Sebastian Fittko on

Business Model and Idea Validation

at Workshop „Mehrwertiges Unternehmertum“, Zeppelin Universität
1
About Sebastian
Intro Business Idea
Intro Business Model Canvas
Q&A
How to validate a Business Idea
Q&A
About Sebastian
Intro Business Idea
Intro Business Model Canvas
Q&A
How to validate a Business Idea
Q&A
About Sebastian
Intro Business Idea
Intro Business Model Canvas
Q&A
How to validate a Business Idea
Q&A
NEW IDEA

Image curtsey: http://www.flickr.com/commons
Without Execution & Insights

Image curtsey: http://www.flickr.com/commons
Traction

Time
Problem/
Solution Fit

Product/Market
Fit

Image curtsey: http://www.flickr.com/commons

Scale
GET OUT AND EXECUTE!!
Image curtsey: http://www.flickr.com/commons
How to get
insights?
Insights

Where is the pain?
Image curtsey: http://www.flickr.com/commons
Ask your potential customers!
Qualitative

Asking for customer‘s intent
Image curtsey: http://www.flickr.com/commons
&
Quantitative

Measure customer behavior
Image curtsey: http://www.flickr.com/commons
How to
execute?
Start here?

Image curtsey: http://www.flickr.com/commons
Image curtsey: http://www.flickr.com/commons
„Everybody has a plan
until they get punched
in the mouth.“
– Mike Tyson
Image curtsey: http://www.flickr.com/commons
Day

Month

No.

Who are our Key Partners?
Who are our key suppliers?
Which Key Resources are we acquiring from partners?
...
google business model canvas
or
http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf
Bla
Bla
Bla

Bla

Image curtsey: http://www.flickr.com/commons

Bla
Image curtsey: http://www.flickr.com/commons
Day

Month

No.

Who are our Key Partners?
Who are our key suppliers?
Which Key Resources are we acquiring from partners?
...
Day

Month

Year

No.

Who are our Key Partners?
Who are our key suppliers?
Which Key Resources are we acquiring from part...
Go out an ask your customers
Get your numbers right!

Image curtsey: http://www.flickr.com/commons
About Sebastian
Intro Business Idea
Intro Business Model Canvas
Q&A
How to validate a Business Idea
Q&A
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Newness: You solve a unsolved problem!

Image curtsey: http://www.flickr.com/photos/72439897@N02/6623264623/sizes/l/in/phot...
Performance: Your product has a better
performance than the competition!

Image curtsey: http://www.babez.de/wp-content/my...
Customization: You enable to
customize products by the user

http://media.cmgdigital.com/shared/img/photos/2013/02/10/58/4...
Getting things done: You help your
customers to get things done.

http://capmembers.com/media/cms/working_together_in_spac...
Design, UX, CX: You have just a
stunning design, UX and CX.

http://3.bp.blogspot.com/_wuUoxyO0BNI/TCsb1xIOeuI/AAAAAAAAIWw...
Price: You can offer you product
simply cheaper than the competion could.

http://www.gemeinde-asbach.de/img/ALDI.JPG
Cost reduction: You help your
cusomers to reduce cost.

http://cdn.physorg.com/newman/gfx/news/hires/2012/1-containershi.j...
Risk reduction: Reducing risk for you customers
(more reliable product or service)

http://files.mercedes-fans.de/images/20...
Accessibility: Making things accessible to your
cusomers they could not afford or access before.

http://www.airlinereporte...
Wake the world a better place: Solving social or
environmental problems for the good of the society.

http://www.airlinere...
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Image curtsey: http://www.flickr.com/commons
What are you aiming for?
„Being in a good market with a product
that can satisfy that market.“
– Marc Andreessen
Image cur...
Go where the beef is and
people want your stuff!!
Image curtsey: http://www.flickr.com/commons
Mass market

Image curtsey: http://1.bp.blogspot.com/-wYRDKwwuvZk/Tq6Esx2CoAI/AAAAAAAABkg/d7jEc7vPzT0/s1600/Crowd_Obama_In...
Niche Market

Image curtsey: http://www.trashness.com/wp-content/uploads/2012/06/preppy-hipster.jpg
Segmented

Image curtsey: http://www.kotorikits.com/ekmps/shops/mummymadeit/resources/Design/father-and-son.jpg
Diversifiziert

Image curtsey:http://4.bp.blogspot.com/-ECdDDi3kO50/TaHu-p5cQcI/AAAAAAAAAAM/np6_jKgDQ0U/s1600/Farmers-Marke...
Multi Sided

Image curtsey:http://naturalgeographic.net/wp/wp-content/uploads/2013/08/rock-concert.jpg
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Key
Activities

