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New Rules for the New Bubble<br />Steve Blank<br />Stanford - School of Engineering<br />U.C. Berkeley - Haas School Of  B...
I Write a Blog  <br />www.steveblank.com<br />
I Drew This<br />CustomerDiscovery<br />Company <br /> Building<br />CustomerValidation<br />Customer Creation<br />Pivot<...
I Called It:Customer Development<br />CustomerDiscovery<br />Company <br /> Building<br />CustomerValidation<br />Customer...
I Wrote This<br />
A Few People Read It<br />
This Talk is Based On<br />Business Model Generation<br />Four Steps to the Epiphany<br />Lean Startup<br />
Premise<br />Beginning of another tech bubble<br />Rules are different in a bubble<br />What are they?<br />How do they di...
A Few Short Stories<br />
How Did We Get Here?<br />
Paths to Startup Liquidity<br />1970 – 1995 	build a business (revenue)<br />1995 – 2000	flip the business (concept IPO)<b...
1970 – 1995Building a BusinessStartups Are Small Versions of A Large Company<br />
1970 - 1995 Building a Startup the Hard Way<br />$Millions’sto start				 (Proprietary hdwr/sftwr)<br />Long product dev cy...
1970 - 1995Making Money the Hard Way<br />Goal was long term company success<br />VC’s/Founders were company builders<br /...
1970 – 1995  Playbook<br />
Product Introduction Model<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />
Product Introduction Model<br />The Leading Cause of Startup Death<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Be...
Product Introduction Model:Two Implicit Assumptions<br />Customer Problem: known<br />Concept/Seed Round<br />Product Dev....
Tradition – Hire Marketing<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />...
Tradition – Hire Sales<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />- Cr...
 Hire Sales VP
 Hire 1st  Sales Staff</li></ul>Sales<br />
Tradition – Hire Bus Development<br />Concept<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />- Cre...
 Hire Sales VP
 Pick distribution   Channel</li></ul>Sales<br />Business <br />Development<br /><ul><li> Hire First   Bus Dev
 Do deals for FCS</li></li></ul><li>Tradition – Hire Engineering<br />Concept<br />Product Dev.<br />Alpha/Beta Test<br />...
 Hire Sales VP
 Pick distribution   Channel</li></ul>Sales<br />Business <br />Development<br /><ul><li> Hire First   Bus Dev
 Do deals for FCS</li></ul>Engineering<br /><ul><li> Write MRD
 Waterfall
 Q/A
Tech Pubs</li></li></ul><li>More startups fail from a lack of customers than from a failure of product development<br />
1995 – 2000Flipping A BusinessThe Dot.comBubble <br />
1995 - 2000The Dot-com Bubble<br />10’s $millions to start			(get big fast, create a brand)<br />Long product dev cycle 	(...
1995 - 2000The Dot-com Bubble – Making Money<br />Goal = short term exit<br />VC’sengineering financial transactions<br />...
1995 – 2000 Playbook<br />Netscape<br />
2001 – 2010Why Startups Are Not Small Versions of A Large Company<br />
2001 - 2010The Lean Startup<br />≤ $½ million to start		   (open source, commodity hdwr)<br />Short product dev cycle (Agi...
Scalable<br />Startup<br />Large Company<br /><ul><li>Business Model found
 i.e. Product/Market fit</li></ul>- Repeatable sales model<br />- Managers hired<br />What’s A Startup?<br />Search <br />...
What VC’s Don’t Tell You:The Transition – Founders Leave<br />Scalable<br />Startup<br />Transition<br />Large Company<br ...
 Professional Mgmt
 Process
 Beginning of scale</li></li></ul><li>Startups Search and Pivot<br />The Search for the Business Model<br />Scalable<br />...
Startups Search, Companies Execute<br />The Execution of the Business Model<br />The Search for the Business Model<br />Sc...
 Product/Market fit</li></ul>- Repeatable sales model<br />- Managers hired<br />
Metrics Versus Accounting<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large<b...
 Cash Flow Statement
 Income Statement</li></li></ul><li>Metrics Versus Accounting<br />The Search for the Business Model<br />The Execution of...
 Viral coefficient
 Customer Lifetime Value
 Average Selling Price/Order Size
 Monthly burn rate
 etc.  </li></ul>Traditional Accounting<br /><ul><li> Balance Sheet
 Cash Flow Statement
 Income Statement</li></li></ul><li>Customer Validation Versus Sales<br />The Execution of the Business Model<br />Scalabl...
 Scalable
 Price List/Data Sheets
 Revenue Plan</li></li></ul><li>Customer Validation Versus Sales<br />The Search for the Business Model<br />The Execution...
 Pricing/Feature unstable
 Not yet repeatable
“One-off’s”</li></ul>Sales<br /><ul><li> Sales Organization
 Scalable
 Price List/Data Sheets
 Revenue Plan</li></li></ul><li>Engineering Versus Agile Development<br />The Execution of the Business Model<br />Scalabl...
 Waterfall Development
 QA
 Tech Pubs</li></li></ul><li>Engineering Versus Agile Development<br />The Search for the Business Model<br />The Executio...
 Waterfall Development
 QA
 Tech Pubs</li></ul>Agile Development<br /><ul><li> Continuous Deployment
 Continuous Learning
 Self Organizing Teams
 Minimum Feature Set
 Pivots</li></li></ul><li>Startups Model, Companies Plan<br />The Execution of the Business Model<br />Scalable<br />Start...
 features
 customers/markets
 business model</li></li></ul><li>Startups Model, Companies Plan<br />The Search for the Business Model<br />The Execution...
 describes “unknowns”
customer needs
 feature set
 business model
 found by iteration
Plan describes “knowns”
 Known features for line extensions
 Known customers/markets
 Known business model</li></li></ul><li>2001 - 2010The Lean Startup<br />IPO market ~closed, M&A liquidity path<br />Build...
2001 - 2010 Playbook<br />Four Steps to the Epiphany<br />Many Agile Texts<br />
But We Were Still Using This<br />
No Business Plan survives first contact with customers<br />
So Search for a Business Model<br />
The Business Model:<br />Any company can be described in 9 building blocks<br />
CUSTOMER SEGMENTS<br />which customers and users are you serving? <br />which jobs do they really want to get done?<br />
VALUE PROPOSITIONS<br />what are you offering them? what is that <br />getting done for them? do they care?<br />
CHANNELS<br />how does each customer segment want to be reached? through which interaction points?<br />
CUSTOMER RELATIONSHIPS<br />what relationships are you establishing with each segment? personal? automated? acquisitive? r...
REVENUE STREAMS<br />what are customers really willing to pay for? how? <br />are you generating transactional or recurrin...
KEY RESOURCES<br />which resources underpin your business model? which assets are essential?<br />
KEY ACTIVITIES<br />which activities do you need to perform well in your business model? what is crucial?<br />54<br />
KEY PARTNERS<br />which partners and suppliers leverage your model? <br />who do you need to rely on?<br />
COST STRUCTURE<br />what is the resulting cost structure? <br />which key elements drive your costs?<br />
value proposition<br />customer relationships<br />key activities<br />customer segments<br />key partners<br />cost struc...
How Do Startups Search For A Business Model?<br /><ul><li>The Search is Customer Development
The Implementation is Agile Development
The Sum is the Lean Startup</li></li></ul><li>Customer Development<br />
Customer Development<br />The founders<br />^<br />Get Out of the Building<br />
Customer DevelopmentThe Search For the Business Model<br />Company<br />Building<br />CustomerDiscovery<br />CustomerValid...
Customer Discovery<br />CustomerDiscovery<br />CustomerValidation<br />Company<br />Building<br />CustomerCreation<br />St...
Test Hypotheses:<br /><ul><li>Product
 Market Type
 Competition</li></ul>Turning Hypotheses to Facts<br />
Test Hypotheses:<br /><ul><li>Problem
 Customer
 User
 Payer</li></li></ul><li>Test Hypotheses:<br /><ul><li>Channel</li></li></ul><li>Test Hypotheses:<br /><ul><li>Demand Crea...
 Customer
 User
 Payer</li></ul>Test Hypotheses:<br /><ul><li>Product
 Market Type
 Competitive</li></ul>Test Hypotheses:<br /><ul><li>Channel
 (Customer)
 (Problem)</li></ul>Test Hypotheses:<br /><ul><li>Channel</li></ul>Test Hypotheses:<br /><ul><li>Pricing Model / Pricing</...
 Validate Business Model</li></li></ul><li>Test Hypotheses:<br /><ul><li>Demand Creation</li></ul>Test Hypotheses:<br /><u...
 Customer
 User
 Payer</li></ul>Agile Development<br />Test Hypotheses:<br /><ul><li>Product
 Market Type
 Competitive</li></ul>Test Hypotheses:<br /><ul><li>Channel
 (Customer)
 (Problem)</li></ul>Customer Development Team<br />Test Hypotheses:<br /><ul><li>Channel</li></ul>Test Hypotheses:<br /><u...
 Validate Business Model</li></li></ul><li>Test Hypotheses:<br /><ul><li>Demand Creation</li></ul>Test Hypotheses:<br /><u...
