Business Models and          Customer Development:          How to FAIL Less(hint: it’s not just a method for startups!)  ...
ME: 7 startups, >20 investments, 3 vests…                                            2
7 IPOs, 6 disasters, Columbia B-School Prof.                                           3
608 pages….500+ startup misteaks                               4
Most startups fail to scale.                               5
More startups fail froma lack of customers than from afailure of product development                                  6
…and passionate customers  are damn hard to find!                            7
Why Most Startups Fail…Assume Customer Problem: known Concept/        Product    Alpha/Beta     Launch/Seed Round        D...
Startup Enemy #1:                    9
Wait a minute Bob… We are hardly a Startup!                            10
I don’t care!You should always be Innovating!Constantly seek customer feedbackAlways challenge your business modelUse the ...
No Business Plansurvives first contactwith customers!         …ask Webvan!                         12
13
14
15
16
17
18
19
When you’re done…9 best GUESSES         …ask Webvan!                        20
21
22
23
TRANSLATE: Not a Startup??…a 4-5 day customer vacation!!                                 24
Where Discovery Begins:       Minimum Viable Product• Google without ads (two years+)• Zappos without any shoes• Diapers.c...
Customer Discovery      Customer       Customer     Customer   Company      Discovery      Validation   Creation    Buildi...
The Pivot                      Search          Customer             Customer          Discovery            Validation     ...
Just a few(of many) Historic Pivots•   Steve Blank: “Page 6”•   Perimeter: “there are 9000 of us”•   Groupon: the $12billi...
Pivot Cycle Time Matters         Search                     Execution Customer        Customer     Customer     Company Di...
How do you know when Discovery is “done?”Key Partners                               Key Activities                        ...
Customer Validation           Search      Customer            Customer     Customer     Company      Discovery           V...
Why Startups Aren’t Run By Accountants  Scalable                     Large                Transition  Startup             ...
Founder of General MotorsScalable                      Large            TransitionStartup                     Company     ...
FIRED by General Motors BoardScalable                     Large           TransitionStartup                    Company    ...
Durant Versus Sloan    • Dies, rich, honored and famous                                  35
Durant Versus Sloan• Dies managing a bowling alley   • Dies, rich, honored and famous                                     ...
Durant Versus Sloan                                    Accountant• Dies managing a bowling alley   • Dies, rich, honored a...
Innovators look out!               WE are hereScalable                        Large                 TransitionStartup     ...
“Get Out of the Building!!!”      bob@kandsranch.com       www.steveblank.com  ON SALE HERE…also in ebook   39
Upcoming SlideShare
Loading in...5
×

Bob dorf about Customer Development

3,152

Published on

0 Comments
4 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
3,152
On Slideshare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
31
Comments
0
Likes
4
Embeds 0
No embeds