Key
Ressources

How you serve the customer

Customer
Segment
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Maintaining your customer relationship
http://www.bruchsal.org/sites/default/files/1_40_Jahre_Dinner_for_one.jpg
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Service Sales
Recurring Revenue
Retail
Commision
Licensing
Advertising
Renting
Donation
http://www.sternsinger.org/fileadmin/upload/Presse/DKS/Sternsinger-Fotos/Inventar/Inventar04.jpg
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Key Partner
Key Partner

Key
Activities
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
S...
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relati...
Key Partner

Key
Activities

Value
Proposition

Key
Resources

Cost Structure

Channels

Customer
Segment

Customer
Relati...
About Sebastian
Intro Business Idea
How to Work with Business Model Canvas
Q&A
How to Validate
Q&A
Any Questions?

Image curtsey: http://www.flickr.com/commons
About Sebastian
Intro Business Idea
Intro Business Model Canvas
Q&A
How to Validate
Q&A
How to gather customer insights
and validate decisions?

Image curtsey: http://www.flickr.com/commons
Quantitative

Measure customer behavior
Image curtsey: http://www.flickr.com/commons
vs.
Qualitative

Asking for customer intend
Image curtsey: http://www.flickr.com/commons
We do this in two steps:
1st step
Validate Problem

2nd step
Validate Solution

Do they care?
Do they need it?
Do they hav...
Numbers are a horrible way to
understand customer intend!

Image curtsey: http://www.flickr.com/commons
So go and ask your customers!
“If I had asked people what they wanted, they
would have said faster horses.” – Henry Ford
Image curtsey: http://www.flickr...
The hard things in customer interviews
Knowing who your customer is.
Define narrow segmentation!
5-10 customers per segment...
The hard things in customer interviews
Ask the right way.
Did or do, NEVER would.
Don‘t ask for opinions.
Don‘t assume pro...
The hard things in customer interviews
Use their feedback.
Know what you want to learn.
Test your riskiest assumptions.
Le...
The hard things in customer interviews

Be prepared to
kill your idea!
The interview
Design a questionnaire based
on your assumptions.

Testrun the interview.
Let them speak.
Ask open questions...
The interview – protocol
No laptop.
Use Post-its.
Write down exact
customer phrase.
NEVER delegate interviews!
Interviews should be done by
the product deciders.
Lern to talk and listen to your
customers!
I...
Review with your team!
Use exact wording by the customer.
Understand their answers in their context.
Reflect and rethink yo...
Validate Solution.
Come back to interviewees.
Focus first on current solution.
Discuss flaws of current solutions.
Show mock...
If you were wrong – be HAPPY!
You don‘t wasted your money,
time and money
Iterate or pivot
Usually a successful startup di...
About Sebastian
Intro Business Idea
How to Work with Business Model Canvas
Q&A
How to Validate
Q&A
Any Questions?

Image curtsey: http://www.flickr.com/commons
THX!
contact:
sebastian.fittko@gmail.com
twitter: @forstartups
XING – Linkedin
Must-reads!
Lecture on Business Model Canvas and Customer Interviews
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Lecture on Business Model Canvas and Customer Interviews

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This presentation was held as part of the lecture and entrepreneurship workshop on "Mehrwertiges Unternehmertum" at Zeppelin University, Friedrichshafen.
Subject of the presentation is the explanation of the business model canvas and the problem/solution validation with customer development interviews.

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Transcript of "Lecture on Business Model Canvas and Customer Interviews"

