How to Build a Startup - What Is A Company

Let's take up this target business model and customer development but you know before we even begin one of the first questions I tend to ask is what is a company? What is it that I'm trying to actually start? Just for the sake this class, I think we ought to just use this definition. A company is a business organization with sales, a product, or service in exchange for revenue and profit. So explicitly for the purpose of this class, I'm eliminating nonprofits. Let me be clear, you could use the business model canvas and customer development to go through the process for nonprofit but actually having some goals that are fairly concrete revenue and profit allows us to measure whether we're succeeding and failing in very clear ways and then we adjust to the question. What's a startup? It tells use where the company is but how does a startup different, and for me you have know I spent 20 years doing eight startups and I never could have given you a definition on the top my head what a startup is. I always thought a startup is where we have free food. Where there is a great small team or you could bring your dog and whatever, but I never quite understood the purpose of a startup. So I'm going to give you Steve's definition of what it is your actually doing. A startup is a temporary organization design to search for a repeatable and scalable business model. Now let's go back and parts the sentence because this is pretty important. Number one is temporary. The goal of a startup is not to be startup. A startup actually aims to bring you company. Well that's kind of interesting because if you really think about it at least if you're a web mobile startup there is no such thing as a ten year old startup. There's a two year old startup attached to an eight year old failure. A start up is a temporary organization and what are you suppose to be doing? Well, while you think it might be built on the product or maybe if your thinking harder it might be get customers, actually no. A startup is actually design to search person. Well that' kind of interesting. What is it that I'm suppose to be searching for? Let see. Well number one, you want to search for something that's repeatable and repeatable means the same thing that works on Monday, works on Wednesday, and works on Friday, and works next week, and works the next month. That is I want to find sales and ,marketing, and engineering processes that are repeatable. I also want to find them scalable. What scalable means, I put a dollar in, I get two dollars out, or I put a dollar in and maybe I get ten dollars out. But I better not be loosing money on a continual basis or I'm called an out of business startup. Okay, I know I'm searching for something repeatable and scalable but what is it that I'm searching for? What you're searching for is the business model and that business model search is the basis of the rest of the class. Let's take a look and see how we become okay.