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.

Introduction to entrepreneurial management

2,892 views

Published on

Research from Harvard Business School’s Shikhar Ghosh shows that 75% of all startup enterprises fail. What causes these failures and what can entrepreneurs do to mitigate the risk? Enter “Entrepreneurial Management.”

In Session 4 of Entrepreneurship 101, we discuss the research from Startup Genome’s report, define the 5-Dimensions of success and introduce entrepreneurial management practices that startups can use to reduce the risk of failure. Startups are not just small versions of big companies – they need special tools and methodology to manage uncertainty and find their place in the market. We aim to equip attendees with the tools to mitigate risk and enjoy the journey of building a great company.

Published in: Business

Introduction to entrepreneurial management

  1. 1. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 16 October 2014 marsdd.com Visit us at
  2. 2. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S ENTREPRENEURIAL MANAGEMENT N AT H A N M O N K , @ CO W B OY T W E E T S I C T V E N T U R E S E R V I C E S 1 5 O C T 2 0 1 4 Visit us at marsdd.com
  3. 3. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S “ A legendary hero is usually the founder of something – the founder of a new age, the founder of a new religion, the founder of a new city, the founder of a new way of life. In order to found something new, one has to leave the old and go on a quest of the seed idea, germinal idea that will have the potenYal of bringing forth that new thing. Our Future MaFers Joseph Campbell, The Hero with a Thousand Faces 15 October Entrepreneurial Management2014
  4. 4. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT Our Future MaFers You do not need to just solve a ‘pain’ or ‘problem’ to be an entrepreneur. -­‐ 2014
  5. 5. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT 2014 Our Future MaFers
  6. 6. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT 2014 Our Future MaFers Ask yourself: What can I do well that I would love to do for an extended period of Yme? -­‐
  7. 7. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S ENTREPRENEURIAL MANAGEMENT 1. Knowledge: what was the focus of your educaYon or career? 2. Capability: what are you most proficient at / strengths? 3. ConnecYons: who do you know and in what industries? 4. Financial: do you have significant financial capital, or meager savings account to start? What is your ‘Ramon Noodle’ diet? 5. Name recogniYon: what are you or your partners well-­‐known for? 6. In previous jobs you’ve held, what inefficiencies or pain points existed? 7. Passion for a parYcular market? 8. Commitment: do you have the Yme and effort to devote? -­‐ Our Future MaFers 15 October 2014 Where do I start ‘digging’?
  8. 8. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S ENTREPRENEURIAL MANAGEMENT Our Future MaFers “Olen you will find an idea or technology that improves something for you personally, then realize that idea or technology has the potenYal to help many others.’” -­‐ Bill Aulet, Sr. Lecturer, MIT Entrepreneurship, Sloan School of Management 15 October 2014
  9. 9. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT2014 Our Future MaFers E N T R E P R E N E U R I A L M A N A G E M E N T DEFINING ENTREPRENEURIAL MANAGEMENT
  10. 10. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT 2014 Our Future MaFers A set of principles and frameworks that are aligned with your passion and help you idenYfy a sustainable and repeatable business model, while managing the chaos of scaling through 5 phases of business growth.
  11. 11. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October The Emergence of New PracYces Our Future MaFers 2001 Agile Develop-­‐ ment 2005 Customer Development 1911 Scien6fic Mgmt 2009 Lean Startup Mvmt 2003 Lean Thinking 1948 Toyota Produc6on System 2014
  12. 12. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT Our Future MaFers Are you ready to jump? Really? Are you sure? Seriously? 2014
  13. 13. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S “ 30-­‐40% of all U.S. startups fail (liquidaYng all assets) and 95% fail to deliver projected return on investment or breakeven by a defined Yme period. Our Future MaFers Shikhar Ghosh, Sr. Lecturer, Harvard Business School Entrepreneurial Management 15 October 2014
  14. 14. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT Our Future MaFers Are you sure you want to jump? 2014
