Quick review of prior material Web startups Hockey stick curve (in contrast to) high tech startups Trough of sorrow / valley of death (in contrast to) small businesses Angel Investors Disruptive innovation Dotcom bubble Lean Startup Pets.com sock puppet (in contrast to) Business plan Venture Capital Agile Software Development Silicon Valley Minimum Viable Product (MVP) Entrepreneurial spirit Iteration Exit Customer Development IPO = Initial public offering Customer Discovery Acquisition Customer Validation Lifestyle business Customer Creation Startup Lottery Company Building Execution
Pitches Agenda Discussion Practices (1 minute) Real Pitches (2 minutes) Investments Form Teams Funny pitches
What is a pitch? Pitch Any short summary of the product and company to someone who has never heard of it before. “Elevator Pitch” 30 second pitch, summarize your idea Let a listener figure out if he’s interested Contents Who you are How you came up with the idea The idea Where you’re going with it
Why is pitching important? Entrepreneur is always selling… The product The vision The company … to everyone Customers Key hires Potential investors Board of directors Strategic Partners You never know when you’ll need to pitch. It’ll just happen.
What makes a great pitch? Keep it fast, short, and sweet Don’t babble on and on. FOCUS!! Your goal is to (1) tell the audience enough, and (2) get the audience to want to learn more. Know who your audience is. Specifically mention things that they are interested in. With customers, sell the benefits With investors, talk about revenue and name drop With potential partners, sell the passion and the vision Tell a story, or do something memorable A magic trick (related to your company)
Practice Pitches Ideas from: http://itsthisforthat.com/ http://www.halfbakery.com http://www.kickstarter.com/ 1 minute each Just practice speaking in front of an audience, keep it fast, short, and sweet.
Real pitches, 2 minutes each 2 minutes. At 2:30, I will cut you off. When you’re not pitching, you are an angel investor You have a $150,000 fund. Each $1 bill is $1,000 You must split your fund among 3-5 companies. Splitting it up reduces your risk Splitting too much will reduce the value of your investments, and it’s a pain to manage too many companies, too. You must deliver your investment immediately after the pitch. You must decide on the spot. No “comparing later” allowed. Top 3 Winners Also, keep in mind who you might want to work with for the rest of the class.
Rules for Forming Teams 2 people is best. No more than 3 people No working with people you already know. Word of caution – only work on something where you feel comfortable. No NDA’s today, please. If you want to work alone, that is OK, but you’ll get a better learning experience by working in a team of 2.
Funny Pitches Third, videos about funny pitches Ali G – Ice cream gloves https://www.youtube.com/watch?v=48TR0vUPQCs Share the Air – Venture Capital Fundraising Club http://www.youtube.com/watch?v=wyrFWbGiGOc Hardly working startup guys http://www.collegehumor.com/video/6507690/hardly- working-start-up-guys
What is a pitch deck? Same as a pitch, but in powerpoint form Any short summary of the product and company to someone who has never heard of it before. Primary use is for investors. Compared to the verbal pitches we just did, pitch decks need more focus on business and product, less focus on your story. Marketing strategy Revenue models and financial projections
Pitch deck outline Many different ways to do the Cover same thing: describe what the Mission / Vision company is and where it’s Summary going Team Problem We’re going to use a template that’s been put together by Solution / Demo some investors. Technology Marketing Walk through the outline Business Model template Competition Milestones / Financial Forecast Conclusion
Work on your pitch deck for your project (in teams)Pitch decks take a lot of time to put together. Weeks, sometimes even months. You really need to think through and research the business opportunity.
Funny Pitch Deck Color.xxx http://techcrunch.com/2011/03/24/color-blind/ “Hot Keywords” everywhere Making fun of a crazy $41 M investment in a photo- sharing startup called “color” (still so crazy of an investment after the Instagram acquisition?) Making fun of the VC community for “flipping” startups
Naming Tools Keep in mind that the name of a product/company can change over time. It’s not set in stone USPTO search http://www.uspto.gov Domain name search California Secretary of State business name search http://www.nameboy.com http://www.namecheck.com Slogan Generator: http://thesurrealist.co.uk/slogan
Researching the Competition Crunchbase is your best friend (example usage)Keeping Files Synchronized Dropbox is your best friend (example usage)
That’s all for Business Planning … break time …next, Section 2: Website Introduction
Components to a Website Domain Registration … $10/year = the data record of who owns what virtual property Email … (free with google apps) = what happens to an email to email@example.com Web Hosting … varies greatly, $10-$2,000/month = actual physical server cost, with hard drives, networking, and electricity Web code … depends on type. = the HTML, PHP, or anything else that happens when the website is accessed by a visitor
Domain Registration www.________.com Getting the ownership of virtual property A lot like owning real land. Once you own it, you can build on it, sell it, or anything. Generally very cheap, $10-20/year per domain Registrars: Namecheap.com Godaddy Use a dedicated registrar, not a “secondary” reseller
DNS = Domain Name System Foundation of how the internet works Technically, converts www.______.com 188.8.131.52 Commonly called the “internet phone book / address book” Frequently part of your registrar, you can tell it what to do with the domain for various instructions http://_____.com http://www._____.com http://somethingelse._____.com Email to ____@_____.com
Google Apps Free* and Awesome! * free for small accounts, like startups. Lots of great collaboration tools Email Calendar Documents Chat Moderately-easy setup (requires DNS changes)
Now what for the website? Must set up DNS Point to someone else’s server We will do this next session, pointing to other web apps Point to our own server (must buy hosting) A CMS like Wordpress or Joomla running on our server Or, our own custom code (web application)
Websites… before we start Building a “web startup website” is very different from building a “small business website” Just like starting a “web startup” is very different from starting a “small business” – remember last session? By a factor of at least 100… Much more difficult Much more expensive Much more time consuming You get what you put into it (money, time, effort)
Why so different? When you build a web application, you’re actually building something completely new that’s never been done before. When you build a small business website, you’re actually just using someone else’s web application All the small business website builders are web startups Wordpress.com Wix Weebly SquareSpace Moonfruit If you use that, you are just a customer “user” to their startup.
Functional Requirements Questions to answer What customer problem does this product solve? What are the customer use cases? How will the customer use this product to solve his problem? How will the product make money?
Content Every single screen Instructions to the user Search-Engine-friendly content Long tail keywords Content Uniqueness Any emails that are sent? Blog posts? PR releases? Analytics tools
Agile Software Development Start Small Minimum Viable Product Iterate quickly Track user data Flexible software Release frequently Cycle weekly or every two weeks
Homework Name your product. Check the name to make sure you can use it. Remember that you can always change the name later (e.g. after the class). Get the domain for your project Set up google apps Work on the pitch deck as much as possible with your team. At least put in your ideas/thoughts for each section Get your team set up on dropbox or other file sharing Reading material Online articles about elevator pitches, pitch decks, business plans, and financial projections.