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@NYUEntrepreneur
So I’ve got a big idea…now what?!Frank RimalovskiExecutive Director, NYU Entrepreneurial InstituteManaging Director, NYU Innovation Venture FundInstructor, NSF Innovation Corps (I-Corps)March 20, 2017
@NYUEntrepreneur
75% of startups fail to return investors capitalShikhar GhoshHarvard Business School
@NYUEntrepreneur
So why do so many startups
fail?
@NYUEntrepreneur
“More startups fail from a lack
of customers than from a
failure of product
development.”
@NYUEntrepreneur
Top 12 Reasons Startups Fail
@NYUEntrepreneur
Top 12 Reasons Startups Fail
42%#nyuef
cite lackof marketneed
@NYUEntrepreneur7
“Starting a startup is something you can only learn intrinsically by
doing it. What you need to learn is
the needs of your own users.”
@NYUEntrepreneur
Need to do this before you finish designing and/or building your product/service
@NYUEntrepreneur
Bigger Than a Revenue Modelu Who are our initial target customers?
u What do they value/why will they buy?
u How do we get/keep/grow customers?
u What’s our channel strategy/how will we deliver?
u What’s our revenue model/how will we make money?
u What key partnerships do we need to start?
u What are the key skills do we need on our team?
u What are our cost structure/unit economics?
9
@NYUEntrepreneur
Evidence-based Entrepreneurship(aka the Lean Startup)
10
@NYUEntrepreneur
@NYUEntrepreneur
All I Need to Do is Make the Forecast
@NYUEntrepreneur
“For everyone of our
failures, we had
spreadsheetsthat looked awesome!”
@NYUEntrepreneur
“Everyonehas a planuntil they get punched in the face!”
@NYUEntrepreneur
@NYUEntrepreneur
Planning comes beforethe plan
@NYUEntrepreneur17
“In preparing for battle I have always found that plans are useless, but planning is indispensable.”
@NYUEntrepreneur
Business Model CanvasThe Business Model Canvas
Revenue Streams
Channels
Customer SegmentsValue PropositionsKey ActivitiesKey Partners
Key Resources
Cost Structure
Customer Relationships
Designed by: Date: Version:Designed for:
designed by: Strategyzer AGThe makers of Business Model Generation and Strategyzer
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit:http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
strategyzer.com
What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?
is your business moreCost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)Value Driven (focused on value creation, premium value proposition)
sample characteristicsFixed Costs (salaries, rents, utilities)Variable costsEconomies of scaleEconomies of scope
Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?
channel phases1. Awareness
How do we raise awareness about our company’s products and services?2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?3. Purchase
How do we allow customers to purchase specific products and services?4. Delivery
How do we deliver a Value Proposition to customers?5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?Who are our most important customers?
Mass MarketNiche MarketSegmentedDiversifiedMulti-sided Platform
What type of relationship does each of our Customer Segments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?
examplesPersonal assistanceDedicated Personal AssistanceSelf-ServiceAutomated ServicesCommunitiesCo-creation
What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?
categories ProductionProblem SolvingPlatform/Network
What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?
types of resourcesPhysicalIntellectual (brand patents, copyrights, data)HumanFinancial
Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?
motivations for partnershipsOptimization and economy Reduction of risk and uncertaintyAcquisition of particular resources and activities
What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?
characteristicsNewnessPerformanceCustomization“Getting the Job Done”DesignBrand/StatusPriceCost ReductionRisk ReductionAccessibilityConvenience/Usability
typesAsset saleUsage feeSubscription FeesLending/Renting/LeasingLicensingBrokerage feesAdvertising
fixed pricingList PriceProduct feature dependentCustomer segment dependentVolume dependent
dynamic pricingNegotiation (bargaining)Yield ManagementReal-time-Market
@NYUEntrepreneur19
So what do we do?
@NYUEntrepreneur
What’s a Startup?
