Colorwheels E245 final presentation

Team Alice Brooks Colorwheels Create. Express. Inspire. Daniela Buchman Bettina Chen Miguel Reyes Unleashing the next generation of female Mentors creativity through innovative play… Nick O’Connor Ashton Udall Parents: 69 Kids: 110 High school girls: 6 Experts: 32 Manufacturers: 6 Bloggers: 3 Survey responses: 68 Total: 294E245 The Lean LaunchPad

Alice Brooks BS MIT Mech E Team MS Stanford Mech E Nest Labs Product Development, Rapid prototyping Miguel Reyes Bettina Chen BS IE (ASU) BS Caltech EE MS MS&E (Stanford) MS Stanford EE Intel Supply Chain, Mfg, Experience at a hardware Biz Dev, Teaching/presenting startup and mentoring kids to kids Daniela BuchmanMentors BS Brown Univ. Mech ENick O’Connor MS StanfordAshton Udall Mech E Product Dev, Teaching/ presenting to kids, ﬁnding local resources

Original ideaWe’ll combine the best features from these personality fun back story + beautiful design intuitive joiners inﬁnite+ educational + combinations To make a new interactive building set for girls

Original ideaWe’ll combine the best features from these Market Size personality + fun back million US females aged 5-9 10 story beautiful design intuitive joiners 50% adoption (or so we thought...) Basic kit $40 5 million * $40 = inﬁnite+ educational + combinations $200 million target market To make a new interactive building set for girls

Agenda Phase 1: Customer discovery Phase 2: Product and experience development Phase 3: Channels and strategy Appendix Project timelineTalking to parents, craigslistanalogous product postings, andlanding pages Testing with analogous products with kids

Agenda Phase 1: Customer discovery Phase 2: Product and experience development Phase 3: Channels and strategy Appendix Project timelineTalking to parents, craigslistanalogous product postings, andlanding pages Developing the product Testing with analogous Developing the experience products with kids (Children’s Creativity Museum)

Agenda Phase 1: Customer discovery Phase 2: Product and experience development Phase 3: Channels and strategy Appendix Project timelineTalking to parents, craigslistanalogous product postings, and Brainstorming new businesslanding pages Developing the product model ideas Testing with analogous Developing the experience Investigating MLM products with kids (Children’s Creativity Museum)

Business Model Canvas (Phase 1) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes Premium Direct communication Parents with Intuitive ParentParent college Marketing instructions communitynetworks degrees Child’s qualitySuppliers of life Daughter (user): Product R&D 5-9 years old lab Fun, unique Web sales social Design, Distribution, Materials, Asset sale (kits, add-ons) Manufacturing

Phase 1: Customer Discovery

Customer Discovery Goals

Customer Discovery GoalsUnderstand buyer’s wants, needs, and behaviorsUnderstand end user’s wants, needs, and behaviorsFigure out why a solution does not yet exist

What we did

What we didInterviewed 55 parents - In homes, at schools and museums, on the streets - Landing page tests - Purchasing behaviorObserved 41 kids playing - In homes, at schools and museums - Their toys, analogous products, initial prototypesInterviewed 18 experts - Professors, educators, toy industry veterans

Hypothesis testing

“Too mysterious” “Who is this for?”

“What am I supposed todo now?”

6 purchases

Key Learnings Hands-on learning Parents Convenient purchasing decision Educated STEM parents Fun to assemble and decorate Kids Community Girls aged 6-10 This problem is the holy grail Experts Differences in development correctable through play

Susan (STEM Mother) She’s a scientist. Household income: $80k+ She works 60+ hours a week and is incredibly busy. Motivations Needs educational toys/after school activities, so she can feel good about her daughter’s intellectual development. Wants to do anything she can to help her daughter prepare for college.Colorwheels AngleHeard about colorwheels through other moms; signs up for the mailing list and gets information/deals.Older “Mary Kay” girls are good role models for her daughter. Give her daughter something to aspire to

