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The Lean LaunchPad for BiotechSteve Blank@sgblank
www.steveblank.com
21 Years Executing the Plan
Actual Photo of What Happened When My Plan Had
First Contact With Customers
Is this all there is?
?
It Resulted in a Few Hypotheses
Startups Are Not Smaller Versions of Large Companies
Startups Are Not Smaller Versions of Large Companies
Large Companies Execute Known Business Models
Startups Are Not Smaller Versions of Large Companies
Startups Search for Unknown Business Models
What’s A Startup?
A temporary organization designed to search
for a repeatable and scalable business model
A temporary organization designed to search
for a repeatable and scalable business model
A temporary organization designed to search
for a repeatable and scalable business model
A temporary organization designed to search
for a repeatable and scalable business model
Startups Fail Because They Confuse Search with Execute
Startups need their own tools, different from those used
in existing companies
Startups need their own tools, different from those used
in existing companies
And a Question
Can We Build a Process to Search?
Before we Execute
1. Startups are a series of untested hypotheses2. You can test these hypotheses with the same
scientific method you use in the lab, but…3. There are no facts inside your building, so get the
hell outside
3 Big Ideas
Customer Development Process
This was Formalized in a
+
+ +
So I Wrote A “Book”
And Then A Class
MBA 295: Customer Development
Eric Ries Extends the Model
• Took my class at U.C. Berkeley • Co-founded IMVU, I sat on his board
– 1st implementation of Customer Development– Paired it with an Agile Development Model
• Called it the Lean Startup
Which Turned Into A Better Model
+Agile Development
Alex Osterwalder - Business Model
• Business Model Generation• Defines what the “search” is about
Which Turned Into an Even Better Model
+
+
We now know how to make startups fail less
We now know how to make startups fail less
Lean Startup
And that Turned into Another Book
Lean Startup = 3 parts
Business Model Canvas
Part 1
Lean Startup
Part 1
Part 2
Customer Development
+
Lean Startup
Part 1
Agile Engineering
+
+
Part 2
Agile Engineering
Part 3
And Then Into Another Class
Engr 245: The Lean LaunchPad
Lean Startup
Business Model Canvas
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Mentors
Then It Turned Into Another Class
A Scientific Method For Entrepreneurship
LaunchPad Central Software
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
LaunchPad Central Software
DataDataData
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Weekly Progress
LaunchPad Central Software
DataDataData
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Weekly Progress Experiment Scorecard
+
LaunchPad Central Software
DataDataData
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Evidence-based Curriculum (NSF I-Corps/Lean LaunchPad)
Hypotheses Experiments Data
Weekly Progress Experiment Scorecard
Data, Experiments, Trajectory, IRL
+ =
Cohort Leaderboard
Customer Interviews
Hypotheses to Test
Weekly Canvas Updates
Trained the Trainers
Added two More Schools
Taught by Takashi Tsutsumi @ Hosei
Co-taught with Murray Low @ Columbia Bob Dorf Co-taught with: Jon Feiber @ MDV
Taught by Jim Hornthal
And Four More SchoolsAdd 5-day version of the class
5-day Version
59
Put the class online150,000 students
Train 9 More Universities
Lean LaunchPad Educators Class
• Train educators each quarter
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
Lean Startup
Business Model Canvas
Customer Development Agile Engineering+ +
64
QuestionWill this Work for Biotech?
Lean LaunchPad for Life Sciences
• Therapeutics• Diagnostics• Devices• Digital Health
66
Insight Commercialization in the 21st Century
National Science Foundation Commercialization Problem Prior to I-Corps
• Disparate centers– All thought their culture was different
– All had their own commercialization program
– No best practices
– No common training/education
– No common platform
– All had technology-centric focus
• No centralized leadership
68
Insight Technology Evidence but no Commercialization Evidence
69
Current Thinking about Translational Medicine
Research Performing InstitutionsTechnology
(diagnostic, device, therapeutic)
Solicit &Select
Develop Technology
Obtain AdditionalCapital
Research InstitutionsTechnology
(diagnostic, device, therapeutic)
Solicit & Select
Existing Company
New Company
Technology Development Process
RegulatoryIntellectual
Property
BusinessDevelopment
Project Management
Medical, Scientific, and Business Review
Licensing and Exit
Accepted
independent financing
Product Development
Additional Capital
Current Thinking about Translational Medicine
Mentors
71
InsightAdd a Formal Path for
Commercialization Evidence
physical space & equipment
seed $’s
MentorshipWorkshops/Webinars
Technology ProgressClinical Trials, etc.
CommercializationProgress
Accelerating Commercialization: – Requires Parallel Paths
Answers to Hypotheses are Outside The Lab
• You may be the smartest person in your lab• But you are not smarter than the collective
intelligence of your potential customers, partners, payers and regulators
• You can’t learn this by reading papers or listening to lectures
Need a process for hypotheses testing
74
InsightCommercialization Evidence
Require Outward Focus
Research InstitutionsTechnology
(diagnostic, device, therapeutic)
Solicit & Select
Add Evidence-based Commercialization
Medical, Scientific, and Business Review
Accepted
Additional Capital
Inward-facing
Research InstitutionsTechnology
(diagnostic, device, therapeutic)
Solicit & Select
Add Evidence-based Commercialization
Medical, Scientific, and Business Review
Accepted
Additional Capital
Reimburse-men
Partners
Customers (users, payers, etc.)
