2. INTRODUCTION
StartNowHow
• Open seminar series for active and prospective entrepreneurs
• 10 sessions on monthly basis until summer 2016
• Covers relevant theoretical and practical aspects of entrepreneurship
• Based on lecture „entrepreneurship“ @Bogazici University
• Based on experiences of entrepreneurs, investors, mentors and consultants
• Each session with guest speaker (entrepreneurs, investors, mentors, etc.)
• Language: English / Turkish
• Thursdays 17.15h – 19.30h
• Next session: Thu 7. January 2016
• Topic: Market and Competitor Research
• Certificate provided for participants joining at least 70% of the sessions
• Early registration for each session required (eventbrite), limited capacity!
• Priority for regular participants
Startnowhow – Seminar 210.12.2015 2
3. INTRODUCTION
StartNowHow - Seminar Topics (preliminary)
1. Thu 1.10.15: The entrepreneurial ecosystem in Turkey
2. Thu 15.10.15. Entrepreneurship as a profession
3. Thu 12.11.15: Opportunity recognition and evaluation
4. Thu 10.12.15: Planning, developing and testing a business model
5. Thu 7.1.16: Market and competitor research
6. Thu 11.2.16 (tbc): Financial planning for startups
7. Thu 10.3.16 (tbc): Digital Marketing planning and control
8. Thu 14.4.16 (tbc): Funding the startup – stage financing for ventures
9. Thu 12.5.16 (tbc): The investment process – pitching, negotiations and termsheet
10. Thu 9.6.16 (tbc): Success and failure as an entrepreneur
Startnowhow – Seminar 210.12.2015 3
4. BUSINESSMODEL
What Is a Business Model?
• Core of the business plan, key element of the business plan - how will the venture create
money?
• Definitions:
• „A business model explains how a venture is expected to create a profit“ (Fiet, J.O. /
Patel, P.C., Forgiving Business Models for New Ventures, in: Management Science 48 (1),
2008, pp.105-121)
• „A business model describes the rationale of how an organization creates, delivers, and
captures value.“ (Osterwalder, A. / Pigneur, Y., Business Model Generation, 2009, p.14)
• „A business model is a concise representation of how an interrelated set of decision
variables in the areas of venture strategy, architecture, and economics are addressed
to create sustainable competitive advantage in defined markets.“(Morris, M.H. et. al.,
The Entrepreneur‘s Business Model: Towards Conceptualization, in: International Journal
of Business Research 58 (6), 2005, pp. 726-735)
10.12.2015 4Startnowhow – Seminar 4
5. BUSINESSMODEL
Types of Business Models
10.12.2015 5Startnowhow – Seminar 4
(adopted from Amit, R, / Zott, C., Value Creation in E-Business, in: Strategic Management Journal 22 (6/7),
2001, pp. 493-520)
Value
Creation
Efficiency
Complementarity
Innovation Lock-In
• Innovation-centered business models: Create new possibilities for transactions among
economic subjects – Example: Location-based mobile commerce
• Efficiency-centered business models: Increase efficiency for already existing transactions
among economic subjects – Example: Use of internet in touristic industry, Amazon
• Lock-in-centered business models: Increase volume of existing transactions between
existing economic subjects by binding them closer together – Example: 2-year-contracts for
mobile phone usage and value-added services, Google search engine, Loyaltycard programs
• Complementarity-centered business models: Combining own services with
complementary services for increasing attractiveness of transactions among economic
subjects – Example: App stores, Computer + operating system bundle
6. BUSINESSMODEL
Characteristics of Superior Business Opportunities
• Added value
• Venture creates or adds significant value to a customer or end user
• Venture solves a significant problem
• Venture adds value by solving a significant problem, removing a serious pain, or meeting
a significant want or need
• Someone is willing to pay a premium for solving this problem
• Venture has robust market, margin, and money-making characteristics
• Large enough market (min. 50 Mio $)
• High growth expectation (min. 20% p.a.)