 Customer
 User
 Payer</li></ul>Agile Development<br />Test Hypotheses:<br /><ul><li>Product
 Market Type
 Competitive</li></ul>Test Hypotheses:<br /><ul><li>Channel
 (Customer)
 (Problem)</li></ul>Customer Development Team<br />Test Hypotheses:<br /><ul><li>Channel</li></ul>Test Hypotheses:<br /><u...
 Validate Business Model</li></li></ul><li>The Minimum Viable Product (MVP)<br /><ul><li> Smallest feature set that gets y...
MVP + Customer are the first two you need to nail
 MVP is just 1 of the 9 parts of your model</li></li></ul><li>The Pivot<br /><ul><li>The heart of Customer Development
Iteration without crisis
Fast, agile and opportunistic</li></li></ul><li>How Does This Really Work?Stanford Lean LaunchPad Class<br />
Pivot ExampleOn-line Social Buying Platform<br />Talked to 250 Customers in 8 weeks<br />
OURCRAVE is an online social shopping platform where customers can make their own deals on products or services of their c...
Business Canvas #1<br />Seller: - Access to large online customer pool<br />- Bulk sales with reduced commission<br />Buye...
Seller Side Test with a fake E-MAIL<br />Give me a quote<br />for a bulk sale!<br />Electronics Sellers on Amazon/Ebay<br ...
22% paid 5~10% transaction fee
78% agreed it was too much
33% actually provided discount proportional to group size</li></li></ul><li>Seller Side<br />Interview with Industry Speci...
User Side<br />: Online User Survey<br />Power to choose products<br />Discount on products<br />Buyer community feedback<...
Business Canvas #2<br />Seller: - More customer traffic<br />- Bulk sales with reduced commission<br />Buyer: - Better dis...
 Sellers who need more traffic</li></ul>- Server providers<br />- Automated services- Communities of buyers and sellers- C...
Key Question for Business Canvas #2<br />HOW CAN WE ATTRACT BUYERS?<br />CUSTOMER ACQUISION COST?<br />
Buyer Demand Test<br />Best Marketing Channel for having buyers is Facebook Wall<br />: 144 Unique Visits, 10 e-mail subsc...
Business Canvas #3<br />Seller: - More customer traffic<br />- Bulk sales with reduced commission<br />Buyer: - Better dis...
Server providers</li></ul>Established services- Online Marketing : Google/Facebook<br />- Automated services- Communities ...
 Online social networks
 Online advertising</li></ul>- Physical resources (IT infrastructure)- Existing social networks -Buyer and seller communit...
Key Question for Business Canvass #3<br />HOW CAN WE ATTRACT SELLERS?<br />COOPERATION WITH SELLERS?<br />
Seller Contact<br />Deal with sellers failed because no group pricing or discount too low.<br />Organize Real Group Deal<b...
3 products: HD camera, protein drink, videogame
Videogame was for pre-order</li></ul>Result<br /><ul><li>Most sellers: no group discounts
Discounts offered < 10%
With shipping and tax still >= Amazon price
David vs. Goliath problem</li></li></ul><li>To Pivot or Not to Pivot?<br />Although dismayedat seller response, we did not...
Seller problem intractable?
Teaching staff: Pivot or else…</li></ul>Beaten, but not defeated<br /><ul><li>Lost one battle, but not the war!
Only contacted larger sellers
Sellers need more value
Show them a real website</li></ul>Filter advice and stay determined!<br />No Pivot Yet<br />
Solution 1 : Rapid Implementation<br />Implement seller & buyer side features to give sellers  fuller experience. <br />Si...
Buyer facebook login
Online social networking integration
Seller login and registration
Seller bidding
Seller group deal creation page</li></li></ul><li>Solution 1 : Rapid Implementation<br />Humble beginnings <br />
Solution 1 : Rapid Implementation<br />The Real Deal <br />
Solution 1 : Rapid Implementation<br />Main page<br />Facebook connect<br />Deal creation by sellers<br />Bidding dialog<b...
Solution 2 : More seller value & spamming<br />Add value for sellers based on mentor and industry expert interviews<br />A...
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Sxsw New Rules for the New Bubble 031211

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Sxsw New Rules for the New Bubble 031211

  1. New Rules for the New Bubble<br />Steve Blank<br />Stanford - School of Engineering<br />U.C. Berkeley - Haas School Of Business<br />www.steveblank.com<br />Twitter: sgblank<br />
  2. I Write a Blog <br />www.steveblank.com<br />
  3. I Drew This<br />CustomerDiscovery<br />Company <br /> Building<br />CustomerValidation<br />Customer Creation<br />Pivot<br />
  4. I Called It:Customer Development<br />CustomerDiscovery<br />Company <br /> Building<br />CustomerValidation<br />Customer Creation<br />Pivot<br />
  5. I Wrote This<br />
  6. A Few People Read It<br />
  7. This Talk is Based On<br />Business Model Generation<br />Four Steps to the Epiphany<br />Lean Startup<br />
  8. Premise<br />Beginning of another tech bubble<br />Rules are different in a bubble<br />What are they?<br />How do they differ from what you did before?<br />
  9. A Few Short Stories<br />
  10. How Did We Get Here?<br />
  11. Paths to Startup Liquidity<br />1970 – 1995 build a business (revenue)<br />1995 – 2000 flip the business (concept IPO)<br />2001 – 2010 build a business (M&A)<br />2011 – 2014 flip a built business (M&A / IPO)<br />
  12. 1970 – 1995Building a BusinessStartups Are Small Versions of A Large Company<br />
  13. 1970 - 1995 Building a Startup the Hard Way<br />$Millions’sto start (Proprietary hdwr/sftwr)<br />Long product dev cycle (Waterfall)<br />Thousands customers (Businesses)<br />Liquidity = IPO (5qtrsrevenue/profit)<br />No repeatable methodology(Smallerbig company)<br />
  14. 1970 - 1995Making Money the Hard Way<br />Goal was long term company success<br />VC’s/Founders were company builders<br />Exits were IPO’s<br />Founders and VC success ≤ $10 million<br />
  15. 1970 – 1995 Playbook<br />
  16. Product Introduction Model<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />
  17. Product Introduction Model<br />The Leading Cause of Startup Death<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />
  18. Product Introduction Model:Two Implicit Assumptions<br />Customer Problem: known<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br /> Product Features: known<br />
  19. Tradition – Hire Marketing<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />- Create Demand<br />- Launch Event<br />- “Branding”<br />- Hire PR Agency<br />- Early Buzz<br /><ul><li> Create Marcom </li></ul> Materials<br />- Create Positioning<br />Marketing<br />
  20. Tradition – Hire Sales<br />Concept/Seed Round<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />- Create Demand<br />- Launch Event<br />- “Branding”<br />- Hire PR Agency<br />- Early Buzz<br /><ul><li> Create Marcom </li></ul> Materials<br />- Create Positioning<br />Marketing<br /><ul><li> Build Sales Organization
  21. Hire Sales VP
  22. Hire 1st Sales Staff</li></ul>Sales<br />
  23. Tradition – Hire Bus Development<br />Concept<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />- Create Demand<br />- Launch Event<br />- “Branding”<br />- Hire PR Agency<br />- Early Buzz<br /><ul><li> Create Marcom </li></ul> Materials<br />- Create Positioning<br />Marketing<br /><ul><li> Build Sales Channel / Distribution
  24. Hire Sales VP
  25. Pick distribution Channel</li></ul>Sales<br />Business <br />Development<br /><ul><li> Hire First Bus Dev
  26. Do deals for FCS</li></li></ul><li>Tradition – Hire Engineering<br />Concept<br />Product Dev.<br />Alpha/Beta Test<br />Launch/<br />1st Ship<br />- Create Demand<br />- Launch Event<br />- “Branding”<br />- Hire PR Agency<br />- Early Buzz<br /><ul><li> Create Marcom </li></ul> Materials<br />- Create Positioning<br />Marketing<br /><ul><li> Build Sales Channel / Distribution
  27. Hire Sales VP
  28. Pick distribution Channel</li></ul>Sales<br />Business <br />Development<br /><ul><li> Hire First Bus Dev
  29. Do deals for FCS</li></ul>Engineering<br /><ul><li> Write MRD
  30. Waterfall
  31. Q/A
  32. Tech Pubs</li></li></ul><li>More startups fail from a lack of customers than from a failure of product development<br />
  33. 1995 – 2000Flipping A BusinessThe Dot.comBubble <br />
  34. 1995 - 2000The Dot-com Bubble<br />10’s $millions to start (get big fast, create a brand)<br />Long product dev cycle (ship beta, 1st mover adv)<br />Millions customers (1st consumer internet wave)<br />Liquidity - IPO (Little/no revenue, no profits)<br />Repeatable methodology(brand, hype, flip or IPO)<br />
  35. 1995 - 2000The Dot-com Bubble – Making Money<br />Goal = short term exit<br />VC’sengineering financial transactions<br />Founders hyped their company<br />“Musical Chairs” – last one standing looked dumb<br />Everyone else got absurdly rich<br />
  36. 1995 – 2000 Playbook<br />Netscape<br />
  37. 2001 – 2010Why Startups Are Not Small Versions of A Large Company<br />
  38. 2001 - 2010The Lean Startup<br />≤ $½ million to start (open source, commodity hdwr)<br />Short product dev cycle (Agile Development)<br />100’s millions Customers (Social networks, consumer)<br />Liquidity -M&A(revenue & network of users)<br />Repeatable methodology(Agile + Cust Dev)<br />
  39. Scalable<br />Startup<br />Large Company<br /><ul><li>Business Model found
  40. i.e. Product/Market fit</li></ul>- Repeatable sales model<br />- Managers hired<br />What’s A Startup?<br />Search <br />Execute<br />A Startup is a temporary organization used to search for a repeatable and scalable business model <br />
  41. What VC’s Don’t Tell You:The Transition – Founders Leave<br />Scalable<br />Startup<br />Transition<br />Large Company<br />Build<br /><ul><li>Founders depart
  42. Professional Mgmt
  43. Process
  44. Beginning of scale</li></li></ul><li>Startups Search and Pivot<br />The Search for the Business Model<br />Scalable<br />Startup<br />Transition<br />Large Company<br /> Business Model found by founders<br /><ul><li> customer needs/product features found</li></ul> i.e. Product/Market fit<br /><ul><li> Repeatable sales model</li></ul>- Managers hired<br />
