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Turning Products into Companies

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Startup Secrets presents a lecture on how to turn products into companies! Your great idea won't stand on its own -- Figure out how to build a sustainable company around a fantastic product.

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Turning Products into Companies

  1. 1. Proprietary and ConfidentialProprietary and Confidential Turning Products into Companies startupsecrets.com
  2. 2. Proprietary and ConfidentialProprietary and Confidential Workshops Full descriptions of each at startupsecrets.com 1. What’s Your Roadmap to Success? 2. Building a Compelling Value Proposition 3. Turning Products into Companies 4. Culture, Mission and Vision 5. Hiring A+ Talent 6. Game-Changing Business Models 7. Go to Market Strategies 8. Getting Behind the Perfect Investor Pitch 9. Funding Strategies to go the Distance 10. Have You Got What It Takes? 11. Mastering Mutual Mentorship
  3. 3. Proprietary and ConfidentialProprietary and Confidential The Problem… We get MVP, We get product market fit, YET, We don’t get enough momentum to build a company. We have a product company GAP! 3startupsecrets.comTurning Products Into Companies
  4. 4. Proprietary and ConfidentialProprietary and Confidential The Product-Company GAP GAP Company 4startupsecrets.comTurning Products Into Companies
  5. 5. Proprietary and ConfidentialProprietary and Confidential The Product-Company GAP GAP Company Go to Market Business Model Execution 5startupsecrets.comTurning Products Into Companies
  6. 6. Proprietary and ConfidentialProprietary and Confidential GAP startupsecrets.comTurning Products Into Companies Go to Market Business Model Execution GAP Solidworks 6 The Product-Company GAP
  7. 7. Proprietary and ConfidentialProprietary and Confidential Your product… 7startupsecrets.comTurning Products Into Companies
  8. 8. Proprietary and ConfidentialProprietary and Confidential It’s all about the product, right? 8startupsecrets.comTurning Products Into Companies
  9. 9. Proprietary and ConfidentialProprietary and Confidential Your Expenses Will Flip 9 From all R&D and engineering… Development STARTUP Sales & Marketing startupsecrets.comTurning Products Into Companies
  10. 10. Proprietary and ConfidentialProprietary and Confidential 10 From all R&D and engineering… to prove market acceptance, gain, repeatability Development Market Acceptanc e Sales & Marketing startupsecrets.comTurning Products Into Companies Your Expenses Will Flip
  11. 11. Proprietary and ConfidentialProprietary and Confidential 11 From all R&D and engineering… to prove market acceptance, Then repeat and scale using Sales & Marketing Development Sales & Marketing SCALE startupsecrets.comTurning Products Into Companies Your Expenses Will Flip
  12. 12. Proprietary and ConfidentialProprietary and Confidential 12 From All R&D and engineering… to prove market acceptance, Then repeat and scale using Sales & Marketing Sales & Marketing = 2-3x (!) Development Development Sales & Marketing SCALE startupsecrets.comTurning Products Into Companies Your Expenses Will Flip
  13. 13. Proprietary and ConfidentialProprietary and Confidential So, why not plan where you want to be when you get there? 13 e.g., look at CARC, your Business Model, GTM Strategy, and how your PRODUCT will influence it startupsecrets.comTurning Products Into Companies
  14. 14. Proprietary and ConfidentialProprietary and Confidential Software & Services Model 14 62% 61% 53% 43%48% 29% 21% 19% 43% 50% 45% 44% 19% 14% 11% 11% L/T Model based on profitable subscription based software company 62% 48% 43% 19% 51% 29% 65% 14% 11% 45% 21% 53% 44% 19% 44% 11% 10% 35% 15% 25% Sales & Marketing = 2-3x (!) Development startupsecrets.comTurning Products Into Companies
