startup thinking 101 for libraries: workshop
DESCRIPTION
This half-day workshop covers the basic thinking behind launching a new product or service. It uses the Business Model Canvas as a starting point followed by an application of the Customer Development Framework. Helen Kula and M.J. D'Elia presented this workshop at Internet Librarian 2014 in Monterey, California. The workbook (.doc) from the session has also been added to SlideShare.TRANSCRIPT
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MONTEREY
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CALIFORNIAIL 2014startup
thinking 101M.J. D’ELIA & HELEN KULA UNIVERSITY OF GUELPH UNIVERSITY OF TORONTO MISSISSAUGA
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welcome1
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agenda
welcome explore the challenge
biz model canvas !
customer development discovery & validation
wrap
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objectives
★ apply principles of startup thinking ★ map out a model for a new idea ★ develop a plan to validate your idea ★ focus on creating value
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Helen Kula
Head, Learning & Curriculum Support Team University of Guelph [email protected]
@mjdelia
Librarian, Institute for Management and Innovation U of Toronto Mississauga [email protected]
@helenkula
M.J. D’Elia
about us
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plans vs. models
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poor biz plan process
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built on assumptions
(secondary data)
assumptions considered
“facts”
“facts” are not challenged or
altered> > >
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poor biz plan process
8
plan becomes static (it is not
rewritten)
company-centric
approach
productivity is measured against
plan> >
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first contact
!
“no plan survives first contact with its customers.”
~ Steve Blank
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biz model approach
1 0
built on assumptions
(secondary data)
assumptions considered
“facts”
“facts” are not challenged or
altered
built on observation
(primary data)
assumptions are
acknowledged
assumptions altered based on
new learning
> > >
> > >
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biz model approach
1 1
plan becomes static (it is not
rewritten)
company-centric
approach
productivity is measured against
plan
model continues to be rewritten
(dynamic)
customer-centric
approach
productivity is measured by performance
> >
> >
the scenariopractice startup thinking
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recommendations
★ choose a: ★ user/patron focused product or service ★ new idea or approach ★ challenge that targets a subset of your
user population
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scenario
★ public library partnership with local hotels to offer library collections to hotel guests
★ hotels can sign guests up for a free library card during their stay
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explore the challenge
2
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customers / users
★ who do you expect will use your product or service?
★ what problem(s) are you solving for your potential users?
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problem / solution
★ what do your potential users do right now to solve those same problems?
★ why would they choose your solution over their current solutions?
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analogs
★ successful predecessor examples ★ who do you want to emulate/copy? ★ what elements of their approach can you
borrow?
1 8
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antilogs
★ predecessor examples that did not work ★ what do you want to do differently?
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biz model canvas
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customer segments
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customer segments
“...defines the different groups of people or organizations an enterprise aims to reach and serve.”
~BMG, p. 20
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customer segments > questions
★ for whom does the company/project create value?
★ who are their most important customers/users?
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value proposition
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value proposition
“...describes the bundle of products and services that create value for a specific customer segment.”
~BMG, p. 22
2 5
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value proposition > questions
★ what value does the idea deliver? ★ which problem is getting solved? ★ which needs will be satisfied? ★ what bundles of products/services do
they offer each customer segment?
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channels
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channels
“...describes how a company communicates with and reaches its customer segments to deliver a value proposition.”
~BMG, p. 26
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channels > questions
★ how do the segments want to be reached?
★ how are they reached now? ★ how is the company integrating with
customer routines?
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customer relationships
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customer relationships
“...describes the types of relationships a company establishes with specific customer segments.”
~BMG, p. 28
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customer relationships > questions
★ what type of relationship does each segment expect?
★ which relationships have been established?
★ how are they integrated with the rest of the model?
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revenue streams / return
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revenue streams / return
“...represents the cash a company generates from each customer segment (costs must be subtracted from revenues to create earnings).”
~BMG, p. 30
3 4
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revenue streams > questions
★ for what value are customers really willing to pay?
★ for what do they currently pay? ★ how are they currently paying? ★ how much does each revenue stream
contribute to overall revenue?
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key resources
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key resources
“...the most important assets required to make the business model work.”
~BMG, p. 34
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key resources > questions
★ what key resources do your value propositions require? ★ distribution channels? ★ customer relationships? ★ revenue streams?
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key activities
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key activities
“...describes the most important things a company must do to make its business model work.”
~BMG, p. 36
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key activities > questions
★ what key activities do your value propositions require? ★ distribution channels? ★ customer relationships? ★ revenue streams?