  45. Startups Search, Companies Execute<br />The Execution of the Business Model<br />The Search for the Business Model<br />Scalable<br />Startup<br />Transition<br />Large Company<br />- Cash-flow breakeven<br />- Profitable<br />- Rapid scale<br />- New Senior Mgmt<br />~ 150 people<br /><ul><li>Business Model found
  46. Product/Market fit</li></ul>- Repeatable sales model<br />- Managers hired<br />
  47. Metrics Versus Accounting<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large<br />Company<br />Traditional Accounting<br /><ul><li>Balance Sheet
  48. Cash Flow Statement
  49. Income Statement</li></li></ul><li>Metrics Versus Accounting<br />The Search for the Business Model<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large<br />Company<br />Startup Metrics<br /><ul><li> Customer Acquisition Cost
  50. Viral coefficient
  51. Customer Lifetime Value
  52. Average Selling Price/Order Size
  53. Monthly burn rate
  54. etc. </li></ul>Traditional Accounting<br /><ul><li> Balance Sheet
  55. Cash Flow Statement
  56. Income Statement</li></li></ul><li>Customer Validation Versus Sales<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large<br />Company<br />Sales<br /><ul><li>Sales Organization
  57. Scalable
  58. Price List/Data Sheets
  59. Revenue Plan</li></li></ul><li>Customer Validation Versus Sales<br />The Search for the Business Model<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large<br />Company<br />Customer Validation<br /><ul><li> Early Adopters
  60. Pricing/Feature unstable
  61. Not yet repeatable
  62. “One-off’s”</li></ul>Sales<br /><ul><li> Sales Organization
  63. Scalable
  64. Price List/Data Sheets
  65. Revenue Plan</li></li></ul><li>Engineering Versus Agile Development<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large Company<br />Engineering<br /><ul><li> Requirements Docs.
  66. Waterfall Development
  67. QA
  68. Tech Pubs</li></li></ul><li>Engineering Versus Agile Development<br />The Search for the Business Model<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large Company<br />Engineering<br /><ul><li> Requirements Docs.
  69. Waterfall Development
  70. QA
  71. Tech Pubs</li></ul>Agile Development<br /><ul><li> Continuous Deployment
  72. Continuous Learning
  73. Self Organizing Teams
  74. Minimum Feature Set
  75. Pivots</li></li></ul><li>Startups Model, Companies Plan<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large Company<br />Business Plan<br /><ul><li> describes “knowns”
  76. features
  77. customers/markets
  78. business model</li></li></ul><li>Startups Model, Companies Plan<br />The Search for the Business Model<br />The Execution of the Business Model<br />Scalable<br />Startup<br />Transition<br />Large Company<br /><ul><li>Business Model
  79. describes “unknowns”
  80. customer needs
  81. feature set
  82. business model
  83. found by iteration
  84. Plan describes “knowns”
  85. Known features for line extensions
  86. Known customers/markets
  87. Known business model</li></li></ul><li>2001 - 2010The Lean Startup<br />IPO market ~closed, M&A liquidity path<br />Build for long term but take short term sale<br />Founders learn Lean skills<br />Focus on building customers<br />Minimum hype<br />
  88. 2001 - 2010 Playbook<br />Four Steps to the Epiphany<br />Many Agile Texts<br />
  89. But We Were Still Using This<br />
  90. No Business Plan survives first contact with customers<br />
  91. So Search for a Business Model<br />
  92. The Business Model:<br />Any company can be described in 9 building blocks<br />
  93. CUSTOMER SEGMENTS<br />which customers and users are you serving? <br />which jobs do they really want to get done?<br />
  94. VALUE PROPOSITIONS<br />what are you offering them? what is that <br />getting done for them? do they care?<br />
  95. CHANNELS<br />how does each customer segment want to be reached? through which interaction points?<br />
  96. CUSTOMER RELATIONSHIPS<br />what relationships are you establishing with each segment? personal? automated? acquisitive? retentive?<br />
  97. REVENUE STREAMS<br />what are customers really willing to pay for? how? <br />are you generating transactional or recurring revenues?<br />
  98. KEY RESOURCES<br />which resources underpin your business model? which assets are essential?<br />
  99. KEY ACTIVITIES<br />which activities do you need to perform well in your business model? what is crucial?<br />54<br />
  100. KEY PARTNERS<br />which partners and suppliers leverage your model? <br />who do you need to rely on?<br />
  101. COST STRUCTURE<br />what is the resulting cost structure? <br />which key elements drive your costs?<br />
  102. value proposition<br />customer relationships<br />key activities<br />customer segments<br />key partners<br />cost structure<br />revenue streams<br />key <br />resources<br />channels<br />57<br />images by JAM<br />
  103. How Do Startups Search For A Business Model?<br /><ul><li>The Search is Customer Development
  104. The Implementation is Agile Development
  105. The Sum is the Lean Startup</li></li></ul><li>Customer Development<br />
  106. Customer Development<br />The founders<br />^<br />Get Out of the Building<br />
  107. Customer DevelopmentThe Search For the Business Model<br />Company<br />Building<br />CustomerDiscovery<br />CustomerValidation<br />Customer Creation<br />Pivot<br />
  108. Customer Discovery<br />CustomerDiscovery<br />CustomerValidation<br />Company<br />Building<br />CustomerCreation<br />Stop selling, start listening<br />Test your hypotheses<br />Continuous Discovery<br />Done by founders<br />
  109. Test Hypotheses:<br /><ul><li>Product
  110. Market Type
  111. Competition</li></ul>Turning Hypotheses to Facts<br />
  112. Test Hypotheses:<br /><ul><li>Problem
  113. Customer
  114. User
  115. Payer</li></li></ul><li>Test Hypotheses:<br /><ul><li>Channel</li></li></ul><li>Test Hypotheses:<br /><ul><li>Demand Creation</li></ul>Test Hypotheses:<br /><ul><li>Problem
  116. Customer
  117. User
  118. Payer</li></ul>Test Hypotheses:<br /><ul><li>Product
  119. Market Type
  120. Competitive</li></ul>Test Hypotheses:<br /><ul><li>Channel
  121. (Customer)
  122. (Problem)</li></ul>Test Hypotheses:<br /><ul><li>Channel</li></ul>Test Hypotheses:<br /><ul><li>Pricing Model / Pricing</li></ul>Test Hypotheses:<br /><ul><li>Size of Opportunity/Market
  123. Validate Business Model</li></li></ul><li>Test Hypotheses:<br /><ul><li>Demand Creation</li></ul>Test Hypotheses:<br /><ul><li>Problem
  124. Customer
  125. User
  126. Payer</li></ul>Agile Development<br />Test Hypotheses:<br /><ul><li>Product
  127. Market Type
  128. Competitive</li></ul>Test Hypotheses:<br /><ul><li>Channel
  129. (Customer)
  130. (Problem)</li></ul>Customer Development Team<br />Test Hypotheses:<br /><ul><li>Channel</li></ul>Test Hypotheses:<br /><ul><li>Pricing Model / Pricing</li></ul>Test Hypotheses:<br /><ul><li>Size of Opportunity/Market
  131. Validate Business Model</li></li></ul><li>Test Hypotheses:<br /><ul><li>Demand Creation</li></ul>Test Hypotheses:<br /><ul><li>Problem
  132. Customer
  133. User
  134. Payer</li></ul>Agile Development<br />Test Hypotheses:<br /><ul><li>Product
  135. Market Type
  136. Competitive</li></ul>Test Hypotheses:<br /><ul><li>Channel
  137. (Customer)
  138. (Problem)</li></ul>Customer Development Team<br />Test Hypotheses:<br /><ul><li>Channel</li></ul>Test Hypotheses:<br /><ul><li>Pricing Model / Pricing</li></ul>Test Hypotheses:<br /><ul><li>Size of Opportunity/Market
  139. Validate Business Model</li></li></ul><li>The Minimum Viable Product (MVP)<br /><ul><li> Smallest feature set that gets you the most …orders, learning, feedback, failure…
  140. MVP + Customer are the first two you need to nail
  141. MVP is just 1 of the 9 parts of your model</li></li></ul><li>The Pivot<br /><ul><li>The heart of Customer Development
  142. Iteration without crisis
  143. Fast, agile and opportunistic</li></li></ul><li>How Does This Really Work?Stanford Lean LaunchPad Class<br />
  144. Pivot ExampleOn-line Social Buying Platform<br />Talked to 250 Customers in 8 weeks<br />
  145. OURCRAVE is an online social shopping platform where customers can make their own deals on products or services of their choosing with sellers who can offer them in bulk at a discounted price.<br />
  146. Business Canvas #1<br />Seller: - Access to large online customer pool<br />- Bulk sales with reduced commission<br />Buyer: - Better discounts<br />- Maintainingonline buyer/seller communities and credibilityof transactions- Promotionof website and brand <br />- Powerful sellers<br />- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller:<br />Pro-sellers in Amazon and eBay who sell electronicsBuyer:<br />Online shoppers<br /><ul><li> Web & App sales </li></ul>-Online social networks<br />- Physical resources (IT infrastructure)- Existing social networks -Buyer and seller communities,- Brand awareness<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br />- Variable costs: server and traffic maintenance costs- Fixed Cost: rent, salaries <br />
  147. Seller Side Test with a fake E-MAIL<br />Give me a quote<br />for a bulk sale!<br />Electronics Sellers on Amazon/Ebay<br />FAKE CEO<br />(Steve Feiberg)<br />57%<br />showed interest<br />90%<br />sell products <br />on Amazon<br /><ul><li>56% paid 10~20% transaction fee
  148. 22% paid 5~10% transaction fee
  149. 78% agreed it was too much
  150. 33% actually provided discount proportional to group size</li></li></ul><li>Seller Side<br />Interview with Industry Specialist (LG Electronics)<br />Main Target<br />Bestbuy<br />Target,<br />Walmart<br />25%<br />Associations of <br />RegionalBig Sellers<br />25%<br />40%<br />
  151. User Side<br />: Online User Survey<br />Power to choose products<br />Discount on products<br />Buyer community feedback<br />
