Uploading an old presentation that I did for the BCIC New Ventures Regional Seminar Series back in

1. Stop planning and start seeking
or
“How to throw away your business plan and go faster”
prepared for New Ventures BC
by
Troy Angrignon,VP Sales & Marketing, Cloudscaling

2. Your Plan A is wrong.Yes, yours.
How will you get to Plan B?
Image courtesy John Mullins & Randy Komisar

3. Most startups fail.
57 of 58 products launched fail.
I think this can change.

4. Who are you?
Whom am I?

5. SOME NEW PERSPECTIVES
ON BUILDING BUSINESSES

6. Entrepreneurship is not the path to
sure riches but is a sure path to a life
of rich living.
✓Change the world
✓ Build an organization of lasting value
✓Make customers lives better

7. This is about testing to find
answers rather than trying to be
the mythical visionary founding
entrepreneur

8. You're an adventurer in search of
answers. Be like Shackleton!
"MEN WANTED FOR
HAZARDOUS JOURNEY.
LOW WAGES, BITTER
COLD, LONG HOURS OF
COMPLETE DARKNESS.
SAFE RETURN DOUBTFUL.
HONOUR AND
RECOGNITION IN EVENT
OF SUCCESS."

9. Be a seeker, not a planner

10. The second you leave shore, you're a
pirate on a sinking ship.

11. Stay firm on the mission (passion)
and flexible on the plan (how you
make money from your passion)

12. You are Billy Durant, not Alfred Sloan
Image courtesy Steve Blank

13. Startups Search.
Companies Execute.
Image courtesy Steve Blank

14. If you still want a business plan
make it one page long. Really.

15. Using traditional financial
statements as your weekly guide
to the business is wrong. Use
startup metrics that suit what it
is you are trying to do.
(This will make more sense later.)

16. Startup metrics are appropriate
to the business and tied to
proving or disproving your
hypotheses.

17. FOCUS ON BUSINESS MODELS
NOT ON BUSINESS PLANS

18. What is a business model?

19. The illustration approach

20. Business Model Generation Approach
Image courtesy “Business Model Generation” book

21. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model
Model courtesy “Getting to Plan B”

22. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model
Model courtesy “Getting to Plan B”

23. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model

24. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model

25. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model

26. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model

27. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model For a margin return model, what is our
gross margin model?
Gross Margin
Model How do we maximize gross margin?
Operating 0-30% don’t do it
Model
30-50% okay
Working
Capital model >50% interesting
Investment >90% Awesome
model

28. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model

29. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model

30. Business Relevant Relevant Hypotheses
Model Leaps of Faith used to test
Analogs antilogs
Element LOF
Revenue
Model
Gross Margin
Model
Operating
Model
Working
Capital model
Investment
model

31. Business Hypotheses
Relevant Relevant Leaps of
Model used to test
Analogs antilogs Faith
Element LOF
Sally’s Sally’s His pricing
Revenue 10 cust / day
Lemonade Lemonade model will
Model x $1 / cust
Stand Stand make more $
Gross He can talk Ask for the
Co-branding LemonCo into
Margin ? giving him free order
companies
Model lemon crystals (get it? Y/N)
I can get Mom Ask Mom to
Operating Any family
? to work for work for free
Model business!
free (Y/N)
Working I can get the sign Ask stationery
making stuff now store if I can pay for
Capital Costco ? but pay LESS pens Monday AND
model LATER. get a discount!
I can launch biz
Investment Uncle Tony’s Confirm the
? without
model Pedi-cab above? (y/n)
investment!

32. Business Hypotheses
Model used to test Setup Cust 1 2 3 4
Element LOF
Revenue 10 cust / day 25 cents
Model x $1 / cust 50 cents $2!!! $1
(!)
Gross Ask for the Got half of Lemonade too lemon flavour
weak; need lemon mix not good for
Margin order what I asked more crystals some; need
Model (get it? Y/N) for - rats than I thought. good now
TWO KINDS?
Ask Mom to Mom’s
Operating
Model
work for free busy - - - -
(Y/N) Sunday
Ask stationery Got a
Working store if I can pay discount but
Capital for pens Monday - - - -
model AND get a have to pay
discount! up front.
Dang.
Investment Confirm the
model above? (y/n)
Needed $2 - - - -
for big pens

33. Take-aways
•Have a different business model
than competitors
•Use the Five elements to create
cash for growth
•Dashboard it so you can track
your progress

34. CONSIDER USING LEAN
STARTUP APPROACHES

35. Know your problem/solution space
Problem Solution
Waterfall processes
Field of Dreams
Known
Nuclear Reactor
1% of the time
Construction
Customer
Agile Processes
Development Process
Unknown
coding as you learn
99% of the time

36. The lean startup approach
(thanks to Eric Ries at www.startuplessonslearned.com)
• Search for the business model with the
“Customer Development Process.”
• Implement the business model with agile
processes such as agile/extreme programming.
• Leverage free and open source and open
platform solutions to accelerate time to
market.
• Do so by using a minimum viable product
approach

37. Myths about Lean Startups
• Myth 1: Lean means cheap. Lean startups try to spend
as little money as possible.
• Myth 2: The Lean Startup methodology is only for
Web 2.0, Internet and consumer software companies
• Myth 3: Lean Startups are bootstrapped startups
• Myth 4: Lean Startups are very small companies
• Myth 5: Lean Startups replace vision with data or
customer feedback

38. Use customer development to
understand what to build for whom

39. Implement with agile development
approaches including
• agile programming
• features should be pulled, not pushed
• continuous deployment is key
• small frequent releases
• doing good startup engineering vs. good engineering

40. These are parallel processes
that feed each other!

41. Use commoditized and open source
and open platform technologies to
decrease costs and increase speed
•commodity technology
•open source tools
•no capex cloud computing resources
•what else?

42. Minimum viable product
• allows you to collect the maximum information with the
minimum of effort
• probably 1/10 of what you consider to be “the minimum”
• could be a button (and no code) or a brochure (but no
product).
• It is not about MINIMAL product, it is about MINIMUM
VIABLE product.
• Use your judgement. Can you learn this lesson with less? If
not, use more.
• Tools of the trade: smoke tests, landing pages, A/B tests, SEM,
prototypes, index cards, mockups.

43. CASE STUDIES

53. Resources
• Steve Blank: www.steveblank.com
• Eric Ries: www.startuplessonslearned.com
• Randy Komisar: Getting to Plan B
• Kent Beck: Agile Manifesto
• Brant Cooper & Patrick Vlaskovitz:
The Entrepreneur’s Guide to Customer Development
• Alexander Osterwalder & Yves Pigneur:
Business Model Generation
• Lean Startup Wiki leanstartup.pbworks.com

54. THANK YOU!
Troy Angrignon
troy@troyangrignon.com
@troyangrignon
http://www.troyangrignon.com