about you and me - college of business...customer pains how your products and services create...
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AboutYouandMe
SixTypesofStartups
• Lifestylestartup—workyourpassion• Smallbusiness—makealivingforyouandyourfamily
• Buyablestartup—selltoalargercompanyfor$5-$50M
• Largecompanystartup—innovateorevaporate• Socialstartup—driventomakeadifference
• Scalablestartup—BorntobeBIG
WhataScalableStartupIs
1. Ateam ofpeople (youandothers)2. Attemptingtofind,formulate,andvalidatea
businessmodel basedona3. ProprietaryTechnology* thatcansolvea
problem fora4. Largeandrapidlygrowingmarketsegment.
NotThis This.
• Mission• Vision• ProjectDescription
• Assumptions• Conclusion
BusinessPlan
WhatIsABusinessPlan?
• Adocument• Asetofspreadsheets• Astory
• Itisallofthesethings,andnoneofthem
• Whatyoureallyneedbefore anyoftheseis:
ATheoryoftheBusiness
• Acomprehensive,communicable,understandableexplanationof–WHATISOURBUSINESSPURPOSE?–HOWDOWECREATEANDDELIVERVALUE?–HOWANDWHYDOWEMAKEMONEY?
UNTILYOUGATHERFACTS, ALLYOUHAVEAREHYPOTHESES
WRITETHEMALLDOWN!
Existing Market Resegmented Market
New Market
Customers Existing Existing New / New Usage
Customer Needs Performance 1. Cost2. Perceived need
Simplicity & convenience
Performance Better / faster 1. Good enough at the low end
2. Good enough for the niche
Low in “traditional attributes,” improved by new customer metrics
Competition Existing incumbents Existing incumbents Non-consumption / other startups
Risks Existing incumbents 1. Existing incumbents
2. Niche strategy fails
Market adoption
*source: The Four Steps to the Epiphany, Steven Gary Blank
TheMostImportantMarketEntryQuestion:MarketType*
BusinessModelGeneration
http://www.businessmodelgeneration.com/downloads/businessmodelgeneration_preview.pdf
Products/Servicesthat
createvaluefora
customersegment.
-Quantitative-Qualitative
GroupsofPeopleorOrgsa
companyhopestoreachandserve
-CommonNeeds-CommonBehaviors- Other
HowyoucommunicateandreachcustomersegmentstodeliverValueProposition
TypeofRelationship
establishedwithacustomer
Cashgeneratedfromcustomersegments
MostImportantAssets
Requiredtomakeeverything
work
SuppliersandAllies
AllCostsIncurred
ValuePropositions• Whatvaluedowedelivertothecustomer?• Whichofourcustomer’sproblemsarewehelpingtosolve?• Whatbundlesofproductsandservicesareweofferingto
eachCustomerSegment?• Whichcustomerneedsarewesatisfying?
characteristicsNewnessPerformanceCustomization“GettingtheJobDone”Design
Brand/StatusPriceCostReductionRiskReductionAccessibilityConvenience/Usability
CustomerSegments§Forwhomarewecreatingvalue?§Whoareourmostimportantcustomers?§ MassMarket§ NicheMarket§ Segmented§ Diversified§ Multi-sidedPlatform
ForEACH CustomerType!
Gain Creators
Pain Relievers Pains
Gains
Products& Services
CustomerJob(s)
Value Proposition Customer Segment
copyright: Strategyzer AGThe makers of Business Model Generation and Strategyzer
The Value Proposition Canvas
strategyzer.com
Listofyour
offerings
Howyourproductsandservicesalleviatecustomerpains
Howyourproductsandservicescreatecustomergains
Outcomescustomerswant
Whatcustomeris
Badoutcomes,risk,obstacles
Benefitscustomersseek
tryingtogetdone
relatedtocustomerjobs
Allowsyoutoclearlyarticulatetheproblemsyouaresolvingfortheclientandhowtheyinteractwithyour
productorservice.
Answersquestionslike:Forwhomarewecreatingvalue?
Whoareourmostimportantcustomers?Whatvaluedowedelivertothecustomer?Whatproblemsarewehopingtosolve?
CustomerRelationships§ WhattypeofrelationshipdoeseachofourCustomer
Segmentsexpectustoestablishandmaintainwiththem?§ Whichoneshaveweestablished?§ Howaretheyintegratedwiththerestofourbusiness
model?§ Howcostlyarethey?
§ examples§ Personalassistance§ DedicatedPersonalAssistance§ Self-Service§ AutomatedServices§ Communities§ Co-creation
Channels
§ ThroughwhichChannelsdoourCustomerSegmentswanttobereached?
§ Howarewereachingthemnow?§ HowareourChannelsintegrated?§ Whichonesworkbest?§ Whichonesaremostcost-efficient?§ Howareweintegratingthemwithcustomerroutines?
Channelschannelphases:1.Awareness
Howdoweraiseawarenessaboutourcompany’sproductsandservices?2.Evaluation
Howdowehelpcustomersevaluateourorganization’sValueProposition?3.Purchase
Howdoweallowcustomerstopurchasespecificproductsandservices?4.Delivery
HowdowedeliveraValuePropositiontocustomers?5.Aftersales
Howdoweprovidepost-purchasecustomersupport?
