The startup secret – don’t be stupid

I’ve been reading and studying around the new thinking on ‘Entrepreneurship’ (I don’t find that a useful  word. Let’s call it “starting companies”). I was pointed at The Lean Startup because “you talk about the same stuff as is in the book”; and I loved it.

I was already a big fan of Business Model Generation and the visual thinking approach around that. Then I came across Steve Blank’s stuff, which is great (I recommend his free course on Udacity, by the way). And the three of them, Reis, Osterwald and Blank, work with each other so this combines nicely into a new body of thinking. The latest, cutting edge, ‘hot from the Valley’ stuff on how to start and grow successful businesses. I mean, these guys teach at Stamford and Berkeley, so this is hot shit, right?

At the beginning of “The Startup Owner’s Manual” by Steve Blank and Bob Dorf, they contrast the new approach with the old way of doing things. They give examples of WebVan and Irridium as examples of how the old way was flawed. Here were two businesses that were massively ambitious, were headed up by stellar people, got huge investment and failed spectacularly. In the case of WebVan, a home shopping for groceries business, they spent billions building out a huge and complex infrastructure to collect orders, warehouse and deliver the goods before they actually put  the service in front of the customers. Then they were surprised to find that customers didn’t take to it as enthusiastically as they had imagined. Who’d have guessed?

Well, me. I could never fathom out why they did start-ups that way, it always seemed to me to be a stupid approach. I learnt the hard way that customers just don’t think and behave like you want them too. I know, it’s bloody annoying but there it is. They just won’t be talked to. So, you have to get the service in their hands as soon as possible to find out if they’ll  use it and how they’ll use it. It is insane to spend many months and even more billions of dollars building something you haven’t tried out with customers. Yet no-one spotted it.

Was this a case of groupthink in the valley? The internet equivalent of the Emperor’s New Clothes? (Oh no, that was probably How did all those smart people do something so stupid? Several times?

No, I don’t understand either.

So, to be a successful startup, you don’t need to be super-smart. You just have to avoid being super-stupid.

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