AlexOsterwalder.com
@business_design
Creating
Start-Up
Success 101
SteveBlank.com
@sgblank
Contribution by Alan Smith @thi...
BusinessModelGeneration.com StevenBlank.com/books.html
+
this presentation combines two global bestsellers
So what makes for a
successful start-up?
Start with a brilliant
founder like...
Mike, 34
Stanford
Alumnus
he used to be an...
Experienced
Exec
All his operating
experience built up
some...
...outstanding
credentials!
One day Mike has...
A “killer”
product idea!
A “killer”
product idea!
he’s really
passionate about it
Mike’s experienced.
He knows how to test his
idea using...
...market
research
The research looks good!
Mike moves forward, and
writes a fantastic....
Great!
Based on the credentials,
research, and plan, Mike has
secured the final piece...
...VC Funding!
Money in hand,
Mike get’s started on
...building his
start-up.
He makes the headlines
of every major...
... and is invited to give...
...keynote talks
Mike and his
start-up are
on a roll!
How likely is his
business to
succeed?
Despite the experience,
research and plan...
...Mike
slipped up.
29
Let’s help Mike
with 5 things he
didn’t know.
No business
plan survives
the first
customer
contact.
1
Sticking to a planning
document works for a
known future, not for a
start-up context.
Plan’s fail in start-ups.
It’s the
business
model,
stupid.
2
Hey Mike, your plan was
to build a company, but
did your plan include a
Business Model?
“A business model describes
the rationale of how an organization
creates, delivers, and captures value”
Here are the 9 building blocks of
a business model:
CUSTOMER SEGMENTS
images by JAM
which customers and users are you serving?
which jobs do they really want to get done?
VALUE PROPOSITIONS
images by JAM
what are you offering them? what is that
getting done for them? do they care?
CHANNELS
images by JAM
how does each customer segment want to be reached?
through which interaction points?
CUSTOMER RELATIONSHIPS
images by JAM
what relationships are you establishing with each segment?
personal? automated? acqui...
REVENUE STREAMS
images by JAM
what are customers really willing to pay for? how?
are you generating transactional or recur...
KEY RESOURCES
images by JAM
which resources underpin your b.model?
which assets are essential?
KEY ACTIVITIES
images by JAM
which activities do you need to perform well in
your b.model? what is crucial?
KEY PARTNERS
images by JAM
which partners and suppliers leverage your model?
who do you need to rely on?
COST STRUCTURE
images by JAM
what is the resulting cost structure?
which key elements drive your costs?
images by JAM
customer
segments
key
partners
cost
structure
revenue
streams
channels
customer
relationships
key
activities...
“Hmm, interesting so
what do I make of
that?”
use it as a tool to...
sketchoutyourbusinessmodel
building
block
building
block
building
block
building
block building
block
building
block
building
block
building
block
building
block
building
block
building
block
building
block
building
block
bu...
This tool is called the
Business Model Canvas
(download with instructions at
www.businessmodelgeneration.com/downloads)
Take time
to think
through
alternative
possibilities.
3
the same technology, product, or service
can have numerous business models
try sketching out alternative
business models by asking
yourself...
transactional vs.
recurring revenues
fixed vs. variable
costs
acquisition vs. retention
one customer segment
vs. another
c...
onlymakeafirstchoiceafterprototyping
andthinkingthroughseveralmodels...
OK. You’ve got your model,
but you’re not done yet...
Your business
model idea is
just a set of
hypotheses.
4
a business model might look great on
paper...
building
block
buildingblock
building
block
building block
blockbuilding
blo...
guess guess
guess
guess
guess
guess
guess
guess
guess
guess
guess
guess
... just a set of hypotheses
...so you need to get out of the
building and...
test each hypothesis
(e.g. with customers)
this business model testing process is
called Customer Development
customer
discovery
customer
validation
customer
creatio...
two different phases...
search
execution
customer
discovery
customer
validation
customer
creation
company
building
pivot
and it starts with...
customer
discovery
customer
validation
customer
creation
company
building
pivot
... verifying
every
hypothesis
test your hypotheses
product
market type
competition
test your hypotheses
problem
customer
user
payer
test your hypotheses
channel
test your hypotheses
problem
customer
user
payer
channel
product
market type
competition
pricing
model
validate business
m...
to accomplish this you will need a special
and agile ...
customer
development
team
A team that ...
... gets out of the
building!