  152. Business Canvas #2<br />Seller: - More customer traffic<br />- Bulk sales with reduced commission<br />Buyer: - Better discounts<br />- Power to choose product deal<br />- Buyer community feedback on products and sellers<br />- Maintainingonline buyer/seller communities and credibilityof transactions- Promotionof website and brand <br /><ul><li> Powerful sellers
  153. Sellers who need more traffic</li></ul>- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller:<br />Trustworthy online sellers with verifiable websitesBuyer:<br />Online shoppers who are willing to wait to get significant discounts on products<br /><ul><li> Web & App sales </li></ul>-Online social networks<br />- Physical resources (IT infrastructure)- Existing social networks -Buyer and seller communities,- Brand awareness<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br />- Variable costs: server and traffic maintenance costs- Fixed Cost: rent, salaries <br />
  154. Key Question for Business Canvas #2<br />HOW CAN WE ATTRACT BUYERS?<br />CUSTOMER ACQUISION COST?<br />
  155. Buyer Demand Test<br />Best Marketing Channel for having buyers is Facebook Wall<br />: 144 Unique Visits, 10 e-mail subscriptions for 3 days<br />Facebook Wall<br />Google Adwords<br />Facebook Ads<br />5%<br />0.08%<br />0.005%<br />(CTR)<br />$7.52<br />$4.88<br />$0<br />(COST)<br />
  156. Business Canvas #3<br />Seller: - More customer traffic<br />- Bulk sales with reduced commission<br />Buyer: - Better discounts<br />- Power to choose product deal<br />- Buyer community feedback on products and sellers<br />- Maintainingonline buyer/seller communities and credibilityof transactions- Promotionof website and brand <br /><ul><li> Sellers who need more traffic
  157. Server providers</li></ul>Established services- Online Marketing : Google/Facebook<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller:<br />Trustworthy online sellers with verifiable websitesBuyer:<br />Online shoppers who are willing to wait to get significant discounts on products<br /><ul><li> Web & App sales
  158. Online social networks
  159. Online advertising</li></ul>- Physical resources (IT infrastructure)- Existing social networks -Buyer and seller communities,- Brand awareness<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br /><ul><li>Variable costs: server and traffic maintenance costs- Fixed Cost: rent, salaries </li></ul>- Online ad campaigns<br />
  160. Key Question for Business Canvass #3<br />HOW CAN WE ATTRACT SELLERS?<br />COOPERATION WITH SELLERS?<br />
  161. Seller Contact<br />Deal with sellers failed because no group pricing or discount too low.<br />Organize Real Group Deal<br /><ul><li>Contact popular online sellers
  162. 3 products: HD camera, protein drink, videogame
  163. Videogame was for pre-order</li></ul>Result<br /><ul><li>Most sellers: no group discounts
  164. Discounts offered < 10%
  165. With shipping and tax still >= Amazon price
  166. David vs. Goliath problem</li></li></ul><li>To Pivot or Not to Pivot?<br />Although dismayedat seller response, we did not give up.<br />What do do?<br /><ul><li>Deal with sellers disappointing
  167. Seller problem intractable?
  168. Teaching staff: Pivot or else…</li></ul>Beaten, but not defeated<br /><ul><li>Lost one battle, but not the war!
  169. Only contacted larger sellers
  170. Sellers need more value
  171. Show them a real website</li></ul>Filter advice and stay determined!<br />No Pivot Yet<br />
  172. Solution 1 : Rapid Implementation<br />Implement seller & buyer side features to give sellers fuller experience. <br />Site Upgrade Frenzy<br /><ul><li>Improved site design
  173. Buyer facebook login
  174. Online social networking integration
  175. Seller login and registration
  176. Seller bidding
  177. Seller group deal creation page</li></li></ul><li>Solution 1 : Rapid Implementation<br />Humble beginnings <br />
  178. Solution 1 : Rapid Implementation<br />The Real Deal <br />
  179. Solution 1 : Rapid Implementation<br />Main page<br />Facebook connect<br />Deal creation by sellers<br />Bidding dialog<br />
  180. Solution 2 : More seller value & spamming<br />Add value for sellers based on mentor and industry expert interviews<br />Add Seller Value<br /><ul><li>Low transaction fees
  181. Customer contact information
  182. Cross-selling products
  183. Ad banners
  184. Power to create group deal</li></ul>The Art of Spam<br /><ul><li>Massive seller e-mail campaign (16,000 in total)
  185. Stanford takes notice and issues warning (oops)
  186. Enumerate value propositions
  187. Show live website
  188. Hand out registration codes</li></li></ul><li>Seller Invitation Result<br />180 sellers<br /># of sellers who signed up<br /># of deals made by sellers<br />80 deals<br />(below Amazon price)<br />
  189. Seller Invitation Result<br /># of sellers who replied to our email<br />200 sellers<br /># of sellers who made suggestions on OURCRAVE<br />50 sellers<br />
  190. Business Canvas #4<br />- Maintainingonline buyer/seller communities and credibilityof transactions- Promotionof website and brand <br />Seller: - More customer traffic<br /><ul><li>Bulk sales with reduced commission</li></ul>- Access to customer contact information <br /><ul><li> Cross-sell their products.- Site advertising- Power to create deals</li></ul>Buyer: - Better discounts<br />- Power to choose product deal<br />- Buyer community feedback on products and sellers<br /><ul><li> Sellers who need more traffic
  191. Server providers</li></ul>Established services- Online Marketing : Google/Facebook<br />-Payment Gateway : Paypal- Customer Service (Front side webservice) : Self- Customer Service (Product side) : Sellers- Delivery : Sellers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller:<br />Trustworthy online sellers with verifiable websitesBuyer:<br />Online shoppers who are willing to wait to get significant discounts on products<br /><ul><li> Web & App sales
  192. Online social networks
  193. Online advertising</li></ul>- Physical resources (IT infrastructure)- Existing social networks -Buyer and seller communities,- Brand awareness<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br /><ul><li>Variable costs: server and traffic maintenance costs- Fixed Cost: rent, salaries </li></ul>- Online ad campaigns<br />
  194. Key Question for Business Canvass #4<br />Key Activities for Next Stage<br />Can we make enough money?<br />
  195. Key Activity – Seller Management<br />We should manage main feedbacks from sellers by making basic function, <br />1. Convenient System<br /><ul><li>Auto Sales Tax Calculator
  196. Bulk List Uploading Function
  197. Notification to Sellers </li></ul> for relevant cravebags<br />2. Building credibility<br /><ul><li>FAQ List for Sellers
  198. Share buyer information
  199. F2F meeting with big sellers</li></ul>3. More Incentives<br /><ul><li>Cross selling Option
  200. Seller Advertisement Feature</li></li></ul><li>Key Activity – Initial Advertisement<br />By price comparison site and online ads, test our early service model. Then, Crazy deals needed for jumping<br />2nd Active : Crazy Deals<br /><ul><li>20~30 % sales for Promotion Deals
  201. Very very very famous products</li></ul>1st Passive : Online Ads<br /><ul><li>Google / Facebook / Yahoo Ads
  202. Price Comparison Site ( very important)</li></li></ul><li>Key Activity – Encouraging Buyer’s Viral<br />We will implement incentive system for sharing deals and help buyers communicate with each other in our service<br />Incentive for sharing<br />Buyer Community<br />14%<br />22%<br />People who willing to share deals in FB*<br />People who shared deals<br />In FB*<br /><ul><li>OurCrave Point
  203. Extra Discount
  204. Free shipping or tax Coupon
  205. Live comment on cravebags
  206. Weekly Best cravebag vote
  207. Youtube Ads Competition</li></ul>* OurCrave User Survey in 2/3 weeks<br />
  208. Revenue / Cost Source<br />Revenue<br />Cost<br />Product Ads<br />Transaction Fee ( Main )<br />Float Money<br />Site Maintenance <br />Marketing ( Main )<br />Customer Support<br />Server/Traffic<br />/Mobie Apps<br />15% of transaction<br />Ads for buyer<br />Seller Management<br />3~5% ( paypal)<br />Outsourcing<br />20%/60days*<br />* google/groupon’s rule, we are asking sellers about this rule.<br />
  209. Business Canvas Final<br />Seller: - More customer traffic<br /><ul><li>Bulk sales with reduced commission</li></ul>- Access to customer contact information <br /><ul><li> Cross-sell their products.- Site advertising- Power to create deals</li></ul>Buyer: - Better discounts<br />- Power to choose product deal<br />- Buyer community feedback on products and sellers<br /><ul><li> Sellers who need more traffic
  210. Server providers</li></ul>Established services- Online Marketing : Google/Facebook<br />- Payment Gateway : Paypal- Customer Service (Front side webservice) : Self- Customer Service (Product side) : Sellers- Delivery : Sellers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br /><ul><li> Growing and maintaining online buyer/seller communities and credibilityof transactions- Promotionof website and brand </li></ul>- Establishing credibility<br />Multi-sided platformSeller:<br />Trustworthy online sellers with verifiable websitesBuyer:<br />Online shoppers who are willing to wait to get significant discounts on products<br /><ul><li> Web & App sales
  211. Online social networks
  212. Online advertising</li></ul>- Physical resources (IT infrastructure)- Existing social networks -Buyer and seller communities,- Brand awareness<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br />- float money<br /><ul><li>Variable costs: server and traffic maintenance costs- Fixed Cost: rent, salaries </li></ul>- Online ad campaigns<br />
