NYU and charged with building an entrepreneurial ecosystem across the university. Frank’s goal in the meeting was to figure out how to ensure that NYU would be one of the new universities selected when the National Science Foundation scaled the Innovation Corps nationally. (The Innovation Corps, or I-Corps for short, is my Stanford Lean LaunchPad class offered by the National Science Foundation to our leading scientists. The Lean LaunchPad class teaches students how to build a Lean Startup using business model design, customer development and agile engineering. Teams have to get out of the building and talk to 10-15 customers a week.) I gave Frank the same advice I offered all the other universities who asked. But the difference was that Frank took it and made it part of the NYU proposal.
In 2012 NYU partnered with the City University of NY (CUNY) and Columbia University, and in early 2013 they won a grant from the National Science Foundation to build the Innovation Corps in New York City and jointly create the the NYC Regional Innovation Node (NYCRIN).
Spend it Wisely As part of the National Science Foundation I-Corps program, NYU was responsible for training our country’s top scientists – and they’ve taught 170 of them so far.
But what NYU did with the rest of their grant dollars was simply brilliant. Over the last two years they used part of the National Science Foundation funds to send eight NYU faculty to California attend the Lean LaunchPad Educators program. (The Educators Program is a 2½ day class that teaches faculty how to create and teach their own Lean LaunchPad class.) In exchange the faculty had to agree to teach a Lean LaunchPad class at NYU within the next year. Unbelievably, they’ve delivered – and more. By this spring there will be 9 different Lean LaunchPad classes with 12 NYU instructors (and several more gearing up) teaching Lean at 12 of the schools/colleges within NYU. Some of these were brand new classes while others adapted existing business, design and engineering curricula to utilize the Lean approach.
Spread it Widely In two short years, the Lean LaunchPad has had a major impact on teaching entrepreneurship at NYU. Starting this year all 750 incoming freshman at the NYU Polytechnic School of Engineering take the required Innovation and Technology Forum class. The class has been updated to cover the key elements of the Lean Startup (customer development, customer segments & value propositions, product/market fit, and minimal viable products)!
In addition, 165 students from twelve different schools/colleges within the University took the full Lean LaunchPad class this year. And in each of the past two summers 10 teams with 30 students participated in the NYU Summer Launchpad accelerator program. Frank even convinced me to come to New York and teach a five-day 10-hour-a-day Lean LaunchPad class with him and his team each August.
Student Impact While classes offered and curriculums built are impressive, what really matters is whether we had any impact on the students. Did we open new eyes? Encourage new startups? Change lives? To my surprise the impact has been clear and immediate. A few of the students wrote blogs about their experience in the classes. Here are a a few quotes that stand out:
Tlacael Esparza recently received his masters in music tech from NYU Steinhardt and is the co-founder of Sensory Percussion. “…I found the idea of doing 10-15 customer interviews a week daunting and distracting. How can I commit to “getting out of the building” when I have so much more work to do building and improving our first product? … However, going through the customer development process showed me the danger in that kind of thinking. In talking to musicians and music producers…there was a lot to be learned about how our competitors’ products are perceived and used and how Sensory Percussion would fit into the current eco-system.” Read Tlacael’s blog post about his Summer Launchpad experience here.
Fang-Ke Huang is a postdoctoral fellow in NYU Langone Medical Center, applying the proteomic approach to understand the brain’s functionalities such as learning and memory. “…(The) class taught me not only the importance of customers, but also the application of the scientific method to the business model...I also learned that an entrepreneur should have a productive attitude towards setbacks. …, I started to view setbacks as a chance for feedback and as opportunities to redirect my efforts.” Fang-Ke’s blog about the class is here.
What’s Next? From my time at NYU last summer, it was clear there is already a growing demand and interest from faculty and administrators alike to apply Lean in life science and healthcare at NYU. Now that the National Institute of Health has run an I-Corps class specifically targeted for Life Science and Healthcare (therapeutics, diagnostics, medical devices and digital health), there’s now a Lean LaunchPad curriculum for Frank’s next target – bringing the Lean LaunchPad class into the NYU Medical Center in 2015
The National Science Foundation Innovation Corps has been a great investment for the country
It’s spurred a renaissance in entrepreneurial education
NYU has grabbed the opportunity with both hands
They’ve made one heck of an impact in just two years
In the 20th century corporate skunk works were used to develop disruptive innovation separate from the rest of the company. They were the hallmark of innovative corporations. By the middle of the 21st century the only companies with skunk works will be the ones that have failed to master continuous innovation. Skunk works will be the […]
Why Corporate Skunk Works Need to Die
In the 20th century corporate skunk works were used to develop disruptive innovation separate from the rest of the company. They were the hallmark of innovative corporations.
By the middle of the 21st century the only companies with skunk works will be the ones that have failed to master continuous innovation. Skunk works will be the signposts of companies that will be left behind.
In the 20th century companies could be leaders in a market for decades by just focusing on their core product(s). Most companies incrementally improved their products with process innovation (better materials, cheaper, product line extensions) and/or through acquisitions. Building disruptive products were thought of as “risky” and a distraction since it was not “core” to the company and did not fit existing corporate structures. Why make big bets if no one was asking for them and competitors weren’t doing so.
CIA A-12 spy plane. Developed by Lockheed Skunkworks
A few innovative companies did push the envelope. The way they did so was to set up “skunk works” to develop their most advanced, disruptive products. (IBM used the process to develop the IBM PC.) But it was Lockheed, then an aircraft manufacturer that coined the term and perfected the art. The Lockheed Skunk Works led by Kelly Johnson was responsible for its Advanced Development Projects – everything from the P-80, the first U.S. jet fighter plane, to the U-2 and A-12 spy planes.
Skunk works differed from advanced research groups in that they were more than just product development groups. They had direct interaction with customers and controlled a sales channel which allowed them to negotiate their own deals with customers.
Decades before we were able to articulate the value of “getting out of the building” and the Lean Startup, the value in having skunk works controlling their own distribution was starkly evident. Other companies with world-class R&D groups built radical innovations only to see their company fumble the future and others reap the rewards (think of Xerox and the personal computer, Fairchild and integrated circuits, Kodak and digital photography, etc.) Common themes in these failures were, 1) without a direct connection to the customer advanced R&D groups built products without understanding user needs, and 2) the core of the company was so focused on execution of current products that it couldn’t see that the future didn’t look like the past.
Kelly Johnson’s 14 rules about how to manage a disruptive project described how to remove a small innovative team from the politics, policies, procedures and processes a large company had built to support execution of its core business (and its military customers had developed to procure large numbers of standard aircraft.)
