The Startup Community Way

CHAPTER TWOWHY STARTUP COMMUNITIES EXIST

To set the stage for a more in-depth exploration of how a startup community works, given the premise that startup communities can, and should, exist almost everywhere in the world, we must first describe what entrepreneurs do and relate it to place. While a startup community is an abstract concept, it's important to remember that entrepreneurs and the participants in startup communities are all people.

WHAT ENTREPRENEURS DO

Entrepreneurship is a process applied by an individual or group of individuals, called entrepreneurs, to first explore and then exploit a commercial opportunity, generally by bringing new goods and services to the market, or substantially improving an existing product, service, or method of production.¹ This process typically occurs through a new company (a startup), and the entrepreneurs take considerable personal and financial risk.

Steve Blank, the grandfather of the Lean Startup movement, states that “a startup is a temporary organization formed to search for a repeatable and scalable business model.”² This temporary phase tests and validates a business model before a shift in strategy to achieve high rates of growth and market share (“scaling-up”), or conversely, failing and ceasing operations.

Entrepreneurship is broader than starting and scaling companies. The approach, referred to as an “entrepreneurial mindset,” can be applied to many different problems and types of organizations. Many firms achieve high ...