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It's also the Steve Blank definition. https://steveblank.com/2010/01/25/whats-a-startup-first-principles/ https://steveblank.com/2010/01/25/whats-a-startup-fir

It's also the Steve Blank definition. https://steveblank.com/2010/01/25/whats-a-startup-first-principles/ https://steveblank.com/2010/01/25/whats-a-startup-first-prin...

wpietri 9y ago
That is definitely not Steve Blank's definition. His is: "an organization formed to search for a repeatable and scalable business model." You can have a rapidly growing company with an old business model. Look at McDonald's, for example. The business model, selling hamburgers, wasn't particularly different. But they took great advantage of the rise of car culture and TV advertising. Or look at the Android phone market. Selling phones is a pretty well understood business model, but companies there have grown rapidly by continual incremental improvement.
- paulsutter 9y ago
  Repeatable and scalable sound like ingredients for fast growth. To demonstrate that Steve Blanks definition is materially different from Paul Graham's, perhaps you could name a few successful startups which found a scalable/repeatable business model, but that were not designed to grow fast?
  - wpietri 9y ago
    Seriously? I already demonstrated that it was materially different by showing that some-fast growing companies were not formed to search for business models. All successful startups grow fast, because that's how we define business success. Not all fast-growing companies are startups, though.
    - paulsutter 9y ago
      Ok great, Steve Blank excludes companies that already have a scalable repeatable model? Somehow I doubt that's his intention EDIT: Most ecommerce startups would fall into your "proven business model" category, and yet they, like McDonalds before them, do extensive experimentation to find the path to rapid growth. Which is why Steve Blank underscores that the search is never finished.
      - wpietri 9y ago
        Not quite. His definition is about what the organization was formed to do. If a company was formed to search for a scalable, repeatable business model, then he's still interested in it when they have found it. Then they're in the growth stage. But if a company was formed, as most companies are, intending to use a proven business model, then it's not in his definition of a startup. No matter how fast it grows.
        throwawayknecht 9y ago
        > But if a company was formed, as most companies are, intending to use a proven business model, then it's not in his definition of a startup. This would seem to exclude virtually all delivery service, cleaning service, car service, etc. companies, which are usually considered the prototypical SV startups.
        wpietri 9y ago
        It depends on how they're doing it. Uber and Lyft, for example, are definitely startups under Blank's definition, because they were searching for a new model. Postmates too was new; I don't believe there was a successful delivery company that worked like they do. If you were to start a Postmates competitor today, though, and were just doing what they did, then it wouldn't be a startup. At $250m ARR, their business model is already proven.
- SkyMarshal 9y ago
  >That is definitely not Steve Blank's definition. His is: "an organization formed to search for a repeatable and scalable business model." That's what "a company designed to grow fast" is. >You can have a rapidly growing company with an old business model. Look at McDonald's" McDonalds was a startup under this definition. If Ray's original plan was to take an old business model, redesign it for cars, and scale it rapidly with TV advertising, that's a startup by Steve and Paul's definition.