With the vantage point of the 21st century, we can now see that a successful skunk works – separated from its corporate parent, with its own culture, in control of its own R&D and distribution channel – looked much like a startup.
But as successful as skunks works were to the companies that executed them well, innovation and execution couldn’t co-exist in the same corporate structure. Skunk works were emblematic of corporate structures that focused on execution and devalued innovation.
Continuous Disruption Requires Continuous Innovation In the 21st century market share is ephemeral – ask General Motors, Blackberry, Nokia, Microsoft, Blockbuster, etc. –disruption is continual.
Therefore companies need to master continuous innovation – the art of executing on core products while continually inventing new products and new businesses. That means that somehow we need to take the innovation that a skunk works removed from the core of the company and integrate the two.
We need to realize that skunk works epitomize innovation by exception. But to survive companies need innovation by design.
We now know how to do just that. We can get innovation and execution to work side-by-side.
To start it requires board support and CEO and executive staff agreement. And recognition that cultural, process and procedure changes are needed to embrace learning and experimentation alongside the existing culture of execution.
I’ll provide details on how companies can organize this way in a follow-on post.
Skunk were advanced/disruptive product groups organizational isolated from the rest of their company
Skunk works had control over their sales channel and had direct customer feedback
World-class R&D groups that didn’t control the channel often saw their innovation die internally
Skunk works looked much like a startup
Skunk works epitomized innovation by exception
Companies now need innovation by design – innovation and execution that work side-by-side
“You cannot teach a man anything, you can only help him find it within himself.” Galileo Galilei One of the great things about teaching is that while some students pass by like mist in the night others remain connected forever. I get to watch them grow into their careers and cheer them on. — Its […]
Watching My Students Grow
“You cannot teach a man anything, you can only help him find it within himself.”
One of the great things about teaching is that while some students pass by like mist in the night others remain connected forever. I get to watch them grow into their careers and cheer them on.
Its been three and a half years since I first designed and taught the Lean LaunchPad class and lots of water has gone under the bridge since then. I’ve taught hundreds of teams, the National Science Foundation Innovation Corps has taught close to 400 teams led by our nations top scientists, and the class is being taught around the world.
But I still remember a team from the first class, one which wanted to build a robotic lawnmower. It’s now been over 3 years since the team has left my classroom and I thought I’d share with you what the two founders, Jorge Heraud and Lee Redden, learned then and what they’re doing now.
The Autonomous Lawnmower They called their company Autonomow. And they were absolutely convinced what the world needed was an auto-driving lawn mover for institutions with large green spaces.
You can see their first slide deck in class below (and here)
Like in all our Lean Launchpad classes we teach a combination of theory coupled with intense and immersive experiential learning outside the classroom. Students need to get out of the building and talk to 10-15 customers a week.
The next week they came back in class and presented this:
Each week we’d teach them about one more part of what makes up a business model. All teams struggle with finding product/market fit.
Notice something different about the cover slide? Massive pivot. Like all great Silicon Valley companies they started with a technology and guessed who the customers will be. They’re almost always wrong. They could have never figured this out sitting inside a classroom writing a business plan.
At week five (see here) they were actually getting into farm fields wearing hip boots and overalls. Now they were figuring out how to create demand.
The Customer Development process, this relentless drive to turn hypotheses into facts is what makes this learning so rapid.
At week six they were trying to figure out their distribution channel (here) after another pivot. They got their minimal viable product (a machine vision platform) up and running in the lab.
At week seven (here) another pivot happened when farmers taught them about how to price their product. Instead of an of selling hardware they were selling a service.
BTW, notice that they were now dragging their machine vision platform through the farm fields! If there was ever any question of whether a minimal viable product can work for hardware, see what they say in their video below.
By week eight they were learning who they needed to partner with (see here). Most importantly they found a customer who taught them while weeding carrots was nice, thinning lettuce was where the money was.
After 9 weeks their final presentation looked like this.
When I teach in universities I’m not running an incubator. What I’m trying to do is to get students to learn a way of thinking about new ventures that will stick with them for life. And I try to do by having them teach themselves, rather than us teaching at them. Whether they start a company or not, I don’t keep score.
But some teams remain connected forever. I get to watch them grow into their careers and cheer them on. This was one of those teams. After class they took this idea and formed a company – Blue River Technology.
Over the last three years they turned their vision and PowerPoint slides into real hardware that solves real customer problems. And with 3 rounds of funding, including a grant from the National Science Foundation, they’ve raised $13 million.
“The customers had way more insights then we had. They had been thinking about their own problems for so long…If you just go out and try to sell maybe you’ll find some buyers, but you won’t be learning about what you should be doing.”
Lee Redden – Blue River Technology
I’m off next week on the next great adventure. We’re going to launch the I-Corps @ NIH and change how our country commercializes life sciences.
In Oracle’s early days Kathryn Gould was the founding VP of Marketing, working there from 1982 to 1984. When I heard that Larry Ellison was stepping down as Oracle’s CEO I asked Kathryn to think about the skills she saw in a young Larry Ellison that might make today’s founders winners. — Though I haven’t talked to […]
Watching Larry Ellison become Larry Ellison — The DNA of a Winner
In Oracle’s early days Kathryn Gould was the founding VP of Marketing, working there from 1982 to 1984. When I heard that Larry Ellison was stepping down as Oracle’s CEO I asked Kathryn to think about the skills she saw in a young Larry Ellison that might make today’s founders winners.
Though I haven’t talked to Larry face-to-face for 20 years, and haven’t worked at Oracle for 30 years, he’s the yardstick I’ve used to pick entrepreneurs all of these years since.
Larry had the DNA I’ve seen common with all the successful entrepreneurs I’ve backed in my 25 years of Venture Capital work—only he had a more exaggerated case than most. Without a doubt, Larry was the most potent entrepreneur I’ve known. It was a gift to be able to work with him and see him in action.
Here’s what was exceptional about Larry:
Potent Leadership Skill Larry didn’t practice any kind of textbook management, but he was an intense communicator and inspiring leader. As a result, every person in the company knew what the goal was—world domination and death to all competitors. He often said, “It’s not enough to win—all others must fail.” And he meant it, but with a laugh.
It wasn’t as heavy as it sounds, but everyone got the point. We were relentless competitors. Even as the company grew from a handful of people when I started to about 150 when I left (yes, still ridiculously small) I observed that, every single person knew our mission.
This is not usual—startups that fail often have a lot of people milling around who don’t know what the goal is. In winning companies, everybody pulls in the same direction.