  1. 1. Sebastian Fittko on Business Model and Idea Validation at Workshop „Mehrwertiges Unternehmertum“, Zeppelin Universität 1
  2. 2. About Sebastian Intro Business Idea Intro Business Model Canvas Q&A How to validate a Business Idea Q&A
  3. 3. About Sebastian Intro Business Idea Intro Business Model Canvas Q&A How to validate a Business Idea Q&A
  4. 4. About Sebastian Intro Business Idea Intro Business Model Canvas Q&A How to validate a Business Idea Q&A
  5. 5. NEW IDEA Image curtsey: http://www.flickr.com/commons
  6. 6. Without Execution & Insights Image curtsey: http://www.flickr.com/commons
  7. 7. Traction Time Problem/ Solution Fit Product/Market Fit Image curtsey: http://www.flickr.com/commons Scale
  8. 8. GET OUT AND EXECUTE!! Image curtsey: http://www.flickr.com/commons
  9. 9. How to get insights?
  10. 10. Insights Where is the pain? Image curtsey: http://www.flickr.com/commons
  11. 11. Ask your potential customers!
  12. 12. Qualitative Asking for customer‘s intent Image curtsey: http://www.flickr.com/commons
  13. 13. &
  14. 14. Quantitative Measure customer behavior Image curtsey: http://www.flickr.com/commons
  15. 15. How to execute?
  16. 16. Start here? Image curtsey: http://www.flickr.com/commons
  17. 17. Image curtsey: http://www.flickr.com/commons
  18. 18. „Everybody has a plan until they get punched in the mouth.“ – Mike Tyson
  19. 19. Image curtsey: http://www.flickr.com/commons
  20. 20. Day Month No. Who are our Key Partners? Who are our key suppliers? Which Key Resources are we acquiring from partners? Which Key Activities do partners perform? What Key Activities do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue streams? What Key Resources do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue Streams? What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive? 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? 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? For whom are we creating value? Who are our most important customers? 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? 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? 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. BIG thanks to Alex Osterwalder! You can download the here: http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf Year
  21. 21. google business model canvas or http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf
  22. 22. Bla Bla Bla Bla Image curtsey: http://www.flickr.com/commons Bla
  23. 23. Image curtsey: http://www.flickr.com/commons
  24. 24. Day Month No. Who are our Key Partners? Who are our key suppliers? Which Key Resources are we acquiring from partners? Which Key Activities do partners perform? What Key Activities do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue streams? What Key Resources do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue Streams? What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive? 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? 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? For whom are we creating value? Who are our most important customers? 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? 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? 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. BIG thanks to Alex Osterwalder! You can download the here: http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf Year
  25. 25. Day Month Year No. Who are our Key Partners? Who are our key suppliers? Which Key Resources are we acquiring from partners? Which Key Activities do partners perform? What Key Activities do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue streams? Hypothesis 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? Hypothesis 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? For whom are we creating value? Who are our most important customers? Hypothesis Hypothesis Hypothesis What Key Resources do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue Streams? 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? Hypothesis What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive? 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? Hypothesis Hypothesis 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. BIG thanks to Alex Osterwalder! You can download the here: http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf
  26. 26. Go out an ask your customers
  27. 27. Get your numbers right! Image curtsey: http://www.flickr.com/commons
  28. 28. About Sebastian Intro Business Idea Intro Business Model Canvas Q&A How to validate a Business Idea Q&A
  29. 29. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  30. 30. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  31. 31. Newness: You solve a unsolved problem! Image curtsey: http://www.flickr.com/photos/72439897@N02/6623264623/sizes/l/in/photostream/
  32. 32. Performance: Your product has a better performance than the competition! Image curtsey: http://www.babez.de/wp-content/myfotos/bf-performance-gt660/bf-performance-gt-660-02.jpg
  33. 33. Customization: You enable to customize products by the user http://media.cmgdigital.com/shared/img/photos/2013/02/10/58/41/MichaelDell1jpgCopy.jpg.JPG
  34. 34. Getting things done: You help your customers to get things done. http://capmembers.com/media/cms/working_together_in_space_hires_E77D1F50E1332.jpg
  35. 35. Design, UX, CX: You have just a stunning design, UX and CX. http://3.bp.blogspot.com/_wuUoxyO0BNI/TCsb1xIOeuI/AAAAAAAAIWw/k9ph1nqXj2w/s1600/P1040804.JPG
  36. 36. Price: You can offer you product simply cheaper than the competion could. http://www.gemeinde-asbach.de/img/ALDI.JPG
  37. 37. Cost reduction: You help your cusomers to reduce cost. http://cdn.physorg.com/newman/gfx/news/hires/2012/1-containershi.jpg