Susan (STEM Mother) She’s a scientist. Household income: $80k+ She works 60+She works a week a week and is incredibly busy. hours 60+ hours and is incredibly busy Motivations Needs educational toys/after school activities, so she can feel good about her daughter’s intellectual Anything to help development. her daughter Wants to do anything she can to help her daughter prepare for college for college. prepareColorwheels AngleHeard about colorwheels through other moms; signs up for the mailing list and gets Heard about Colorwheels information/deals.Older “Mary Kay” girls are good role models for her daughter. Give her daughter through other moms something to aspire to

Maya, 8 years oldAttends piano lessons, soccer practice, girl scouts, and advanced math classes after school.Her mother is a neurologist.MotivationsLikes playing with her friends and doing group activitiesIs interested in science but also likes playing pretend with her friends.Colorwheels AngleWay more fun than math classes and she gets to play with her friends.Interacts with “cool” older girls that help her build her projects.

Maya, 8 years oldAttends piano lessons, soccerafter school Many practice, girl activities scouts, and advanced math classes after school.Her mother is a neurologist. Playing with friendsMotivationsLikes playing with her friends and doing group activitiesIs interested in science but also likes playing pretend with her friends. Looks up to older girlsColorwheels AngleWay more fun than math classes and she gets to play with her friends.Interacts with “cool” older girls that help her build her projects.

Phase 2: Product and experiencedevelopment

Business Model Canvas (Phase 2) Learning topic Quick and Proven toys convenient buy Parents with Cant wait for college degrees,Online Interactive Keep daughters the next busy lifestylesMarketplace material occupied shipment Fun to Parents: assemble and decorate Daughter (user): Retail Playdates Online sales 7 to 9 years old Intuitive Girls: create instructions and advocate Hands-on learning Design, Distribution, Asset sale (kits, add-ons) Materials, Manufacturing Monthly Subscription

Revised Product Idea (DIY electronic kit)Skills Developed: Fine motor skills by Vision: Use our line-up of toys to build assembling the toy, spatial cognition Colorwheel CityBeneﬁts: Learn about voltage, solar Social Proof: Show off masterpiece on power, how circuits turn on/off website

Product and Experience Goals

Product and Experience GoalsDetermine if our presence is necessary in the current model forthe experience to succeedProduct that girls can learn from independently, with minimalparental involvement and stay engaged

What we did

What we didRemoved ourselves from the experienceShipped 12 MVP kits to local familiesTested social play and competition as motivatorHosted after school program at DuveneckMimicked Girl Scout community and culture to test engagementHosted 2 sessions at SF Children’s Creativity Museum

Hypothesis testing

Key Learnings Experience is more important than the product MVP Parents and kids are busy Varied parent expectations of the experience Diminishing returns: 12 kits not necessary Competition!Duveneck More fun in a group Parents prefer safe apps to website for kids Excitement at badges, community feel CCM The experience is essential We are part of the product and the experienceHow do we provide more role models?

Experience > ProductCapitalize on this with:- Party Packages- Physical store- Colorwheels Team Video Series- School programs, after schooland weekends- Young Mary Kay type agents

Experience > Product

Phase 3: Channels, Strategy

What we did4 Main Areas: Experience trumps product Channels Girl Scout model Market Broadening via MLMKept coming back to our 3 core principles: Girls STEM Hands-on learning

Business Model Canvas (Phase 3) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes Quick, convenient Learning topics iPad app buyReferrers Video demos Merit based level up Creativity and skills Educated STEM(parents and development parents Host classes Parent communitybloggers) and camps Assemble andOlder kids - role Tiger momsmodels - young decorate Train young repsreps Gift givers Kids communityKids: Build, post Parents community Online salesonline, share Educational Daughter (user): content Schools, Museum gift 7 to 9 years old Hands-on learning shops, Camps, Educational Homeschool Co-op, Kit Packager institution After school programs, Supply Chain Flash sale sites Design, Distribution, Materials, Multi-level marketing Manufacturing