1978: Ed Oates, Bruce Scott, Bob Miner and Larry Ellison celebrate Oracle’s first anniversary
A corollary to Larry’s leadership style was that, at least in my day, he did it with great humor, lots of off-the-cuff funny stuff. He loved to argue, often engaging one of our talented VPs who had been captain of his school debate team. When we weren’t arguing intensely, we were laughing. It made the long hours pass lightly.
Huge Technical Vision
Larry always had a 10-year technical vision that he could draw on the whiteboard or spin like a yarn.
It wasn’t always perfect, but it was way more right than wrong, It informed our product development to a great degree and kept us working on more or less the right stuff. Back then he advocated for
Portability (databases had previously been shackled to the specific machines they ran on)
Being distributed/network ready (even though Ethernet was just barely coming into use in the enterprise)
The choice of the SQL a way to ask questions (queries) in an easy-to-understand language
Relational architecture (a collection of data organized as a set of formally described tables) in the first place—all new stuff, and technically compelling
The final proof of a compelling technical vision is that customers were interested—the phone was always ringing. Often it was people cold calling us, who had read something in a trade magazine and wanted to know more. What a gift! Not every startup gets to have this—but if you don’t, you’ve got a problem.
Pragmatic and Lean Larry ascribed to the adage, “We don’t do things right, we do the right things.” I’m not sure if he ever actually said that, but it is what he lived.
In a startup you can’t do a great job of everything, you have to prioritize what is critically important, and what is “nice to have.” Larry didn’t waste time on “nice to have.”
I am a reformed perfectionist (reformed after those days) so often this didn’t sit well with me. I now realize it was the wisdom of a great entrepreneur. Basically if you didn’t code or sell, you were semi-worthless. (Which is why I had OEM sales as part of marketing—we had to earn our keep.)
This philosophy extended to all aspects of the company. We always had nice offices, but we didn’t mind crowding in. When I started we were in a small suite at 3000 Sand Hill Road. I would come to the office in the morning and clean up the junk food from the programmer who used my work area all night. This was cool!
Oh, and I should say, even though we were at 3000 Sand Hill, VCs kind of ignored us. They thought we were a little nuts. It took a long time for our market to develop, so Oracle wasn’t exactly a growth explosion in the early days. There we were, right under their noses!
Larry was loathe to sell any of the company stock; he generally took a dim view of VCs and preferred to bootstrap. (Sequoia Capital eventually invested just a little in us). Angel investor Don Lucas had his office above ours. I remember Larry telling me that every time we borrowed his conference room we had to pay Don $50. I’m not sure it’s true, but it’s what Larry said. I wonder if he took stock or cash.
Irresistible Salesmanship Larry wasn’t always selling, didn’t even like salespeople half the time, but boy, when he decided to sell, he was unbeatable.
I’ll never forget sitting in an impressive conference room at a very large computer manufacturer that was prepared to not be all that interested in what we had to say.
Larry just blew them away. They had to re-evaluate their view on their database offering—and they eventually became a huge customer.
He reeled out that technical vision, described the product architecture in a way that computer science people found compelling and turned on the charm. It was neat to be in the room. I saw this a lot with Larry; the performance was repeated many times.
Hired the Smartest People The old adage “A players hire A players, and B players hire C players” applies here. Larry often philosophized that we couldn’t hire people with software experience because there were hardly any software companies, so we just had to get the smartest bastards we could, and they’d figure it out.
I think he was particularly skilled at applying this to the technical team.
I remember a brilliant young programmer whom Larry allowed to live anywhere he wanted in the US or Canada, didn’t care about hours, where he was or any of that stuff. We just got him a network connection and that was it. This was unheard of back then, but we did it fairly often to get superstars. I remember when we hired Tom Siebel—Larry was so excited, telling me about this deadly smart guy we just hired in Chicago who was sitting in our conference room that very minute! I had to go meet him!
I should say that Larry looked for smarts in men and women—women have always had the opportunity to excel at Oracle. And now there’s Safra Catz—whom I never met, but even back in the ’80s I remember Larry telling me how smart she was.
He Had Some Quirks Larry would sometimes take time out to think. He would just disappear for a few days, often without telling marketing people (who may have scheduled him for a press interview or a customer visit!), and return re-charged with a pile of ideas—many good, some not so much.
He liked to experiment with novel management ideas, like competing teams. He would set up some people to develop a product or go after a customer or whatever, and have competing teams trying to do the same thing. It’s always fun to experiment, though I never saw one of these fiascos succeed.
I remember one time he had his cowboy boots up on the desk, saying that we’d be bigger than Cullinet and we’d do it with 50 people, and only one salesperson. He was getting high on ideas. Only a computer historian would know Cullinet, an ancient database company that made it to $100M in sales back in the early ’80s. Yes, he was right about “bigger than Cullnet.” The “50 people” was motivated by his dream that we could just have the very, very best developers in the world, and hardly any salespeople—it was just talk. I think he came to appreciate the sales culture later on.
Larry loved to be called “ruthless.” When I asked what was his favorite book, he told me Robber Barons — worth a read even today! And he used to pore over spec sheets for fancy jets he probably thought he could never afford. Funny, I never heard him talk about sailing back then.
I’m not sure how all of this played out later because I wasn’t there. But it was clear, even back in those early days, that Larry had it all: leadership, technical vision, pragmatism, personal salesmanship, frugality, humor, desire to succeed.
I have to think my success in the VC business was due in no small part to seeing Larry Ellison in action back in the day.
Great entrepreneurial DNA is comprised of leadership; technological vision; frugality; and the desire to succeed. World-class founders:
Have a clear mission and inspire everyone to live it every day
Are the best salesman in the company
Hire the smartest people
Have a technological vision and the ability to convince others that it’s the right thing
Know it’s about winning customers and don’t spend money on things that aren’t mission-critical
Are relentless in pursuit of their goals and never take NO for an answer
Describing something as the “Woodstock of…” has taken to mean a one-of-a-kind historic gathering. It happened recently when a group of educators came to the ranch to learn how to teach Lean entrepreneurship to K-12 students. — We Can Do Better than Teaching Students How to Run a Lemonade Stand Over the last few years it’s […]
The Woodstock of K-12 Education
Describing something as the “Woodstock of…” has taken to mean a one-of-a-kind historic gathering. It happened recently when a group of educators came to the ranch to learn how to teach Lean entrepreneurship to K-12 students.
We Can Do Better than Teaching Students How to Run a Lemonade Stand Over the last few years it’s become clear that the days of teaching “how to write a business plan” as the cornerstone of university entrepreneurship are over. We now understand the distinction between startups – who search for a business model – versus existing companies – that execute a business plan. Learning how to keep track of inventory and cash flow and creating an income statement and a balance sheet are great skills to learn for managing existing businesses.