... to test and adapt your model
problem
customer
user
payer
channel
product
market type
competition
pricing
model
validat...
customer
discovery
customer
validation
customer
creation
company
building
you need to adapt the
business model until
you c...
“How do I prove
a business
model works?”
One example of “proving” is
concluding the ...
...salesofa“minimumviable
featureset”
This adaptation process is called ...
the pivot
(repeat * until proven)
customer
discovery
customer
validation
customer
creation
company
building
pivot
so do you have any “factual” proof?
Congratulations!
You finished the search
process!
So don’t ever forget ...
Don’t build your
company, until
you’ve verified
your Business
Model
5
or you’ll risk ...
Burningyourcashwhile
searchingforaworking
businessmodel
execution is not search
execution follows search
Build when you’ve found
your model
only then execute:
scale your marketing
execution
customer
discovery
customer
validation
customer
creation
company
building
pivot
and build your org
structures
execution
customer
discovery
customer
validation
customer
creation
company
building
pivot
Don’t build your company,
until you’ve verified your
Business Model
5
Your business model idea is
just a set of hypotheses...
BusinessModelGeneration.com StevenBlank.com/books.html
+
you can read more about business models and the
customer developm...
BusinessModelGeneration.com
AlexOsterwalder.com
@business_design
StevenBlank.com/books.html
SteveBlank.com
@sgblank
Good
L...
Successfulentrepreneurship 101111173533-phpapp01 (1)
Successfulentrepreneurship 101111173533-phpapp01 (1)
Successfulentrepreneurship 101111173533-phpapp01 (1)
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Successfulentrepreneurship 101111173533-phpapp01 (1)

  1. 1. AlexOsterwalder.com @business_design Creating Start-Up Success 101 SteveBlank.com @sgblank Contribution by Alan Smith @thinksmith
  2. 2. BusinessModelGeneration.com StevenBlank.com/books.html + this presentation combines two global bestsellers
  3. 3. So what makes for a successful start-up?
  4. 4. Start with a brilliant founder like...
  5. 5. Mike, 34 Stanford Alumnus
  6. 6. he used to be an...
  7. 7. Experienced Exec
  8. 8. All his operating experience built up some...
  9. 9. ...outstanding credentials!
  10. 10. One day Mike has...
  11. 11. A “killer” product idea!
  12. 12. A “killer” product idea! he’s really passionate about it
  13. 13. Mike’s experienced. He knows how to test his idea using...
  14. 14. ...market research
  15. 15. The research looks good! Mike moves forward, and writes a fantastic....
  16. 16. Great! Based on the credentials, research, and plan, Mike has secured the final piece...
  17. 17. ...VC Funding!
  18. 18. Money in hand, Mike get’s started on
  19. 19. ...building his start-up.
  20. 20. He makes the headlines of every major...
  21. 21. ... and is invited to give...
  22. 22. ...keynote talks
  23. 23. Mike and his start-up are on a roll!
  24. 24. How likely is his business to succeed?
  25. 25. Despite the experience, research and plan...
  26. 26. ...Mike slipped up.
  27. 27. 29 Let’s help Mike with 5 things he didn’t know.
  28. 28. No business plan survives the first customer contact. 1
  29. 29. Sticking to a planning document works for a known future, not for a start-up context. Plan’s fail in start-ups.
  30. 30. It’s the business model, stupid. 2
  31. 31. Hey Mike, your plan was to build a company, but did your plan include a Business Model?
  32. 32. “A business model describes the rationale of how an organization creates, delivers, and captures value”
  33. 33. Here are the 9 building blocks of a business model:
  34. 34. CUSTOMER SEGMENTS images by JAM which customers and users are you serving? which jobs do they really want to get done?
  35. 35. VALUE PROPOSITIONS images by JAM what are you offering them? what is that getting done for them? do they care?
  36. 36. CHANNELS images by JAM how does each customer segment want to be reached? through which interaction points?
  37. 37. CUSTOMER RELATIONSHIPS images by JAM what relationships are you establishing with each segment? personal? automated? acquisitive? retentive?
  38. 38. REVENUE STREAMS images by JAM what are customers really willing to pay for? how? are you generating transactional or recurring revenues?
  39. 39. KEY RESOURCES images by JAM which resources underpin your b.model? which assets are essential?
  40. 40. KEY ACTIVITIES images by JAM which activities do you need to perform well in your b.model? what is crucial?
  41. 41. KEY PARTNERS images by JAM which partners and suppliers leverage your model? who do you need to rely on?