• High gross margins (min. 40%)
• Strong and early cash flow (recurring revenue, low assets, low working capital)
• High profit potential (min. 10% - 15% after tax income)
• Attractive, realizable return for investors (Internal Rate of Return IRR min. 25%- 30%)
• Venture fits to skillset
• Good fit with founder(s) and managment team skills for that time and marketplace
• Attractive risk-reward balance
• Source: Timmons / Spinelli, New Venture Creation, p.150
10.12.2015 6Startnowhow – Seminar 4
8. BUSINESSMODEL
Design of Business Models
• Cost Structure C$ - Resulting from cost contribution for building blocks of the business
model:
• Key partners KP: Resources necessary for producing and offering the products / services,
and to be purchased from outside
• Key resources KR: Necessary key assets for producing and offering products / services
• Key activities KA: Key activities to be performed for producing and offering the products
/ services
• Revenue Streams R$ - Resulting from successful offer of VP to the customer:
• Customer segments CS: Relevant customer segments to be served
• Customer relationships CR: Development and maintenance of relationships for each
relevant CS
• Channels CH: Channels through which products / services will be offered to customers
• Value Proposition VP – Way in which organization will solve customer problems and fulfill
customer needs by providing value-adding products / services
• (from: Osterwalder, A, Pigneur, Y., Business Model Generation, 2009)
10.12.2015 8Startnowhow – Seminar 4
9. BUSINESSPLAN
What Is a Business Plan?
• Definition: The business plan is a written document prepared by the entrepreneur that
describes all the relevant external and internal elements involved in starting a new
venture.
(Hisrich / Peters / Shepherd, Entrepreneurship, p.189)
• Integration of functional plans (e.g. Marketing, finance, manufacturing, HR)
• Planning horizon: 3-5 years
• „Like a road map“ when travelling from A to B on different possible routes
• Types of Business Plans
• „Business plans, like entrepreneurs, come in all shapes and sizes“ (Harper, Extraordinary
Entrepreneurship, p.182)
• Summarized business plan: around 15 pages, contains only key information, not for
external communication / communication to potential / new business partners
• Complete business plan: Most frequent form, 30-50 pages + 10-30 pages attachments,
especially needed for obtaining external funding
• Operational business plan: More than 100 pages, mainly for already existing companies
(example: sale of business), extensive quantitative part, used for internal planning
process
• (Translated from Fischl / Wagner, Der perfekte Businessplan, pp. 17-20)
10.12.2015 9Startnowhow – Seminar 4
10. BUSINESSPLAN
Overview: The Purpose of a Business Plan
10.12.2015 10Startnowhow – Seminar 4
Source: Stokes / Wilson, Small Business Management and Entrepreneurship, p.179
11. BUSINESSPLAN
Why Preparing a Business Plan?
• Even without the need for an external investor, entrepreneurs should force themselves
to carefully prepare a business plan
• „In preparing for battle I have always found that plans are useless, but planning is
indispensable.“ (Dwight D. Eisenhower)
• Helps you learning about details of your business, your market and your operations
• Supports gaining critical insights into your intended partner‘s styles, strenghts,
weaknesses, and ways of cooperation
• Gives you intimate knowledge of the opportunity, buyer and user, market and
competition, and financial characteristics
• Serves as tool for communication to outside parties interested in the venture, and as a
medium for discussion with them, revealing their knowledge, creativity, and suit for their
intended roles
• Prevents you from jumping ahead prematurely, limits sloppiness with regard to necessary
research, creative problems solving, and „hard thinking“
• Tests your commitment and prevent your heart from getting too far ahead of your head
• Saves time during operations, helps avoiding common mistakes, helps creating order for
a, in general, chaotic and unpredictable event
• Helps you creating the best possible roadmap from where you are, to where you want to
be
• (Adopted from Timmons / Spinelli, New Venture Creation, pp. 270-271)
10.12.2015 11Startnowhow – Seminar 4
12. BUSINESSPLAN
Structure of a Business Plan – Example, page 1
10.12.2015 12Startnowhow – Seminar 4
Source: Hisrich / Peters / Shepherd, Entrepreneurship, p.201
13. BUSINESSPLAN
Structure of a Business Plan – Example, page 2
10.12.2015 13Startnowhow – Seminar 4
Source: Hisrich / Peters / Shepherd, Entrepreneurship, p.201
14. OUTLOOK
StartNowHow - Outlook
• Today‘s materials will be made available to participants for downloading
• Next Seminar: „Market and Competitor Research“
• Guest Speaker: Burak Boysan / Isil Emir (BIC Angel Investments)
• Thursday, 7.1.2016, 17.15 – 19.30h
• Don‘t forget to register early (eventbrite) - capacity 50 people!
• Priority for participants / registrants from today‘s session
• General rule: Allocation of seats according to participation
• Regular participation = certificate (70% participation)
Startnowhow – Seminar 310.12.2015 14