But to teach startup entrepreneurship we need to teach students new skills. They need to learn to find answers to questions like: who are my customers, what product features match customer needs, how do I create demand and what metrics matter? Learning these skills requires a very different type of entrepreneurship class, best taught through a hands-on, team-based, experiential approach. (The Lean LaunchPad/I-Corps class is the canonical model of such a class, with versions now taught in hundreds of colleges and universities.)
In addition, most programs fail to teach students the distinction between a lifestyle business, small business and scalable startup. While the core principles of lean work the same for building a small business versus a scalable startup, there is a big difference between size, scaling, risk, financing, decision-making, uncertainty, teams, etc.
Entrepreneurial education in grades K-12, if it exists at all still focuses on teaching potential entrepreneurs small business entrepreneurship – the equivalent of “how to run a lemonade stand.” This is fine if what we want to do is prepare our 21st-century students to run small businesses (a valid option), but it does real damage when students leave entrepreneurship classes thinking they’ve learned something about how entrepreneurs who build scalable startups think and operate.
On Fire With A Vision
In 2013, after taking the 2½-day “Lean LaunchPad for Educators” seminar, a few brave educators from Hawken School, a K-12 school in Cleveland, Ohio, decided to change the status quo. They returned to Hawken on fire with a vision of building a completely different sort of entrepreneurship course in their school. They saw the future was a course where students would learn by working on actual problems in the real world instead of sitting in a lecture hall. They adopted the Lean LaunchPad methodology because, as they said, it provides a framework for the chaos of a startup, where nothing is predictable. They found that they could approach teaching entrepreneurship like the scientific method. They ask their students to develop hypotheses and then get out of the classroom to conduct interviews to test them. They learn techniques for innovation, analytical approaches to research, and evidence-based systems for decision-making and problem-solving.
Teaching Other K-12 Educators I had blogged about what Hawken learned implementing something this radical in High School here, and in middle school here. (Take a minute to look at the posts for context.) Honestly, I had never expected the Lean LaunchPad class to work so well in high school. But an even bigger surprise was when Doris Korda, Hawken’s program director, told me she was getting calls and emails from K-12 teachers across the country asking her to hold a “Hawken Lean LaunchPad for K-12 Educators” workshop.
So the Hawken teaching team took a deep breath and they offered this class – here at the K&S Ranch – so other educators could learn what Hawken is doing and how they’re doing it. Here’s what they were trying to accomplish.
Thirty educators from 19 public and private schools throughout the U.S. attended their inaugural workshop.
These educators arrived at the ranch with a palpable sense of urgency, eager for the tools needed to build their own classes. There are no established Lean K-12 curricula, textbooks or handbooks for entrepreneurship programs. The class offered the first set of Lean educators’ materials anywhere. It took the attendees through the basics of Lean and how to build the class at their own schools.
The Hawken folks knew that in the back of the minds of other educators there was going to be the question, “Will this really work with my students? Can I really get them out of the classroom and expect real learning?” In what I thought was a stroke of genius, the Hawken team brought seven Hawken students who had taken the lean entrepreneurship class to help teach this educators course. These students told the attendees real world stories of how the class changed their lives and offered input and advice about what worked and didn’t for them.
The energy at the ranch was off the charts. Every minute was filled with talk about how to build this new model of learning and how to use LLP to encourage students to think creatively and analytically.
The attendees went back to their schools armed with a methodology and sample curriculum to develop their own entrepreneurship courses and put what they learned into practice. Some will take what they learned and apply Lean entrepreneurial principles to create innovate STEM programs and/or to encourage the growth of entrepreneurial ecosystems beyond school walls.
Here’s what some of them had to say about the experience:
Jeremy Wickenheiser, a high school teacher with the Denver School of Science and Technology, a STEM public school serving 6,500 students, summed up the remarks we heard again and again: “This is the beginning of a movement to change how students learn.”
What’s Next Encouraged by the attendees, Hawken is developing a comprehensive educational program for educators, with workshops on the East and West coasts, an educator’s handbook, and codified systems to help educators build their own experiential, LLP-based K-12 programs.
To learn about the workshops and sign up, click here.
The old ways of teaching entrepreneurship prepared students for small businesses
We needed a new educational approach to prepare them for scalable startups
Using the Lean LaunchPad, the Hawken School developed a successful entrepreneurship program for middle and high school students to do just that
How do you figure out what’s the right mix of skills for the co-founders of your startup? Surprisingly if you’ve filled out the business model canvas you already know who you need. ——- I was having breakfast with Radhika, an ex-grad student of mine who wanted to share her Customer Discovery progress for her consumer hardware startup. She started […]
How To Find the Right Co-Founders?
How do you figure out what’s the right mix of skills for the co-founders of your startup?
Surprisingly if you’ve filled out the business model canvas you already know who you need.
I was having breakfast with Radhika, an ex-grad student of mine who wanted to share her Customer Discovery progress for her consumer hardware startup. She started by sketching her business model canvas on a napkin, but somehow the conversation quickly shifted to what was really on her mind. “After reading your post on Why Founders Should Know How to Code it looks like web/mobile startups have it easy. They seem to know the right mix of skills on their founding team is a hacker, hustler and designer. But what about for us, a consumer hardware hardware company? Trying to figure out what the right set of co-founders isn’t so clear. How do I decide who I need to have on board on day one? Who can I hire later? And what can I outsource?”
Co-founders Skills are the First Derivative of the Business Model Canvas I told Radhika this is a perennial question for startups. I had struggled with this one for years. And over time every venture capitalist develops their own gut feel for what makes up a great team in their industry. I said, “If you’ve filled out the business model canvas you already know who you need on your founding team, the answer is staring us in the face.”
She looked at bit puzzled, so I continued to explain…
Understanding Activities and Resources Will Help You Spec Your Team I suggested to Radhika that we start by looking at the canvas box labeled “key activities”. “Activities” is where you define the most important things your company must do to make the rest of your business model work. Activities define the unique expertise your company needs to deliver the value proposition, customers, channels, customer relationships and/or revenue. (If you’re a startup it’s easy to get confused on this step. We don’t need to know your activities for your five-year plan. Just list the Activities needed to get a major early milestone – i.e. cash flow positive, or first million users, regulatory submission/approval, etc.)
For example, if you’re building a mobile app, then the key activities are: app software development, user interface design and demand creation skills. Or if you’re building consumer electronics the key activities might be: low cost hardware design, high volume manufacturing, user interface design, consumer branding and retail distribution. For medical devices it might be mechanical engineering, clinical trials, regulatory approval, freedom to operate (intellectual property) and figuring out a reimbursement strategy.
