Here’s the startup knowledge we teach all our Japanese students before they start

80% of the learning that happens in our startup program is from field work (8 week startup projects). Our focus is on helping students learn the “startup methodology” based on data driven decisions, which in turn is based on field work.

Sekai Creator
Sep 21, 2018 · 8 min read

Even before students can gain the full benefits of field work, they need some foundational classroom knowledge. We believe that this foundational knowledge should be minimal, with a heavier focus on “bias towards action,” (seconded by Stanford Design School as well). The goal of this blog is to give a quick overview of the foundational knowledge that we teach all of our students before sending them into the field.

So what is the minimum startup knowledge that you need to get started?

  • What does starting your business mean in the first place?
  • Why is it important to start your business?
  • What do you mean by value?
  • How do you create value and develop a successful business?
  • What is Lean Startup Methodology?
  • Ok, I learned the basics, so what do I do next?

What does starting your business mean in the first place?

If you don’t have a background in business, it can be intimidating to think about creating a startup. Although running a business is incredibly difficult, the core concept is very easy to understand.

My favorite simple definition is that business is an exchange of products/services in return for value (monetary or otherwise). A business creates value (product or service) and offers it to a customer in exchange for value (usually money). The goal of this exchange is (usually) for a company to make financial profit. Of course, this transaction is not possible unless the customers are satisfied with the amount of value the product or service offers (price).

Why is it important to start your business?

Business runs the world. It is the core components running our societies. We experience innumerable benefits in our daily lives because businesses work hard to create value for us, hoping that we will give them money in exchange for these products/services. In an ideal world, businesses improve the lives of customers and provide essential resources people in society.

So if you want to change the world and/or make money, business is one of the best ways to achieve your goals.

What do you mean by value?

Since the heart of business is creating value for customers, it’s important to understand the meaning of value concretely. Think about your own life — we spend money on things that provide value to us by meeting our needs/wants. One way to think about it is that we pay for solutions to problems.

While some solutions are objective and valuable to everyone (basic food, shelter, clothing), some solutions are subjective, depending on the individual person (type of restaurant to eat at, what clothes to buy etc). Sometimes, these solutions can vary depending on specific circumstances (ice cream is less valuable in the cold winter). So the key is deeply understanding the people who you are creating value for.

We need to understand who they are, what’s important to them, where they have challenges, and how they live their lives with these challenges every day. We also need to understand if our offering (product/service) creates enough value that people will be willing to make a transition and use our offering. Sometimes, we need to think along the lines of finding a solution which doesn’t address people’s challenges but makes their life easier (example: installing vending machines in offices).

In addition to this common sense understanding of value, it’s also helpful to learn about “Progression of Economic Value.” This explains how market conditions force value to evolve. The classic example is looking at how the economic value of coffee has progressed, from customers buying the value of a coffee bean (commodities) then to packaged coffee (goods) then to someone making coffee (services) then to a cup of Starbucks coffee (experience).

You can learn more by reading the book that introduced this idea (The Experience Economy), reading this article from HBR, or watching this video presentation by the authors.

How do you create value and develop a successful business?

Now that we understand the basic concept of value creation, let’s get more concrete and learn how to create valuable solutions. One of the things that we encourage students to do at the beginning of their entrepreneurial journey is to figure out who they are and what they believe in. We would like our students to work on problems they deeply care about. We want to make sure they are maximizing their energy by operating with the Hedgehog Concept.

The Hedgehog Concept, which was made famous by Jim Collins in the book, “Good to Great,” is the idea that the most effective companies are like the hedgehog animal and focus on doing one simple thing very well (the hedgehog has one very effective strategy of becoming a spiky ball). The goal is to focus on the intersection of these three things:

  1. What are you deeply passionate about?
  2. What can you be best in the world at?
  3. What drives your economic engine (makes money)?

In order to answer these important questions, it’s helpful to discover who you are and why you ultimately do what you do. This is very important for companies, as illustrated by Simon Sinek in one of the most famous TED talks of all time, where he talks about “The Golden Circle.” Once you know who you are, you will know what you need to do.

After our students have worked through these deep questions, they are ready to get out in the field and start building their own venture, using the Lean Startup methodology.

This is the foundational teaching content we build our program from

What is Lean Startup Methodology?

Our hands-on method of building startups follows the best practices of the Lean Startup, which is one of the global best practices used in building startups. In the words of Eric Ries, founder of the Lean Startup movement,

“The Lean Startup provides a scientific approach to creating and managing startups and get a desired product to customers’ hands faster. The Lean Startup method teaches you how to drive a startup-how to steer, when to turn, and when to persevere-and grow a business with maximum acceleration. It is a principled approach to new product development.”

This lean approach came from the methodology of Customer Development, which was created by Steve Blank, who was the college professor of Eric Ries. The main idea of customer development is that startups should validate/verify that they are actually working on a problem that market truly cares about and then, that the solution actually fits that problem. The only way to do this is by “getting out of the building” and interviewing real customers.

Another key part of the Lean Startup methodology is using the Business Model Canvas (BMC), which is a simple and visual framework that startups can use to explain their business and update their ideas as they gain insights from customers. While the BMC methodology is great, we prefer to use the Lean Canvas, which is an adaptation of the BMC that was built specifically for startups (not established companies).

We love Lean Startup methodology because it forces students to actually test their ideas. Once they start talking to customers, our students learn key insights that help them adjust their business idea until they hopefully arrive at “product-market fit.”

The best way to learn this startup methodology step by step is through the amazing free course by Steve Blank — “How to build a startup” (hosted on Udacity). You can also just watch the YouTube playlist of videos here.

Rena’s Sekai Creator Story

Ok, I learned the basics, so what do I do next?

Now that you understand the basics of how to build a startup, the next step is to #juststart. There are a handful of great programs available in Japan. Startup Weekend Japan is a great way to get a taste of what startups are like and there are events held all over Japan. Borderless Japan has a unique program that provides a 5-month startup academy, with a tuition refund if you start your own business.

If those options aren’t the right fit for you, we would encourage you to join Sekai Creator and attempt the challenge of creating your own startup in 8-weeks. You will meet many other passionate students who are trying to learn about startups, receive weekly coaching support, and have the chance to pitch in front of local entrepreneurs and investors.

So if you are interested in startups but don’t know where to start, we want to help you take your first steps!

Sekai Creator

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Sekai Creator unlocks the hidden potential of Japanese students through entrepreneurship education. Hustle and Grit! #DisruptShukatsu

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