Start-up

Definition

A temporary organization designed to search for a repeatable and scalable business model.

• For new ideas, the goal is to quickly gather data and talk to potential customers to validate or invalidate a set of hypotheses.
• A traditional Strategic Plan is not as useful for the development of new ideas where the Business Model is not clear.
• Lean Start-Up Approach
  • Summarize business opportunity and guesses using Business Model Canvas.
  • Test business model/guesses — Customer Development Process
  • Practice Agile Development
  • Fail quickly and cheaply, rather than fail slowly and expensively.
• Five things (by Chris Vargas)
  • Problem/Need
  • Market, ICP (Ideal Customer Persona)
  • Solution
  • GTM = Go-to-Market strategy — the most difficult part
  • Monetization strategy
• Stages
  • Idea
  • MVP = Minimum Viable Product
  • PMF = Product Market Fit
  • Growth
  • Expansion
• Large companies can also utilize a lean start-up approach, e.g. FastWorks Framework in General Electric

Funding

• Cap Table
• Venture Capital
• Founders agreement.
• “Simple Agreement for Future Equity” (= SAFE) by Y Combinator