MtB workshop 2011: Business Development for Startups

1,012 views

Published on

Published in: Business, Technology, Design
0 Comments
4 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
1,012
On SlideShare
0
From Embeds
0
Number of Embeds
3
Actions
Shares
0
Downloads
0
Comments
0
Likes
4
Embeds 0
No embeds

No notes for slide

MtB workshop 2011: Business Development for Startups

  1. 1. Biz Dev for Startups Developing a network of partners by defining your Business Model
  2. 2. Business Plan
  3. 3. Biz Plan ≠ Biz Model• Business plan is a story • How the business will evolve in the future i.e. science fiction• Business model is a snapshot • A diagram of the business engine i.e. inputs, outputs and components • It is not just “how you make money”...
  4. 4. • Viable (= repeatable) business model... • Shows HOW business results are achieved • Shows WHY company needs money • Shows WHERE to put it to work • Show WHO to partner with...
  5. 5. Biz Model Biz Dev
  6. 6. Biz Model FrameworkPartners Activities Value Customer Customer Proposition Relations Segments Resources ChannelsCost Structure Revenue Streams Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  7. 7. Biz Model Biz DevPartners Activities Value Customer Customer Proposition Relations Segments Resources ChannelsCost Structure Revenue Streams Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  8. 8. Example: TwitterPartners Activities Value Customer Customer- Search Engines - Service Mgmt Proposition Relations Segments- Mobile Ops - Policy - Users: free, easy, fast way - Customer - Users- App Devs enforcement to disseminate & find support - Brand- Socnet Devs - Marketing information/content - Analytics Advertisers- Analytics Devs - Sales - Advertisers/Brands: easy, - SMEs/Local fast way to engage directly - Celebrities & communicate with consumers Resources Channels - Partners: distribution & - Userbase - Search engine incremental user base/ - IT resources - Web/widgets traffic to monetize - Public APIs - Mobile - Private APIs - AppsCost Structure Revenue Streams- Infrastructure - Promoted Tweets/Trends (Cost-per-Engagement)- Staff (dev, support, sales) - Promoted Accounts (Cost-per-Follow) - Paid API feeds (“Fire hose”) Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  9. 9. Example: TwitterPartners Activities Value Customer Customer- Search Engines - Service Mgmt Proposition Relations Segments- Mobile Ops - Policy - Users: free, easy, fast way - Customer - Users- App Devs enforcement to disseminate & find support - Brand- Socnet Devs - Marketing information/content - Analytics Advertisers- Analytics Devs - Sales - Advertisers/Brands: easy, - SMEs/Local fast way to engage directly - Celebrities & communicate with consumers Resources Channels - Partners: distribution & - Userbase - Search engine incremental user base/ - IT resources - Web/widgets traffic to monetize - Public APIs - Mobile - Private APIs - AppsCost Structure Revenue Streams- Infrastructure - Promoted Tweets/Trends (Cost-per-Engagement)- Staff (dev, support, sales) - Promoted Accounts (Cost-per-Follow) - Paid API feeds (“Fire hose”) Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  10. 10. Example: Twitter• User value prop + Partner value prop• Clear, relatively simple partnership model• Revenue-, metrics-driven• “Last year, Google paid $15 million to access the Firehose, Microsoft $10 million, and Yahoo joined later with a cash and revenue-share deal.” - ATD/Wall Street Journal
  11. 11. Biz Dev Execution
  12. 12. Execution Steps1. Define the partnership model2. Clarify partner value prop3. Select target partners4. Engage the pipeline5. Seal the deal
  13. 13. 1. What is your model?Partners Activities Value Customer Customer Proposition Relations Segments Resources ChannelsCost Structure Revenue Streams Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  14. 14. Models Partners• Marketplace (commission) Merchants• Advertising (rev share) Publishers• Infomediary (subscription) Data Vendors• Merchant (margin) Manufacturers• Manufacturer (sales) Distributors
  15. 15. Models Partners• Affiliate (commission) Merchants• Licensor (royalties) Manufacturers• Subscription (fees) Content creators• Utility (metering) Integrators• Community (donations) Contributors