  213. Business Canvas – Week 1<br />Seller : - More customer traffic<br />- Bulk sales- Lower transaction feesBuyer : - Better discounts<br />- Platform/Networkmanagement (maintaining online buyer/seller communities and credibility)- promotion of website and brand <br />- Powerful sellers<br />- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller :pro-sellers on Amazon and eBayBuyer :Online shoppers<br />- Web & App sales <br />- Online social networks<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />Seller side:- transaction fees <br />Buyer side:- targeted ads <br />
  214. Business Canvas – Week 2<br />Seller : - More customer traffic<br />- Bulk sales- Lower transaction fees- Brand name marketingBuyer : - Better discounts<br />- Power to choose product deal<br />- Platform/Networkmanagement (maintaining online buyer/seller communities and credibility)- promotion of website and brand <br />- Powerful sellers<br />- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller :pro-sellers on Amazon and eBayBuyer :Online shoppers<br />- Web & App sales <br />- Online social networks<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />Seller side:- transaction fees <br />Buyer side:- targeted ads <br />
  215. Business Canvas – Week 3<br />Seller : - More customer traffic<br />- Bulk sales- Lower transaction fees- Brand name marketingBuyer : - Better discounts<br />- Power to choose product deal<br />- Buyer community feedback on products and sellers<br />- Platform/Networkmanagement (maintaining online buyer/seller communities and credibility)- promotion of website and brand <br />- Powerful sellers<br />-Regionalsellers<br />- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller :<br />Sellers on Amazon and eBayBuyer :Online shoppers who are willing to waitto get significant discounts on products<br />- Web & App sales <br />- Online social networks<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />Seller side:- transaction fees <br />Buyer side:- targeted ads <br />
  216. Business Canvas – Week 4<br />Seller : - More customer traffic<br /><ul><li>Bulk sales- Lower transaction fees- Brand name marketingBuyer : - Better discounts</li></ul>- Power to choose product deal<br />- Buyer community feedback on products and sellers<br />- Platform/Networkmanagement (maintaining online buyer/seller communities and credibility)- promotion of website and brand <br />- Sellers who need more traffic<br />-Regionalsellers<br />- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller :<br />Sellers on Amazon and eBayBuyer :Online shoppers who are willing to waitto get significant discounts on products<br />- Web & App sales <br />- Online social networks<br />- Onlineadvertising<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />Seller side:- transaction fees <br />Buyer side:- targeted ads <br />
  217. Business Canvas – Week 5<br />- Platform/Networkmanagement (maintaining online buyer/seller communities and credibility)- promotion of website and brand <br />Seller : - More customer traffic<br />- Bulk sales- Lower transaction fees- Brand name marketing<br /> - Access to customer contact information<br /> - Ability to cross-sell products<br /> - Site advertising<br />Buyer : - Better discounts<br />- Power to choose product deal<br />- Buyer community feedback on products and sellers<br />- Sellers who need more traffic<br />-Regionalsellers<br />- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller :<br />Sellers on Amazon and eBayBuyer :Online shoppers who arewilling to waitto get significant discounts on products<br />- Web & App sales <br />- Online social networks<br />- Onlineadvertising<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />- Online ads<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br />
  218. Business Canvas – Week 6<br />Seller : - More customer traffic<br />- Bulk sales- Lower transaction fees- Access to customer contact information <br />- Cross-sell their products.- Site advertising- Power to create dealsBuyer : - Better discounts- Power to choose product deal- Buyer community feedback on products and sellers <br />- Platform/Networkmanagement (maintaining online buyer/seller communities and credibility)- promotion of website and brand <br />- Sellers who need more traffic<br />-Regionalsellers<br />- Server providers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller :<br />Sellers on Amazon and eBayBuyer :Online shoppers who arewilling to waitto get significant discounts on products<br />- Web & App sales <br />- Online social networks<br />- Onlineadvertising<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />- Online ads<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br />- float money<br />
  219. Business Canvas – Week 7<br />Seller : - More customer traffic<br />- Bulk sales- Lower transaction fees- Access to customer contact information <br />- Cross-sell their products.- Site advertising- Power to create dealsBuyer : - Better discounts- Power to choose product deal- Buyer community feedback on products and sellers <br />- Platform/Networkmanagement (maintaining online buyer/seller communities and credibility)- Promotion of website and brand <br />- Sellers who need more traffic<br />- Regionalsellers<br />- Server providers<br />Established services- Online Marketing : Google/Facebook -Payment Gateway : Paypal- Customer Service (Front side webservice) : Self- Customer Service (Product side) : Sellers- Delivery : Sellers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platformSeller :Sellers on Amazon and eBay<br />Seller: <br />Trustworthy sellers with verifiable websites.Buyer :Online shoppers who arewilling to waitto get significant discounts on products<br />- Web & App sales <br />- Online social networks<br />- Onlineadvertising<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />- Online ads<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br />- float money<br />
  220. Business Canvas – Week 8<br />Seller : - More customer traffic<br />- Bulk sales- Lower transaction fees- Access to customer contact information <br />- Cross-sell their products.- Site advertising- Power to create dealsBuyer : - Better discounts- Power to choose product deal- Buyer community feedback on products and sellers <br />- Platform/Networkmanagement (maintaining and growing online buyer/seller communities and credibility)- Promotion of website and brand<br />- Establishing credibility<br />- Sellers who need more traffic<br />Established services- Online Marketing : Google/Facebook -Payment Gateway : Paypal- Customer Service (Front side webservice) : Self- Customer Service (Product side) : Sellers- Delivery : Sellers<br />- Automated services- Communities of buyers and sellers- Co-creation of value through customer feedback <br />Multi-sided platform<br />Seller: <br />Trustworthy sellers with verifiable websites.Buyer :Online shoppers who are willing to wait to get significant discounts on products<br />- Web & App sales <br />- Online social networks<br />- Onlineadvertising<br />- Physical resources (IT infrastructure)- Existing social networks - Buyer and seller communities,- Brand awareness<br />- Variable costs: server and traffic maintenance costs- Fixed costs: rent, salaries<br />- Online ads<br />Seller side:- transaction fees <br />Buyer side:- targeted ads<br />- float money<br />
  221. Pivot ExampleRobotic Weeding<br />Talked 75 Customers in 8 Weeks<br />
  222. Our initial plan<br />Confidential<br />
  223. 20 interviews, 6 site visits…We got OUR Boots dirty<br />Weeding<br />Visited two farms in Salinas Valley to better understand problem<br />Interviewed:<br /><ul><li>Bolthouse Farms, Large Agri-Industry in Bakersfield
  224. White Farms, Large Peanut farmer in Georgia
  225. REFCO Farms, large grower in Salinas Valley
  226. Rincon Farms, large grower in Salinas Valley
  227. Small Organic Corn/Soy grower in Nebraska
  228. Heirloom Organics, small owner/operator, Santa Cruz Mts
  229. Two small organic farmers at farmers market
  230. Ag Services of Salinas, Fertilizer applicator</li></ul>Mowing<br />Interviewed:<br /><ul><li>Golf: Stanford Golf course
  231. Parks: Stanford Grounds Supervisor, head of maintenance and lead operator (has crew of 6)
  232. Toro dealer (large mower manufacturer)
  233. User of back-yard mowing system
  234. Maintenance Services for City of Los Altos
  235. Colony Landscaping (Mowing service for stadiums)</li></ul>Confidential<br />
  236. Business Plan Autonomous Vehicles for Mowing & Weeding<br />Dealers sell, installs and supports customer<br />Co. trains dealers, supports dealers<br />- Innovation<br />- Customer Education<br />- Dealer training<br />Mowing<br />- Owners of public or commercially used green spaces (e.g. golf courses)<br />- Landscaping service provider<br />Weeding<br />- Farmers with manual weeding operations<br />We reduce operating cost<br />- Labor reduction<br />- Better utilization of assets (eg mow or weed at nights)<br />- Improved performance (less rework, food safety)<br />- Dealers (Mowing and Ag)<br />- Vehicle OEMs (John Deere, Toro, Jacobsen, etc)<br />- Research labs<br />- Mowing Dealers<br />- Ag Dealers<br />Engineers on Autonomous vehicles, GPS, path-planning<br />Dealer discount <br />COGS seek a 50-60% Gross Margin<br />Heavy R&D investment <br />Asset sale<br />Our revenue stream derives from selling the equipment<br />
  237. Autonomous vehiclesWEEDING<br />Dealers sell, installs and supports customer<br />Co. trains dealers, supports dealers<br />- Innovation<br />- Customer Education<br />- Dealer training<br />- Low density vegetable growers<br />- High density vegetable growers<br />- Thinning operations<br />- Conventional vegetables<br />We reduce operating cost<br />- Labor reduction (100 to 1)<br />- Reduced risk of contamination<br />- Mitigate labor availability concerns<br />- Ag Dealers<br />- Ag Service providers<br />- Research labs<br />- Ag Dealers<br />- Ag Service providers<br />Engineers on Machine Vision<br />Two problems:<br />- Identification<br />- Elimination<br />Dealer discount <br />COGS seek a 50-60% Gross Margin<br />Heavy R&D investment <br />Asset sale<br />Our revenue stream derives from selling the equipment<br />