So What Does this Have to Do With A Founding Team? Once you establish what activities your company needs to do, the next question is, “how do these activities get accomplished?” i.e. what resources do I need to make the activities happen? The answer to that question is what goes in the “Resources” box on the canvas (and if third parties outside your company are going to provide it, in the Partners box.)
For example, in web and mobile apps most of the resources needed at first are people: a developer (the hacker), a user interface designer, and someone to lead the team and create customer demand and if needed raise capital (the hustler).
In medical device startups these resources are expertise in the basic science, industrial design, human factors, managing Contract Research Organizations, reimbursement, Intellectual Property, and someone to lead the team and raise capital and establish strategic partnerships. Therefore the ideal medical device team might be a physician; engineer; operator; business development/financial analyst.
Are We Missing A Founder? Once you’ve figured out the activities and resources, you can then ask, “If these activities are crucial in building our company and these resources are the critical people skills need to make them happen. Does anyone on the founding team have these skills? Are we missing a founder? Or can we outsource these activities to Partners?”
Radhika nodded. “I get it” she said, “understanding activities and resources help me identify and then prioritize the skill sets I’ll need, but what about the individual characteristics of the individuals – resilience? tenacity? agility? team work? How much value should I put on co-founders I’ve worked with before?”
I smiled and said, “Figure out what you need first, then we can have another coffee.”
Figuring out the right founding team starts with listing the critical activities to make the startup successful in the first year or so
Next, what human resources are necessary to make those activities happen?
Can these skills be outsourced to partners or are they integral to the DNA of the company?
If they’re integral to the company’s success, they should be part of the founding team
There have been 2 or 3 courses in my entire education that have changed the way I think. This is one of those. Hobart Harris Professor and Chief, Division of General Surgery at UCSF For the past three years the National Science Foundation Innovation Corps has been teaching our nations best scientists how to build a […]
Why Translational Medicine Will Never be The Same
There have been 2 or 3 courses in my entire education that have changed
the way I think. This is one of those. Hobart Harris Professor and Chief, Division of General Surgery at UCSF
For the past three years the National Science Foundation Innovation Corps has been teaching our nations best scientists how to build a Lean Startup. Close to 400 teams in robotics, computer science, materials science, geoscience, etc. have learned how to use business models, get out of the building to test their hypotheses and minimum viable product.
The Lean Startup is a process for turning ideas into commercial ventures. Its premise is that startups begin with a series of untested hypotheses. They succeed by getting out of the building, testing those hypotheses and learning by iterating and refining minimal viable products in front of potential customers. That’s all well and good if you already have […]
How To Think Like an Entrepreneur: the Inventure Cycle
The Lean Startup is a process for turning ideas into commercial ventures. Its premise is that startups begin with a series of untested hypotheses. They succeed by getting out of the building, testing those hypotheses and learning by iterating and refining minimal viable products in front of potential customers.
That’s all well and good if you already have an idea. But where do startup ideas come from? Where do inspiration, imagination and creativity come to bear? How does that all relate to innovation and entrepreneurship?
Quite honestly I never gave this much thought. As an entrepreneur my problem was that I had too many ideas. My imagination ran 24/7 and to me every problem was a challenge to solve and new product to create. It wasn’t until I started teaching that I realized that not everyone’s head worked the same way. While the Lean Startup gave us a process for turning ideas into businesses – what’s left unanswered was, “Where do the ideas come from? How do you get them?”
It troubled me that the practice of entrepreneurship (including the Lean Startup) was missing a set of tools to unleash my students’ imaginations and lacked a process to apply their creativity. I realized the innovation/entrepreneurship process needed a “foundation” – the skills and processes that kick-start an entrepreneurs imagination and creative juices. We needed to define the language and pieces that make up an “entrepreneurial mindset.”
Here’s Tina’s latest thinking on the foundational skills necessary to build a new venture.
There is an insatiable demand for innovation and entrepreneurship. These skills are required to help individuals and ventures thrive in a competitive and dynamic marketplace. However, many people don’t know where to start. There isn’t a well-charted course from inspiration to implementation.
Other fields — such as physics, biology, math, and music — have a huge advantage when it comes to teaching those topics. They have clearly defined terms and a taxonomy of relationships that provide a structured approach for mastering these skills. That’s exactly what we need in entrepreneurship. Without it, there’s dogged belief that these skills can’t be taught or learned.
Below is a proposal for definitions and relationships for the process of bringing ideas to life, which I call the Inventure Cycle. This model provides a scaffolding of skills, beginning with imagination, leading to a collective increase in entrepreneurial activity.
Imagination is envisioning things that do not exist
Creativity is applying imagination to address a challenge
Innovation is applying creativity to generate unique solutions
Entrepreneurship is applying innovation, bringing ideas to fruition, by inspiring others’ imagination
This is a virtuous cycle: Entrepreneurs manifest their ideas by inspiring others’ imagination, including those who join the effort, fund the venture, and purchase the products. This model is relevant to startups and established firms, as well as innovators of all types where the realization of a new idea — whether a product, service, or work of art — results in a collective increase in imagination, creativity, and entrepreneurship.
This framework allows us to parse the pathway, describing the actions and attitudes required at each step along the way.
Imagination requires engagement and the ability to envision alternatives
Creativity requires motivation and experimentation to address challenges
Innovation requires focusing and reframing to generate unique solutions
Entrepreneurship requires persistence and the ability to inspire others
Not every person in an entrepreneurial venture needs to have every skill in the cycle. However, every venture needs to cover every base. Without imaginers who engage and envision, there aren’t compelling opportunities to address. Without creators who are motivated to experiment, routine problems don’t get solved. Without innovators who focus on challenging assumptions, there are no fresh ideas. And, without entrepreneurs who persistently inspire others, innovations sit on the shelf.
Let’s look at an example to see these principles at work:
As a Biodesign Innovation Fellow at Stanford University, Kate Rosenbluth spent months in the hospital shadowing neurologists and neurosurgeons in order to understand the biggest unmet needs of physicians and their patients.
In the imagination stage, Kate worked with a team of engineers and physicians to make lists of hundreds of problems that needed solving, from outpatient issues to surgical challenges. By being immersed in the hospital with a watchful eye, she was able to see opportunities for improvement that had been overlooked. This stage required engagement and envisioning.
