innovation colonies:incubating the future of your business
TRANSCRIPT
INNOVATION COLONIES: INCUBATING THE FUTURE OF YOUR BUSINESS
LIVE WEBINAR
WHO AM I?
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Jeff Steinberg - SolutionsIQ Lean Innovation & Agile Transformation Coach
• 15 years’ experience in product and service development
• Builds cultures of innovation and organizational effectiveness
• Director of Lean-Agile at 3 startups • Has helped transform dozens of large orgs
and hundreds of teams • Coaching combines Lean Startup, Design
Thinking and Agile Delivery
S&P 500 COMPANIES HAVE SHORTEST LIFE SPAN EVER
www.Inosights.com, Corporate Longevity, May 2016
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PRINCIPLE #1: WE DON’T KNOW WHAT WE DON’T KNOW
FORESIGHT IS VANISHING
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PRINCIPLE #2: PERSPECTIVE
“Get out of the building. There are no facts in here." - Steve Blank
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PRINCIPLE #3: APPLY THE SCIENTIFIC METHOD
Requirements = Hypothesis
As a <user>I want <this capability/feature>
so that <business reason>.
Requirements
We believe < this target market>,will <do this action/use this
solution>,for <this reason>,
as measured by <this signal>.
Hypothesis
BUILD-MEASURE-LEARN CYCLE
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DATA CODE
IDEAS
LEARN BUILD
MEASURE
Build-Measure-Learn Cycle
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DATA CODE
IDEAS
LEARN BUILD
MEASURE
start here (mostly)
MINIMUM
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“The MVP is that version of the product that enables a full turn of the Build-Measure-Learn loop with a minimum amount of effort and the least amount of development time.”
VIABLE
M i n i m u m V i a b l e P r o d u c t
PRINCIPLE #4: MINIMUM VIABLE PRODUCT
TACTIC: EXPLAINER VIDEO
TACTIC: WIZARD OF OZ TEST
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PRINCIPLE # 5 - PIVOT
PIVOT
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“A pivot is a structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth.” - Eric Ries
AT LEAST TWO TYPES OF INNOVATION
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Sustaining Innovation Disruptive Innovation
Existing market New or previously ignored market
Improves performance & lowers cost Innovation is game changing
Incremental change Dramatic change
Market is predictable Market is unpredictable
Traditional business model Is sufficient Traditional business models fail
Doing the same thing better
Doing something new that may make the old thing obsolete
DISRUPTION
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X
DISRUPTION
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X
DISRUPTION
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X
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HACKATHON’S
SAFE’S INNOVATION AND PLANNING ITERATION
INNOVATION LABS
CORPORATE ANTIBODIES
INNOVATION COLONIES
WHAT IS AN INNOVATION COLONY?
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Def: A dedicated department of small entrepreneurial teams focused on cultivating disruptive innovation for the benefit of the enterprise.
INNOVATION COLONY ARE MULTI-FUNCTIONAL
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Design Studio
Startup Incubator
Investment Fund
Corporate Development
INNOVATION COLONY PERFORM THREE JOBS
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1. Conceiving New Disruptive Products
2. Validating Markets For Them
3. Shepherding to Product-Market Fit
They are SEPARATE… Legal Entities Budget Brand Location
which ENABLES… Experiment Pivot Allocate Resources
INNOVATION COLONIES HAVE RADICAL AUTONOMY
INNOVATION COLONY HAVE THEIR OWN LEADERSHIP
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Innovation Officer • Reports Directly to CEO or Board • Acts as Internal Venture Capitalists • Previous Entrepreneurial Experience
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2 - 3 Managing Directors $1 - $50M Fund
2 - 5 Years
INNOVATION COLONY HAVE THEIR OWN STRUCTURE
Success requires a large sample size of ideas to choose from
Idea Sources
Ideation Workshops
Idea Boxes
Hackathons
Intraprenuership Programs
Startup Community
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1. Incubate Internal Startups
2. Acquire Early Stage Startups
3. Invest in Outside Startups
INNOVATION COLONY HAVE THREE INVESTMENT TYPES
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“Ownership is why you stay up all night. It’s why you think about this all day, every day.”
Chris Dixon, Venture Capitalist Andreessen Horowitz
True entrepreneurs give up salary for equity, so too should intraprenuers.
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500 Teams Apply 10 Selected into Colony
25k - 250k in Initial Funding 3 Months to Get to Market
INNOVATION COLONY: EXAMPLE SCENARIO
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Financial Accounting
Revenue, Margin, Profit
Innovation Accounting
Customer Behavior & Growth
INNOVATION COLONY HANDLE ACCOUNTABILITY DIFFERENTLY
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Once they get customers and prove the product…
…when most of the uncertainty is gone…
The enterprise has 3 options: 1. integrate into enterprise 2. grow as independent entity 3. pass and sell to outside buyer
Fact 1: 1 out of 10 Venture Capital investments pays for the other 9
Fact 2: 1 in 1000 YCombinator investments are worth more than the rest of their entire portfolio combined.
INNOVATION COLONY ARE A CURRENT STRATEGY
CULTIVATE THE FUTURE OF YOUR BUSINESS WITH
INNOVAT ION COLON IES
WHERE CAN I LEARN MORE ABOUT LEAN INNOVATION?
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Q&A
