1. Creating a Profitable Company
ASU Startup School / Stage 5

2. By the end of this lesson, you should
be able to:
• Understand CostStructureandRevenue Streams
• CreateaSalesForecast
• Understand andCreateaProfitandLossforyourCompany
• Definekeymetricsforyourbusinessessuccess
• Understand howtocreatearepeatable, predictable, scalable
andsustainablecompany.
• BuildaBusinessPlanfromyourBusinessModelCanvas

3. Before we start this lesson, consider:
• Howmuchdoesitcosttoacquireacustomer?
• Howmuchdoesitcosttobuildaproduct?
• Howmuchdoesitcosttoserviceacustomer?
• Howmucharefixedcostversusvariable cost?
• HowdoIpricemyproducttomakeaprofit?

4. Startup School is…
• Startup School is a 6-part series to help entrepreneurs learn the
fundamentals of entrepreneurship. At the end of this series,
Entrepreneurs will be able to express their ideas with an excellently
crafted elevator pitch. Have completed the Business Model Canvas,
Customer Discovery, Built or Identified an MVP and Understand the Cost
and Revenue needed to be successful. Finally, we will translate all of
this into a Business Plan to execute against.

5. Your Name
Your BIO Here

6. Overview
1. OVERVIEW
6. GROWTH
2. 3.4.
5.

7. Building a Profitable Business Model
ASU Startup School / Stage 5.1

8. Let’s look at the Business Model Canvas
Preview book: http://www.businessmodelgeneration.com/downloads/businessmodelgeneration_preview.pdf
Download printable canvas: https://upload.wikimedia.org/wikipedia/commons/1/10/Business_Model_Canvas.png

9. Profit
PROFIT

10. Cost Structure:
What are the most important costs inherent in our business model?
Which key resources are most expensive?
Which key activities are most expensive?
Revenue Streams:
For what value are our customers really willing to pay? For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each revenue stream contribute to overall revenues?

11. Cost Structure

12. Revenue Streams

13. Keys to Profitable Company
ASU Startup School / Stage 5.2

14. Repeatable Customers
The key to success is to find customers that will become repeat customers.
What will they come back for?
So if we can create a subscription service or “wine of the month” subscription
then, we will repeat. Most businesses do not have repeat customers.

15. Predictable Sales
With repeatable customers, comes predictable sales. Each month grows
The base customer list and revenue streams.
With predictable sales, you can raise money and invest it to create more
Predictable sales.

16. Scalable Business
With predictable sales pouring in, there will be a need to scale your operations.
How do you do for one customer for one million?
Scalable is a great hurdle, productizing your service and creating a service of
Your product is one way.
How do you make the process match the technology or people?
These are just the beginning of questions to grapplel with…

17. Sustainable Company
With a scalable business, it creates the possibility to create a sustainable
Company.

18. Sales Forecast
ASU Startup School / Stage 5.3

19. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.

20. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.
Add Referral Source

21. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.Add Product/Service

22. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.Who Sold It

23. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.Company you sold it too

24. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.If you have types of customers

25. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.How closed is the sale

26. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.
Automatic based on %
closed and projected

27. Sales Forecast
Download spreadsheet:
Sales is the life blood of a startup. It also cures many other things.Projected sale in dollars

28. Profit & Loss
ASU Startup School / Stage 5.3

29. Profit & Loss
Download spreadsheet:
Understanding where you spend money and make money is pretty important.

30. Profit & Loss
Download spreadsheet:
Understanding where you spend money and make money is pretty important.
Auto-populates from Forecast

31. Profit & Loss
Download spreadsheet:
Understanding where you spend money and make money is pretty important.
Commission to Sales Rep

32. Profit & Loss
Download spreadsheet:
Understanding where you spend money and make money is pretty important.
Project Management to
deliver Service

33. Profit & Loss
Download spreadsheet:
Understanding where you spend money and make money is pretty important.
Insert Expenses here

34. Profit & Loss
Download spreadsheet:
Understanding where you spend money and make money is pretty important.
Auto-populates from Forecast

