The Startup Owners Manual – Bob Dorf, Steve Blank | Free Book Summary

The Startup Owners Manual – Bob Dorf, Steve Blank

The organization can be confusing. The reader is guided step-by-step through the startup’s necessary tasks in this book.

Customer verification

Customer validation entails testing sales at every stage of the process. 

The customer validation process is divided into four phases:

• Phase I: Prepare to sell.
• Phase II: Go live and attempt to sell.
• Phase III: Refine your product and position your company.
• Phase IV: Analyze, pivot, or continue.

Founders cannot lead from afar; they must be actively involved in the process.

Phase I — Prepare to sell

This phase begins with developing a positioning statement: a message (short but compelling) explaining why people should buy your product.

Customer-focused sales and marketing materials should be largely based on the information derived from the hypothesis developed for the customer discovery process.

A Sales roadmap

The next step is to create a sales roadmap that covers everything from the first sales call to contract signing. Remember what you’ve learned about the customer and go over some of the materials you created during the customer discovery stage. Create a buyer’s journey model and identify key influencers.

Map of customer access

A Customer Access Map can assist you in identifying organizations to which customers belong (if you are selling to the general public) or key decision makers within the organization (if you are selling to a business). 

Put all of the maps together, think about the sales strategy, and create an Implementation Plan that outlines everything that needs to happen before selling your product.

Minimum Viable Product (MVP)

Using the information gathered to create previous versions, you will create a high-fidelity MVP with more features than the previous one.  

Make sure to collect as much information as possible about customer reactions to the new MVP. Collect data, analyze, and optimize—this is how it goes from the moment a web/mobile business opens its virtual doors until it dies.

Phase II — Get out of the building and sell

In this phase, you are validating your business model hypothesis, but you are still testing (by making real sales). Don’t try to scale up just yet—the purpose of your sale is to validate your business model.

You only need a few customers to sell physical products. Remember the early vangelists and adopters? These are your natural customers. But keep in mind that what motivates them is unlikely to motivate the average Joe.

Testing Phase: Optimisation

Optimisation is all about getting more out of everything—for example, if your activation rate is 6%, try to increase it to 10%. Strive for measurable improvement in everything you track. 

Optimisation should be focused on increasing volume, decreasing cost per activated customer, and increasing visitor to user conversion.

Tips on optimization testing

• Understand what you’re testing and why.
• Avoid over-testing.
• Controlled tests must adhere to accepted protocols.
• Consider the customer’s lifetime value rather than just this one transaction.

Phase III — Positioning phase

Return to the positioning statement you created during the customer validation phase at this point. How did it make it through the validation process? Do you know why the customers didn’t like it if they didn’t? Additionally, schedule meetings with the key decision-makers you noted during the customer discovery phase. 

Check to see if these opinion leaders and other business analysts will have favorable things to say about you.

Phase IV — Pivot and/or proceed

Make sure there are sound responses to the hypotheses by going over and analyzing all the material you’ve produced.  

Depending on the type of market, revenue growth curves differ: growth in a new market company will appear as a hockey stick on a graph, starting out slowly before accelerating; growth in an existing market shows a steady rate of growth.