@NYUEntrepreneur
A temporary organization designed to search for a repeatable and scalable business model
@NYUEntrepreneur
A temporary organization designed to searchfor a repeatable and scalable business model
@NYUEntrepreneur
A temporary organization designed to search for a repeatable and scalable business model
@NYUEntrepreneur
A temporary organization designed to search for a repeatable and scalable business model
@NYUEntrepreneur
What is a Business Model?
How a company creates value for itself
while delivering products or services for
customers
@NYUEntrepreneur
The Business Model Canvas
Revenue Streams
Channels
Customer SegmentsValue PropositionsKey ActivitiesKey Partners
Key Resources
Cost Structure
Customer Relationships
Designed by: Date: Version:Designed for:
designed by: Strategyzer AGThe makers of Business Model Generation and Strategyzer
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit:http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
strategyzer.com
What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?
is your business moreCost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)Value Driven (focused on value creation, premium value proposition)
sample characteristicsFixed Costs (salaries, rents, utilities)Variable costsEconomies of scaleEconomies of scope
Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?
channel phases1. Awareness
How do we raise awareness about our company’s products and services?2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?3. Purchase
How do we allow customers to purchase specific products and services?4. Delivery
How do we deliver a Value Proposition to customers?5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?Who are our most important customers?
Mass MarketNiche MarketSegmentedDiversifiedMulti-sided Platform
What type of relationship does each of our Customer Segments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?
examplesPersonal assistanceDedicated Personal AssistanceSelf-ServiceAutomated ServicesCommunitiesCo-creation
What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?
categories ProductionProblem SolvingPlatform/Network
What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?
types of resourcesPhysicalIntellectual (brand patents, copyrights, data)HumanFinancial
Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?
motivations for partnershipsOptimization and economy Reduction of risk and uncertaintyAcquisition of particular resources and activities
What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?
characteristicsNewnessPerformanceCustomization“Getting the Job Done”DesignBrand/StatusPriceCost ReductionRisk ReductionAccessibilityConvenience/Usability
typesAsset saleUsage feeSubscription FeesLending/Renting/LeasingLicensingBrokerage feesAdvertising
fixed pricingList PriceProduct feature dependentCustomer segment dependentVolume dependent
dynamic pricingNegotiation (bargaining)Yield ManagementReal-time-Market
The Business Model Canvas
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
HypothesisHypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
@NYUEntrepreneur
More than half of your assumptions are wrong!
27
@NYUEntrepreneur
Customer DevelopmentHow you search for the business model
Test assumptions about customer needs/problem & develop MVPs
Seek validationthat people are interested in your product/ solution
Begins to builddemand & improve efficiency of customer acquisition
Drive growth aggressively & execute business model
@NYUEntrepreneur
“You can’t just ask customers
what they want and then try to give that
to them.”
@NYUEntrepreneur
“New ideas come from watchingsomething, talk(ing) to people,experimenting,asking questions and getting out of the office!”
@NYUEntrepreneur31
@NYUEntrepreneur
“Great founders
never put anyone
between themselves
and their users.”
@NYUEntrepreneur
The Business Model Canvas
Revenue Streams
Channels
Customer SegmentsValue PropositionsKey ActivitiesKey Partners
Key Resources
Cost Structure
Customer Relationships
Designed by: Date: Version:Designed for:
designed by: Strategyzer AGThe makers of Business Model Generation and Strategyzer
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit:http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
strategyzer.com
What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?
is your business moreCost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)Value Driven (focused on value creation, premium value proposition)
sample characteristicsFixed Costs (salaries, rents, utilities)Variable costsEconomies of scaleEconomies of scope
Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?
channel phases1. Awareness
How do we raise awareness about our company’s products and services?2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?3. Purchase
How do we allow customers to purchase specific products and services?4. Delivery
How do we deliver a Value Proposition to customers?5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?Who are our most important customers?