  - wpietri 9y ago
    > That's what "a company designed to grow fast" is. No. Most startups are designed to grow fast. But many non-startups are designed to grow fast. There is overlap in the Venn diagram, but they are not the same thing. > If Ray's original plan If that was Kroc's plan, you'd be right. Do you have some evidence it was? As far as I can tell, he spotted an existing restaurant that had already found product-market fit and just scaled the operation using variants on known franchising approaches. I also haven't seen any evidence that at the time he foresaw suburbanization, white flight, and the resulting increase in value of heavy branding, trends that were nascent at the time he joined McDonalds. I'd say it was more akin to the top-growing restaurants of today, ones I point out elsewhere in this discussion. They are fast growers, but they are scaling mild variations on well-known business models.
    - slededit 9y ago
      His insight was that the model was repeatable and scalable. The assembly line kitchen they developed not only made making burgers fast but also made them incredibly consistent. Because of this he could franchise the restaurants and be assured that quality would be consistent among them despite being operated by different people. He never intended to open large numbers of his own restaurants - just enough for experimentation purposes. To this day this is a major selling point. When travelling you can take your chances on a local place or go with what you know.
      - wpietri 9y ago
        Sure. I think we're saying the same thing: The McDonald brothers had found product-market fit. Kroc scaled it. Ergo, Kroc's approach was not what Blank calls a startup.
jacquesm 9y ago
Do you honestly believe nobody used the term 'start-up' before Steve Blank or Paul Graham used it? https://www.merriam-webster.com/dictionary/start-up https://www.merriam-webster.com/dictionary/start-up "A Fledgling Business Enterprise" That's exactly what it means, no more, no less. Keep in mind that outside of the HN crowd absolutely nobody would know who either Steve Blank of Paul Graham are and neither of them get to redefine the English language.
- paulsutter 9y ago
  Nobody suggested they originated the term. Paul Graham's definition for "startup" is exactly right for Silicon Valley, and the Merriam Webster definition is incorrect, for Silicon Valley. It's true that lots of people use the word startup to mean fledgling business, and that's perfectly OK and cool, but if you use the term "startup", in Silicon Valley, to refer to a lifestyle business, people will view it as self-aggrandizement or delusion. This is also true in any venture capital context anywhere in the world.
- SkyMarshal 9y ago
  >Do you honestly believe nobody used the term 'start-up' before Steve Blank or Paul Graham used it? Did I say that somewhere or are you just straw manning me? My post and paulsutter's are clearly referring to the Silicon Valley idea of a startup, not the general idea. The difference is one of intent, so it is useful to distinguish between the two. Someone who opens a diner or a watch repair shop or a Kinko's franchise with the intent of servicing their locale is certainly doing "a fledgling business enterprise" and thus may technically be doing a startup. But SV is specifically interested in greenfield endeavors that can leverage the web or other new tech to find a large customer base and rapidly scale to billion dollar+ valuations. Given your long history on HN I know you know this so why are we bickering over semantics?