  16. 16. 2. Which value prop?Partners Activities Value Customer Customer Proposition Relations Segments Resources ChannelsCost Structure Revenue Streams Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  17. 17. Tools• Value Chain analysis • Where are you capturing/creating value? • How much value? • Which portion of the value can be shared with partners?
  18. 18. ToolsAdapted from Simply Market Report, 2010
  19. 19. Tools• Customer Acquisition Cost analysis • How much does it cost to acquire a customer? • Does the partnership increase or decrease it? • What volume targets must be met so that it makes sense?
  20. 20. ToolsAdapted from Evernote, 2010
  21. 21. Tools• Customer Lifetime Value analysis • How much is each customer worth? • What are the most attractive segments • What are the best channels long-term? • Does the partnership increase CLTV?
  22. 22. Tools Distributor Direct Customer CustomerAdapted from Occams Razor, 2010
  23. 23. 3. Which partners?Partners Activities Value Customer Customer Proposition Relations Segments Resources ChannelsCost Structure Revenue Streams Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  24. 24. Be deliberate & focused• List of top 25 target partners (as per model)• Score them by criteria (1 to 5) 1. $ value of deal to them! (50%) 2. $ value of deal to you (30%) 3. Speed/ease to close (10%) 4. M&A option value (10%)• Degree-of-separation is not a good criteria
  25. 25. The “Standard Deal”• Simple to design, understand and deploy • One-page term sheet, simple excel sheet• Working capital positive or neutral • Do you need to finance your partners?• ~0 custom development (90% built-in) • Have you thought about product features? • What about support?
  26. 26. The “Standard Deal”• Everybody understands... • Licensing agreement • Reselling agreement • Revenue Share agreement • White label agreement • Distribution agreement • ...
  27. 27. 4. How do you engage? Adapted from Real Pro Systems, 2010
  28. 28. Partner Marketing• Developing marketing content for biz dev • Biz dev presentation (≠ investor presentation) • Partner case study • Partner financial model • Technical training material• Speaking/attending industry events• Engaging industry analysts
  29. 29. Build a pipeline• Create a lead generation program • Partner-focused content > web leads • Events > live leads • Analysts > referral leads • Put a $ value on each opportunity• Treat partner prospects as sales prospects• Convert & nurture opportunities
  30. 30. Tips for healthy pipeline• Do • Enroll your board for intros to your list • Go for #1 in your list first • Know when to cut your losses• Don’t • Chase brands for brands’ sake • Work only with large companies
  31. 31. 5. Do we have a deal?Partners Activities Value Customer Customer Proposition Relations Segments $$$ Resources ChannelsCost Structure Revenue Streams Adapted from the Business Model Canvas by Alex Osterwalder et al., 2010
  32. 32. "Tutto il mondo è paese” • Trust • “Warm” intro, 2 degrees • Your board, their board, investor, other partners, time-tested relationships... • Make it easy to help you • Meet in person
  33. 33. At the table...• Ask 5 questions for every answer you give• Both sides are buying and selling• Focus on the partner pain points and value• Write down next steps and be timely• Leave lawyers and NDAs for last
  34. 34. A “funny” accent• Unfamiliar corporate/legal structures• Unfamiliar market references• Pre-conceived industry associations• Cultural biases do exist and are very strong• Be consistently better than your reputation...
  35. 35. Be ready with facts...• Do your homework, research people• Trustworthy CEO + Team?• Who owns the IP?• Who backs the company?• How long has it been in business?• Acknowledge missing elements
  36. 36. ... and with style• Arrive on time or early• Play conversational tennis• Never argue a point• Remember that “maybe” means “no”
  37. 37. Top 10 Mistakes
  38. 38. 1. Having an unclear partnership model2. Having an unclear partner value prop3. Spray and Pray i.e. not being focused4. Partner with other startups i.e. risk^25. Not having a formal pipeline process
  39. 39. 6. Thinking biz dev is a part-time job7. Overestimate your board “contacts”8. Ignoring working capital i.e. cash9. Not being operationally deal-ready
  40. 40. 10. Not following up!
  41. 41. Matteo Fabianomf@firematter.com

×