Mass MarketNiche MarketSegmentedDiversifiedMulti-sided Platform
What type of relationship does each of our Customer Segments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?
examplesPersonal assistanceDedicated Personal AssistanceSelf-ServiceAutomated ServicesCommunitiesCo-creation
What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?
categories ProductionProblem SolvingPlatform/Network
What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?
types of resourcesPhysicalIntellectual (brand patents, copyrights, data)HumanFinancial
Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?
motivations for partnershipsOptimization and economy Reduction of risk and uncertaintyAcquisition of particular resources and activities
What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?
characteristicsNewnessPerformanceCustomization“Getting the Job Done”DesignBrand/StatusPriceCost ReductionRisk ReductionAccessibilityConvenience/Usability
typesAsset saleUsage feeSubscription FeesLending/Renting/LeasingLicensingBrokerage feesAdvertising
fixed pricingList PriceProduct feature dependentCustomer segment dependentVolume dependent
dynamic pricingNegotiation (bargaining)Yield ManagementReal-time-Market
The Business Model Canvas
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
HypothesisHypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
@NYUEntrepreneur
@NYUEntrepreneur
Value PropositionWhat Problem Are You Solving?
@NYUEntrepreneur
Value Proposition
u describes the benefits customers can expect from a bundle of products and services
@NYUEntrepreneur
Customer SegmentWho Cares?
@NYUEntrepreneur
Customer Profile
u Who are they and why would they buy?
@NYUEntrepreneur
Problem-Solution Fit
Fit
@NYUEntrepreneurhttp://bit.ly/2ncE5IS
@NYUEntrepreneur
Value PropositionWhat Problem Are You Solving?
@NYUEntrepreneur
Key Questions for Value Prop
u Problem Statement: What is the problem?
u Technology/Market Insight: Why is the problem so hard to solve today?
u Product: How do you solve it today?
u Competition: Who is delivering that solution?
u Utility: What level of improvement in efficacy/speed/cost/etc. is needed?
u Market Size: How big is this problem?
@NYUEntrepreneur
Customer SegmentWho Cares?
@NYUEntrepreneur
Define Customer Archetype
u Who are they?o Position / title / age / sex / role
u How/where do they buy?o Discretionary budget (name of
budget and amount)
u What matters to them?o What motivates them?
u Who influences them?o What do they read/who do they
listen to?
@NYUEntrepreneur
put yourself in the customers’ shoes
@NYUEntrepreneur
What is your potential customer trying to get done?
Jobs to be Done
46
@NYUEntrepreneur
…they want a quarter-inch hole!"
“People don't want to buy a quarter-inch drill…
SOLUTION(WHAT)
JOB(WHY)
InnosightLLC
@NYUEntrepreneur
“Make me efficient at my work”
FUNCTIONAL
“Convey my professional status”
SOCIAL
“Make me confident that I can get the job
done”
EMOTIONAL
“Help me perform likea professional”
JOB
• Valueà demonstrate my ability to recognize value
• Prestigeà show others that I focus on quality starting with my equipment
• Confidenceà ensure me that I can count on my equipment
• Versatilityà give me the ability to work in different environments
• Powerà give me the ability to cut through thick/dense material
• Speedà help me get the project done quickly
InnosightLLC
@NYUEntrepreneur
Guess the product from the job
I want to feel confident when having a
close conversation
I want my mouth to feel refreshed
I want to kill the germs that cause bad breath
I want to show that I have the latest gadget
I want to be able to get information easily
when on the go
I want to kill small snippets of time
productively
I want feel ‘in-the-know’ about things
happening in my social circle
I want an efficient way to share my pictures
with all my friends and family
I want a way to reconnect with friends I
haven’t talked to in a while
I want to feel like I’m buying the best for my
family
I want to be socially conscious
I want access to high-quality grocery products
I want the convenience of shopping online
I want to be able to decide how much I will
pay for a product
I want an easy way to sell things I no longer
need
InnosightLLC
@NYUEntrepreneur
Who’s the Customer?
