After reading the next assigned article, Steve Blank’s “Why the Lean Start-Up Changes Everything” (as seen in the May 2013 issue of the Harvard Business Review), I was tempted to include the link to a post I wrote a couple classes ago about the changing media landscape. However, I’ve already linked to that article two or three times in the past, so another linking probably wouldn’t be necessary. Nonetheless, the sentiment of that article remains in tact: Times are changing – something that’s especially evident when looking at the media. With that, Blank’s article introduces a new business model for startups to adopt that’s more flexible, efficient and customer-focused than the linear business plans of yesterday, and this new business model (named the “Lean Start-Up”) encourages entrepreneurs to take a step back and listen closer to the people at the core of a successful startup: Its customers.
An extensive business plan may look appealing to investors, but (at the risk of sounding too informal) it doesn’t mean jack if it doesn’t appeal to customers. With lean startups, all they start with are ideas and hypotheses of what may work. From there, they commence research to see if these ideas will actually resonate with an audience while “iteratively and incrementally” creating a minimum viable product. What’s beneficial about this business model is that if the research harbors negative findings, the startup won’t have to suffer an insurmountable loss of funds pivoting its direction away from a dead end. Blank’s article mentions a case in which a startup initially planned to target its automated lawn products to golf courses, but after research, pivoted its direction to agriculture and now operates in that market as Blue River Technology. The creation of a minimum viable product as opposed to something more grandiose means the startup can accurately pivot the product to better fit an audience, and with production becoming faster, cheaper and more accessible, the entire roll-out of a product is much quicker than before. In the Blue River Technology example, a prototype was built only 10 weeks following the pivot.
Overall, the “Lean Start-Up” model is more adaptable to customer response, and fits nicely with the more affordable development costs and broadening of entrepreneurial opportunities at the fingertips of aspiring startups. That’s not to say lean startups are completely foolproof, but Blank’s presenting of such makes it more appealing to startups in this day in age. Indeed, if the environment of media technology is changing, it makes sense that a business model exists for new entries that’s able to actively react to whatever comes its way.