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Key Models & Definitions
Copyright © 2015 by the Board of Trustees of the Leland Stanford Junior University and Stanford Technology Ventures Program (STVP). This document may be reproduced for educational purposes only.
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What is Silicon Valley?
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Vision
Strategy
Execution
Starts With Vision!
Note: See Built to Last and other similar books by Jim Collins
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Vision
Strategy
Execution
Opportunity
Vision
Distinctive competencies
Business strategy
Structure
Profitability
Access to resources Capabilities of team
Innovation of novelty Industry context
Talent Processes
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Jim Collins’ Classic Entrepreneurship Model
FIRST THINGS FIRST
Assess Vision, Internal and External characteristics.
TALENT Team & Culture
IDEAS Product & Market Strategy
CAPITAL Cash Flow & Venture Finance
Managing Growth &
Change
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Sheryl Sandberg COO of Facebook
V-I-E E X E R C I S E
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Lean Startup Methods
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Moore’s “Crossing the Chasm” Model for B2B
The
Chas
m
Customers want Technology and Performance
Customers want Solutions and Convenience
Rela
tive
% o
f Cus
tom
ers
Time
INNOVATORS
EARLY ADOPTERS
EARLY MAJORITY
LATE MAJORITY
LAGGARDS
Tornado
Bowling Alley
Main Street
Source: Geoff Moore
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Moore’s “Gears” for B2C
Referral Contributions
SHARING
Advertising Retail
BUS MODEL
Traffic Eyeballs
HITS
Time on Site Interactions
LIKING
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Silicon Valley: Another Renaissance?
“No bankers, no renaissance.”
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The Most Important Risk Right Now?
TEAM RISK
MARKET RISK
CAPITAL RISK
TECHNOLOGICAL RISK
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Sources of Capital
Idea Business Plan
Prototype Beta
Sales Profitability
Decreasing Risk
$100K
$1M
$100M
Incr
easi
ng
Inve
stm
ent
Size
VC Banks Angels
(Groups & Syndicates)
FFF Gov’t
IPO Strategic Partners
Crowd
Reference: Trevor Loy (Flywheel)
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Bill Sahlman’s Classic Entrepreneurship Model
PEOPLE & RESOURCES Experiences, Skill,
Contacts, Attitude, Knowledge
CONTEXT Macroeconomy, Tax, Regulatory, Socio-political
DEAL Allocation of Risk
and Reward, Incentives, Signals,
Sorting, Consequences
OPPORTUNITY Entry Barriers,
Customers, Suppliers, Substitutes, Rivalry,
Economics
Project-Appropriate Financing
Option Preservation
Opportunity-Appropriate Knowing and Being Known
Appropriate Risk / Reward Allocation and Incentives
Investor Value Added
Favorable Technology Macroeconomy
Favorable Rules of the Game
Favorable Sociological Factors
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Models in E140A
TALENT
IDEAS
CAPITAL
Managing Growth & Change
C&L’s VIE
Cialdini’s Forces of Influence
Sahlman’s Concepts
Seelig’s Models, Blank’s Lean Startup, Moore’s Chasm
Mullins & Komisar’s Plan B, Kaplan’s Startup
Game, Osterwalder’s
Business Canvas
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Cases in E140A
TALENT
IDEAS
CAPITAL
Managing Growth & Change
C&L’s VIE
Cooliris, Roizen, Wily,
Hess
Yahoo, Dropbox
IMVU, Documentum
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Startup Development Phases