I thought it would be helpful to do a review of 2010 and year-to-date in 2011.
The following is a list of influences on my entrepreneurial and venture investing that caused what I would call a tectonic shift in my thinking:
Co-Founding BoomStartup. I had long admired mentorship-driven investment programs Y-Combinator and especially TechStars. I felt Utah needed it's own version. I was on the verge of founding one in early 2009 but I postponed it for a year due to concerns with the economy (remember March 2009 when optimism was abysmal [see chart]?). In 2010, this effort started in earnest and my co-founders and I had a great year with supportive investors, a boatload of great mentors, and really cool entrepreneurs with strong ideas. What I like almost better than anything about BoomStartup is that I had a front-row seat to an startup sandbox. I thoroughly enjoyed every person and was grateful for the experience. It helped start my revelatory experience. By the way, BoomStartup seeks applications for 2011 - apply here.
The next step in my metamorphosis came from a colleague. I teach entrepreneurship and help lead the Center for Entrepreneurship & Technology at BYU. In mid-2010, Dr. Nathan Furr (far left), a coup recruit for BYU, and a protégé of Stanford's Steve Blank (left), author of The Four Steps to the Epiphany, shared with me what he was working on: (1) teaching business models in the Steve Blank and Alex Osterwalder (author/compiler of Business Model Generation, a landmark how-to book) and (2) writing his own practical guide to The Four Steps called Nail It then Scale It.
Steve Blank's framework for startup entrepreneurship was nothing short of revelatory to me. It explained my entrepreneurial and venture investing career better than any existing model I had come across. It's analogous to how Einstein's Theory of Relativity explained physics for very small and very large masses better than Newtonian laws.
Steve's differentiation of the different type of entrepreneurship, a focus on customer discovery and customer validation much earlier in the startup process versus pure product development, the lean startup process, Sloan vs. Durant education perspectives, etc. ... everything is making more sense.
I quickly spent hours modifying my Fall 2010 classes to completely incorporate this process into my advance entrepreneurship courses at the undergraduate and graduate levels. I took scores of students through a new idea to pitching to investors, and developing the opportunity, the business model, pivoting after hypothesis, nailing the model, and putting together an execution plan, and pitching to investors (see graphic below). The best student traction I have ever seen in my classes (amazing stories of customer validation) have lead to the strongest field of BYU Business Plan Competition semi-finalists we have seen in years.
I had the privilege of playing a key role in the founding of and execution of the first-ever Business Model Competition, an international event hosted by BYU. Instead of me telling you all about it here, check out the website and Steve Blank's blog entry on it. Steve attended as a judge and we had Alex Osterwalder judging via Skype (he was in the Swiss Alps).
This is my paradigm shift. The convergence of many factor from the economy since 2007 to the lowering of the cost of starting a business to the sophistication of entrepreneurs to the use of technology to commoditize processes, the last year has made me a better entrepreneur, a better venture investor, and a much better mentor to those who come to me for help. It has been my privilege to meet and work with those who are leading the charge in education and in the field.