  238. 1 Week – 1 CarrotBot<br />Confidential<br />
  239. The Business Plan Canvas Updated<br /><ul><li>Technology Design
  240. Marketing
  241. Demo and customer feedback
  242. Farming conventions.
  243. Demo, demo, and demo!!
  244. Proximity is paramount
  245. Organic Farmers
  246. Weeding Service Providers
  247. Conventional Farmers
  248. Cost Reduction
  249. Remove labor force pains
  250. Eliminate bio-waste hazards
  251. Research Labs
  252. Equipment Manufacturers
  253. Distribution Network
  254. Service Providers
  255. IP – Patents
  256. Video Classifier Files
  257. Robust Technology
  258. Dealers
  259. Direct Service
  260. Indirect Service
  261. … then Dealers
  262. Asset Sale
  263. Direct Service with equipment rental
  264. … then Asset Sale</li></ul>Value-Driven<br />
  265. The Business Plan Canvas Updated<br /><ul><li>Technology Design
  266. Marketing
  267. Demo and customer feedback
  268. Farming conventions.
  269. Demo, demo, and demo!!
  270. Proximity is paramount
  271. Mid/Large Organic Farmers
  272. Agricultural corporations
  273. Weeding Service Providers
  274. Mid/Large Conventional Farmers
  275. Cost Reduction
  276. Remove labor force pains
  277. Eliminate bio-waste hazards
  278. Research Labs
  279. Equipment Manufacturers
  280. Distribution Network
  281. Service Providers
  282. IP – Patents
  283. Video Classifier Files
  284. Robust Technology
  285. Direct Service
  286. Indirect Service
  287. … then Dealers
  288. Direct Service with equipment rental
  289. ($1,500/d; 120d/yr )
  290. Low density: $1,500/d
  291. High density: $6,000/d</li></ul>Value-Driven<br />
  292. World Ag Expo interviews:the need is real and wide spread<br />10+ interviews at show<br />Everyone confirmed the need<br />Robocrop, UK based, crude competitor sells for $171 K<br />Revenue Stream<br />Mid to small growers prefer a service<br />Large growers prefer to buy, but OK with service until technology is proven<br />Charging for labor cost saved is OK, as we provide other benefits (food safety, labor availability)<br />Confidential<br />
  293. The Business Plan Canvas Updated<br /><ul><li>Technology Design
  294. Marketing
  295. Demo and customer feedback
  296. Farming conventions.
  297. Demo, demo, and demo!!
  298. Proximity is paramount
  299. Mid/Large Organic Farmers
  300. Agricultural corporations
  301. Weeding Service Providers
  302. Mid/Large Conventional Farmers
  303. Research Labs
  304. Equipment Manufacturer
  305. Distribution Network
  306. Service Providers
  307. 2 or 3 Key Farms
  308. Cost Reduction
  309. Remove labor force pains
  310. Eliminate bio-waste hazards
  311. IP – Patents
  312. Video Classifier Files
  313. Robust Technology
  314. Direct Service
  315. Indirect Service
  316. … then Dealers
  317. Direct Service with equipment rental
  318. Low density: $1,500/d
  319. High density: $6,000/d</li></ul>Value-Driven<br /><ul><li> R&D
  320. Bill of Materials
  321. Training & Service
  322. Sales</li></li></ul><li>Autonomous weeding - Final<br />Direct<br />- Provide high quality service at competitive price<br />- Innovation<br />- Customer Education<br />- Dealer training<br />- Low density vegetable growers<br />- High density vegetable growers<br />- Thinning operations<br />- Conventional vegetables<br />We reduce operating cost<br />- Labor reduction (100 to 1)<br />- Reduced risk of contamination<br />- Mitigate labor availability concerns<br />- Ag Service providers<br />- Research Institutes (eg UC Davis, Laser Zentrum Hannover)<br />- 3-4 key farms<br />Direct <br />- Alliance with service providers<br />- Eventually sell through dealers<br />Engineers on Machine Vision<br />Two problems:<br />- Identification<br />- Elimination<br />Costs for service provision<br />COGS seek a 50-60% Gross Margin<br />Heavy R&D investment <br />Service provision<br />- Charge by the acre with modifier according to weed density <br />- Eventually move to asset sale<br />
  323. 2011 – 2014Rules for the New Bubble<br />
  324. New Bubble Hypotheses<br />We’re in one<br />Rules are different in 2011 then 2006<br />Exits will be IPO and M&A<br />Unlike last bubble initial IPO’s will be “real”<br />Quality of IPO pipeline will diminish rapidly<br />Acquirers can be “targeted”<br />You can “engineer for an acquisition”<br />
  325. 2011 – 2014The New Bubble<br />Short product dev cycle (Agile Development)<br />Customers 10’s/100’s millions(Social networks, consumer)<br />Liquidity through M&A & IPO(revenue & network of users)<br />Repeatable methodology (Agile + Cust Dev + Bus Model)<br />Target acquirers (Adoption, Visibility, order of battle)<br />
  326. 2011 - 2014Rules for the New Bubble<br />Founders/VC’s can engineer financial transactions<br />Transactions economically or usage accretive<br />Still require Agile, Cust Dev & Bus Model<br />Add: Adoption, Order of Battle and Visibility<br />
  327. 2011 - 2014 Playbook<br />Business Model Generation<br />Four Steps to the Epiphany<br />Lean Startup<br />Liquidity Strategy<br />
  328. Lean & Pivots is the Minimum Entry<br /><ul><li> Continuous Customer Discovery
  329. Rapid Bus Model iteration
  330. Extreme Agile Development</li></li></ul><li>2011 – 2014Order of Battle<br />Each market has a finite number of acquirers<br />Each with a finite number of deal makers<br />Each looking to fill specific product/market holes<br />Each read/go to finite number of blogs/conferences<br />This is not an NP-complete problem<br />
  331. 2011 – 2014Adoption<br />Get wide adoption (freemium, low costs, etc) <br />Go for massive distribution<br />Monetize later<br />Can only be done Lean, requires Pivots<br />
  332. 2011 – 2014Visibility<br />Be everywhere<br />Look larger than life<br />Conference, blogs, social networks<br />PR is your best friend, invest in it<br />
  333. Closing Thoughts<br />We’re at the beginning of another tech bubble<br />Rules for making money are different in a bubble<br />Founders & VC’s can engineer financial transactions<br />Transactions need to be economically or usage accretive<br />Still require Agile, Cust Dev & Bus Model<br />Add: Adoption, Order of Battle and Visibility<br />
  334. Thanks<br />www.steveblank.com<br />
  335. BACKUP<br />
  336. Pivot ExamplePersonal Libraries<br />Talked to 75 Customers in 8 weeks<br />
  337. Version 1.0: Personal Libraries<br />
  338. something-something-something.com<br />Original idea<br />Invincible Business Model: Version 1.0<br />SHORT TERMResearchers<br />Lawyers<br />Scientists <br />LONG TERMAvid book readers<br />Professionals <br />FB/TW posts from users you know<br />Company blog, FB, TW, support forums<br />Import, organize and share thousands of papers<br />Targeted marketing<br />Product development<br />Constant iteration & testing<br />Libraries, Universities, Research Centers<br />Bloggers and media targeting customer segment<br />Academic Database providers<br />Affiliate program<br />SEO/SEM/SM<br />IE/FF/Chrome App Stores<br />Developers<br />Marketers<br />Affiliate program fees<br />Licensing<br />Subscription fees<br />Ad revenue<br />AWS Infrastructure<br />SEM<br />Eng & Marketing OpEx<br />
  339. Got out of the building<br /><ul><li>100+ Interviews
  340. Extensive Surveys
  341. 33,000+ Adwords
  342. Compete Review
  343. Market Sizing
  344. 50 bloggers
  345. 6 Social Networks
  346. Usability Tests
  347. Rapid Iteration</li></li></ul><li>Version 2.0: Trusted Advice<br />