  15. 15. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S ENTREPRENEURIAL MANAGEMENT Our Future MaFers Why do startups fail? Customer Product Team No segmenta6on Acquisi6on b4 PMF Vanity metrics trap Wrong target Wrong archetype Invalidated PSF Inves6ng scale before PMF 3.4x more lines of code Execute on irrelevant Poor MVP / conversion Outsourced development Hiring too much too early Adop6ng mul6-­‐levels Not hiring doers No accountability Lack of Customer Dvp. Focus on features No ‘search & learn’ Business Model Financials Profit max. too early Over planning Not adap6ng to market Costs > revenue Pivot with no valida6on No learning capture Undisciplined Raising too much No innova6on accoun6ng Picking wrong investors Deploying capital wrong No KPI or understanding Misnomer Attributes • Emphasis on market size • Product release cycles • Education levels • Gender • Cofounder history • Entrepreneurial experience • Age • Number of products • Type of tools to track metrics 15 October 2014
  16. 16. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT Our Future MaFers If your answer is sYll YES. 2014
  17. 17. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 16 October ENTREPRENEURIAL MANAGEMENT 2014 Our Future MaFers
  18. 18. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October The art of ‘high growth’ entrepreneurship is to master the chaos of getting each of Entrepreneurial Management 2014 Our Future MaFers these 5 dimensions to move in time and concert with one another. (SGR)
  19. 19. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S ENTREPRENEURIAL MANAGEMENT 1. Startups with helpful mentors, track performance metrics effecYvely & learn from thought leaders raise 7x more money & have 3.5x beFer user growth. 2. PivoYng startups raise 2.5x more money, 3.6x beFer user growth, & are 52% less likely to scale prematurely. Startups that haven’t raised money overesYmate their market size by 100%. 3. Premature scaling is common reason startups perform worse: scale team, customer acquisiYon strategies, or over build the product. 4. Solo founders take 3.6x longer to reach scale stage. 5. Business-­‐heavy founding teams are 3.3x more likely to successfully scale with sales-­‐driven startups 6. Tech-­‐heavy founding teams are 3.3x more likely to scale with a product-­‐centric startup 7. Balanced teams with one technical founder and one business founder raise 30% more money, have 2.9x more user growth and are 19% less likely to scale prematurely than technical or business-­‐heavy founding teams 8. Founders that don’t work full-­‐Yme have 4x less user growth and end up raising 24x less money from investors 9. Most successful founders are driven by impact rather than experience or money. 10. Startups need 2-­‐3 Ymes longer to validate their market than most founders expect. The underesYmaYon creates the pressure to scale prematurely. B2B and B2C isn’t a meaningful segmentaYon because of the way the internet has changed customer dynamics. Our Future MaFers We now know. 15 October 2014
  20. 20. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 6-­‐ Stage Life Cycle of a Startup • Learning • Valley of death Our Future MaFers 15 October Entrepreneurial Management 2014 ESTG PMF LSTG BMC Extreme uncertainty Search 4 repetable & scalable business model DISCOVERY • PMF • PSF VALIDATION EFFICIENCY SCALE SUSTAIN CONSERVATI ON i: $100k / month threshold / scaling, BMC ops. 60% Search for problem space & fit (PSF-PMF) Valley of Death PSF “Scaling successfully is what separates eventual industry leaders from long-­‐forgoden startups in the deadpool.” – Michael A. Jackson
  21. 21. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S failure to failure without loss of enthusiasm. Our Future MaFers “ Success is going from Winston Churchill 15 October 2014 Entrepreneurial Management
  22. 22. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October The Entrepreneurial API Entrepreneurial Management 2014 Our Future MaFers Business Model Stages Lean Itera6on
  23. 23. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ENTREPRENEURIAL MANAGEMENT2014 Our Future MaFers E N T R E P R E N E U R I A L M A N A G E M E N T FRAMEWORKS AND METHODOLOGIES
  24. 24. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Who do we follow? Our Future MaFers The Founders of lean, disrupYon, crossing the chasm, business model innovaYon, startup markeYng and the discipline of entrepreneurship: Blank, Aulet, Christensen, Ellis, Mauyra, Ries, Moore Osterwalder, Chen 2014
  25. 25. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 1. Business Model GeneraYon 2014 Our Future MaFers
  26. 26. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Business Model 2014 Our Future MaFers
  27. 27. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 4. Customer SegmentaYon 2014 Our Future MaFers
  28. 28. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 4. Customer SegmentaYon 15 October 2014 PresentaYon Title Goes Here Our Future MaFers
  29. 29. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Big idea… Our Future MaFers We no longer compete on a product or service, but rather, a compeYYve, repeatable and scalable business model. 2014
  30. 30. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 7 key quesYons 2014 Our Future MaFers
  31. 31. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Source: Osterwalder Masterclass, 2012 2014 Our Future MaFers