  42. 42. COST STRUCTURE images by JAM what is the resulting cost structure? which key elements drive your costs?
  43. 43. images by JAM customer segments key partners cost structure revenue streams channels customer relationships key activities key resources value proposition
  44. 44. “Hmm, interesting so what do I make of that?”
  45. 45. use it as a tool to...
  46. 46. sketchoutyourbusinessmodel
  47. 47. building block
  48. 48. building block building block building block building block
  49. 49. building block building block building block building block building block building block building block building block building block building block building block building block
  50. 50. This tool is called the Business Model Canvas (download with instructions at www.businessmodelgeneration.com/downloads)
  51. 51. Take time to think through alternative possibilities. 3
  52. 52. the same technology, product, or service can have numerous business models
  53. 53. try sketching out alternative business models by asking yourself...
  54. 54. transactional vs. recurring revenues fixed vs. variable costs acquisition vs. retention one customer segment vs. another capital expenditure vs. partnership paid vs. free product vs. service copyright vs. copyleft open vs. closed human intensive vs. system intensive personal vs. automated direct sales vs. indirect sales advertising vs. sales niche market vs. mass market scale vs. scope blue ocean vs. red ocean disruptive vs. incremental in-sourcing vs. out- sourcing tailor-made vs. mass production distributed vs. centralized physical vs. virtual difficult questions
  55. 55. onlymakeafirstchoiceafterprototyping andthinkingthroughseveralmodels...
  56. 56. OK. You’ve got your model, but you’re not done yet...
  57. 57. Your business model idea is just a set of hypotheses. 4
  58. 58. a business model might look great on paper... building block buildingblock building block building block blockbuilding block building block building block buildingblock building block buildingblock buildingblock building block ... but be honest that it’s
  59. 59. guess guess guess guess guess guess guess guess guess guess guess guess ... just a set of hypotheses
  60. 60. ...so you need to get out of the building and...
  61. 61. test each hypothesis (e.g. with customers)
  62. 62. this business model testing process is called Customer Development customer discovery customer validation customer creation company building pivot
  63. 63. two different phases...
  64. 64. search execution customer discovery customer validation customer creation company building pivot
  65. 65. and it starts with...
  66. 66. customer discovery customer validation customer creation company building pivot ... verifying every hypothesis
  67. 67. test your hypotheses product market type competition
  68. 68. test your hypotheses problem customer user payer
  69. 69. test your hypotheses channel
  70. 70. test your hypotheses problem customer user payer channel product market type competition pricing model validate business model channel (customer) (problem) demand creation
  71. 71. to accomplish this you will need a special and agile ...
  72. 72. customer development team
  73. 73. A team that ...
  74. 74. ... gets out of the building!
  75. 75. ... to test and adapt your model problem customer user payer channel product market type competition pricing model validate business model channel (customer) (problem) demand creation agile business model adaptation customer development team
  76. 76. customer discovery customer validation customer creation company building you need to adapt the business model until you can prove it works pivot
  77. 77. “How do I prove a business model works?”
  78. 78. One example of “proving” is concluding the ...
  79. 79. ...salesofa“minimumviable featureset”
  80. 80. This adaptation process is called ...
  81. 81. the pivot (repeat * until proven) customer discovery customer validation customer creation company building pivot
  82. 82. so do you have any “factual” proof?
  83. 83. Congratulations!
  84. 84. You finished the search process!
  85. 85. So don’t ever forget ...
  86. 86. Don’t build your company, until you’ve verified your Business Model 5
  87. 87. or you’ll risk ...
  88. 88. Burningyourcashwhile searchingforaworking businessmodel
  89. 89. execution is not search
  90. 90. execution follows search
  91. 91. Build when you’ve found your model
  92. 92. only then execute:
  93. 93. scale your marketing execution customer discovery customer validation customer creation company building pivot
  94. 94. and build your org structures execution customer discovery customer validation customer creation company building pivot
  95. 95. Don’t build your company, until you’ve verified your Business Model 5 Your business model idea is just a set of hypotheses. 4 Take time to think through alternative possibilities 3 It’s the business model, stupid.2 No business plan survives the first customer contact. 1
  96. 96. BusinessModelGeneration.com StevenBlank.com/books.html + you can read more about business models and the customer development process here:
  97. 97. BusinessModelGeneration.com AlexOsterwalder.com @business_design StevenBlank.com/books.html SteveBlank.com @sgblank Good Luck! Contribution by Alan Smith @thinksmith
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