User
@NYUEntrepreneur
Who’s the Customer?
User EconomicBuyer
@NYUEntrepreneur
Who’s the Customer?
User Influencer Recommender DecisionMaker
SaboteurEconomicBuyer
@NYUEntrepreneur
“Customer”Ecosystem of people you need to understand, satisfy and appeal to in order to get them to buy your product
@NYUEntrepreneur
Technology Lifecycle Adoption Curve
54
@NYUEntrepreneur
Who wants…uA combined phone, internet
browsing & mail device withoNo copy & pasteoNo physical keyboardoOnly 2G data speedsoNo corporate emailoNo 3rd party appsoOnly works on one carrier
@NYUEntrepreneur
@NYUEntrepreneur
Look familiar?
0
20
40
60
80
100
120
140
160
180
Year 1 (2007-08)
Year 2 (2008-09)
Year 3 (2009-10)
Year 4 (2010-11)
Year 5 (2011-12)
Year 6 (2012-13)
Year 7 (2013-14)
Uni
t Sa
les
(mill
ions
)
Apple iPhone Sales Since Introduction
Enthusiasts
Visionaries
Pragmatists
@NYUEntrepreneur
What’s your point?I have two!
58
@NYUEntrepreneur
1. As a startup, you are not capable of serving the mainstream marketWith your half-baked product, small staff & non-existent sales & market budget
59
@NYUEntrepreneur
2. There is no point in building the features you will need when you have a million usersOptimize your product for the immediate stage of growth
60
@NYUEntrepreneur61
“The key to success I know not, buttrying to please everyone, the key to failure is.”
@NYUEntrepreneur
Product / Solution Fit?
I’ve figured out who I’m selling to and what pain point I’m solving!
I’m ready to start building and selling… Right?!
@NYUEntrepreneur
? ✔ ✔?
?
?
?? ?
Not so fast!
You can’t have a valid business until you test
both sides of the canvas!
@NYUEntrepreneur
Customer RelationshipsHow do you Get, Keep and Grow Customers?
@NYUEntrepreneur
ChannelsHow does your product get to customers?
@NYUEntrepreneur
Revenue StreamsHow do you make money?
@NYUEntrepreneur
Key ActivitiesWhat are the most important things your
business needs to be good at?
@NYUEntrepreneur
Key ResourcesWhat are your most important assets?
@NYUEntrepreneur
Key PartnersWho are your partners and suppliers?
@NYUEntrepreneur
Cost StructureWhat are the key costs and expenses?
@NYUEntrepreneur
The Business Model Canvas
Revenue Streams
Channels
Customer SegmentsValue PropositionsKey ActivitiesKey Partners
Key Resources
Cost Structure
Customer Relationships
Designed by: Date: Version:Designed for:
designed by: Strategyzer AGThe makers of Business Model Generation and Strategyzer
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit:http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
strategyzer.com
What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?
is your business moreCost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)Value Driven (focused on value creation, premium value proposition)
sample characteristicsFixed Costs (salaries, rents, utilities)Variable costsEconomies of scaleEconomies of scope
Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?
channel phases1. Awareness
How do we raise awareness about our company’s products and services?2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?3. Purchase
How do we allow customers to purchase specific products and services?4. Delivery
How do we deliver a Value Proposition to customers?5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?Who are our most important customers?
Mass MarketNiche MarketSegmentedDiversifiedMulti-sided Platform
What type of relationship does each of our Customer Segments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?
examplesPersonal assistanceDedicated Personal AssistanceSelf-ServiceAutomated ServicesCommunitiesCo-creation
What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?
categories ProductionProblem SolvingPlatform/Network
What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?
types of resourcesPhysicalIntellectual (brand patents, copyrights, data)HumanFinancial
Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?
motivations for partnershipsOptimization and economy Reduction of risk and uncertaintyAcquisition of particular resources and activities
What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?
characteristicsNewnessPerformanceCustomization“Getting the Job Done”DesignBrand/StatusPriceCost ReductionRisk ReductionAccessibilityConvenience/Usability
typesAsset saleUsage feeSubscription FeesLending/Renting/LeasingLicensingBrokerage feesAdvertising
fixed pricingList PriceProduct feature dependentCustomer segment dependentVolume dependent
dynamic pricingNegotiation (bargaining)Yield ManagementReal-time-Market
9+ Guesses!