  15. 15. Proprietary and ConfidentialProprietary and Confidential What if… 15 You thought about this upfront? LET’S DO IT! startupsecrets.comTurning Products Into Companies
  16. 16. Proprietary and ConfidentialProprietary and Confidential Closing the Product-Company GAP: by Design & Architecture 16 • Design • Product Go To Market Fit • PVP • MVP • MVS • MRP • Architecture • Business Model • SLIPPERY Products • Russian Doll Pricing and Packaging • Whole Product • Services startupsecrets.comTurning Products Into Companies
  17. 17. Proprietary and ConfidentialProprietary and Confidential Design for Go To Market fit 17 PVP – Primary Value Proposition startupsecrets.comTurning Products Into Companies
  18. 18. Proprietary and ConfidentialProprietary and Confidential Value Proposition 18 BEFORE you build: - What problem are you solving? - Who are you solving it for? startupsecrets.comTurning Products Into Companies
  19. 19. Proprietary and ConfidentialProprietary and Confidential Focus Your Value Proposition! 19 Find a PRIMARY value proposition for a single audience Multi-faceted ones are harder: - Chicken and Egg problems - Serving too many masters startupsecrets.comTurning Products Into Companies
  20. 20. Proprietary and ConfidentialProprietary and Confidential PRIOR to MVP 20 Check, recheck and triple check your Value Proposition - If you’re not solving a valuable problem… - YOU’RE NOT SOLVING A VALUABLE PROBLEM! - And unsurprisingly you won’t build any value  - VIABLE does not always mean VALUABLE!! startupsecrets.comTurning Products Into Companies
  21. 21. Proprietary and ConfidentialProprietary and Confidential Qualitative Evaluation 21 Before After Acute Pain  Absolute Joy  Vitamin vs. Penicillin startupsecrets.comTurning Products Into Companies
  22. 22. Proprietary and ConfidentialProprietary and Confidential Value Prop: Recap & Intersection 22 - 3D Solution • Discontinuous • Defensible • Disruptive - 4U Need • Unworkable • Unavoidable • Urgent • Underserved market(For targeting, Segmentation) Unique startupsecrets.comTurning Products Into Companies
  23. 23. Proprietary and ConfidentialProprietary and Confidential Qualify the Need 23 Is it “blac” & white? - (B)latant - (L)atent - (A)spirational - (C)ritical Blatant Latent Aspirational Critical White Space startupsecrets.comTurning Products Into Companies
  24. 24. Proprietary and ConfidentialProprietary and Confidential Qualify the Need: B2B vs. B2C? 24 Is it “blac” & white? - (B)latant - (L)atent - (A)spirational - (C)ritical Blatant Latent Aspirational Critical Blatant Critical B2C Best for B2B startupsecrets.comTurning Products Into Companies
  25. 25. Proprietary and ConfidentialProprietary and Confidential It’s Just a Big iPod… Is it “blac” or white?  (L)atent  (A)spirational 25 Blatant Latent Aspirational Critical Blatant Critical iPad vision execution startupsecrets.comTurning Products Into Companies
  26. 26. Proprietary and ConfidentialProprietary and Confidential Example - Apperian 26 • Increase revenue by 40% at counters • Saved $2.5M+ in direct IT costs • Roll out 17,000 iPads • Deliver worldwide no IT touch required startupsecrets.comTurning Products Into Companies
  27. 27. Proprietary and ConfidentialProprietary and Confidential Example - Apperian 27 • Increase revenue by 40% at counters • Saved $2.5M+ in direct IT costs • Roll out 17,000 iPads • Deliver worldwide no IT touch required GAIN PAIN startupsecrets.comTurning Products Into Companies
  28. 28. Proprietary and ConfidentialProprietary and Confidential Design for Product Go To Market fit  MVP and introducing MVS, MRP 28startupsecrets.comTurning Products Into Companies
  29. 29. Proprietary and ConfidentialProprietary and Confidential The Product-Market Fit MarketProduct Fit 29startupsecrets.comTurning Products Into Companies
  30. 30. Proprietary and ConfidentialProprietary and Confidential MarketMVP The Product-Market Fit 30startupsecrets.comTurning Products Into Companies
