To take away some of the suspense, Steve Blank brings the definition of a startup to a point: "A startup is a temporary organization that is looking for a repeatable and scalable business model"...
Temporary means that a startup wants to become a real company eventually ( even when Yahoo likes to state that they are still a startup after 20 years...) What is meant is that the goal is to have a product on the market, paying customers, users, employees, offices, goals...
As a startup, especially in this phase which can take a couple of years, you want find a product as well as a business model that works on Monday and on the rest of the days of the week. During this phase marketing, sales strategy and everything else has to be built, optimized and perfected. This is just like a car race where the tires and motor have to be warmed up and the right position has to be found on the track. The first laps are to postion yourself and to find the grid. The remaining laps to the finish line are there to drive forward.
As a startup and founder I want to create something scalable. Like so often in life this is measured easily...Scalability in this case is measured by money. I invest an Euro and gain two or more in the end which I then use for the scalability of my client base, my employees, the product and it then starts all over again. To bring it down to the common denominator: Over the course of time I should be taking in more money that I am spending otherwise it will soon be over.
To bring it to a point: I have to look for a business model. When I find and form it, I will be much closer to success. A startup is a temporary company looking for a business model. But until then I am simply a "non profit" company that has to be economical with financial means and resources.
This article is written by our CEO, Bernd Korz. With his experience as an entrepreneur, he shares his vision about the lessons provided by Steve Blank. Join us every week for a new article on Steve Blank’s lectures.
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