evaluating ideas: how to spot a winner
TRANSCRIPT
Welcome
Evaluating business ideas
Agenda
• Introduction
• Shooting Puppies
– Bryan Cassady– Brussels Director Founder Institute
• Getting to big ideas… and some thoughts on market
research – Koen Stevens - Director BuboBox
• BREAK (10 min)
• Your turn to evaluate some business ideas
• Joining The Founder Institute program
The Program
Idea Business Launch 1. Orientation
2. Vision
3. Research
4. Revenue
5. Naming
6. Mentor Idea Review
7. Startup Legal
8. Team
9. Product
10. Mentor Progress Review
11. Sales
12. Branding
13. Fundraising
14. Graduation
By focusing hard on ideas first
70% of graduates succeed and 45% get funded
Let’s be honest ….
Most start ups have ideas only a
mother could love !
The biggest 3 mistakes of Entrepreneurs
1. Investing in the wrong business
2. Staying too long in the wrong business.. (after you
should know it is time to change…)
3. People don’t buy your product or service ‘cause they
understand why they should…
I will see it when I believe it vs.
I will believe it when I see it
Too much research is the first type
An example: global warming
Hot summers Warm winters Evidence of global warming
Cold summers Cold winters Evidence of global warming
Clearly there is evidence of global warming ?!
9
Solutions …
Issues
• We often do research to check
our brilliant ideas
• SUGGING (Selling under the guise
of market research)
Solutions
• Objective criteria in place before
the research starts
– Is 35% planned purchase good or bad
• Clearly define your biases before
you start
• Focus on insight (vs.
confirmation)
• Do regular reality checks
You’re not alone !
‘‘More than nine out of ten consumable products launched in the last ten years offered absolutely
nothing new to the consumer.
More than eight out of ten new products fail. You don’t need to be a statistician to realize there’s a
correlation between the two numbers.’’
-- Robert McMath
Arguing the other direction…
Why is this a bad idea…
If it fails, why will it fail…
And then deciding what can
be done about it…
A checklist for ideas…
• Is there a benefit (real or perceived)
• People willing to pay (enough)
• Cost of cut-through acceptable
• People will see the benefit buy again / recommend
to others
• Will someone hate it
13
Pets.com
Pet supplies via the internet
Save big, save time
Stay at home
14
Kosmo.com Instant delivery of products purchased via the internet in big cities Order a wide variety of products, from movies to snack food, and get them delivered to your door for free within an hour.
16
Despair.com
We hate all the senseless, wasted time on employee motivation and un-founded optimism
We imagine you do to, buy our products and show your true colors
17 Continuous effort is the key to unlocking your potential Winston Churchill
18
Etoys.com
The new place to buy toys. Find you
want on the internet
20
21
Petrock.com Pets take a lot of time and energy. Your kids can have almost as much fun with a pet rock. We even include a care guide
22
23
24
Webvan.com
Buying groceries should be easier. With webvan you can get all your groceries, so you have time for other
things
25
Now the most important question Why would this business fail …
Why would it fail …
Pets.com
Kosmo
Despair.com
Etoys.com
Petrock.com
Flooz
Webvan
27
Costs per stage
Ideas, screening
Concept, analysis
Prod.
devel
Test
mktg
commercialization
The time to
Make mistakes !
Budget
Time
Can you ask the experts ???
“I think there’s a world market for about five computers.” (President of IBM, 1943)
“TV won’t be able to hold on to any market it
captures after the first six months. People will soon get tired of staring at a plywood box every night.”
(President of 20th Century Fox, 1946)
30
Should consumers be followed or led ?
Mobile phone
Computers
Internet…
Not all new products are revolutions !
There are many holes in the
markets, but fewer markets in the holes ..
Better is not always better
Fat Bastard is priced higher,
tastes less good but outsells
Bilton 10 to 1…
A checklist …
• Talk to 20 people (that are not your friends)
• If no one hates the idea, be scared
• Ask people “if this fails” why would it fail (you’ll get a
lot more information than asking what they think of
the idea !)
• Keep it simple … check do people really understand
Koen’s Presentation
A new experiment 7 pitches
Your challenge… pick the 3
winners
1. Breathometer
2. Onesole
3. Lollacup
4. Coffee Cups
5. First Defense
6. Kevo
7. Beddies
1. Breathometer
2. Onesole
3. Lollacup
4. Coffee Cups
5. First Defense
6. Kevo
7. Beddies
1. Breathometer
2. Onesole
3. Lollacup
4. Coffee Cups
5. First Defense
6. Kevo
7. Beddies
The Elevator Pitch…
You want to be an successful entrepreneur
Our Promise: We'll help validate your ideas and show you a fast effective way to build a meaningful and enduring company
Proof: World class people ready to help in Brussels A proven track record, 70% of graduates succeed and 45% get funded