  31. 31. Proprietary and ConfidentialProprietary and Confidential Adding to Lean Startup Thinking 31 Minimum Viable Product (MVP) MVP startupsecrets.comTurning Products Into Companies
  32. 32. Proprietary and ConfidentialProprietary and Confidential The Product-Market Fit Problem 32 here? here? here? here? Fit ? Stretch ? MVP MVP ++ here? Market startupsecrets.comTurning Products Into Companies
  33. 33. Proprietary and ConfidentialProprietary and Confidential The Product-Market Fit Solution 33 Market not here not here not here not here Fit MVP startupsecrets.comTurning Products Into Companies
  34. 34. Proprietary and ConfidentialProprietary and Confidential MV S MVP Adding to Lean Startup Thinking 34 Minimum Viable Product (MVP) + Minimum Viable Segment (MVS) Repeat? startupsecrets.comTurning Products Into Companies
  35. 35. Proprietary and ConfidentialProprietary and Confidential MVS = Same NEEDSMVP Adding to Lean Startup Thinking 35 Minimum Viable Product (MVP) + Minimum Viable Segment (MVS) Repeat for… startupsecrets.comTurning Products Into Companies
  36. 36. Proprietary and ConfidentialProprietary and Confidential MVP Adding to Lean Startup Thinking 36 Minimum Viable Product (MVP) + Minimum Viable Segment (MVS) = Minimum Repeatable Product (MRP) MR P Repeatable  MRP startupsecrets.comTurning Products Into Companies MVS = Same NEEDS
  37. 37. Proprietary and ConfidentialProprietary and Confidential MVP Adding to Lean Startup Thinking 37 Minimum Viable Product (MVP) + Minimum Viable Segment (MVS) = Minimum Repeatable Product (MRP) Smaller target to reference lead, dominate MRP Repeatable, Referenceable  MRP startupsecrets.comTurning Products Into Companies MVS = Same NEEDS
  38. 38. Proprietary and ConfidentialProprietary and Confidential Startup Secret! Minimum Viable Segment  Maintains MVProduct footprint • Same functionality needed by all customers  People reference according to the same NEEDS • Customers can compare solutions  Potential for leadership, domination • At least initial Beachhead 38 Segment according to the same NEEDS MVP MRP startupsecrets.comTurning Products Into Companies MVS = Same NEEDSMRP
  39. 39. Proprietary and ConfidentialProprietary and Confidential + Blatant Critical need if possible: Startup Secret! Targeting and Segmentation 39startupsecrets.comTurning Products Into Companies Mobile Professionals vs. Office Worker Field Workers vs. White Collar Services vs. Sales Medical Equipment vs. Office Equipment vs. Medical ClinicsHospitals Critical Care vs. Diagnostics
  40. 40. Proprietary and ConfidentialProprietary and Confidential No Longer Just Product-Market Fit  It’s about Product-Go-To-Market Fit • Narrow your target • Segment it by need • Focus your product  Vital for • Positioning, Messaging, Communication • Packaging and Pricing • Channels & Distribution, Partner Alignment  Enables • Reference selling, network effects, viral possibility • Overall Business alignment 40startupsecrets.comTurning Products Into Companies
  41. 41. Proprietary and ConfidentialProprietary and Confidential  Narrow as possible to start! • Think small targets to dominate  Would you rather: • Expand on success? • Contract on failure?  Balance Vision vs. Execution • See post on startupsecrets.com 41 #1 startupsecrets.comTurning Products Into Companies Startup Secret! Don’t Be Afraid to FOCUS
  42. 42. Proprietary and ConfidentialProprietary and Confidential Closing the Product-Company GAP: by Design & Architecture  Design • Product-Go-To-Market Fit  PVP  MVP  MVS  MRP  Architecture • Business Model  SLIPPERY Products  Russian Doll Pricing and Packaging  Whole Product  Services 42startupsecrets.comTurning Products Into Companies
  43. 43. Proprietary and ConfidentialProprietary and Confidential Architecting for Business Model SLIPPERY Products 43startupsecrets.comTurning Products Into Companies