Business Model Canvas (Phase 3) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes Quick, convenient Learning topics iPad appReferrers Video demos buy Merit-based Level up Merit based level up Creativity and skills Educated STEM(parents andbloggers) Host classes development (Gamiﬁcation) Parent community parents Older Kids asOlder kids - role and camps Assemble and Tiger moms decorate Role Models young repsmodels - youngreps Train Gift givers Kids communityKids: Build, post Parents community Online salesonline, share Educational Daughter (user): content Schools, Museum gift 7 to 9 years old Hands-on learning shops, Camps, Educational Homeschool Co-op, Kit Packager institution After school programs, Supply Chain Flash sale sites Multi-level Design, Distribution, Materials, Multi-level Marketing marketing Manufacturing

Updated Market Size (Online sales)“Online/Internet sales experiencing the most explosive revenue growth over 2009 at 22 percent.”US market size for building sets (2010): $1.2 billion (2x the 2004market size)– NPD Press Release 7.5M households with girls 5-9 20% of US households make over $92K US Toy Market $21.23 billion 7.5*0.20 = 1.5M Expect to get 30% of those households = 450K Target Market 450K*$100 = 45M $45 million ($100 comes from subscription and also from analogous toys that these households are willing to spend on)

Channels and Analytics

Summary of resultsChannel Funnel 6 kits sold*$20/kit=$120 revenue $120-6kits*$8materials/kit=>$72 proﬁt Cost of advertising (wildﬁre) = $13.91 acquisition revenue profit cost visitors $0.17 $0.10 $0.02 emails $0.78 $0.47 $0.09 sales $20.00 $12.00 $2.32

Customer map SF! Palo Alto! Ohio! Sunnyvale! Utah! 1! 3! 1! 1! Virginia!2 gift givers4 parents http://www.curtainrising.com/gallery/us_outline.gif

Girl Scout Model

Michelle, Junior in high school, 16Attends high school at a top school and is applying to 15 top colleges for applied math.“She’s more interested in the experience than the pay”MotivationsWants something to help her get into excellent four year college and pursue her degree in applied math.Colorwheels AngleFlexible working hoursGreat college application enhancerMoneyAbout 106K female students from the class of 2011 scored a 3 or higher on a STEM AP test

Michelle, Junior in high school, 16Attends high school at a interestedand the “She’s more top school in is applying to 15 top colleges for applied math. experience in the the pay” than“She’s more interested than experience the pay”MotivationsWants something to workingget into excellent Flexible help her hours four year college and pursue her degree in applied math.Colorwheels Angle Great college applicationFlexible working hours enhancerGreat college application enhancerMoneyAbout 106K female students from the class of 2011 scored a 3 or higher on a STEM AP test

Key LearningsChannels Better ways to reach target market Don’t leave out the gift givers MLM Evangelists: highly motivated teenagers Effectively train and retainPartners Exposure through: Local partnerships Bloggers: Required $$ or followers

Company VisionThis decade we will inspire and unleash the next generationof female creativity to accelerate the growth of females in theSTEM ﬁeld.Core PrinciplesHands-on LearningSTEM (Science, Tech, Engr, and Math)Geared towards girls

Overall Project Take-aways1. Advice ≠ Wisdom *pick out what makes the most sense2. Titles ≠ Roles *fully democratic was too slow3. Building a product ≠ Building a company *investigate “product-market ﬁt” as well4. Successful entrepreneurs = Don’t give up *Get used to picking yourself up

Moving Forward Ofﬁcially starts next week! https://fbcdn-sphotos-a.akamaihd.net/hphotos-ak-ash4/294574_197561530304090_177206045672972_532357_7049749_n.jpg

User Testing Appendix

Business Model Canvas (week 1) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes Parents: Paying Customer Direct communication with - High level ofPartners: School of Manufacturing customer online Cost: “premium” toys are involvement with childEducation, Bay Area Mom/ Product R&D Retention and customer expensive - College degrees inDad blog groups, Bay Area Marketing loyalty by offering free Appeal: educational math, science, orparent association sample of new products usually means boring and engineering unattractive Parent blogs/communitySuppliers: Manufacturer, Design: instructions arestores providing building typically not kid-friendly Daughter (user):materials Retention: limited - 5-9 years old Value for Parents: increase child’s quality of life by Outsourced manufacturer providing them with a fun, R&D lab for prototyping educational, and effective Behavioral data of children toy Value for Kids: fun, unique social (online component) Web sales Product design costs Basic Kits ($40 List Price) Distribution, S&H costs Add-ons/Specialized accessories Materials, Manufacturing ($15-20 List Price) costs

