Furthering the "Startup Process"
One of his more recent posts focuses on the Business Model Design. This is a key tenet of his process for startups: that the FIRST job is to find a scalable business model. Only when this scalable model is found do you focus on actually scaling the business itself. But how to design and describe the business model was one of those “black boxes” that most entrepreneurs weren’t really sure how to execute. Steve points to work by Alexander Osterwalder and Yves Pigneur, who have published the definitive work on the subject, “Business Model Generation”. Steve has, in the last year, started to use their Business Model canvas as not just a static tool, but actually as a launchpad for testing hypotheses and keeping a scorecard for tracking iterations and pivots:Steve Blank’s posts on the Business Model/Customer Development/Lean Startup stack have been really compelling reading, and I believe are zeroing in on what may be a repeatable process for startups. It doesn’t mean the process always yields a successful startup – but using the tools and processes outlined, combined with good judgment and great talent appears to give a startup a much better chance of succeeding with the resources at their disposal.
In the last year I found that the Osterwalder Business Model canvas could be used for something much more than a static planning tool. I realized that it was the launch-pad for setting up the hypotheses to test, and a scorecard for visually tracking iterations and Pivots during Customer Discovery and Validation. Meanwhile on the other side of the world Alexander Osterwalder was coming to the same conclusion: tying the two processes together would create a “strategy stack for entrepreneurship.”I find the idea of a process for generating a business model to be compelling.