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key partnerships
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key partnerships
“...describes the network of suppliers and partners that make the business model work.”
~BMG, p. 38
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key pARTNERSHIPS > questions
★ who are the key partners? ★ who are the key suppliers? ★ which key resources do you need from
someone else? ★ which key activities do partners
perform?
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cost structure
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cost structure
“...describes all costs incurred to operate the business model.”
~BMG, p. 40
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cost structure > questions
★ what are the most important costs inherent in our business model?
★ which key resources are most expensive?
★ which key activities are most expensive?
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customer development
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KP KA VP
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BMG
, p. 7
4-75
biz model
KP KA VP
KR
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BMG
, p. 7
4-75
biz model
ASSUMPTIONS
(LEAPS OF FAITH)
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customer development
★ four-step framework ★ discover and validate your market ★ built the right product features ★ solve customers’ needs ★ tested methods for acquiring customers ★ deployed resources to scale business
5 1
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customer development
★ process by which you question and test the core assumptions of your idea
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cust dev > 1. customer discovery
5 3
customer discovery
problem-solution fit
proposedmvp
★ a product solves a problem for an identified group of users
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cust dev > 2. customer validation
5 4
customer validation
product-market fit
biz model
sales map
★ the market is large enough to build a viable business
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cust dev > 3. company creation
5 5
company creation
scale execution
★ the business is scalable through repeatable sales
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cust dev > 4. company building
5 6
company building
scaleorganization
scaleoperations
★ company grows and operational processes are created to support growth
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cust dev > framework
5 7
customer discovery
customer validation
company creation
company building
problem-solution fit
proposedmvp
product-market fit
biz model
sales map
scale execution
scaleorganization
scaleoperations
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cust dev > pivot
5 8
customer discovery
pivot
company creation
company building
problem-solution fit
proposedmvp
product-market fit
biz model
sales map
scale execution
scaleorganization
scaleoperations
customer validation
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pivot
“...a structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth.”
~ Eric Ries, The Lean Startup
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pivot > based on learning
“A pivot requires that we keep one foot rooted in what we’ve learned so far, while making a fundamental change in strategy in order to seek even greater validated learning.”
~ Eric Ries, The Lean Startup
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discovery + validation
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cust dev > first stage
6 2
customer discovery
pivot
company creation
company building
problem-solution fit
proposedmvp
product-market fit
biz model
sales map
scale execution
scaleorganization
scaleoperations
customer validation
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empathy map > bonus worksheet
★ understanding the mindset of the user ★ influences ★ pressures ★ pains, gains
★ anticipating their needs
6 3
BMG, p. 131
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wrap6
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instinct
“There is no way to remove the human element--vision, intuition, judgment--from the practice of entrepreneurship, nor would that be desirable.”
!
~ Eric Ries, The Lean Startup
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reminders for application
There are no facts inside your
building, so get outside.
6 6
The best startup ideas ideas come
from noticing.
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reminders for application
Determine what you want to learn before you build.
6 7
Build a minimum viable product
with the smallest possible feature
set.
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reminders for application
No business plan survives first contact with customers.
6 8
Failure is an integral part of
the search.
evaluationwhat did you think?
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APRIL 8, 2014
Helen Kula
Head, Learning & Curriculum Support Team University of Guelph [email protected]
@mjdelia
Librarian, Institute for Management and Innovation U of Toronto Mississauga [email protected]
@helenkula
M.J. D’Elia
contact info
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references
7 1
Blank, S. & Dorf, B. (2012). The Startup Owner’s Manual. Pescadero, CA: K&S Ranch.Cooper, B. & Vlaskovits, P. (2010). The Entrepreneur’s Guide to Customer Development. Newport Beach, CA: Cooper-VlaskovitsGreenberg, D., McKone-Sweet, K. & Wilson, H. J. (2011). The New entrepreneurial leader. San Francisco: Berrett-Koehler Publishers.Kiefer, C. F., Schlesinger, L. A. & Brown, P. B. (2010). Action trumps everything. Duxbury, MA: Black Ink PressKomisar, J. & Mullins, R. (2009). Getting to Plan B. Cambridge, MA: Harvard Business.Martin, R. (2009). The design of business. Boston: Harvard Business Press. Osterwalder, A. & Pigneur, Y. (2010). Business model generation. Hoboken, NJ: Wiley.Ries, E. (2011). The Lean Startup. New York: Crown Business.