Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Case Study: Bootstrap vs. Venture Funding

1,302 views

Published on

How did FitBit, Inc capture most of the market share for wearable fitness trackers in less than two years with mostly organic growth and minimal venture capital investment? In contrast, their competitor, Jawbone raised six times more money from venture capital investors, but captured only 19% of the market.

Published in: Business
  • Be the first to like this

Case Study: Bootstrap vs. Venture Funding

  1. 1. Case Study: Bootstrap vs. Venture Funding How did FitBit, Inc become market leader with organic growth
  2. 2. Case Study: Bootstrap vs. Venture Funding What we will see today 2 Agenda © 2015, ANAGARD, LLC 1 2 3 4 About Us Bootstrap vs. Venture Funding Case Study: Fitness Trackers FitBit vs. Jawbone 5 6 Go-to-market Strategy Contact Us Business Growth Consulting for Startups & Small Businesses Overcapitalization may lead to managerial complacency FitBit, Inc market leader in less than 2 years Minimal vs extensive venture funding Customer acquisition Quality
  3. 3. Case Study: Bootstrap vs. Venture Funding Download case study document 3 Watch this presentation © 2015, ANAGARD, LLC Watch a presentation Download a case study document http://www.anagard.com/blog/2015/05/06/case-study-bootstrap-vs-venture-funding/
  4. 4. Case Study: Bootstrap vs. Venture Funding For Startups and Small Businesses 4 ANAGARD, LLC: © 2015, ANAGARD, LLC Our approach Tested and validated value proposition is the fundamental building block to a successful business How will you serve your customers and make money BUSINESS MODEL Market Research Customer Discovery PRODUCT-MARKET FIT Define customer segment, their problems, and the advantage of using your solution over currently available ones in the market VALUE PROPOSITION
  5. 5. Case Study: Bootstrap vs. Venture Funding For startups and small businesses 5 ANAGARD, LLC: BUSINESS GROWTH CONSULTING © 2015, ANAGARD, LLC Our Services MARKET RESEARCH Customer Discovery Target Market Segment Competition BUSINESS PLANS Business plan document doubles probability of funding, yet only 40% of companies have one. Business Plan Evaluation & Development Business Model Canvas INVESTOR-READY CONSULTING Reduce time needed to raise funds Pitch-book Business Model TECHNOLOGY COMMERCIALIZATION Platform Technology developed by researchers or academics Find Technology-Product-Market Fit
  6. 6. Case Study How did FitBit, Inc grew organically to be a market leader
  7. 7. How did FitBit Bootstrap its Way to a Market Leader FitBit has raised only $83.8M from investors and have captured 70% of the market within three years. Rival Jawbone, has raised well over $518M and captured only 19% of the wearable fitness trackers market. Case study: wearable fitness trackers Sufficient Venture Capital Investments Do Not Guarantee Business Success in the Market Place 7 Bootstrap vs. raise money from venture capital investors © ANAGARD, LLC
  8. 8. Case Study: Bootstrap vs. Venture Funding 2014 Market Share 8 Wearable Fitness Trackers © 2015, ANAGARD, LLC 3% 8% 19% 70% FitBit Jawbone Nike FuelBand Others Launch Dates FitBit and Jawbone November 2011 Nike FuelBand, January 2012 Discontinued April 2014 70M units shipped in 2014
  9. 9. For 3 times less market share 9 Jawbone raises 6 times more money than FitBit © ANAGARD, LLC FitBit, Inc Raised $83.8M 70% Market Share in 2014 Ŵ Jawbone Raised $515.8M 19% Market Share in 2014 Ŵ $0M $50M $100M $150M $200M 2006 2007 2008 2009 2010 2011 2012 2013 2014 $0M $13M $25M $38M $50M 2008 2009 2010 2011 2012 2013 2014 2015
  10. 10. $83.M venture funding, over $300M net income in just two years 10 Hockey Stick Growth © ANAGARD, LLC FitBit, Inc Raised $83.8M and grew it to $750M in revenue 70% Market Share in 2014, grew it to 85% by March 2015 Ŵ $0M $13M $25M $38M $50M 2008 2009 2010 2011 2012 2013 2014 2015 • Profitable in 2013 • $130M Net Income in 2014 • $170M Net Income projected for 2015
  11. 11. Comparable product line, different distribution strategy 11 Key Differentiator: Go-To-Market Strategy © ANAGARD, LLC
  12. 12. Case Study: Bootstrap vs. Venture Funding Jawbone ignored Android users in the first year 12 Size of the Ecosystem Matters © 2015, ANAGARD, LLC FitBit, Inc Jawbone 40% of all smartphones in 2012 were Android phones Jawbone ignored almost half of potential market size for a full year
  13. 13. Case Study: Bootstrap vs. Venture Funding Utility trumps beautiful design 13 Quality Matters © 2015, ANAGARD, LLC “The UP No Questions Asked Guarantee” Poor hardware design lead to immediate widespread device replacements HARDWARE DESIGN Jawbone emphasized beautiful design over R&D vigor, and operational efficiencies R&D Dissatisfied customers CUSTOMER SERVICE
  14. 14. Case Study: Bootstrap vs. Venture Funding Smartphone and tablet app, website interface, paid premium analytics 14 Access to customer analytics © 2015, ANAGARD, LLC FitBit, Inc Jawbone Multiple platforms let customers gain insight into their fitness and nutritional goals
  15. 15. Case Study: Bootstrap vs. Venture Funding FitBit: Wellness Program for Businesses 15 Expanded distribution channels © 2015, ANAGARD, LLC B2C + B2B > B2C
  16. 16. Case Study: Bootstrap vs. Venture Funding Planning IPO vs fending off creditors 16 Spring 2015 © 2015, ANAGARD, LLC Planning $100M IPO March 31, 2015: increased market share to 85% S-1 filing Launched UP3 after 6 months delay Fending off creditors VC backed out from equity financing, claim money was loan Suing FitBit for poaching employees & IP
  17. 17. Case Study: Bootstrap vs. Venture Funding For 30-minutes long complimentary discovery consultation 17 Contact Us © 2015, ANAGARD, LLC 9360 Falls of Neuse Rd Suite 205 Raleigh, NC 27615 Phone +1-919-876-1314 twitter.com/DraganaMendel plus.google.com/+AnagardBizGrowth linkedin.com/company/anagard-llc www.ANAGARD.com info@ANAGARD.com

×