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
HypothesisHypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
@NYUEntrepreneur
Customer DevelopmentHow you search for the business model
Test assumptions about customer needs/problem & develop MVPs
Seek validationthat people are interested in your product/ solution
Begins to builddemand & improve efficiency of customer acquisition
Drive growth aggressively & execute business model
@NYUEntrepreneur
Customer DiscoveryuApply the scientific method to
business model development
Modify hypothesis
Observe phenomena
Formulate hypothesis
Test hypothesis via rigorous experiments
Establish theory
based on repeated
validation of results
PIVOT!
@NYUEntrepreneur
Talk to Humans!u Get out of
the building!
u In person is best
u You must gaininsight into your customer & market
u You are doing pattern recognition… Must have sufficient data points to see andto test all elements of your BMC!
@NYUEntrepreneur
Who do you want to learn from?
75
5
3A. Who Do You Want To Learn From (Inked)
@NYUEntrepreneur
Who Cares?
@NYUEntrepreneur
Do not fear picking the wrong market!
@NYUEntrepreneur78
@NYUEntrepreneur
Types of Customers
79
@NYUEntrepreneur80
@NYUEntrepreneur81
@NYUEntrepreneur82
@NYUEntrepreneur83
@NYUEntrepreneur84
@NYUEntrepreneur
@NYUEntrepreneur
Customers are People!
@NYUEntrepreneur
Finding Interview Subjects
7
5A. How Do You Find Your Interview Subjects (Inked)
87
@NYUEntrepreneur
Finding Interview Subjectsu At least one degree of separation
u Become a LinkedIn power user
u Make referrals happen
u Get creative…recruiting hacks
u Fish where the fish are…
u …In the wild
u Promise to be brief
u Tell them you’re studying or trying to learn about something!
88
@NYUEntrepreneur
Meet People You Don’t Know
u People you know will be nice and tell you what you want to hear
u Those interviews are possibly harmful
u Let others use people you know
u People you don’t know have no relationship to protect…Only they will tell you the truth
@NYUEntrepreneur
The Ugly Baby!
@NYUEntrepreneur
Pro Tipsu Practice, practice, practiceu NO email, focus groups or surveysu Don’t start with your dream customeru Being an entrepreneur means being
aggressive & persistentu Leverage your network!u Flatter subjectsu Be transparentu Follow up/stay in touch
91
@NYUEntrepreneur
What do you want to learn?
6
4D. What Do You Want To Learn
92
@NYUEntrepreneur
What do you want to learn?
93
The Business Model Canvas
Revenue Streams
Channels
Customer SegmentsValue PropositionsKey ActivitiesKey Partners
Key Resources
Cost Structure
Customer Relationships
Designed by: Date: Version:Designed for:
designed by: Strategyzer AGThe makers of Business Model Generation and Strategyzer
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit:http://creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
strategyzer.com
What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?
is your business moreCost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)Value Driven (focused on value creation, premium value proposition)
sample characteristicsFixed Costs (salaries, rents, utilities)Variable costsEconomies of scaleEconomies of scope
Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?
channel phases1. Awareness
How do we raise awareness about our company’s products and services?2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?3. Purchase
How do we allow customers to purchase specific products and services?4. Delivery
How do we deliver a Value Proposition to customers?5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?Who are our most important customers?