Business Model Canvas (week 2) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes User base: show off their Quick & Convenient masterpiece Parents: Paying - approval/rec by other Customer parents (faster decision - High level of Continuous stream ofOnline Marketplace making) Looking for MORE!: Kids involvement with child newly designed- Amazon - add-ons shipped to can’t wait to receive the - College degrees in products (Base Kits,- eBay household every month next thing they chose for math, science, or Add-ons) (less need to shop for this month engineering new toys) - info, videos, testimonialsRetail provided on the website- Local toy stores (well informed purchase) Website: winning post Daughter (user): Parents, Mommy- Independent niche bloggers, Parent groups: every month gets featured - 5-9 years oldstore word-of mouth, Skills developed: recommend our toys - ﬁne motor skills Retention: kid chooses on - spatial cognition the website the next add User base: need kids to on to receive Kid built the product share creations from the - fun, unique Product demos: after- kits online - self esteem, conﬁdence school centers, Little - chance to be creative League, YMCA, Innovation One time purchase: Museum, Children’s $30 base model kit Product design costs Museum Distribution, S&H costs Materials, Manufacturing Subscription costs $20 for one add on per month

Business Model Canvas (week 3) Incorporate formal Rely on Quick, convenient, learning topics into Colorwheels for informed purchasing Parents (paying product proven set of toysOnline Marketplace decision customer): High level Create interactive of involvement with- Amazon material Keep daughters Cant wait for the child- eBay (instructional occupied with non next shipment to College degrees in videos, stories, etc.) princess toy create and decorate STEMRetail Limited free time- Local toy stores Parents/ Fun to assemble and from busy lifestyle- Independentniche Community host decorate Online salesstore play dates, word of mouth Effective and Daughter (user): intuitive instructions - 7 to 9 years old Girls: create, wear, advocate, and share Hands-on learning the product One time purchase: $30 base model kit Product design costs Distribution, S&H costs Subscription Materials, Manufacturing costs $20 for one add on per month

Business Model Canvas (week 4) Incorporate learning topics Quick, convenient, Club Colorwheels Create interactive informed purchasing (online Parents (payingReferrers (parents material decision community) customer): High leveland bloggers) of involvement with Marketing child (Exposure, Creativity and skills College degrees in product demos) development STEM Limited free timeKids: Build, post Fun to assemble and from busy lifestyleonline, share decorate Online sales Gift giver Kit Packager Effective and Daughter (user): Supply Chain intuitive instructions - 7 to 9 years old Educational non- proﬁt institution Hands-on learning One time purchase: $30 base model kit Product design costs Distribution, S&H costs Subscription Materials, Manufacturing costs $20 for one add on per month

same as last week new this weekBusiness Model Canvas (week 5) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes Incorporate learning topics Quick, convenient, Private online informed purchasing space or iPad app Parents (paying Create interactive decision customer): High levelReferrers (parents material of involvement withand bloggers) Host after- Creativity and skills Level up system child school programs development College degrees in STEM Eco friendly Limited free timeKids: Build, post Fun to assemble and Online sales from busy lifestyleonline, share decorate Schools Gift giver Educational Kit Packager Effective and Museum gift shops non-proﬁt Supply Chain intuitive instructions Camps Daughter (user): institution Homeschool networks 7 to 9 years old Hands-on learning After school programs Online ﬂash sale sites Product design costs Distribution, S&H costs Subscription Materials, Manufacturing costs One time purchase: $20 for one add on per $30 base model kit month

