Steve Blank is an unlikely celebrity at SXSW Interactive.
The 57-year-old Blank is, as he often points out, four times the age of some of the attendees he’s presenting to here. He hasn’t built a trendy social network or app. And he talks very inside baseball about the business of start-ups.
Yet his panel had longer lines than some of the parties, and he was mobbed everywhere he went.
This is all because of his magic advice for building a business. Blank advocates for the lean start-up – keeping a company on its toes using slimmed down, streamlined and above all agile manufacturing methods.
Instead of perfecting your product, Blank would argue, put it out as soon as it’s viable. Then you can learn what your customers like and don’t, and build on that.
While you’re building, Blank’s line of thought goes, get out of the building. Go ask people what they want, rather than spending time, energy and money building that which potentially no one wants.
Blank’s philosophy essentially eliminates any work or investment that doesn’t produce value for customers. It’s all his book, The Four Steps To The Epiphany, which is considered a bible here.
These ideas have caught on fire with internet entrepreneurs.
His appeal was interesting. Blank moves from straight-talk about start-ups, probably frightening to most people here, to flattering entrepreneurs in the next sentence.
“Let me just point out that every one of you in this room is certifiably insane,” he said at his panel, which had a least a hundred people lined up outside.
“In this room are a couple people who will make $100-million in their life. There are couple of you who will make $10-million. The rest of you will make less money than working at McDonald’s. And every one of you is feeling sorry for the other people in the room. That’s my definition for an entrepreneur.”
Then he called them artists.
Mostly he talked about agile development, a tenet of the lean start-up which he called the adopted methodology for start-ups.
“We can build start-ups on a credit cards. It doesn’t take millions of dollars anymore,” he said.
But as per his ebb and flow of flowery compliments to harsh realities, he said this: that start-ups were not good at making money anyway. They are good for searching for ways to make money, and finding them. But once an entrepreneur found a way to make a buck, he or she takes off.
He said it was failure to execute. Entrepreneurs cannot execute, because that often involves mindless repetition. Walmart has a business model, he said, and a team of executives that practice it, do the same thing every day to keep a company profitable.
People who build start-ups, like Blank, who has started eight companies himself, will just leave if it gets boring.
So start-ups can be lean, agile and practice the tao of Blank, but to a fault. Luckily for his SXSWi audience, though, there is still a large job market for people who can find business models.
Listen to his presentation at SXSW here.