What is a startup or start-up?
A startup or start-up is a company or project undertaken by an entrepreneur to seek, develop, and validate a scalable business model.
What does entrepreneurship refer to?
Entrepreneurship refers to all new businesses, including self-employment and businesses that never intend to become registered, startups refer to new businesses that intend to grow large beyond the solo founder.
What is the term for a founder or co-founder who has a way to solve a problem?
The founder of a startup is the one who begins market validation by problem interview, solution interview and building a minimum viable product.
What is a minimum viable product?
a prototype to develop and validate their business models.
How long can the startup process take?
The startup process can take a long period (by some estimates, three years or longer), and hence sustaining effort is required.
Why is sustaining effort especially challenging?
because of the high failure rates and uncertain outcomes.
What are the models behind startups associated with?
Models behind startups presenting as ventures are usually associated with design science.
What is one of the initial design principles?
one of the initial design principles is "affordable loss".
What are some of the most critical decision biases of entrepreneurs to start up a new business?
Overconfidence, Illusion of control, The law of small numbers, Availability bias, Escalation of commitment.
What does Illusion of control means?
Overemphasize how much skills, instead of chance, improve performance.
What does Law of small numbers mean?
Reach conclusions about a larger population using a limited sample.
What is a lean startup?
Lean startup is a clear set of principles to create and design startups under limited resources and tremendous uncertainty to build their ventures more flexibly and at a lower cost.
What is the lean startup based on?
It is based on the idea that entrepreneurs can make their implicit assumptions about how their venture works explicitly and empirically testing it.
What is the empirical test?
It is to de/validate these assumptions and to get an engaged understanding of the business model of the new ventures, and in doing so, the new ventures are created iteratively in a build–measure–learn loop.
What does lean startup focus on?
1-find a problem worth solving then defines a solution
2-engage early adopters for market validation
3-continually test with smaller, faster iterations
4-build a function, measure customer response and verify/refute the idea
5-evidence-based decisions on when to "pivot" by changing your plan's course
6-maximize the efforts for speed, learning, and focus
A key principle of a startup is to validate the market need before providing a customer-centric product or service to avoid business ideas with weak demand.
How can market validation be done in several ways?
Market validation can be done in several ways, including surveys, cold calling, email responses, word of mouth, or through sample research.
What is used to understand the customers' needs in an engaging manner?
Design thinking is used to understand the customers' needs in an engaging manner.
Why Design Thinking and customer development can be biased?
because they do not remove the risk of bias because the same biases will manifest themselves in the sources of information, the type of information sought, and the interpretation of that information.
Encouraging people to "consider the opposite" of whatever decision they are about to make tends to reduce what?
to reduce biases such as overconfidence, hindsight bias, and anchoring.