A brief presentation on Evidence-based Entrepreneurship, given as a part of AUTM 2014's Startup Class.

1. Lean Startups
evidence-based entrepreneurship
Keith McGreggor, Ph.D.
Director of VentureLab

3. #1 early
#1
stage incubator
engineering/science incubator
#2
overall

4. innovations reviewed
new projects
current projects
companies created
total of angel & VC investments
in VL companies
250+/year
35+/year
100+ active
150+
$730M+

6. since June 2012
13 cohorts / 5 nodes
300+ NSF teams
12+
teams

7. since May 2012
22+ cohorts / 7 locations
250+ teams
400+ entrepreneurs

8. Lean Startup?

9. Lean Startup
is now known as
Evidence-based
Entrepreneurship

10. A new way of thinking about
and designing startups
engineering

11. three big ideas
a definition
a framework
a methodology

12. three big ideas :
Definition
what is a startup?

13. three big ideas :
Definition
We used to think
A startup is a smaller
version of a large company.

14. Startups ?
Companies ✓

15. three big ideas :
Definition
A startup is a temporary
organization designed to
search for a repeatable
and scalable business
model.
- Steve Blank

16. Startups Search
Companies Execute

17. three big ideas :
Definition
A startup is a temporary
organization designed
to search for a repeatable
and scalable business
model.
- Steve Blank

18. Research Team
Core Idea or
Technology

19. Research Team
Core Idea or
Technology
Company

20. three big ideas :
Definition
Not everyone can or
should be a founder.
!
Professors are terrible as
CEOs (but great as advisors).

21. three big ideas :
Framework
How do we share
our thinking?

22. three big ideas :
Framework
What we used to do
Write a business plan.
Make a five-year forecast.
Pitch for investors.

23. Business plan? Fiction
5 year forecast? Fantasy

24. three big ideas :
Framework
What we do now
Focus on the business model.
Talk about evidence,
not belief.

25. Use the business model canvas

26. As a Startup Engine…
KA
P
VP
KR
C$
CS
C
R$

27. … and as Investment Readiness
✓
✓
✓
✓
✓
✓
✓
✓
✓

28. three big ideas :
Methodology
How can we be
assured?

29. Startups are risky.
Startups fail, often.
Even yours.
Even ours.

30. Four Existential Startup Risks
Product
Market
Team
Financial

31. Four Startup Risks:
Product
Every startup can make something.
Can you transform that great technology
into a product someone wants to
buy from you?

32. ?
$
Core Idea or
Technology
Startup
Customers

33. Four Startup Risks:
Market
The common denominator of
every business is a customer.
Most startups fail because
they fail to find their customer.

34. Four Startup Risks: Team
Can your team execute?
Do they have the network?
Can they attract & hire talent?
Can they get the funding?

35. Four Startup Risks:
Financial
Is the model capital efficient?
Revenue in year 1?
Repeatable sales process by 2?
Organic growth or investment?

36. three big ideas :
Methodology
Systematic reduction of startup risk
Product
Market
Do this first.
Team
Financial
Then, do this.

37. three big ideas :
Product
Methodology
Market
Connected & Primary Risks

38. three big ideas :
Methodology
Customer
Development

39. Customer Development
?
✓
Customer
Discovery
Customer
Validation
Startup
Customer
Creation
Company
Building
Company

40. Alignment & Sequence
Risk
Process
Market
Product
?
✓
Customer
Discovery
Customer
Validation

41. However…
Assume
Risk
Market
you can
transform
?
technology
Process
into product
…
Customer
Discovery
Product
✓
Customer
Validation

42. … and
Risk
Process
Market
?
Customer
Discovery
… Address
Product
Market Risk
before doing
✓
Anything
Else
Customer
Validation

43. Why?
?
$

44. Customers, not Technology
Desire
Job / Task
✓
Pain

45. How?
?
$

46. three big ideas :
Methodology
Answer these questions:
WHO CARES?
WHY will they BUY?

47. three big ideas :
Methodology
There are NO facts
in your buildings or labs.
Get out into the world and
find out what’s true.
the real key:
100+ Interviews

48. A man
who carries
a cat by the
tail learns
something he
can learn in
no other way.

49. three big ideas :
Methodology
You cannot outsource
the discovery process.
!
Your startup team must
gather the evidence
themselves
(but you can guide them).

50. three big ideas :
Methodology
You should expect:
Deadends & Pivots
Complaints
Frustration
and then, finally,
Evidence

51. Startups are risky.
Evidence-based
entrepreneurship and these
processes will make yours
fail less.

53. 75 Fifth St NW, Suite 415, Atlanta GA 30308
venturelab.gatech.edu
@venturelab / @keithmcgreggor
keith@venturelab.gatech.edu