COURSE NUMBER: EWMBA 295F-1* (this course is cross-listed with FT MBA)

COURSE TITLE: Customer and Business Development in Hi-Tech Enterprise

UNITS OF CREDIT: 2 Units

INSTRUCTOR: Steve Blank

E-MAIL ADDRESS: sblank@kandsranch.com

CLASS WEB PAGE LOCATION: bSpace

MEETING DAY(S)/TIME: Tuesdays, 6:00 p.m. to 8:00 p.m.

PREREQUISITE(S): EWMBA 295A,
The main requirements for this class are passion, energy and resourcefulness. The course also assumes that students have either; experience in bringing a new product to market, taken a basic Entrepreneurship course, or have written a business plan.

CLASS FORMAT: The course will combine lectures, readings, case materials and regular class involvement by entrepreneurs and business professionals. Well-prepared and intellectually engaged students are essential for the class to succeed.

REQUIRED READINGS: The readings for this course are principally from the course text: Four Steps to the Epiphany, articles, book chapters and cases that will be published in an on-line Reader. They are organized as required readings and cases for class discussion along with suggested supplemental readings that will deepen your understanding of the class.

BASIS FOR FINAL GRADE: Students will be graded on the independent research project (50% of final grade), completion and quality of effort related to the Application Exercises (25% of final grade), and class attendance and participation (25% of final grade).

ABSTRACT OF COURSE'S CONTENT AND OBJECTIVES:
This course is about how to build a “Lean Startup” using the “Customer Development” methodology to successfully organize sales, marketing and business development, with particular emphasis on high technology companies. Its premise is that startups are not smaller versions of large companies. Instead early stage ventures require their own tools and techniques.

For the purpose of this course, a “startup” can either be a new venture, or an existing company entering a new market.  Both must solve a common set of issues: Where is our market? Who are our customers?  How do we build the right team?  How do we scale sales?

The class will cover the four steps of Customer Development; Customer Discovery - understanding customer problems and needs, Customer Validation -developing a sales model that can be replicated, Customer Creation - creating and driving end user demand, and Company Building - transitioning the organization from learning and discovery to a well oiled machine engineered for execution.

The key points of this Customer Development class are:
1. Get out of the building. Very few technology startups fail for lack of technology. They almost always fail for lack of customers. Yet surprisingly few companies take the basic step of attempting to learn about their customers (or potential customers) until it is too late - it's just so easy to focus on product and technology instead. True, there are the rare products that have literally no market risk; they are all about technology risk (i.e. life sciences and a "cure for cancer"). For everyone else you need to get some facts to inform and qualify our hypotheses ("fancy word for guesses") about what kind of product customers will ultimately buy.
2. Theory of market types. Market Types explain why different startups face wildly different challenges and time horizons. There are three fundamental situations that change what your company needs to do: creating a new market, bringing a new product to an existing market, and resegmenting an existing market. If you're entering an existing market, competition comes from the incumbent players. When creating a new market, it may take years before you get traction with early customers.

3. Finding a market for the product as specified. Customer Development tries is to find the minimum feature set required to get early customers.

4. Phases of product & company growth. Customer Development posits that startups go through four stages of growth; Customer Discovery (when you're just trying to figure out if there are any customers who might want your product), Customer Validation (when you make your first revenue by selling your early product), Customer Creation (akin to a traditional startup launch,) and Company Building (where you gear up to Cross the Chasm and realign management.

5. Learning and iterating vs. linear execution. In the early stage of a startup companies are focused on figuring out which way is up. In a traditional startup, they would probably launch their product and company, failing or succeeding spectacularly. Only after a major, public, and expensive failure would they iterate.

6. Premature Execution: An insight of Customer Development is that startups need time spent in a mindset of learning and iterating, before they try to launch. During that time, they can collect facts and change direction in private, without dramatic and public embarrassment for their founders and investors.        

This course will challenge your perception of the traditional sales, marketing and business development roles, leave you with a new way to view and organize these roles, and help you increase the odds of a successful venture.

BIOGRAPHICAL SKETCH:
Steve Blank is a retired serial entrepreneur and private investor. Since 1978 Steve has been a founder of or participant in eight Silicon Valley startups including Zilog and MIPS, two semiconductor startups; Ardent, a supercomputer company; Convergent Technologies a workstation company; SuperMac, an Apple peripheral supplier; Rocket Science, a video game company, and E.piphany; an enterprise software company. These startups resulted in five IPO's, and three very deep craters. Steve's operational roles have spanned CEO to VP of Marketing.

Steve has been lecturing at the Haas School at U.C. Berkeley in the entrepreneurship program since 2002, Columbia Business School since 2005, and Stanford’s Graduate School of Engineering since 2006 and was awarded the Best Teacher of the year in the MS&E department.  He is a Trustee at U.C. Santa Cruz. Currently, Steve serves on the boards of Audubon California and the Peninsula Open Space Trust. He was appointed to the California Coastal Commission by Governor Schwarzenegger in February 2007.