No notes for slide

Bob dorf about Customer Development

  1. 1. Business Models and Customer Development: How to FAIL Less(hint: it’s not just a method for startups!) Bob Dorf allegedly retired serial entrepreneur, educator Partner, K&S Ranch Inc. www.steveblank.com bob@kandsranch.com
  2. 2. ME: 7 startups, >20 investments, 3 vests… 2
  3. 3. 7 IPOs, 6 disasters, Columbia B-School Prof. 3
  4. 4. 608 pages….500+ startup misteaks 4
  5. 5. Most startups fail to scale. 5
  6. 6. More startups fail froma lack of customers than from afailure of product development 6
  7. 7. …and passionate customers are damn hard to find! 7
  8. 8. Why Most Startups Fail…Assume Customer Problem: known Concept/ Product Alpha/Beta Launch/Seed Round Dev. Test 1st Ship Assume Product Features: known 8
  9. 9. Startup Enemy #1: 9
  10. 10. Wait a minute Bob… We are hardly a Startup! 10
  11. 11. I don’t care!You should always be Innovating!Constantly seek customer feedbackAlways challenge your business modelUse the same approach, just not everyday 11
  12. 12. No Business Plansurvives first contactwith customers! …ask Webvan! 12
  13. 13. 13
  14. 14. 14
  15. 15. 15
  16. 16. 16
  17. 17. 17
  18. 18. 18
  19. 19. 19
  20. 20. When you’re done…9 best GUESSES …ask Webvan! 20
  21. 21. 21
  22. 22. 22
  23. 23. 23
  24. 24. TRANSLATE: Not a Startup??…a 4-5 day customer vacation!! 24
  25. 25. Where Discovery Begins: Minimum Viable Product• Google without ads (two years+)• Zappos without any shoes• Diapers.com without diapers…Fewest possible features to make the point!…When did a powerpoint last get YOU excited?…YOU can use this process to test new ideas 25
  26. 26. Customer Discovery Customer Customer Customer Company Discovery Validation Creation Building• Stop selling, start listening• Test your hypotheses• Continuous Discovery• …execute while running your current business• …isolate the “startup” within your business 26
  27. 27. The Pivot Search Customer Customer Discovery Validation Pivot• The heart of Customer Development• Iteration without crisis• Fast, agile and opportunistic 27
  28. 28. Just a few(of many) Historic Pivots• Steve Blank: “Page 6”• Perimeter: “there are 9000 of us”• Groupon: the $12billion pivot• Ning• …and thousands more! 28
  29. 29. Pivot Cycle Time Matters Search Execution Customer Customer Customer Company Discovery Validation Creation Building Pivot• MVP speeds up cycle time•Speed of cycle minimizes cash needs• Customer feedback drives the product! 29
  30. 30. How do you know when Discovery is “done?”Key Partners Key Activities Value Proposition Customer Relationships Customer SegmentsWho are our key partners/ suppliers Which key activities does the biz model What type of relationship does each For whom are we creating value require What value do we deliver to the customer segment require of usComplete regional overview  Populate life cycle data for performance  key distinctive product features &  product positioning/elevator pitch for each  identify key market segments benefits for the target customer segment (geography/application) and customer guarantees  Prospect roadmap: how to get face-to-face with segments (e.g. operator versus owner) segment right person at prospects in each segment  how many customers in each segment  Educate market on metric: $/kWh-day  total cost of ownership for segment  key competitors in each segment and their and estimated potential volume for market share each customer delivered over life of asset versus alternatives  key competitors characteristics & dynamics  why will segment buy Durathon versus  how do customers make money … key  What outbound marketing/ advertising/ customer pain/gain points in each  Establish strong partnerships with alternatives (i.e. value proposition) promotion activities are needed segment  support tools required by segment (white channel partners  minimum feature set (i.e. our launch papers, TCO calc., tradeshow)  how are buying decisions made in 0 configuration) and ultimate feature set  pipeline of leads each segment - id process, hurdles,  opportunities to claim IP or trademark / decision makers  what does an Earlyvangelist look like in Key Resources is there freedom to practice 25 each segment Which key resources does the biz model  what regulatory/ certification/  who influences purchases in each require transportation/ customs requirements Channels segment (trade groups, key resellers, trend watchers)  Integrated power system engineering – should be met or could be differentiator Through which channel does each segment want to be reached compatibility for retrofit and optimized system solutions  which segments can only or best be reached through a channel partner  Financing options for Power services  which channel partners are important to optimize operators sales in each segment  what are channel partners requirements and cost to become a proactive sales channel  initial channel partner response to value proposition & customer segments 12 25 4 50Cost Structure Revenue StreamsWhat are our cost drivers How much is each segment willing to pay and how would they like to pay us this amount Launch reliability  What are price /performance characteristics of competing technology  What is the 2013 price target for 1 MM cells  What is the 2015 price target for 10 MM cells  what is optimum sales method for each segment (asset sale, lease, pay for performance, etc.) 3 X = number of in depth customer data points / data sources used to validate hypothesis x x red = low hypothesis confidence yellow = medium hypothesis confidence 30 x green = high hypothesis confidence
  31. 31. Customer Validation Search Customer Customer Customer Company Discovery Validation Creation Building Pivot Execution• Repeatable and scalable business model?• Passionate earlyvangelists?• Pivot back to Discovery if no customers 31
  32. 32. Why Startups Aren’t Run By Accountants Scalable Large Transition Startup Company Alfred P. Sloan 32
  33. 33. Founder of General MotorsScalable Large TransitionStartup Company Billy Durant 33
  34. 34. FIRED by General Motors BoardScalable Large TransitionStartup Company Billy Durant 34
  35. 35. Durant Versus Sloan • Dies, rich, honored and famous 35
  36. 36. Durant Versus Sloan• Dies managing a bowling alley • Dies, rich, honored and famous 36
  37. 37. Durant Versus Sloan Accountant• Dies managing a bowling alley • Dies, rich, honored and famous 37
  38. 38. Innovators look out! WE are hereScalable Large TransitionStartup Company 38
  39. 39. “Get Out of the Building!!!” bob@kandsranch.com www.steveblank.com ON SALE HERE…also in ebook 39
  1. A particular slide catching your eye?

    Clipping is a handy way to collect important slides you want to go back to later.

×