35. Key Metrics for Startups
ASU Startup School / Stage 5.4

36. Key Metrics
Let’s review the metrics and pick 3 to see, which is most essential to the success
of your business.
LIST KEY METRICS TO CHOOSE FROM WITH DEFINITIONS

37. Business Model Canvas to Business
Plan
ASU Startup School / Stage 5.5

38. Translating Canvas to Plan
Canvas
Value Propositions:
• What value do we deliver to the
customer?
• Which one of our customer’s
problems are we helping to
solve?
• What bundles of products and
services are we offering to
each customer segment?
• Which customer needs are we
satisfying?
Customer Segments:
• For whom are we creating
value?
• Who are our most important
customers?
Business Plan
Executive Summary:
• What value does our idea deliver
and to who?
Market/Targeted Customer:
• Who is your targeted customer and
what size of market are they?

39. Translating Canvas to Plan
Canvas
Channels:
• Through which channels do our
customer segments want to be
reached?
• How are we reaching them now?
• How are our Channels integrated?
Customer Relationships:
• What type of relationship does each of
our customer segments expect us to
establish and maintain with them?
• Which ones have we established?
• How are they integrated with the rest of
Business Plan
Marketing Plan:
• What are the channels we need to use
to get to our targeted customer?
Sales/Service Plan:
• How do we get, keep and grow our
customers?

40. Canvas
Key Activities:
• What key activities do our value
propositions require?
• Our Distribution channels?
• Customer Relationships?
• Revenue Streams?
Business Plan
Operations Plan:
• What do we need to do to
operationalize?
Translating Canvas to Plan

41. Canvas
Key Resources:
• What key resources do our value propositions
require?
• Our Distribution Channels? Customer
Relationships?
• Revenue Streams?
• Which ones work best?
• Which ones are the most cost-efficient?
• How are we integrating them with customer
routines?
• Awareness: How do we raise awareness about
our company’s products and services?
• Evaluation. How do we help customers evaluate
our organization’s Value Proposition?
• Purchase. How do we allow customers to
purchase specific products and services?
• Delivery. How do we deliver a Value Proposition
to the customer?
• After Sales. How do we provide post-purchase
customer support?
Business Plan
Management & Staffing Plan:
• What team do we need?
Translating Canvas to Plan

42. Canvas
Key Partners:
• Who are our key partners?
• Who are our key suppliers?
• Which key resources are we
acquiring from partners?
• Which key activities do partners
perform?
Business Plan
Partners & Supply Chain:
• Who are the key partners and
suppliers we need to make this
happen?
Translating Canvas to Plan

43. Canvas
• Cost Structure:
• What are the most important costs
inherent in our business model?
• Which key resources are most
expensive?
• Which key activities are most
expensive?
• Revenue Streams:
• For what value are our customers
really willing to pay? For what do
they currently pay?
• How are they currently paying?
• How would they prefer to pay?
• How much does each revenue
stream contribute to overall
revenues?
•
Business Plan
Startup Capital
• What are the cost to start?
Financial Plan:
• What are the revenue streams and the cost
to create repeatable, predictable, scalable
and sustainable business model?
Appendices:
• What are the other important metrics and
documents to support our business.
Translating Canvas to Plan

44. Summary and Next Steps

45. What we will learn in the last class:
• How to Grow your Company

46. At the end of this course, you will have:
• Completed many Iterations of the Business Model Canvas
• Completed of a Successful 30-Second Elevator Pitch
• Created of a Customer Discovery Analysis
• Developed a Minimum Viable Product
• Created of a Profitable Company
• Understanding of a Fundable Business Plan

47. Here is a list of all additional resources
To get a sense of the energy humming through Silicon Valley, the following reading will be helpful:
First, for the big picture read Why Software is Eating the World, The Rise and Fall of Personal Computing,
and Internet Trends.
Next, look at these articles on Stanford's Facebook class, The Social Network , and Massively Collaborative
Mathematics.
Finally, read Startup = Growth and the book, Zero to One.
.