De-Risking A Business Venture Increasing Value by Decreasing Assumptions Steve Barsh stevebarsh.com  blog.stevebarsh.com steve@barsh.com  +1.215.888.2101  twitter: sbarsh

3 – 7 Key Assumptions stevebarsh.com

Common Assumptions Demand (huge problem) Market size Feature set Positioning / differentiation Product development Pricing Sales cycle stevebarsh.com Competition Team Execution Marketing Financials & forecasts Capital Exit value

Demand (huge problem)

Market size

Feature set

Positioning / differentiation

Product development

Pricing

Sales cycle

Competition

Team

Execution

Marketing

Financials & forecasts

Capital

Exit value

Stop Waving, Start Pointing! stevebarsh.com

De-Risking Identify risks & assumptions Before or while developing product Before pitching De-risk the risks stevebarsh.com

Identify risks & assumptions

Before or while developing product

Before pitching

De-risk the risks

De-Risking Goals Convert assumptions into knowledge At the lowest cost As quickly as possible Consume intellectual capital before venture capital Decrease assumptions to increase value stevebarsh.com

Convert assumptions into knowledge

At the lowest cost

As quickly as possible

Consume intellectual capital before venture capital

Decrease assumptions to increase value

Experiment / Test & Research! stevebarsh.com Hypotheses to prove Valid experiments to prove or disprove Release early, measure, learn, iterate Research Valid proxies you can use So, it’s / were just like ____ Be ready to defend

Hypotheses to prove

Valid experiments to prove or disprove

Release early, measure, learn, iterate

Research

Valid proxies you can use

So, it’s / were just like ____

Be ready to defend

3 Main Takeaways Key assumptions “ Experiments” to test Convert assumptions into knowledge Low capital Increase value stevebarsh.com

Key assumptions

“ Experiments” to test

Convert assumptions into knowledge

Low capital

Increase value

See Also Redeye VC Blog: Failing Cheaper by Josh Kopelman, First Round Capital. Common Mistakes Made by Entrepreneurs by Mark Henricks. How To: Raise Money in a Down Economy by Eric Ries at KPCB. stevebarsh.com

Redeye VC Blog: Failing Cheaper by Josh Kopelman, First Round Capital.

Common Mistakes Made by Entrepreneurs by Mark Henricks.

How To: Raise Money in a Down Economy by Eric Ries at KPCB.

De-Risking A Business Venture Increasing Value by Decreasing Assumptions Steve Barsh stevebarsh.com  blog.stevebarsh.com steve@barsh.com  +1.215.888.2101  twitter: sbarsh