Schroeder - Fail fast or win big: the start-up plan for starting now

FAIL FAST OR WIN BIG

THE START-UP PLAN FOR STARTING NOW

Bernhard Schroeder

Bulk discounts available. For details visit:

www.amacombooks.org/go/specialsales

Or contact special sales:

Phone: 800-250-5308

Email: specialsls@amanet.org

View all the AMACOM titles at: www.amacombooks.org

American Management Association: www.amanet.org

This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought.

The LeanModel Framework is a registered trademark of the author.

Library of Congress Cataloging-in-Publication Data

Schroeder, Bernhard.

Fail fast or win big : the start-up plan for starting now / Bernhard Schroeder. First Edition.

pages cm

Includes bibliographical references and index.

ISBN 978-0-8144-3478-9 (hardcover) ISBN 0-8144-3478-9 (hardcover) ISBN 978-0-8144-3479-6 (ebook) ISBN 0-8144-3479-7 (ebook) 1. New business enterprisesPlanning. 2. New products. I. Title.

HD62.5.S3547 2015

658.1'1--dc23

2014027516

2015 Bernhard Schroeder.

All rights reserved.

Printed in the United States of America.

This publication may not be reproduced, stored in a retrieval system, or transmitted in whole or in part, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of AMACOM, a division of American Management Association, 1601 Broadway, New York, NY 10019.

The scanning, uploading, or distribution of this book via the Internet or any other means without the express permission of the publisher is illegal and punishable by law. Please purchase only authorized electronic editions of this work and do not participate in or encourage piracy of copyrighted materials, electronically or otherwise. Your support of the authors rights is appreciated.

About AMA

American Management Association (www.amanet.org) is a world leader in talent development, advancing the skills of individuals to drive business success. Our mission is to support the goals of individuals and organizations through a complete range of products and services, including classroom and virtual seminars, webcasts, webinars, podcasts, conferences, corporate and government solutions, business books, and research. AMAs approach to improving performance combines experiential learninglearning through doingwith opportunities for ongoing professional growth at every step of ones career journey.

Printing number

10 9 8 7 6 5 4 3 2 1

For my children Nigel, Britney, and
Haley, and for entrepreneurs everywhere do or do not. Be happy.

Fail Fast or Win Big is not about failing. Its about embracing a new way of thinking about creating and launching a company. In the start-up world today, you cant spend months writing a complex business plan that will be out of date before your idea ever comes to market. There is no time to create the perfect company on paper before testing it in the real world. And you dont have to, eithernot with new sources of capital, such as crowdfunding, waiting to be exploited.

You still need to acquire a deep understanding of the marketplace and your customers so that you are more knowledgeable than your potential competitors, but you also have to beat them to the punch. You are much better off launching a minimally viable product or service, one that satisfies your core customers needs, and adjusting it on the fly after you see whats attractive about it and what isnt. Fortunately, the tools are available now to let you get started in 90 days, if not less; after all, your time is the most important investment you make. If your product or service doesnt work out, youve saved yourself plenty to win big with the next idea.

The LeanModel Framework will help you move as fast as you need to go. Its the culmination of my work with some of the most talented people in the world during the past 20 years. Some of those people were fellow professionals in our integrated marketing agency, CKS|Partners, which grew very fast, accelerated through an initial public offering (IPO), and then was sold two years later for more than $300 million. Other people I met through corporate entrepreneurship where, working together, we spun out divisions and/or new products and services very rapidly. The last group I was in consisted of entrepreneurs launching start-ups, mostly on the West Coast.

While everyone seems to recognize the end result when companies become successful, almost no one remembers the lean days that usually preceded that success. Thats when these companies were started in homes, garages, warehouses, and on college campuses. Looking back now, I see that almost all these successful companies embraced a LeanModel Framework: building a solid business model, utilizing lean resources, rapidly prototyping a minimally viable product, and then seeking customer feedback. With that feedback, they then pivoted, evolved, or abandoned the idea.

The philosophy behind the LeanModel Framework is one I adopted early in my own career and that I now espouse as the Director of Programs at the Lavin Entrepreneurship Center, San Diego State University, and as a lecturer for several entrepreneurship courses. Early marketing work in my career with Fortune 500 companies convinced me of two things: (1) Large companies move too slow; and (2) I could not work with slow companies. Instead I looked for opportunities with companies that had a desire to move fast, as they were taking advantage of new market opportunities. I moved away from the General Motors accounts and I embraced the Kelloggs and Nikon assignments that were rapidly prototyping marketing strategies to introduce new products or services, and they were grabbing market share quickly.

When I did work with some automotive companies, I welcomed the chance to help craft new marketing or customer solutions, for smaller, nimbler companies at the time like Hyundai, Mitsubishi, and Mazda. Later, in Silicon Valley, the challenge was to sharpen the education-marketing focus at Apple and define the online marketing strategy for a growing company called Nike. Or, it was taking a small regional craft beer named Widmer and rolling them out nationwide in bottles for the first time ever.

In choosing to work with nimbler, faster-moving companies, I realized it was not about me or my ego. I thrived on the notion of seeing a market opportunity and of moving fast to win big. And I loved working with people who were not afraid to take measured risks in an attempt to win big.

I have worked with some great companies, both large and small. Do you know what made them great, beyond inspirational leadership and usually an amazing culture? It was a powerful sense that they had a meaningful purpose and a destiny, but that in order to fulfill that destiny, they had to move fast. They recognized that moving too slowly would cost themin terms of either market share or long-term survival. In other words, their core belief was that if they did not move fast, they would ultimately fail.