  348. something-something-something.com<br />Original idea<br />Invincible Business Model: Version 2.0<br />Upwardly mobile young professionals making $2-10K of discretionary online purchases a year (excluding travel)<br />FB/TW posts from users you know<br />Company blog, FB, TW accounts<br />Discover online goods recommended by friends at the lowest possible price from trusted vendors<br />Developing trusted advice and advisors<br />Web marketing <br />Affiliate partnerships<br />Constant iteration & testing<br />Bloggers and Media targeting customer segment<br />Retail marketing partners<br />IE/FF/Chrome teams<br />Affiliate Program Providers<br />Affiliate program<br />SEO/SEM/SM<br />IE/FF/Chrome App Stores<br />Developers<br />Marketers<br />Content Library<br />Install base<br />Readership base<br />Affiliate program fees<br />Licensing<br />Subscription fees<br />Ad revenue<br />AWS Infrastructure<br />SEM<br />Eng & Marketing OpEx<br />
  349. New Hypotheses<br />
  350. Here’s What We Did<br />Version 2.0: Trusted Advice<br />
  351. Got out of the building, again<br /><ul><li>40+ Interviews
  352. Extensive Surveys
  353. Landing Page Tests
  354. Market Research
  355. Compete Research
  356. Revenue Analysis
  357. Two Prototypes
  358. Refined Personas</li></li></ul><li>Version 2.0: Trusted Advice<br />Top ~6M US Influentials (~$9B/year)<br />
  359. something-something-something.com<br />Original idea<br />Invincible Business Model: Version 2.0<br />Upwardly mobile young professionals making $2-10K of discretionary online purchases a year (excluding travel)<br />FB/TW posts from users you know<br />Company blog, FB, TW accounts<br />Discover online goods recommended by friends at the lowest possible price from trusted vendors<br />Developing trusted advice and advisors<br />Web marketing <br />Affiliate partnerships<br />Constant iteration & testing<br />Bloggers and Media targeting customer segment<br />Retail marketing partners<br />IE/FF/Chrome teams<br />Affiliate Program Providers<br />Affiliate program<br />SEO/SEM/SM<br />IE/FF/Chrome App Stores<br />Developers<br />Marketers<br />Content Library<br />Install base<br />Readership base<br />Affiliate program fees<br />Licensing<br />Subscription fees<br />Ad revenue<br />AWS Infrastructure<br />SEM<br />Eng & Marketing OpEx<br />
  360. The adventure continuesTrusted Advice 2.0<br />Protection against SEO-spammers<br />Next Experiments: <br /><ul><li>Trusted Lead Gen
  361. Trusted Advice website powered by Shopping Add-in</li></li></ul><li>something-something-something.com<br />Original idea<br />Invincible Business Model: Version 3.0<br />PAT THE PROFESSIONALUpwardly mobile young professionals making $2-10K of discretionary online purchases a year (excluding travel)<br />FB/TW posts from users you know<br />Company blog, FB, TW accounts<br />TRUSTED ADVICE Discover online goods recommended by friends at the lowest possible price from trusted vendors<br />Foil advertorial spammers polluting the Interweb with toxic pseudo-content<br />Developing trusted advice and advisors<br />Web marketing <br />Affiliate partnerships<br />Constant iteration & testing<br />Bloggers and Media targeting customer segment<br />Retail marketing partners<br />IE/FF/Chrome teams<br />Affiliate Program Providers<br />Affiliate program<br />SEO/SEM/SM<br />IE/FF/Chrome App Stores<br />Developers<br />Marketers<br />Content Library<br />Install base<br />Readership base<br />Affiliate program fees<br />Licensing<br />Subscription fees<br />Ad revenue<br />AWS Infrastructure<br />SEM<br />Eng & Marketing OpEx<br />
  362. Pivot ExampleCloud Services<br />Talked to 50 Customers in 8 weeks<br />
  363. Week 1<br />
  364. Cloud compute marketplace<br />Build a cloud marketplace<br />Many different customer segments on buy-side and sell-side<br />Direct sales to both buyers and sellers<br />Huge dependency on technical platform<br />
  365. Week 2<br />
  366. Cloud Services Match Maker<br />Pivot away from technical platform<br />Help buyers find the best provider<br />Removed financial, consumer segments<br />Act as channel for sellers<br />
  367. Week 3<br />
  368. Automated Cloud Capacity Planning<br />Pivot 1:<br />Capacity Planning<br />Pivot 2:<br />Focus on enterprises with variable workload<br />
  369. Week 4<br />
  370. Week 5<br />
  371. Week 6<br />
  372. Week 7<br />
  373. Week 8<br />Capacity Planning<br />· High variability in usage <br />Service Matching<br /><ul><li> Companies unfamiliar with using cloud infrastructure</li></ul>SLA Monitoring<br /><ul><li> Companies with high SLA requirements with their customers</li></ul>· For enterprise segment, higher touch model with field sales force<br />· Reduced cloud infrastructure cost· Better compute needs matching<br />· Increased visibility on service level <br />Integrators:<br />· Increased budget for consulting services<br /><ul><li> Design and refine capacity planning and match making algorithms
  374. Develop and maintain cloud infrastructure vendors relationships
  375. Develop brand as go-to place for cloud lifecycle management</li></ul>· Technology partners – cloud vendors, management tools<br />· System integrators / Consultants<br />· Intellectual property – prediction algorithm· Developers· Inside sales force<br />· Field sales force · Biz dev (channel partners and technology partners)<br />· Integrators / consultants specialized in cloud infrastructure<br /><ul><li> Inside sales and field sales· Development Costs· Infrastructure costs – AWS· Support costs
  376. Subscription charge to buyers
  377. Pricing table scales based on # of servers and # of seats, with tiers</li></li></ul><li>Cloud Lifecycle Management<br />Agora – FINAL<br /><ul><li> Develop capacity planning algorithm
  378. Develop IaaS vendor relationships
  379. Marketing and sales</li></ul>· Technology partners – cloud vendors, management tools<br />· System integrators / Consultants<br />Partner with Integrators<br />Capacity Planning<br />· High variability in usage <br />Service Matching<br /><ul><li> Companies new to cloud</li></ul>SLA Monitoring<br /><ul><li> Companies with high SLA requirements </li></ul>· For enterprise, higher touch model with field sales<br />Customers<br />· Reduced cloud infrastructure cost· Increased visibility on service level <br />Integrators:<br />· Increased revenue<br />Position product for lifecycle management<br />Leverage both inside and field sales<br />· IP– prediction · Developers· Inside sales force<br />· Field sales force · Biz dev (channel and technology partners)<br />· IaaS Integrators / consultants<br /><ul><li> Inside and field sales· Development Costs· Infrastructure costs – AWS· Support costs
  380. Subscription charge to buyers
  381. Pricing table scales based on # of servers and # of seats, with tiers</li></li></ul><li>Pivot ExampleUser Generated Real-Time Traffic Info <br />Talked to 150 Customers in 8 weeks <br />
  382. Initial Product Idea<br />Mobile application providing crowd-sourced real time traffic map in developing countries<br />Lahore<br />Shanghai<br />Jakarta<br />Bangkok<br />
  383. Business Canvas Change Progress <br />1<br />
  384. Business Canvas Change Progress <br />2<br />
  385. Business Canvas Change Progress <br />3<br />
  386. Customer Segment: Corporate<br />The Drivers:<br />Are you questioning our expertise?<br />Archetypes<br />Users<br />International, local, large, and small companies<br /> Influencers <br /> and <br />Recommenders<br />Economic Buyers, <br />Decision Makers<br />Saboteurs<br />
