Master thesis presentation.

1. Software Development Model
for Startups
Thesis project presentation
Author: Martin Verrev
Advisor: Mart Roost
2012

2. Motivation
Business development and technology
development cannot be handled separately
during startup lifecycle.

3. Purpose and scope
Purpose:
• Analyze startup and identify key constraints and
success factors.
• Formalize a development model tailored to
startup lifecycle describing a process from initial
idea to building a successful company.
Scope:
• The model is applicable to tech startups

4. What is a startup?
Startup is a human institution designed to
create a new product or service under
conditions of extreme uncertainty. (Ries)
Startup is temporary organization designed to
search for a repeatable and scalable business
model. (Blank)

5. Business model
Business model is a collection of ideas that
describes the rationale of how an organization
creates, delivers, and captures value.
It includes value proposition, customer
segments, product, marketing and other core
aspects of business describing the rationale of
how an organization creates, delivers, and
captures value converting it to profits.

6. Startup vs traditional company
Business model discovery Business model execution
Startup Organizational Company
transition
Validated business model Cash-flow breakeven
Validated product Profitable
Repeatable sales model Rapid scale
Managers hired New management

7. Startup success definition
Reaching the organizational transition before
running out of resources:
• Having a validated business model
• Having a product that customers want
• Having a repeatable sales channels

8. Model guidelines
• Maximal reduction of uncertainty
• Minimal time to market
• Traceability and measurability
• Scalability and traceability
• Right Action Right Time

9. Model overview
Agile Development
Process
Validated Learning Development Archetype Patterns
practice model practice
Startup lifecycle

10. Startup lifecycle
Problem Market Product
Scaling
Validation Validation Validation
Each distinct phase has:
• Purpose, primary and secondary goals.
• Minimal set of mandatory roles, tasks, actions
and outcomes.
• Success criteria defined by success validation
checklist, supported by phase specific metrics.

11. Agile development process
• Individuals and interactions over
processes and tools
• Working software over
comprehensive documentation
• Customer collaboration over
contract negotiation
• Responding to change over
following a plan

12. Validated learning
• Purpose: Managing external
uncertainty by learning as much as
possible from customers
• Method: Applying scientific
method to development process to
empirically prove correlation
between product attributes and
changed customer behavior

13. Archetype patterns
• Purpose: Managing internal
uncertainty by learning as much as
possible from customers
• Definition: Self-evident and
universal patterns of enterprise
architecture that occur consistently
in both business and technology
domains.

14. Archetype patterns
• Decoupling implementation from
specific problem being solved.
• Providing architectural stability and
guaranteed correctness even in
case of change or pivot.
• Providing scalability to architecture
in case of rapid expansion.
• Providing standards support to
interface with external systems.

15. Implementation
• SPEM 2.0 compliant process model:
– Defined method content.
– Formalized business processes applicable to
startup lifecycle.
– Formalized repeatable components of business
process as capability patterns and applied them to
business processes.
• Applied guidance and supporting materials to
process model for improved legibility and
usability.

16. Result Summary
• Described key constraints and
success factors applicable to
startup.
• Formalized development model
that:
– Supports startup lifecycle.
– Minimizes uncertainty from
environment and external factors.
– Minimizes uncertainty from
architecture and internal factors.
– Follows agile practices.

17. Conclusions
• Startup is fundamentally different from
traditional company.
• Applying traditional agile methodologies to
development process is not enough. Agile
methodologies should be extended with:
– Validated learning practice
– Archetype patterns practice
• Further research can be conducted based on
current results.

18. Further development
• Elaborate the process model to extent that it
is usable by non-technical managers without
supplementary theoretical materials.
• Further theoretical research is possible in
areas of process management, action
research, business development or systems
analysis.

19. Supplementing materials
• Published process model:
http://martinv.zzz.ee/msc/published
• Theoretical foundations (in Estonian):
http://martinv.zzz.ee/msc/theory
• Process model sources:
https://github.com/martinve/asdp-process