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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?
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
Lecture on Business Model Canvas and Customer Interviews
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?
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
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
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
Relationship

Revenue Streams
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relationship

Revenue Streams
Newness: You solve a unsolved problem!

Image curtsey: http://www.flickr.com/photos/72439897@N02/6623264623/sizes/l/in/photostream/
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
Customization: You enable to
customize products by the user

http://media.cmgdigital.com/shared/img/photos/2013/02/10/58/41/MichaelDell1jpgCopy.jpg.JPG
Getting things done: You help your
customers to get things done.

http://capmembers.com/media/cms/working_together_in_space_hires_E77D1F50E1332.jpg
Design, UX, CX: You have just a
stunning design, UX and CX.

http://3.bp.blogspot.com/_wuUoxyO0BNI/TCsb1xIOeuI/AAAAAAAAIWw/k9ph1nqXj2w/s1600/P1040804.JPG
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.jpg
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
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
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
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relationship

Revenue Streams
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 curtsey: http://www.flickr.com/commons
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_Inauguration_Day_Big.jpg
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-Market-foods.jpg
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
Relationshi
p

Revenue Streams
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
Relationship

Revenue Streams
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
Relationship

Revenue Streams
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
Relationship

Revenue Streams
Key Partner
Key Partner

Key
Activities
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relationship

Revenue Streams
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relationship

Revenue Streams
Key Partner

Key
Activities

Key
Resources

Cost Structure

Value
Proposition

Channels

Customer
Segment

Customer
Relationship

Revenue Streams
Key Partner

Key
Activities

Value
Proposition

Key
Resources

Cost Structure

Channels

Customer
Segment

Customer
Relationshi
p

≤

Revenue Streams
Revenue Streams
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 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?
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.com/commons
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 problems.
The hard things in customer interviews
Use their feedback.
Know what you want to learn.
Test your riskiest assumptions.
Learn or pivot.
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.
Let them be the expert.
In person, no Skype, no
online survey, no phone,
no email!

Don‘t do more interviews
if feedback repeats!
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!
Image curtsey: http://www.flickr.com/commons
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.
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.
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
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
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