  44. 44. Proprietary and ConfidentialProprietary and Confidential Gain/Pain Ratio 44 • Revenue • Cost savings • Time • People • Competitive advantage • Reputation • Etc. • Inertia • Switching costs? • Default = do nothing • Alternatives? • Good enough = good enough! • RISK on a startup • Find (See) • Try • Buy • Implement • Deploy • Own – e.g., TCO Inertia, RISK Gain Pain >10 startupsecrets.comTurning Products Into Companies
  45. 45. Proprietary and ConfidentialProprietary and Confidential Gain/Pain Ratio 45 • Revenue • Cost savings • Time • People • Competitive advantage • Reputation • Etc.. • Inertia • Switching costs? • Default = do nothing • Alternatives? • Good enough = good enough! • RISK on a startup • Find (See) • Try • Buy • Implement • Deploy • Own – e.g., TCO Inertia, RISK Gain Pain >10 Product Lifecycle startupsecrets.comTurning Products Into Companies
  46. 46. Proprietary and ConfidentialProprietary and Confidential Get To Market – Product Facilitation What if you could literally slip into the lead? 46startupsecrets.comTurning Products Into Companies
  47. 47. Proprietary and ConfidentialProprietary and Confidential • Simple • Low to no initial cost • Installs easily • Proves value quickly • Plays well with others • Easy to use • ROI is obvious • Your customers can’t live without it – it’s stickY Startup Secret! Friction Free, SLIPPERY Products 47startupsecrets.comTurning Products Into Companies
  48. 48. Proprietary and ConfidentialProprietary and Confidential 48startupsecrets.comTurning Products Into Companies Simple
  49. 49. Proprietary and ConfidentialProprietary and Confidential Simple Complexity Simplicity FIRST PRINCIPLES Advantage Disadvantage 49startupsecrets.comTurning Products Into Companies
  50. 50. Proprietary and ConfidentialProprietary and Confidential Advantage = Innovation / Complexity Complexity # Simplicity Advantage = Innovation * Simplicity Advantage # Disadvantage Disadvantage = Innovation * Complexity 50startupsecrets.comTurning Products Into Companies Simple
  51. 51. Proprietary and ConfidentialProprietary and Confidential Even Simpler = Less is More! Microsoft 51startupsecrets.comTurning Products Into Companies Apple
  52. 52. Proprietary and ConfidentialProprietary and Confidential Example: Knowledge Management vs. Note Taking 52startupsecrets.comTurning Products Into Companies
  53. 53. Proprietary and ConfidentialProprietary and Confidential Simple  Simplify to your C.O.R.E. value (link on startupsecrets.com) • Create a whole product with partnerships • And / or Open Source, etc. 53 Capabilities Of Really Exceptional Value Focus on it! C.O.R.E. Value startupsecrets.comTurning Products Into Companies
  54. 54. Proprietary and ConfidentialProprietary and Confidential Low-to-No Initial Cost  Potential for: • Frictionless trials • Lower initial CARC • Self-identifying Freemium prospects  54 http://www.wired.com/techbiz/it/magazine/16-03/ff_free “Freeconomics" startupsecrets.comTurning Products Into Companies
  55. 55. Proprietary and ConfidentialProprietary and Confidential Low-to-No Initial Cost  Potential for: • Frictionless trials • Lower initial CARC • Self-identifying Freemium prospects  Free-fall, free-fail? • It’s worth what people are paying for it:  Nothing = no proof of value • Perceived value can also be zero! • Ultimately you have to upsell 55startupsecrets.comTurning Products Into Companies
  56. 56. Proprietary and ConfidentialProprietary and Confidential Low-to-No Initial Cost • Value • Network • Monetization 56startupsecrets.comTurning Products Into Companies
  57. 57. Proprietary and ConfidentialProprietary and Confidential Installs Easily, Integrates Well  Slippery, not Trip-up-ery! 57startupsecrets.comTurning Products Into Companies
  58. 58. Proprietary and ConfidentialProprietary and Confidential  Reducing the Pain for customers to try, adopt, deploy 58 Inertia, RISK Gain Pain >10 startupsecrets.comTurning Products Into Companies Installs Easily, Integrates Well
