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20VC: Steve Blank on Why The Startup Ecosystem is Partially A Ponzi Scheme, 3 Things That Determine Startup Survival in a COVID World & Facebook: Platform vs Publisher and Where Does Their Responsibility Lie?

Jul 20, 2020

Steve Blank, a pivotal figure in Silicon Valley and creator of the Lean Startup movement, dives deep into the dynamics of the startup ecosystem. He provocatively critiques the notion that it's ethically sound, likening it to a Ponzi scheme driven by profit motives. Blank discusses the failures of Adam Smith's 'Invisible Hand' in today’s economy and stresses the need for accountability among investors and founders. He also shares insights on navigating the new normal post-COVID and highlights the ethical responsibilities of startups in the digital age.

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INSIGHT

Mass Extinction Event

The current economic crisis is a self-inflicted mass extinction event, impacting some sectors more severely than others.
This creates new opportunities for startups and existing companies to adapt to the "new normal."

ADVICE

Disconnect and Opportunity

Acknowledge the disconnect between daily economic struggles and resilient markets.
Consider market opportunities arising from the crisis, not just tech opportunities.

INSIGHT

New Market Opportunities

Remote work will reshape commercial real estate and create opportunities in remote tools and education technologies.
Telemedicine and sales processes will also undergo lasting transformations.

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Steve Blank is one of the leading luminaries of Silicon Valley, credited with being foundational to the creation of The Lean Startup movement and having spent the last 9 years at Stanford University as a professor and the last 8 as a Senior Fellow @ Columbia University. Steve is the author of "The Four Steps To The Epiphany" and "The Startup Owner's Manual". Prior to joining the world of academics and writing Steve spent over 20 years in the world of entrepreneurship as part of, or co-founded eight Silicon Valley startups ranging from semiconductors, video games, personal computers, and supercomputers. If that was not enough, Steve is also on the Defense Business Board for the United States Department of Defence.

In Today's Episode You Will Learn:

1.) How Steve made his way into the world of startups and Silicon Valley and how that led to his creation of "The Lean Startup Movement"?

2.) Why does Steve vehemently disagree with Adam's Smith's "Invisible Hand" theory when it comes to government intervention? Why is this proven to have failed? How does this only help the rich become richer? As a result, what needs to change in the mechanics of the economy?

3.) Why does Steve not believe that there is accountability placed on investors and founders for projects they create and invest in? Why does Steve believe for the majority of investors today, they have no social conscience? How could this be changed and improved?

4.) How did seeing the booms and busts of the dot com and 2008 impact Steve's operating mentality? What are the 3 core traits that will ensure success for founders in a post COVID world? How should founders change their decision-making process post-COVID? Why does Steve believe in "benign dictatorship"?

Items Mentioned In Today's Show:

Steve's Fave Book: Innovator's Dilemma: When New Technologies Cause Great Firms to Fail

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