  38. 38. Risk reduction: Reducing risk for you customers (more reliable product or service) http://files.mercedes-fans.de/images/2010/09/mercedes-benz-hightech-airbag-gurtstraffer-w126-innovationtf012.jpg
  39. 39. Accessibility: Making things accessible to your cusomers they could not afford or access before. http://www.airlinereporter.com/wp-content/uploads/2010/10/airlines1.jpg
  40. 40. Wake the world a better place: Solving social or environmental problems for the good of the society. http://www.airlinereporter.com/wp-content/uploads/2010/10/airlines1.jpg
  41. 41. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  42. 42. Image curtsey: http://www.flickr.com/commons
  43. 43. What are you aiming for? „Being in a good market with a product that can satisfy that market.“ – Marc Andreessen Image curtsey: http://www.flickr.com/commons
  44. 44. Go where the beef is and people want your stuff!! Image curtsey: http://www.flickr.com/commons
  45. 45. Mass market Image curtsey: http://1.bp.blogspot.com/-wYRDKwwuvZk/Tq6Esx2CoAI/AAAAAAAABkg/d7jEc7vPzT0/s1600/Crowd_Obama_Inauguration_Day_Big.jpg
  46. 46. Niche Market Image curtsey: http://www.trashness.com/wp-content/uploads/2012/06/preppy-hipster.jpg
  47. 47. Segmented Image curtsey: http://www.kotorikits.com/ekmps/shops/mummymadeit/resources/Design/father-and-son.jpg
  48. 48. Diversifiziert Image curtsey:http://4.bp.blogspot.com/-ECdDDi3kO50/TaHu-p5cQcI/AAAAAAAAAAM/np6_jKgDQ0U/s1600/Farmers-Market-foods.jpg
  49. 49. Multi Sided Image curtsey:http://naturalgeographic.net/wp/wp-content/uploads/2013/08/rock-concert.jpg
  50. 50. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationshi p Revenue Streams
  51. 51. Key Activities Key Ressources How you serve the customer Customer Segment
  52. 52. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  53. 53. Maintaining your customer relationship http://www.bruchsal.org/sites/default/files/1_40_Jahre_Dinner_for_one.jpg
  54. 54. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  55. 55. Service Sales
  56. 56. Recurring Revenue
  57. 57. Retail
  58. 58. Commision
  59. 59. Licensing
  60. 60. Advertising
  61. 61. Renting
  62. 62. Donation http://www.sternsinger.org/fileadmin/upload/Presse/DKS/Sternsinger-Fotos/Inventar/Inventar04.jpg
  63. 63. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  64. 64. Key Partner Key Partner Key Activities Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  65. 65. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  66. 66. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams
  67. 67. Key Partner Key Activities Value Proposition Key Resources Cost Structure Channels Customer Segment Customer Relationshi p ≤ Revenue Streams Revenue Streams
  68. 68. About Sebastian Intro Business Idea How to Work with Business Model Canvas Q&A How to Validate Q&A
  69. 69. Any Questions? Image curtsey: http://www.flickr.com/commons
  70. 70. About Sebastian Intro Business Idea Intro Business Model Canvas Q&A How to Validate Q&A
  71. 71. How to gather customer insights and validate decisions? Image curtsey: http://www.flickr.com/commons
  72. 72. Quantitative Measure customer behavior Image curtsey: http://www.flickr.com/commons
  73. 73. vs.
  74. 74. Qualitative Asking for customer intend Image curtsey: http://www.flickr.com/commons
  75. 75. We do this in two steps: 1st step Validate Problem 2nd step Validate Solution Do they care? Do they need it? Do they have budget for it? Who really is they? Does our solution really solve their Problem? Do they understand the solution? Would they pay for it?
  76. 76. Numbers are a horrible way to understand customer intend! Image curtsey: http://www.flickr.com/commons
  77. 77. So go and ask your customers!
  78. 78. “If I had asked people what they wanted, they would have said faster horses.” – Henry Ford Image curtsey: http://www.flickr.com/commons
  79. 79. The hard things in customer interviews Knowing who your customer is. Define narrow segmentation! 5-10 customers per segment.
  80. 80. The hard things in customer interviews Ask the right way. Did or do, NEVER would. Don‘t ask for opinions. Don‘t assume problems.
  81. 81. The hard things in customer interviews Use their feedback. Know what you want to learn. Test your riskiest assumptions. Learn or pivot.
  82. 82. The hard things in customer interviews Be prepared to kill your idea!
  83. 83. The interview Design a questionnaire based on your assumptions. Testrun the interview. Let them speak. Ask open questions. Let them be the expert. In person, no Skype, no online survey, no phone, no email! Don‘t do more interviews if feedback repeats!
  84. 84. The interview – protocol No laptop. Use Post-its. Write down exact customer phrase.
  85. 85. NEVER delegate interviews! Interviews should be done by the product deciders. Lern to talk and listen to your customers! Image curtsey: http://www.flickr.com/commons
  86. 86. Review with your team! Use exact wording by the customer. Understand their answers in their context. Reflect and rethink your assumptions. Which assuptions turned out wrong? See what you‘ve learned. Adapt your solution.
  87. 87. Validate Solution. Come back to interviewees. Focus first on current solution. Discuss flaws of current solutions. Show mockups and interactive demos. Get improvement feedback. Get them to commit. Pay a price? Build a MVP. or iterate.
  88. 88. If you were wrong – be HAPPY! You don‘t wasted your money, time and money Iterate or pivot Usually a successful startup didn‘t start with the final solution Image curtsey: http://www.flickr.com/commons
  89. 89. About Sebastian Intro Business Idea How to Work with Business Model Canvas Q&A How to Validate Q&A
  90. 90. Any Questions? Image curtsey: http://www.flickr.com/commons
  91. 91. THX! contact: sebastian.fittko@gmail.com twitter: @forstartups XING – Linkedin
  92. 92. Must-reads!

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