The Learn Startup: How to Get Into Startups Without Losing Your Shirt

Startup cautionary tales

The world of startups is littered with cautionary tales: like this one and this one. There was even a false statistic that said “9 out of 10 startups fail”. To many, this makes the activation energy required to start a startup way too high. Startups are relegated in the minds of many, to the domain of hardcore risk takers - something that most people are not capable of doing.

Waste

There are two things we want to change here - first we want to reduce the likelihood of startup failure and the second we want to encourage more startups. Startup failures are a part of life, but if a startup fails due to wasteful reasons it’s is an inefficient use of resources. Encouraging more people to join startups is also a reduction in waste. Headlines talk about chronic high unemployment and a sputtering economy. Economist Tyler Cowen wrote The Great Stagnation about how America has used up all the easy engines of growth - land, labor and technology - and now we’re headed for stagnation. The solution he posits is to develop a respect for new innovation. We need to inculcate a new culture of startups that doesn’t rely on the luck of passionate gamblers to win the future.

Marathon runners

No one decides on a whim to run the NYC Marathon. My friend Marco is a competitive marathon runner. Just a few years ago he was an out of shape, couch-sitting smoker, now he’s running 100 mile races. He didn’t jump from the couch to being able to run for over 24 hours straight after one day. It took training. It took really hard training. He had to control his diet, he had to quit smoking, he had get gear. He started off with running just one mile. He had to learn how to run.

And yet we expect new founders to jump right into the deep end and sink or swim. No wonder we have these cautionary tales. Why are repeat founders such a better bet than new ones? They’ve learned.

Enter the Learn Startup

Instead of trying to hit a home run on our first at bat, let’s hit the batting cages - this is the basic premise of the Learn Startup (credit @johndunham , @philcockfield for the inspiration). The idea is to use the techniques from The Lean Startup movement in a lower risk, lower uncertainty environment, to increase our chance of success.

Lower the uncertainty

Our blueprint for the Learn Startup is not-coincidentally the Lean Startup. But where the Learn startup differs from the Lean Startup is in the factor of uncertainty. Eric Ries defines the startup as “a human institution designed to deliver a new product or service under conditions of extreme uncertainty.” The idea behind the Learn startup is to start learning about delivering a product under conditions of some uncertainty.

Instead of taking your shoot-the-moon idea and going out trying to raise money and recruit people, start with a well-understood market and attack a niche. It’s not glamorous it’s not sexy but it’s an opportunity to start learning.

Other huge area of uncertainty is your choice of co-founder. Wouldn’t it be better to find out that your co-founder is not the right fit for you in your Learn Startup rather than your Lean Startup?

There are so many uncertain factors in starting a startup, the more we can mitigate some factors, the more we can focus on learning about the business.

Lower the risk

Technology has helped a lot with lowering the cost factor of startups but The Lean Startup gives us a methodology to lower the risk and increase learning at the same time. It’s called Minimum Viable Product (MVP). MVP allows us to rapidly test ideas and markets. Couple this with a well-understood market and we can significantly lower the risk of starting a new venture.

Pivoting or Persevering is a core concept in The Lean Startup. The idea is that at a certain point you must check your metrics to see if you should persevere with your strategy or pivot your idea using the learning you have achieved. The Learn Startup adds one more “P” to the mix: Perish. After a set time period, agreed to up front with your co-founders, you must make a Pivot, Persevere or Perish decision. Because the Learn Startup is not your Lean Startup, you have to decide whether to continue learning, change your idea based on your learning or stop and go to your “big” idea.

Go into it with an understanding by all that your founders may not continue to the next idea - it’s founder dating, not founder marriage yet. Go into it with the understanding that some of your founders or you yourself may want to pursue your Learn Startup as a bona-fide business. Make sure that everyone starts this venture with these ground level understandings.

My assertion is that you can do all this while still keeping your day job. Your risk profile is lower while you are learning. But once you’ve learned the ropes, you can be much more confident because you’ve lowered the risk by learning.

Learn Startup

As Wayne Gretsky famously said, “You miss 100% of the shots you don’t take.” The problem with startups is not a bubble in angel funding, or too many consumer facing startups or even YASN (yet another startup network). The problem with startups is that the way they are perceived now, as a play area for passionate gamblers, is that it’s just not scalable. Even with the latest flowering of entrepreneurship, our country needs even more people to get involved. Startups need to be democratized but in order to do that, we need to develop a culture where starting up is not just for the crazy ones and the misfits.

The Learn Startup could be the first step in reshaping the narrative of startups. In the future, we could see starting up just as natural as getting your MBA, JD or MS degree. Each of these degrees are designed to afford you an education, but none of these can hold a candle to how much education you get from entrepreneurship.