same as last week new this weekBusiness Model Canvas Train young reps (week 6) Incorporate learning ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes topics Private online space Make video or iPad app demonstrations Quick, convenient, Parents (paying informed purchasing customer): High level of decision Merit based level up - involvement with child Host after-school and weekend programs, Girl Scout model College degrees in STEMReferrers (parents summer camps and Creativity and skills Limited free time fromand bloggers) spring break camps development busy lifestyle Parent communityOlder kids - role Fun to assemble andmodels - young reps decorate Tiger moms Kids: Community withKids: Build, post Free educational other kids, shared Online salesonline, share content culture Parents: Way to link up Gift giver - aunts and Schools uncles, grandparents Kit Packager Hands-on learning Museum gift shops Educational non- proﬁt institution Supply Chain Camps Educational extracurricular Homeschool Co-op activity After school programs Daughter (user): Online ﬂash sale sites 7 to 9 years old Product design costs One time purchase: Distribution, S&H costs $20 base model kit Subscription for additional Materials, Manufacturing costs content Event hosting (eg birthday parties) Camps, after school and weekend classes

Business Model Canvas (week 7) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes Train young reps Quick, convenient, Incorporate learning Merit based level up - informed purchasing topics Girl Scout modelReferrers (parents decision Educated, STEM Parents Make video 5and bloggers) Creativity and skills demonstrations Tiger moms development Parent community Gamiﬁcation of learningEducational non- Fun to assemble and 7 Google adwords Gift giver - aunts andproﬁt institution decorate uncles, grandparents Kids: Community with other kids, shared Daughter (user): Free educational culture 6 to 10 years old content Parents: Way to link up Online sales 20 Kit Packager Hands-on learning Schools Supply Chain Museum gift shops Educational Homeschool Co-op extracurricular 169 169 7 8 After school programs activity Monthly subscription (1 month free trials) Product design costs Distribution, S&H costs Multi-level marketing Materials, Manufacturing costs 4 (Mary Kay model) 15

Business Model Canvas (week 8) ColorWheels Alice Brooks, Daniela Buchman, Bettina Chen, Miguel Reyes Train young reps Quick, convenient, Incorporate learning Merit based level up - informed purchasing topics Girl Scout modelReferrers (parents decision Educated, STEM Parents Make video 5and bloggers) Creativity and skills demonstrations Tiger moms development Parent community Gamiﬁcation of learningEducational non- Fun to assemble and 7 Google adwords Gift giver - aunts andproﬁt institution decorate uncles, grandparents Kids: Community with other kids, shared Daughter (user): Free educational culture 6 to 10 years old content Parents: Way to link up Online sales 20 Kit Packager Hands-on learning Schools Supply Chain Museum gift shops Educational Homeschool Co-op extracurricular 169 169 7 8 After school programs activity Product design costs Distribution, S&H costs Kit and subscription through Materials, Manufacturing costs 4 MLM 20

C change from previous week S same as previous week BMC changes chart 2 3 4 5 6 7 8 KP C S C S C/S S S KA C C C/S C/S C/S C S KR C C C S C/S S S C$ S C S S S S S VP C C C/S C/S C/S S S CR C C C C/S C/S S S CH C C S C/S S S S CS S C C/S S S S S R$ C S S S C/S C CTotals 7C/2S 6C/3S 6C/6S 4C/9S 6C/9S 2C/7S 1C/8S

BMC Weekly Changes Comparison

Operations Timeline

Multi-Level Marketing in ActionStella and DotSell the Story: work from home, ﬂexible“Stella & Dot is so much more than a fashion brand were a company inspired by, and created for, strong, savvy women from all walks of life.”Chloe and IsabelSellers age 19-27, sellers interactwith customers in onlinecommunity originally, founderworked for major jewelrycompanies. Tiffany’s etc.

Summary of resultsFew responses from bloggers: 2 of the 3responses requested money to advertise usSweepstakes upped our “Likes” on Facebook to837 from 50Email marketing campaign to 150 peopleyielded 1 purchase out of 29 clicks

PhysicsC:E&MAbout 106,000 female students from the class of 2011 scored a 3 or higher on a STEM AP test. By parCcipaCng as a colorwheels ambassador, high school girls will have more conﬁdence in their STEM abiliCes.Long term goal: start programs to help high school girls Sta0s0cs take more STEM AP classes and get involved in more STEM acCviCes, ex: FIRST RoboCcs, Science Fairs

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Colorwheels E245 final presentation

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