I recently spent an enjoyable Saturday with the Wellington Lean Startups group watching live webcasts from the Startup Lessons Learned conference in San Francisco. Perhaps the most important lesson of the day emerged from Steve Blank’s presentation about the role of a startup founder. The underlying iteration for a startup venture can be defined by the following three words, search-build-grow. It’s a message that we do not yet fully embrace in New Zealand, which is a nation of small businesses that (mostly) do not scale up at all.
Prof. Blank teaches at the Berkeley business school and introduced a novel subject called “customer development” to the curriculum there. I say “novel” because in the excesses of the late ’90s, more than a few startups (and investors) overlooked the fundamentals of business for a while. It took a bursting bubble and a massive destruction of capital to remind tech company founders that the foundations of a real business never change. At the outset, the entrepreneur’s role involves searching for a viable business model. Later the task becomes building a set of organisational processes that can allow the business to grow. Finally, the business has to scale upwards.
Possibly the reason we predominantly remain a nation of small businesses is that we are great at being founders and innovators, but less confident at implementing formalised professional management that can deliver scale. Part of that is about the desire to retain control; but there is also the question of ambition. New Zealand needs more medium to large sized businesses, especially ones that export value added goods and services. We need to get over our lack of self confidence and think global.
When I left the secure bosom of full-time paid employment last year I stated that my goal was to build a knowledge based business with a $100 million valuation. No doubt there were a few quiet chuckles in private about that statement. But if we don’t set ourselves big goals how can we measure ourselves and drive forwards? At ideegeo having reached the “build” phase of our first venture, we have already begun the “search” phase for our next one. It has been challenging at times, but I’m confident we remain on track. Serial searching and building is a valid business model in itself, provided you can assemble the right skills and access sufficient resources.
Thanks to Dave Moskovitz uber-mentor and facilitator from Webfund for organising the Wellington Lean Startups group and CreativeHQ for feeding us and taking an interest in what’s happening at street level in the local tech startup scene.