  32. 32. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Source: Osterwalder Masterclass, 2012 2014 Our Future MaFers
  33. 33. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Source: Osterwalder Masterclass, 2012 2014 Our Future MaFers
  34. 34. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Source: Osterwalder Masterclass, 2012 2014 Our Future MaFers
  35. 35. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Source: Osterwalder Masterclass, 2012 2014 Our Future MaFers
  36. 36. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Source: Osterwalder Masterclass, 2012 2014 Our Future MaFers
  37. 37. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Source: Osterwalder Masterclass, 2012 2014 Our Future MaFers
  38. 38. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Environment 2014 Our Future MaFers
  39. 39. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 2. Customer Development (new IP) 2014 Our Future MaFers
  40. 40. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October What we used to think… 2014 Our Future MaFers
  41. 41. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October What happens today… 2014 Our Future MaFers
  42. 42. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 2014 Our Future MaFers
  43. 43. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S • Translate business model hypotheses to test with customers • Develop an MVP of the solution to test with customers Our Future MaFers • Continuous testing of hypothesis. • Careful analysis of customer interactions • Pivot or proceed • Product is refined enough to sell • Build demand through marketing & sales • Business transitions for startup mode to departments operating in functions Customer Development Cycle 15 October 2014
  44. 44. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 3. Lean 2014 Our Future MaFers
  45. 45. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October ‘Lean’ methodology favours experimentaYon over elaborate planning, customer feedback over intuiYon, and iteraYve design over tradiYonal up-­‐front development. 2014 Our Future MaFers
  46. 46. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 3. Lean 2014 Our Future MaFers
  47. 47. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Process Our Future MaFers Assump6ons Test problem Assump6ons Measure Evaluate 2014
  48. 48. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Lean vs. TradiYonal 2014 Our Future MaFers
  49. 49. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Why is this important? 2014 Our Future MaFers
  50. 50. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 2014 Our Future MaFers
  51. 51. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 2014 Our Future MaFers
  52. 52. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 4. Customer SegmentaYon 2014 Our Future MaFers
  53. 53. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 2014 Our Future MaFers
  54. 54. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October A target customer is a group of potenYal customers who share many characterisYcs and who would all have similar reasons to buy Our Future MaFers a parYcular product. 2014
  55. 55. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Milkshake 2014 Our Future MaFers
  56. 56. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October By choosing a single market to excel in, your startup can more easily establish a strong market posiYon, and hopefully a state of posiYve cash flow, before it runs out of Our Future MaFers resources. 2014
  57. 57. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October 5. Growth Hacking Entrepreneurial Management 2014 Our Future MaFers
  58. 58. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Growth Hacking Funnel 2014 Our Future MaFers
  59. 59. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Growth Hacking Funnel 2014 Our Future MaFers
  60. 60. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Growth Hacking Funnel 2014 Our Future MaFers
  61. 61. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S ENTREPRENEURIAL MANAGEMENT Our Future MaFers E N T R E P R E N E U R I A L M A N A G E M E N T CONCLUSION
  62. 62. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S Our Future MaFers Summary • ‘Dig for your idea’ and be ready for Everest • Understand why we fail so you can succeed • Hypothesize, test & validate your assumpYons • Search, don’t execute for your business model • Talk to customers (get out of the building) • Minimize waste, deploy resources efficiently • Build a diversified dream team • Growth Hack when ready and opYmize funnel • Have fun, it’s an amazing journey • Put MaRS to work. We are here to support you. 15 October 2014
  63. 63. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October What do I do next? 2014 Our Future MaFers
  64. 64. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S 15 October Thank you. " Our Future MaFers Visit my post-mortem blog on marsdd.com" " " " " Nathan Monk" nmonk@marsdd.com" @Cowboytweets" 2014

×