In the creativity stage, the team was struck by how many people struggle with debilitating hand tremors that keep them from holding a coffee cup or buttoning a shirt. They learned that as many as six million people in the United States are stricken with Parkinson’s disease, and other conditions that cause tremors. The most effective treatment is deep brain stimulation, an onerous and expensive intervention that requires permanently implanting wires in the brain and a battery pack in the chest wall. Alternatively, patients can take drugs that often have disabling side effects. The team was driven to help these patients and began meeting with experts, combing the literature, and testing alternative treatments. This stage required motivation and experimentation.
In the innovation stage, Kate had an insight that changed the way that she thought about treating tremors. She challenged the assumption that the treatment had to focus on the root cause in the brain and instead focused on the peripheral nervous system in the hand, where the symptoms occur. She partnered with Stanford professor Scott Delp to develop and test a relatively inexpensive, noninvasive, and effective treatment. This stage required focus and reframing.
In the entrepreneurship stage, Kate recently launched a company, Cala Health, to develop and deliver new treatments for tremors. There will be innumerable challenges along the way to bringing the products to market, including hiring a team, getting FDA approval, raising subsequent rounds of funding, and manufacturing and marketing the device. These tasks require persistence inspiring others.
While developing the first product, Kate has had additional insights, which have stimulated new ideas for treating other diseases with a similar approach, coming full circle to imagination!
The Inventure Cycle is the foundation of frameworks for innovation and entrepreneurship, such as design thinking and the lean startup methodology. Both of these focus on defining problems, generating solutions, building prototypes, and iterating on the ideas based on feedback. The Inventure Cycle describes foundational skills that are mandatory for those methods to work. Just as we must master arithmetic before we dive into algebra or calculus, it behooves us to develop an entrepreneurial mindset and methodology before we design products and launch ventures. By understanding the Inventure Cycle and honing the necessary skills, we identify more opportunities, challenge more assumptions, generate unique solutions, and bring more ideas to fruition.
With clear definitions and a taxonomy that illustrates their relationships, the Inventure Cycle defines the pathway from inspiration to implementation. This framework captures the skills, attitudes, and actions that are necessary to foster innovation and to bring breakthrough ideas to the world.
The Inventure Cycle defines entrepreneurship as applied innovation, innovation as applied creativity, and creativity as applied imagination
Entrepreneurship requires inspiring others’ imagination, resulting in a collective increase in creativity, innovation, and entrepreneurship
This framework allows us to parse the skills, attitudes, and actions needed at each step in the entrepreneurial process.
“By knowing things that exist, you can know that which does not exist.” Book of Five Rings A startup is not just about the idea, it’s about testing and then implementing the idea. A founding team without these skills is likely dead on arrival. —- I was driving home from the BIO conference in San […]
Why Founders Should Know How to Code
“By knowing things that exist, you can know that which does not exist.”
Book of Five Rings
A startup is not just about the idea, it’s about testing and thenimplementing the idea.
A founding team without these skills is likely dead on arrival.
I was driving home from the BIO conference in San Diego last month and had lots of time for a phone call with Dave, an ex student and now a founder who wanted to update me on his Customer Discovery progress. Dave was building a mobile app for matching college students who needed to move within a local area with potential local movers. He described his idea like “Uber for moving” and while he thought he was making real progress, he needed some advice.
Customer Discovery As the farm fields flew by on the interstate I listened as Dave described how he translated his vision into a series of hypotheses and mapped them onto a business model canvas. He believed that local moves could be solved cheaply and efficiently through local social connections. He described when he got out of the building and quickly realized he had two customer segments – the students – who were looking for low budget, local moves and the potential movers – existing moving companies, students and others looking to make additional income. He worked hard to deeply understand the customer problems of these two customer segments. After a few months he learned how potential customers were solving the local moving problem today (do it themselves, friends, etc.) He even learned a few things that were unexpected – students that live off campus and move to different apartments year-to-year needed to store their furniture over the summer breaks, and that providing local furniture storage over the summer was another part of his value proposition to both students and movers.
As he was learning from potential customers and providers he would ask, “What if we could have an app that allowed you to schedule low cost moves?” And when he’d get a positive response he’d show them his first minimal viable product – the mockup he had created of the User Interface in PowerPoint.
This was a great call. Dave was doing everything right. Until he said, “I just have one tiny problem.” Uh oh…
“I organized some moves by manually connecting students with the movers. And I even helped on some of the moves myself. But I’m having a hard time getting to my next minimal viable product. While I have all this great feedback on my visual mockups I can’t iterate my product. My contract developers building the app aren’t very responsive. It takes weeks to make even a simple change.”
I almost rear-ended another car when I heard this. I said, “Help me understand.. neither you nor your cofounder can code and you’re building a mobile app? And you’ve been at this for six months??” Whoah. This startup was broken at multiple levels. In fact, it wasn’t even a startup.
The Problem Dave sounded confused. “I thought building a company was all about having hypotheses and getting out of the building and testing them?’
There were three problems with Dave’s startup.
He was confusing having an idea with the ability to actually build and implement the idea
He was using 3rd parties to build his app but he had no expertise on how to manage external developers
His inability to attract a co-founder who could code was a troubling sign
A Startup is Not Just About a Good Idea As the miles sped by I explained to Dave that he had understood only two of the three parts of what makes a Lean Startup successful. While he correctly understood how to frame his hypotheses with a business model canvas, and he was doing a good job in customer development – the third component of Lean is using Agile Development to rapidly and iteratively build incrementally better versions of the product – in the form of minimal viable products (MVP’s).
The emphasis on the rapid development and iteration of MVP’s is to speed up how fast you can learn; from customers, partners, network scale, adoption, etc. Speed keeps cash burn rate down while allowing you to converge on a repeatable and scalable business model. In a startup building MVP’s is what turns theory into practice.
Dave had fallen into the new founder trap of looking at the business model canvas and thinking that coding was simply an activity (rapidly build mockups of first the the U/I and then the app). And that he could identify the resources needed, (outsourced contract developers who could build it for him) and he would hire a partner to do so. All great in theory but simply wrong. In a web/mobile startup coding is not an outsourced activity. It’s an integral part of the company’s DNA.
Having a coder as part of the founding team is essential.
Coding is the DNA of a Web/Mobile Startup I offered that if Dave wanted to be the founding CEO then he was going to have to do two things: first, create a reality distortion field large enough to attract a technical co-founder. And second, learn how to code.
Dave was a bit embarrassed when he explained, “I’ve been trying to attract another co-founder who could code but somehow couldn’t convince anyone.” (This by itself should have been a red flag to Dave.) And then he continued, “But why should I have to know how to code, I’m not going to write the final app.”