Everett Rogers, Diffusion of Innovations (New York: The Free Press, 1983.
AdoptionModel
• Has the / a problem your product solves• Knows he / she has the problem• Feels the pain severely enough that he /
she is already trying to solve it• Has a budget to solve it• May already have cobbled together a
solution from piece parts
GO OUT AND FIND ONE!
TheTargetCustomer
KeyActivities
§ WhatKeyActivitiesdoourValuePropositionsrequire?
§ OurDistributionChannels?§ CustomerRelationships?§ Revenuestreams?
– categories§ Production§ ProblemSolving§ Platform/Network
KeyResources
§ WhatKeyResourcesdoourValuePropositionsrequire?
§ OurDistributionChannels?CustomerRelationships?§ RevenueStreams?
– typesofresources§ Physical§ Intellectual(brand,patents,copyrights,data)§ Human§ Financial
KeyPartners
§ WhoareourKeyPartners?§ Whoareourkeysuppliers?§ WhichKeyResourcesareweacquiringfrompartners?
§ WhichKeyActivitiesdopartnersperform?– motivationsforpartnerships:
§ Optimizationandeconomy§ Reductionofriskanduncertainty§ Acquisitionofparticularresourcesandactivities
RevenueStreams§ Forwhatvalueareourcustomersreallywillingtopay?§ Forwhatdotheycurrentlypay?§ Howaretheycurrentlypaying?§ Howwouldtheyprefertopay?§ HowmuchdoeseachRevenueStreamcontributetooverall
revenues?
fixedpricing§ ListPrice§ Productfeaturedependent§ Customersegmentdependent§ Volumedependentdynamicpricing§ Negotiation(bargaining)§ YieldManagement§ Real-time-Market
types:§ Assetsale§ Usagefee§ SubscriptionFees§ Lending/Renting/Leasing§ Licensing§ Brokeragefees§ Advertising
CostStructure§ Whatarethemostimportantcostsinherentinourbusinessmodel?
§ WhichKeyResourcesaremostexpensive?§ WhichKeyActivitiesaremostexpensive?
– isyourbusinessmore:§ CostDriven(leanestcoststructure,lowpricevalueproposition,
maximumautomation,extensiveoutsourcing)§ ValueDriven(focusedonvaluecreation,premiumvalueproposition)
– samplecharacteristics:§ FixedCosts(salaries,rents,utilities)§ Variablecosts§ Economiesofscale§ Economiesofscope
What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?
Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?
For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?Who are our most important customers?
What type of relationship does each of our CustomerSegments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?
What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?
What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?
Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?
What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?
Day Month Year
No.
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Wearenothereto“immanentize theeschaton.”Weareheretosolvesomerealproblemformorethanonerealperson.Whoisthecustomer?Whatjobsaretheytryingtogetdone?Whatpainsaretheyenduringintryingtogetthingsdone?Whatmorecouldtheygetdoneifyourproductorservicemadedoingthingseasier,faster,cheaper?
100
Notrelativesfriends,orroommatesAtleastonedegreeofseparationLookforpatternsPrepareaninterviewguideAskopenquestionsDesign“pass/fail”testsTalktoonepersonatatime,notfocusgroupsGetthemtotellastoryListen,don’ttalk
44ChecklistsinthebackcovertheentireprocessoftheLeanLaunchpadmethodologyfromsettinguptheCustomerDiscoveryTeamto“pivotorProceed.”
Ifyoufollowtheguidanceofthisbook,youmayormaynotsucceed,butyouwillavoidmanymistakesandwastingalotofmoneyalongtheway.
Summary• Youwillneedabusinessmodelcanvastohelpyouthinkandcommunicate
• ItstartswithaValueProposition• YoucannotknowifyourValuePropositionmakessenseuntilyouTalktoHumans—LISTEN!
• Writedownyourassumptions—andtestthem!• Performexperiments,recordtheresults,thinkaboutwhattheymean.
• UsechecklistsforCustomerDiscovery,CustomerValidation
• PivotorProceed?
Questions?
SBDCTechnologyCommercializationCenterProgramsAndServices
Mentorship
• Strategicadvising• TechnologyReadinessLevel
assessment• EnterpriseValueestimation• BusinessModelCanvasdesign&
review• ValuePropositiondesign&review• Customizedmarketresearchreports!• SBIR/STTRtopicsearch• SBIR/STTRProposalreviewand
assistance• CommercializationReadinessLevel
assessment
Education
• Workshopsonfunding,startupvaluation,pitchingtoinvestors,andgovernmentfundingopportunities
• Onlineentrepreneurialtraining&certification
NetworkCollaboration
Thankyou!J.BruceHughes,MBASeniorProjectManager
SBDCTechnologyCommercializationCenter501W.CésarE.ChávezBlvdSanAntonio,TX78207-4415
210.458.2460Main210.458.3271Direct210.710.8494Cell
mailto:[email protected]://txsbdc.org/techcomm
IfIcanhelpyoufurther,pleasesignupasaclientoftheSBDCTechnology
CommercializationCenterandmakeanappointment.