  59. 59. Proprietary and ConfidentialProprietary and Confidential • Integrates well – “Embrace & Extend” Open & Extensible… 59startupsecrets.comTurning Products Into Companies Installs Easily, Integrates Well
  60. 60. Proprietary and ConfidentialProprietary and Confidential • Integrates well – “Embrace & Extend” Open & Extensible… • Assume – Change = risky, painful, time consuming & costly Incumbents far and wide Applications Operating environments Business processes Human skills 60startupsecrets.comTurning Products Into Companies Installs Easily, Integrates Well
  61. 61. Proprietary and ConfidentialProprietary and Confidential Products That Integrate and Play Well With Others Encourage others to play with them… 61 ® LINK Technology Partners LINK program startupsecrets.comTurning Products Into Companies
  62. 62. Proprietary and ConfidentialProprietary and Confidential Proves Value Quickly  Consumer • Instant gratification  Enterprise, • Rapid payback  ≤3 months is great  >12 months is bad 62startupsecrets.comTurning Products Into Companies
  63. 63. Proprietary and ConfidentialProprietary and Confidential Startup Secret! Self-Proving Value  For example, • If your product is about improving a process…  Provide proof as part of the product! • Baseline current before the product usage • Provide key metrics, visibility into progress • Integrate analytics, dashboards • Clearly surface reports that prove the value 63startupsecrets.comTurning Products Into Companies
  64. 64. Proprietary and ConfidentialProprietary and Confidential Package and Progressively Disclose Value 64 VS. startupsecrets.comTurning Products Into Companies
  65. 65. Proprietary and ConfidentialProprietary and Confidential Package and Progressively Disclose Value Example: Acquia, Drupal Gardens 65startupsecrets.comTurning Products Into Companies
  66. 66. Proprietary and ConfidentialProprietary and Confidential Package and Progressively Disclose Value Example: Acquia, Drupal Gardens – Results: 66startupsecrets.comTurning Products Into Companies
  67. 67. Proprietary and ConfidentialProprietary and Confidential Easy to Use and Apply  “OOBE!” • Out Of the Box Experience • Delight & entrance users 67startupsecrets.comTurning Products Into Companies
  68. 68. Proprietary and ConfidentialProprietary and Confidential  Example Salesforce.com vs SIEBEL 68 VS. Easy to Use and Apply startupsecrets.comTurning Products Into Companies
  69. 69. Proprietary and ConfidentialProprietary and Confidential ROI is Obvious  Quantifiable: • Increases revenue • Reduces time, resources and / or costs  Or: • Reduces risk • Drives competitive advantage (ties to fast payback) 69startupsecrets.comTurning Products Into Companies
  70. 70. Proprietary and ConfidentialProprietary and Confidential ROI is Obvious (Supported by Self-Proving Value)  Example: Unidesk 70startupsecrets.comTurning Products Into Companies
  71. 71. Proprietary and ConfidentialProprietary and Confidential StickY  Your customers can’t live without it!  Fulfills a real need  Leaves customers wanting more! 71startupsecrets.comTurning Products Into Companies
  72. 72. Proprietary and ConfidentialProprietary and Confidential Startup Secret! Friction Free, SLIPPERY Products 72 • Simple • Low to no initial cost • Installs easily • Proves value quickly • Plays well with others • Easy to use • ROI is obvious • Your customers can’t live without it – it’s stickY Think of how this improves the Gain/Pain Ratio in our Value Proposition Workshop Gain Pain startupsecrets.comTurning Products Into Companies
  73. 73. Proprietary and ConfidentialProprietary and Confidential info@startupsecrets.com
  74. 74. Proprietary and ConfidentialProprietary and Confidential Turning Products into Companies startupsecrets.com

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