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Customer Development

Serial entrepreneur and renowned tutor of entrepreneurship (at Stanford, Columbia, and UC Berkeley) Steve Blank has developed one of the core themes in his classes – what he calls the 'customer development model' – into a book: The Startup Owner's Manual. Customer development is a parallel process to product development that involves a focus on customers and markets from the very beginning, and utilises customer driven milestones and measures in ways that share a lot of common ground with agile and lean. There's some useful processes, and useful lessons about understanding which customers to listen to (since the goal is not to make every possible customer happy). I've embedded a 2009 presentation he gave with Eric Ries that explains the concept below, and here's the many posts he's written on the subject which are rich with good thinking.

Anyway, I liked these Customer Development principles that he has just enumerated:

A Startup Is a Temporary Organization Designed to Search
for A
 Repeatable and Scalable Business Model

  1. There Are No Facts Inside Your Building, So Get Outside
  2. Pair Customer Development with Agile Development
  3. Failure is an Integral Part of the Search for the Business Model
  4. If You’re Afraid to Fail You’re Destined to Do So
  5. Iterations and Pivots are Driven by Insight
  6. Validate Your Hypotheses with Experiments
  7. Success Begins with Buy-In from Investors and Co-Founders
  8. No Business Plan Survives First Contact with Customers
  9. Not All Startups Are Alike
  10. Startup Metrics are Different from Existing Companies
  11. Agree on Market Type – It Changes Everything
  12. Fast, Fearless Decision-Making, Cycle Time, Speed and Tempo
  13. If it’s not About Passion, You’re Dead the Day You Opened your Doors
  14. Startup Titles and Functions Are Very Different from a Company’s
  15. Preserve Cash While Searching. After It’s Found, Spend
  16. Communicate and Share Learning
  17. Startups Demand Comfort with Chaos and Uncertainty

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