planning your venture
TRANSCRIPT
Planning Your Venture
Dave Jarman. Head of Enterprise & Employability
In this session
• What is a business plan?• Don’t write a plan, build a model.• 3 Tools:– The Value Proposition Canvas– Porter’s 5 Forces– The Business Model Canvas
• Test your assumptions
What is a business plan?
• A summation of how your business will work• A set of assumptions about how the business
will work• Something you hand to investors• A snapshot in time• Obsolete by the time its printed…• A waste of your time?
20 pages or 9 seconds to explain?
Do you get the business model?
• What is the product?• Who is it for?• What does it solve?• Why is it better than the alternatives?
Creating Value – the value proposition canvas
Creating Value – the value proposition canvas
• Customers Jobs:– Getting a task done– Acquiring status– Emotional sensation
• Pains:– Avoiding undesirable situations– Overcoming obstacles– Mitigating risks
• Gains:– Something that works– Opportunities and bonuses
• Scale the importance, severity, or relevance of the value for the customer
Creating Value – the value proposition canvas
• Products and Services:– Physical or Intangible?– How effective is it?
• Pain Relief:– How quick is it?– How effective is it?
• Gain Creators:– How big and how quick a
gain is it?– How relevant is the gain?
Competitor Analysis• Porter’s 5 Forces:
– Existing direct competitors• Who already does what you do?
– Emerging competitors• Who could start doing what you
do?– Substitutes and alternatives
• How else can customers solve their problem?
– Power of suppliers• Are you subject to the whims of
key suppliers?– Power of buyers
• Are you vulnerable to changing customer behaviour?
Do you get the business model?
• How do customers discover the product?• What kind of ongoing relationship do they
have with their customers?• How do they make money?• What kinds of costs do they have?– What kinds of assets/resources do they need?– What kinds of activity do they need to fund?
“A business model describes the rationale of how an organisation
creates, delivers and captures value.”
Alex Osterwalder & Yves Pigneurwww.businessmodelgeneration.com
The Business Model Canvas
Customer segments
• For whom are we creating value?• Each group of customers needs a distinct offer – something that
addresses their specific needs/desires.• Who are our most important or valuable customers?• What do we know about their buying behaviour and what are
they currently using as an alternative?
Value Proposition
• What value do we deliver to the customer?• Which one of customer’s problems are we helping to solve?• Which customer needs are we satisfying?
– Newness, Performance, Customisation, Effectiveness, Design, Brand, Price, Cost Reduction, Risk Reduction, Accessibility, Usability/Convenience
• What bundles of products and services are we offering to which customer segments?
Channels
• Through which mechanisms do our customers want to reach our products and services?– Sales teams, Website, Shops, Partner stores or sites, Wholesale…
• How do our channels integrate?• Which channels work best?• How do our channels adjust to customer behaviour?
Customer Relationships
• What type of relationship does each Customer Segment expect us to establish and maintain?– Personal assistance, Dedicated personal assistance, Self-service,
Automated services, Communities, Co-creation• How costly are they?• How will they integrate with the rest of our business model?
Revenue Streams
• For what value are our customers really willing to pay?• How do they want to pay for our products and services?
– Asset sale, Usage fee, Subscription fee, Lending/Renting/leasing, Licensing, Brokerage fee, Advertising
• What do they already pay and how?• How much is each revenue stream worth overall?• What price should we charge?
Key Resources
• What Key Resources do our Value Propositions require?– Physical assets – facilities, vehicles, machines, systems, distribution networks– Intellectual resources – brands, patents & copyrights, partnerships, databases– Humans – appropriately skilled and motivated people– Financial – cash reserves, lines of credit, financial guarantees
• Do we need to own these ourselves? Or can we borrow/lease?
Key Activities
• What Key Activities do our Value Propositions require?• What actions are required to deliver our Channels, Relationships, and Revenue Streams?
– Designing, making, and delivering at an appropriate quality require a focus on the production processes
– Problem solving for customers issues, consultancy services, anything service based require a focus on knowledge management and staff training
– Building a business around the provision of a platform are dominated by managing, promoting, and maintaining that platform and how it interfaces with customers
Key Partners
• Why Partner?– Optimisation and economies of scale– Reduction of risk and uncertainty– Acquisition of particular resources and activities
• What Key Activities or Key Resources do our Partners supply to us and/or acquire from us?
• Forms of Partnership: Alliances, Joint Ventures, Buyer-Supplier, ‘Coopitition’ (partnerships between competitors)
Cost Structure
• What are the most important costs inherent in your Business Model?• What do our Key Activities and Key Resources cost us and how much can be
offset through Key Partnerships?• Cost Structures:
– Cost-Driven: focus on minimising costs for the leanest possible operation– Value-Driven: focus on value creation – often premium products and services
• Fixed Costs & Variable Costs (those that flex based on sales)
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The Business Model Canvas
The Business Model Canvas
Key Tests
• Explain it in one sentence to a stranger• Explain how it solves a real problem that real people
face that costs them real money• Get positive feedback from a stranger without
explaining to them what it is and how it works
We can support you!• www.bathspa.ac.uk/bathsparks• Workshops (Wed 2pm-4pm,
Newton Park)• 1-2-1 advice• Resources (Pinterest)• Events and activities• Social Media:
– Facebook.com/bathsparks– @BathSparks
Create it Challenge
• 60 second video + 600 characters
• Test your idea, get feedback!
• £100 to be won by the most popular and creative ideas
• Deadline 16th Novemberhttps://bathsparks.wazoku.com