One interesting thing about the Lean Startup is that it teaches founders about Sales and Marketing (and a bit of finance) without making them get an MBA or a decade of sales experience. Founders who go through the process will have an appreciation of the role of sales and marketing like no textbook or classroom could provide. Having done the job themselves, they’ll never be at the mercy of a domain expert. The same is true for coding.
I was glad I had a lot of time in the car, because I was able to explain my belief that all founders in a web or mobile startup need to learn how to code. Not to become developers but at a minimum to appreciate how to hire and manage technical resources and if possible to deliver the next level of MVP’s themselves.
Dave’s objection was to list a few successful startups that he knew where that wasn’t the case. I pointed out that are always “corner cases” and if he thought I was wrong he could simply ignore my advice.
As I was about to pull off an exit for lunch and to recharge my car I strongly suggested to Dave that for both this startup and the rest of career he put his startup on hold and invest his time in attending a coding bootcamp. It would take him to the first step in appreciating the issues in managing web development projects, identifying good developers, and finding a technical co-founder.
Weeks later Dave dropped me a note, “Boy, what I didn’t know about how much I didn’t know. Thanks!”
Startups are not just about the idea, they’re about testing andimplementing the idea
A founding web/mobile team without a coder past the initial stages of Customer Discovery is not a startup
Everyone on the founding team ought to invest the time in a coding bootcamp
Your odds of building a successful startup will increase
I met Kathryn Gould longer ago than either of us want to admit. Kathryn has been the founding VP of Marketing of Oracle, a successful recruiter, a world class Venture Capitalist, a co-founder of a Venture Capital firm, a great board member, one of my mentors and most importantly a wonderful friend. During her career she […]
Pioneering Women in Venture Capital: Kathryn Gould
I met Kathryn Gould longer ago than either of us want to admit. Kathryn has been the founding VP of Marketing of Oracle, a successful recruiter, a world class Venture Capitalist, a co-founder of a Venture Capital firm, a great board member, one of my mentors and most importantly a wonderful friend. During her career she made a big point of not telling you: she was one of the first women Venture Capitalist’s in Silicon Valley (along with M.J. Elmore and Ann Winblad) – “I’m just a VC.” Or one of the first women co-founders of a VC firm – “I co-founded a great firm.” She was twice as smart and just as tough as the guys. She has been a mentor and role model not just for a generation of women VC’s and CEO’s but for all VC’s and CEO’s – and I’m honored to have been one of them.
Her response? “The last thing I want is a bunch of people bugging me while I’m growing my grapes, flying, painting, playing music, and generally goofing off.” I pointed out that, “Now that you retired, what happens to all the knowledge and experience you’ve acquired?” She still demurred so I gave it one last shot. I sent her an email saying, “When you’re gone everything you learned goes with you. This really is bigger than you. I have two daughters starting careers and nothing could be more inspiring than hearing your story. You really ought to share your journey.”
So for the first time ever, she has. Here’s Kathryn’s story.
Why Give a Commencement speech One of the more fun things I’ve been asked to do lately was give the commencement speech at the University of Chicago Booth School of Business in June 2014. What I didn’t tell them before, during, or after the talk was that I’d never gone to my own University of Chicago MBA graduation, nor had I gone to my BSc in physics graduation at University of Toronto. I’ve never been big on pomp, and I had fun jobs I wanted to go to right away after each of them. And to be fair, I wasn’t summa cum laude in either case. I was merely respectable, so there was no appealing ego trip involved. Anyway it was high time I went to a graduation.
The most personally interesting part of writing this speech was thinking about what I could say to the young women that I wish I’d heard at their age. (I heard nothing).
So, for the first time, I thought hard about what it was like to be a woman in a man’s business. Not thinking about it earlier was a survival strategy—because if I’d thought about it, I’d have wanted to TALK about it, and that would have been stupid. I was working and competing with men daily. And successfully. And the truth is, I like working with men. Being a physicist-turned-engineer, I have very little experience working with anything but men. So when members of the press or militant feminist types would question me about this stuff, I would avoid and be annoyed. Now that I’m retired I can speak out and let the chips fall. Still, a nod to Sheryl Sandberg for saying her piece while in the thick of it.
In the aftermath of the speech, I got the most resonance in two areas:
1) make unconventional choices that fit YOUR OWN aspirations
2) from women appreciating the advice to go around obstacles, and enjoying hearing from a fellow ‘dragon lady’
Actually it wasn’t “dragon lady,” it was a stronger, less feminine term — “Ball Buster” — but, hey, I couldn’t say that in a speech. Reason I know is that I’m still very close to most of the former CEOs from my boards. I ran this speech by a couple of them. Over time they had heard me referred to as that other term. They would jump to my defense – and they report that the people who said this had never met me –it was just the “word on the street.” Insidious, yes?
Anyway, mine is a study in making unconventional career choices (not that I recommend everybody go be a recruiter for a few years!), and searching for what you’re great at, and meant to encourage women to go right through those walls.
So they call you a “dragon lady”; so what?!
Here’s the speech:
2014 University of Chicago Commencement speech ‘Your Great Adventure’ “I’m so happy to be here today: First, to help you celebrate your success thus far, and more important: to celebrate your last day of doing what is expected of you —now each of you embark on your own great adventure—there is no ‘expected’ path from here on. You get to create your own history. No more tests, get into this school, get into that class, get this degree—now the real adventure begins. The second reason I’m glad to be here today is that 2 years ago, when Dean Kumar first asked me to do this speech, I wasn’t sure I”d even be alive, so I had to pass. More on that later.
So, about your adventure: should you have a plan? Maybe. But don’t follow it. Planning prepares the mind, and chance favors the prepared mind, but chance usually messes up plans! When I was where you are, 36 years ago (can ya believe it) I didn’t have a plan—but I did have an aspiration: I wanted to go to Silicon Valley and I wanted to work in startups. I had no idea how I was going to get from here to there. I was completely unprepared! We had literally one entrepreneurship course here in the mid 70s—taught by a guy who commuted in from Silicon Valley. Compare that to now—with our superb entrepreneurship curriculum, and I understand 70% of this class has either an interest or focus in entrepreneurship.
Chance Favors the Prepared Mind So here’s how it happened for me. I had had a love affair with computers since I was 18 and a freshman physics major.