It's also the Steve Blank definition. https://steveblank.com/2010/01/25/whats-a-startup-first-principles/ https://steveblank.com/2010/01/25/whats-a-startup-first-prin...

wpietri 9y ago

That is definitely not Steve Blank's definition. His is: "an organization formed to search for a repeatable and scalable business model." You can have a rapidly growing company with an old business model. Look at McDonald's, for example. The business model, selling hamburgers, wasn't particularly different. But they took great advantage of the rise of car culture and TV advertising. Or look at the Android phone market. Selling phones is a pretty well understood business model, but companies there have grown rapidly by continual incremental improvement.

paulsutter 9y ago
Repeatable and scalable sound like ingredients for fast growth. To demonstrate that Steve Blanks definition is materially different from Paul Graham's, perhaps you could name a few successful startups which found a scalable/repeatable business model, but that were not designed to grow fast?
- wpietri 9y ago
  Seriously? I already demonstrated that it was materially different by showing that some-fast growing companies were not formed to search for business models. All successful startups grow fast, because that's how we define business success. Not all fast-growing companies are startups, though.
  - paulsutter 9y ago
    Ok great, Steve Blank excludes companies that already have a scalable repeatable model? Somehow I doubt that's his intention EDIT: Most ecommerce startups would fall into your "proven business model" category, and yet they, like McDonalds before them, do extensive experimentation to find the path to rapid growth. Which is why Steve Blank underscores that the search is never finished.
    - wpietri 9y ago
      Not quite. His definition is about what the organization was formed to do. If a company was formed to search for a scalable, repeatable business model, then he's still interested in it when they have found it. Then they're in the growth stage. But if a company was formed, as most companies are, intending to use a proven business model, then it's not in his definition of a startup. No matter how fast it grows.
      - throwawayknecht 9y ago
        > But if a company was formed, as most companies are, intending to use a proven business model, then it's not in his definition of a startup. This would seem to exclude virtually all delivery service, cleaning service, car service, etc. companies, which are usually considered the prototypical SV startups.
        wpietri 9y ago
        It depends on how they're doing it. Uber and Lyft, for example, are definitely startups under Blank's definition, because they were searching for a new model. Postmates too was new; I don't believe there was a successful delivery company that worked like they do. If you were to start a Postmates competitor today, though, and were just doing what they did, then it wouldn't be a startup. At $250m ARR, their business model is already proven.
SkyMarshal 9y ago
>That is definitely not Steve Blank's definition. His is: "an organization formed to search for a repeatable and scalable business model." That's what "a company designed to grow fast" is. >You can have a rapidly growing company with an old business model. Look at McDonald's" McDonalds was a startup under this definition. If Ray's original plan was to take an old business model, redesign it for cars, and scale it rapidly with TV advertising, that's a startup by Steve and Paul's definition.
- wpietri 9y ago
  > That's what "a company designed to grow fast" is. No. Most startups are designed to grow fast. But many non-startups are designed to grow fast. There is overlap in the Venn diagram, but they are not the same thing. > If Ray's original plan If that was Kroc's plan, you'd be right. Do you have some evidence it was? As far as I can tell, he spotted an existing restaurant that had already found product-market fit and just scaled the operation using variants on known franchising approaches. I also haven't seen any evidence that at the time he foresaw suburbanization, white flight, and the resulting increase in value of heavy branding, trends that were nascent at the time he joined McDonalds. I'd say it was more akin to the top-growing restaurants of today, ones I point out elsewhere in this discussion. They are fast growers, but they are scaling mild variations on well-known business models.
  - slededit 9y ago
    His insight was that the model was repeatable and scalable. The assembly line kitchen they developed not only made making burgers fast but also made them incredibly consistent. Because of this he could franchise the restaurants and be assured that quality would be consistent among them despite being operated by different people. He never intended to open large numbers of his own restaurants - just enough for experimentation purposes. To this day this is a major selling point. When travelling you can take your chances on a local place or go with what you know.
    - wpietri 9y ago
      Sure. I think we're saying the same thing: The McDonald brothers had found product-market fit. Kroc scaled it. Ergo, Kroc's approach was not what Blank calls a startup.

jacquesm 9y ago

Do you honestly believe nobody used the term 'start-up' before Steve Blank or Paul Graham used it? https://www.merriam-webster.com/dictionary/start-up https://www.merriam-webster.com/dictionary/start-up "A Fledgling Business Enterprise" That's exactly what it means, no more, no less. Keep in mind that outside of the HN crowd absolutely nobody would know who either Steve Blank of Paul Graham are and neither of them get to redefine the English language.

paulsutter 9y ago
Nobody suggested they originated the term. Paul Graham's definition for "startup" is exactly right for Silicon Valley, and the Merriam Webster definition is incorrect, for Silicon Valley. It's true that lots of people use the word startup to mean fledgling business, and that's perfectly OK and cool, but if you use the term "startup", in Silicon Valley, to refer to a lifestyle business, people will view it as self-aggrandizement or delusion. This is also true in any venture capital context anywhere in the world.
SkyMarshal 9y ago
>Do you honestly believe nobody used the term 'start-up' before Steve Blank or Paul Graham used it? Did I say that somewhere or are you just straw manning me? My post and paulsutter's are clearly referring to the Silicon Valley idea of a startup, not the general idea. The difference is one of intent, so it is useful to distinguish between the two. Someone who opens a diner or a watch repair shop or a Kinko's franchise with the intent of servicing their locale is certainly doing "a fledgling business enterprise" and thus may technically be doing a startup. But SV is specifically interested in greenfield endeavors that can leverage the web or other new tech to find a large customer base and rapidly scale to billion dollar+ valuations. Given your long history on HN I know you know this so why are we bickering over semantics?