Commercialization Development
Process
Value Propositio
n
Distribution Channels
Add a parallel Commercialization
Process
Inward-facing Outward-facing
Research Performing InstitutionsTechnology
(diagnostic, device, therapeutic)
Solicit & Select
Add Evidence-based Commercialization
Medical, Scientific, and Business Review
Accepted
Additional Capital Customers
Value Proposition
Channels
PartnersReimburse-
ment
Intellectual Property
Commercialization
Magnamosis
• Create a magnetic compression anastomosis with improved outcomes
• Team:– Michael Harrison, MD, Pediatric Surgeon– Elisabeth Leeflang, MD, General Surgery Resident– Michael Danty, MS, Business Development– Dillon Kwiat, BS, Medical Device Engineer
79
80
InsightWe Know How To Build
these Programs
The Tactics
• Organize P.I.’s into Commercialization Teams
• Offer a 10-week training program
• Get them out of the building
Framework = Business Model Canvas
Customers
Revenue
Partners
Activities
Resources
Costs
Channel
Get/Keep/Grow
Product /Service
Experiential
• Getting out of the building – 10-15 hours/weekly
• Formal methodology for customer interaction
• Focus on MVP and Pivots
Teams Present Results Weekly
Update Business Model Canvas Weekly
Use Canvas As a Weekly Scorecard
Week 2
Week 1
Week 3
87
Insight100% Visibility on Progress
LaunchPad Central
InsightPredication of Team Trajectory
88
• 17 out of 233 teams were identified as high performer teams from 10 NSF I-Corps 2012-13 cohorts
Evidence-Based Entrepreneurship
Signal: Customer Interviews
High Performers:• Interview ~ 2X more customers on average• Peak customer interviews during week 4
Average Customer Interviews Per Week
Week Week
Inte
rvie
ws
Increased Focus On Testing Customer Segment Hypotheses
High Performance Teams demonstrate significant cadence by mid-point (week 4)
• The highest number of hypotheses invalidation occurs in week 4
• The highest number of customer interviews occur in week 4
• High performance teams maintain a relentless pace of customer interviews reaching 50% of 100 interviews goal by week 4
Average Customer Interviews by WeekWeeks
Inte
rvie
ws
Average Mentor Interactions
Enga
gem
ents
Weeks
Mentor Engagement
Top Performers:• Engage with mentors often compared to average teams
Average Faculty Interactions
Enga
gem
ents
Weeks
Instructor Engagement
Top Performers:• Engage with instructors early and often compared to average teams
95
InsightsNational Science Foundation
Innovation Corps
I-Corps – Insights
• It’s not just about the science– Technology and commercialization progress require
separate processes– PI’s can’t figure out commercialization sitting in their labs– Technology mentorship is part of the process but it’s
insufficient– You can’t outsource commercialization to a proxy
(consultants, market researchers, etc.)
Outward-Facing Commercialization & Translational Medicine
• Getting out of the building is a big idea
• It accelerates speed of translation
• It makes our national research enormously more efficient
NSF Commercialization SolutionI-Corps
• One commercialization program– Common Platform– Centralized Leadership
• Best practices– Disruptive idea – Lean/Evidence-based– Common training/education– Consistent evaluation criteria
• Nodes not centers– Linkages between nodes
NSF I-Corps Results
• Early evidence of success in SBIR Phase I funding
– 18% of teams who did not take the class
– 60% of teams who did take the class
NSF Program Outcomes
• Scientists & Engineers trained as Entrepreneurs
– pass on their knowledge to students
• Network of Mentors/Advisors
• Increased impact of NSF-funded basic research
Evidence-Based Entrepreneurship
• What we now know
– Commercialization must be a parallel track
– Effort must be experiential (No Proxies)
– New metrics allow for rational discussion
– IT Platform provides tracking capacity:
Continuous improvement
Not About Picking the Winners
• Enable lots of low cost experiments
• Kill the Losers
• Double down on the ones that show progress
103
InsightWill it Work for SynBio?
Early Stage Therapeutic Myths
The Idea is KeyBetter ideas create value
Funding GapEarly Stage
Investment as a market failure
Data Quality Findings in preclinical
research are often not reproducible
Early Stage Therapeutic Myths
The Idea is KeyBetter ideas create value
Funding GapEarly Stage
Investment as a market failure
Data Quality Findings in preclinical
research are often not reproducible
The real gap is the expertise to move early stage research toward industrial relevance
Early Stage Therapeutic Myths
Data Quality Findings in preclinical
research are often not reproducible
Data addressing keydevelopment criteria
Early Stage Therapeutic Myths
Data Quality Findings in preclinical
research are often not reproducible
Data addressing keydevelopment criteria
The Idea is KeyBetter ideas create value
Clear path to modifying a disease
Early Stage Therapeutic Myths
Data Quality Findings in preclinical
research are often not reproducible
Data addressing keydevelopment criteria
The Idea is KeyBetter ideas create value
Clear path to modifying a disease
Funding GapEarly Stage
Investment as a market failure
Operational plan justifying investment
109
SummaryWill it Work for SynBio?
110
SummaryWill it Work for SynBio?
Yes
“God is not on the side of the big arsenals, but on the side of those who shoot best.”
Voltaire
112
Thanks
More info at www.steveblank.com
The Lean LaunchPad for BiotechSteve Blank
@sgblank
www.steveblank.com