Computers were so different from now—arcane, annoyingly difficult— and interesting. But they weren’t really in Silicon Valley at the time—they were in Boston, Minneapolis, New York. So going to Silicon Valley wasn’t an obvious move at the time. It was the invention of the microprocessor that made it obvious for me. I quit my good job here and moved to the valley. Most people thought I was nuts. I had no idea what I was doing—just that I had to be there, and in a startup—so I took a job with the smallest company that made me an offer (passing up Intel, Tandem and Apple). It wasn’t a great choice, but I was THERE. But then, one our customers was Larry Ellison, with this little company that wasn’t even called Oracle at the time. I loved what he was working on (thanks to perspective in data management from my large company experience here—that prepared mind thing). So I joined Oracle when it was about 20 people, eventually becoming VP Marketing. And it was an amazing time. Larry was the best entrepreneur I’ve ever known, and completely unconventional…
What can you learn from this story so far?:
Put yourself in the way of success—get in front of an important wave and ride it.
Gravitate to what’s new.
Don’t be afraid to take a step down (Oracle was a $1 Million business, I had been marketing manager for a $100 Million business).
Build Your Skills Not Your Resume Eventually I left Oracle, wanting to do another startup. Problem is, startups that have world changing potential are not that easy to find. I wanted another Oracle, not any old startup. So I did something completely crazy and unplanned—which looks brilliant only in hindsight! I noticed that I loved looking for a job, even tho I didn’t’ find a company I wanted to join. I liked meeting people, hearing the company plans, learning about their technology, figuring out if it was for real—all that was fun. How could I do that for a living? The answer of course, was Venture Capital, but that was not in the cards—as yet. I had met a few exec recruiters in the process and thought what they did was similar and interesting. So I started an exec search firm as a creative way to look for a new startup. Turns out that I quickly became one of the few best recruiters in the valley for CEO and VP levels, got to work with the best VCs and their startups. And who would have guessed—perfect preparation for the VC business. I ended up doing that for 5 years, and in the process saw about 80 startups in various stages of success and disarray. I developed a deadly accurate intuition on people, an unbeatable set of contacts, and loved working for myself in my little firm. By the 4th year, VCs were asking me to join them, partly for recruiting help, but more because I kept introducing them to startup investment opportunities. As you’ve heard, it’s excruciatingly hard to get in to the VC business, and there I was. Because I”d built some unique skills.
Plus, I had learned some stuff that you don’t get in business school:
How to cold call –adrenaline, real time, 3 seconds to grab their attention—learn this!
Also the adage As hire As, Bs hire Cs—absolutely true—be careful of the company you keep,
And what goes around comes around. Help people with their careers, their ideas, contacts—and I’m serious, good things come back years later.
I also learned that the first time without a paycheck is a little scary.
Find Your Obession I joined VC firm Merrill Pickard in 1989. My first IPO wasn’t until 1995—the VC business takes patience. Two companies I helped start in 1992, DCTM and Grand Junction Networks both became Stanford business school cases and very valuable, successful companies. I was on the way to my lifetime IRR of 90%. I loved the business, and I was good at it. But then, trouble. My two best partners went off to start Benchmark Capital, very successful to this day, so my firm was going to blow up. I went Boogie Boarding where I do my best thinking. I thought, gee, I could already afford to ride waves the rest of my life. That might be neat. But I couldn’t do it. I loved the business, couldn’t stop. So I started Foundation Capital in 1995. I loved starting my own firm, doing it my way. We brought in all operating guys—all had done startups, all had technical backgrounds. In 5 years we were one of the top firms in the Valley by any measure. I had found my obsession.
It’s Not the Calls You Take, It’s the Calls You Make One of my sayings You are the creator of your destiny. In whatever business you’re in, there is always so much coming at you that you can stay insanely busy just responding. Don’t do that. Always think about what is your agenda, what do you want to make happen, what do you want the future to look like. This is not so easy.
Go Where the Action Is: It’s not over in the Valley Now 35 years later, should you still move to the Valley (or Hollywood, or London, or Chicago!—or wherever the action is in your area of interest?). I can’t speak to the other places, but I”ll tell you what, it’s not over in the Valley. From electric cars to drones, DNA sequencing to robotic surgery, enterprise software to social media –the size and variety of these markets makes the Valley of my early days look bush league. There’s no end in sight. The valley startup culture and talent pool is unique in the world. If you think maybe you should go there—maybe you should.
I retired in 2006. My husband and I bought a vineyard—so I’m a beginner again! With another startup!
A Word to the Ladies Here I understand a third of the class is women. I have always said, with an annoyed attitude when people ask, that there are no obstacles to women these days, just look at me! That’s the safe way to answer, right? But it’s not entirely true. One of the gifts of talking to you ladies here is that I forced myself to reflect on this. I’ll just mention two obstacles that hit me—neither of which I even reacted to at the time, just accepted.
I wanted to go to Caltech, but they didn’t take women undergrads until 1970. I wasn’t mad about that; I just thought it was my fault for being interested in guy things. So I dated a Caltech student and got to use their computer—first computer I ever met too—a monster. Structural obstacles like this are over with for you. Good riddance.
Second Obstacle Remember that business of starting Foundation Capital when my first firm blew up? I did it because I didn’t have a choice—couldn’t get a job. Really. I spent a couple of months talking with the few VC firms that I was willing to join. (yes, I was picky) It became clear it was going to take a long time to get into one, and I didn’t have a long time. I didn’t want to lose my momentum. Mind you, I was one of the top handful of VCs in the business at the time. Not on the Midas list yet, because it hadn’t been invented, but anybody could see that my results were heading toward extraordinary. I have to think that a guy with my numbers would have been snapped up pretty fast. For me, starting the firm and raising the money was way faster. Don’t you think that’s stunning? A pretty big fat obstacle. So we went from Boogie Board to money in the bank in 6 months. Not that I’m sorry—it turned out great. But you ambitious women will surely face something like this in your career. Just go around it! There is always a way. Note on the VC business, only 4% of senior VCs are women, according to Fortune Magazine. I don’t think it’s changing anytime soon either.
Now to be fair, consider your advantages: you’re much more memorable than most of the guys, they won’t forget you, and there is a self selection: the men who have the guts to do business with you have the extra self confidence to be more successful. The guys that wanted me on their board of directors had moxy—because of course they had heard all the crap about how I was a dragon lady (all ambitious women get called that as you know) and they still went for it. Who knows—could be why my companies were so successful…
I often walk among my grapevines and think how grateful I am for my life right now. But if the vines had come first, without the adventure and hard work, it wouldn’t be nearly as sweet. So that’s my story so far—but it’s not over yet, because the cabernet is really good!
Tending a New Crop in My Next Venture
So now, for each of you, go create your own unique adventure. You are done preparing—go do it! Make a plan, but don’t stick to it. Let chance favor your prepared mind. Break rules, find your obsession, be extraordinary!”