Mass MarketNiche MarketSegmentedDiversifiedMulti-sided Platform
What type of relationship does each of our Customer Segments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?
examplesPersonal assistanceDedicated Personal AssistanceSelf-ServiceAutomated ServicesCommunitiesCo-creation
What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?
categories ProductionProblem SolvingPlatform/Network
What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?
types of resourcesPhysicalIntellectual (brand patents, copyrights, data)HumanFinancial
Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?
motivations for partnershipsOptimization and economy Reduction of risk and uncertaintyAcquisition of particular resources and activities
What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?
characteristicsNewnessPerformanceCustomization“Getting the Job Done”DesignBrand/StatusPriceCost ReductionRisk ReductionAccessibilityConvenience/Usability
typesAsset saleUsage feeSubscription FeesLending/Renting/LeasingLicensingBrokerage feesAdvertising
fixed pricingList PriceProduct feature dependentCustomer segment dependentVolume dependent
dynamic pricingNegotiation (bargaining)Yield ManagementReal-time-Market
@NYUEntrepreneur
Don’t Assume You Understand the Problem!
@NYUEntrepreneur95
“(The great entrepreneurs) fall in love with
the problem, not the
solution.”
@NYUEntrepreneur
Ensuring effective interviews
8
6B. How To Ensure An Effective Session (Draft)
96
@NYUEntrepreneur
Do not sell!
@NYUEntrepreneur
Do not sell!u No demos! No presentations! No tech talk!
u Get stories, not speculation
u Ask open-ended questions
u Ask how they do their job, about their problems, & how they solve them today
u It’s about them. Not you. Not your product.
u Ask why? Then why? They why again!
98
@NYUEntrepreneur
What About IP?
uNever sign an NDA
uNever ask people to sign an NDA
u If you’re describing your idea/tech
in any detail, you’re doing it wrong
uFocus on the what & not the how
@NYUEntrepreneur
“Don’t worry about people
stealing an idea. If it’s
original, you will have to
ram it down their throats.”
@NYUEntrepreneur
“Don’t worry about people stealing your idea, worry that no one will care.”
@NYUEntrepreneur
Create an Interview Guideu A guide, not a script
u Helps to keep you organized & on point!
u Appear more professional, & ensure you get most important questions early
u Test your Customer Segment & Value Proposition hypotheses first
u List 5-8 questions to test your Value Proposition hypotheses with your initial target Customer Segment(s)
102
@NYUEntrepreneur
Focus on actual behaviorNot speculative or abstract feelings
103
@NYUEntrepreneur
Your job is not to validate your product…
Your job is not to validate your product…
It’s to validate the problem, who has it and
then how best to solve it?
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Documenting Interviewsu (Assign someone to) take notes
u Write down key a-ha’s as they happen
u Note questions that worked & use them again!
u Take pictures or videos!
u Write up & share key insights with your team ASAP!
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How do you make sense of what you learn?
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7B. How Do You Make Sense Of What You Learn (Draft)
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Gaining Insightu Facts are interesting…Insights are your goal
u Be honest…Don’t be too quick to validate or too slow to disprove your hypothesis
u Don’t just scratch the surface, dive deep
u Find the hidden motivations
u Understand their priorities
u Ask why? And why? Then why again?
u Depth of understanding leads to insight
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What’s an insight?
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in•sight |ˈinˌsīt|nounthe capacity to gain an accurate and deep intuitive understanding of a person or thing
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in•sight |ˈinˌsīt|nounsomething you’re so excited about you tell strangers on the train
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“It's grueling listening to
customer feedback. And
if it isn't, you're probably doing it wrong."
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Required Reading/Viewing
TALKING TO HUMANS
Success starts with understanding your customers
GIFF CONSTABLE
Pre-release edition
with Frank Rimalovskiand illustrations by Tom Fishburne
bit.ly/llpcdvstalkingtohumans.com
bit.ly/htbas-ep245
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Questions?
[email protected]@nyuentrepreneurentrepreneur.nyu.edu16 Washington Place
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