  387. Pass/Fail <br />FAIL<br />
  388. Business Canvas Change Progress <br />4<br />
  389. Business Canvas Change Progress <br />5<br />
  390. Business Canvas Change Progress <br />6<br />
  391. Business Canvas Change Progress <br />7<br />
  392. Business Canvas Change Progress <br />FINAL<br />
  393. Pivot ExampleResidential Wind Turbines<br />Talked to 100 Customers in 8 weeks<br />
  394. Business Model Canvas #1<br /><ul><li>Continue R&D
  395. Get certifications
  396. Get approvals from city councils
  397. Cheap wind
  398. Green status symbol
  399. Diversify energy portfolio
  400. Faster payback than alternatives
  401. Single family homeowner
  402. House rental groups
  403. Contractors in home remodeling
  404. 5 yr full service Warranty
  405. Want re-buy from customers
  406. Environmental, bird, wildlife groups (regulations, publicity)
  407. City councils (new regulations, permits).
  408. Contractors
  409. Single family homeowner
  410. City councils (new regulations, permits).
  411. Faster payback than alternatives
  412. Wind
  413. Cheap manufacturing process- Intellectual property
  414. Need Initial capital
  415. Endorsements by environmental groups, and local governments
  416. Direct sales
  417. Web site
  418. Home Depot
  419. Direct sales
  420. Cost-driven model to provide inexpensive, quality product
  421. Asset sales</li></li></ul><li>Initial Idea<br />Affordable<br />New home appliance<br />Status<br />
  422. Business Model Canvas # 2<br /><ul><li>Continuous advertise and recruit new customers (city councils)
  423. Build relationship with city engineers and council members
  424. Understand customer, influencers, motivations, problems, competitors
  425. Form partnerships for maximum reach
  426. Submit bids for city RFPs
  427. Continue R&D
  428. Get certifications
  429. Gain Credibility
  430. Retrofit wind turbine for street and highway lamps.
  431. Create own wind turbines with pole manufacturers
  432. Be owner of cheap green status symbol
  433. Diversify green energy portfolio
  434. Fast payback than alternatives
  435. Single family wealthy, green home and land owner in CA, TX ,CO, WI, NY
  436. Cities
  437. Lighting Companies
  438. 5 year full service Warranty
  439. After 5 years, service charge
  440. Utility to manage after warranty expiration
  441. Extended warranty option
  442. Environmental, bird, wildlife groups (regulations, publicity)
  443. City councils not HOA(new regulations, permits).
  444. Lighting Manufacturers
  445. Electricians and Contractors for Installation/Maintenance
  446. Research Labs
  447. Turbine Certifiers
  448. Build relationship with city engineers and council members
  449. Retrofit wind turbine for street and highway lamps.
  450. City councils not HOA
  451. Cities
  452. Cheap manufacturing process- Intellectual property
  453. $1.5 MM of capital to start manufacturing and distribution for year 1 and 2
  454. Manufacturing Parts
  455. Endorsements by environmental groups, and local governments
  456. Direct sales to cities
  457. Web site
  458. Home Depot
  459. Direct Sales
  460. Service Calls
  461. Leasing
  462. Cost-driven model to provide inexpensive, quality product
  463. Manufacturing costs and customer acquisition costs.
  464. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained (must be in future)</li></li></ul><li>City Process<br /><ul><li>Policies
  465. Community Culture
  466. State Mandates
  467. City Budget Plan</li></ul>Learn about city approval Process<br />City Values<br />Planning Commission<br />Technical Evaluation and Recommendation<br />Back to the envelop metrics<br />IDEA<br />Request for Quote<br />City Council Approval<br />City Council “Pet-Project”<br />Finance Approval<br />
  468. Business Model Canvas – Final <br /><ul><li>Continuously advertise and recruit new customers (city councils)
  469. Build relationship with city engineers and council members
  470. Understand customer, influencers, motivations, problems, competitors
  471. Form partnerships (developers, cities, installers, maintenance) for maximum reach
  472. Submit bids for city RFPs
  473. Continue R&D
  474. Get certifications
  475. Gain Credibility
  476. Retrofit wind turbine for street and highway lamps.
  477. Create own wind turbines with pole manufacturers
  478. Be owner of cheap green status symbol
  479. Diversify green energy portfolio
  480. Fast payback than alternatives
  481. Cities (pilot)
  482. Cities leasing
  483. Lighting Companies
  484. Developer -> Utilities -> City
  485. 5 year full service Warranty,
  486. After 5 years, service charge
  487. Utility to manage after warranty expiration
  488. Extended warranty option
  489. City council (new regulations, permits).
  490. Environmental, bird, wildlife groups (regulations, publicity)
  491. Lighting Manufacturers
  492. Electricians and Contractors for Installation/Maintenance
  493. Research Labs
  494. Turbine Certifiers
  495. Small Wind Developers
  496. Utilities
  497. Cheap manufacturing process- Intellectual property
  498. R&D talent
  499. Endorsements by environmental groups, and local governments
  500. Finance
  501. Direct sales to cities (long term) PILOTS
  502. Small Wind Developer
  503. Cities leasing
  504. Developer -> Utilities -> City
  505. Finance
  506. Cost-driven model to provide inexpensive, quality product
  507. Manufacturing costs and customer acquisition costs.
  508. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained (must be in future)
  509. Leasing, PPA
  510. Direct Sales to wind developers?
  511. Leasing, PPA
  512. Direct Sales to wind developers?</li></li></ul><li>Business Model Canvas – Week 1<br /><ul><li>Continue R&D
  513. Get certifications
  514. Get approvals from city councils
  515. Cheap affordable wind turbine for the everyday American
  516. Be owner of cheap green status symbol
  517. Diversify energy portfolio,
  518. Fast payback than alternatives, < 5 yrs
  519. Single family homeowner
  520. House rental groups
  521. Contractors in home remodelling
  522. 5 year full service Warranty
  523. Want re-buy from customers
  524. Environmental, bird, wildlife groups (regulations, publicity)
  525. City councils (new regulations, permits).
  526. Contractors
  527. Cheap manufacturing process- Intellectual property
  528. Need initial capital
  529. Endorsements by environmental groups, and local governments
  530. Direct sales
  531. Web site
  532. Home Depot
  533. Cost-driven model to provide inexpensive, quality product
  534. Sale of Product</li></li></ul><li>Business Model Canvas – Week 2<br /><ul><li>Continuous advertise and recruit new customers
  535. Continue R&D
  536. Get certifications
  537. Get approvals from city councils
  538. Cheap affordable wind turbine for the everyday American
  539. Be owner of cheap green status symbol
  540. Diversify energy portfolio,
  541. Fast payback than alternatives
  542. Single family homeowner in CA, TX ,CO, WI, NY
  543. House rental groups
  544. Contractors in home remodelling
  545. 5 year full service Warranty
  546. Want rebuy from customers
  547. Environmental, bird, wildlife groups (regulations, publicity)
  548. City councils and neighborhood/??? (new regulations, permits).
  549. Contractors
  550. Cheap manufacturing process- Intellectual property
  551. Need Iniitial capital
  552. Endorsements by environmental groups, and local governments
  553. Direct sales
  554. Web site
  555. Home Depot
  556. Cost-driven model to provide inexpensive, quality product
  557. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained.
  558. Direct Sales
  559. Leasing
  560. Service Calls</li></li></ul><li>Business Model Canvas – Week 3<br /><ul><li>Continuous advertise and recruit new customers
  561. Continue R&D
  562. Get certifications
  563. Get approvals from city councils
  564. Gain Credibility
  565. Cheap affordable wind turbine for the everyday American
  566. Be owner of cheap green status symbol
  567. Diversify energy portfolio,
  568. Fast payback than alternatives
  569. Single family wealthy, green home and land owner in CA, TX ,CO, WI, NY
  570. House rental groups
  571. Contractors in home remodelling
  572. 5 year full service Warranty
  573. Additional Maintenance after
  574. Want rebuy from customers
  575. Environmental, bird, wildlife groups (regulations, publicity)
  576. City councils and neighborhood/??? (new regulations, permits).
  577. Contractors
  578. Cheap manufacturing process- Intellectual property
  579. Need Iniitial capital (600k)
  580. Manufacturing Facilities and Areas
  581. Endorsements by environmental groups, and local governments
  582. Direct sales
  583. Web site
  584. Home Depot
  585. Cost-driven model to provide inexpensive, quality product
  586. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained.
  587. Direct Sales
  588. Leasing
  589. Service Calls</li></li></ul><li>Business Model Canvas – Week 4<br /><ul><li>Continuous advertise and recruit new customers
  590. Continue R&D
  591. Get certifications
  592. Get approvals from city councils
  593. Gain Credibility
  594. Cheap affordable wind turbine for the everyday American
  595. Cheap product more readily available
  596. Be owner of cheap green status symbol
  597. Diversify energy portfolio,
  598. Fast payback than alternatives
  599. Single family wealthy, green home and land owner in CA, TX ,CO, WI, NY
  600. House rental groups
  601. Contractors in home remodelling
  602. 5 year full service Warranty
  603. Additional Maintenance after
  604. Want rebuy from customers
  605. Environmental, bird, wildlife groups (regulations, publicity)
  606. City councils and neighborhood/??? (new regulations, permits).
  607. Contractors
  608. Cheap manufacturing process- Intellectual property
  609. Need Iniitial capital (600k)
  610. Manufacturing Parts
  611. Endorsements by environmental groups, and local governments
  612. Direct sales
  613. Web site
  614. Home Depot
  615. Cost-driven model to provide inexpensive, quality product
  616. Manufacturing costs and customer acquisition costs.
  617. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained (must be in future)
  618. Direct Sales
  619. Leasing
  620. Service Calls</li></li></ul><li>Business Model Canvas – Week 5<br /><ul><li>Continuous advertise and recruit new customers (city councils)
  621. Build relationship with city engineers and council members
  622. Understand customer, influencers, motivations, problems, competitors
  623. Form partnerships for maximum reach
  624. Submit bids for city RFPs
  625. Continue R&D
  626. Get certifications
  627. Gain Credibility
  628. Cheap product more readily
  629. Retrofit wind turbine for street and highway lamps.
  630. Create own wind turbines with pole manufacturers
  631. Be owner of cheap green status symbol
  632. Diversify green energy portfolio
  633. Fast payback than alternatives
  634. Single family wealthy, green home and land owner in CA, TX ,CO, WI, NY
  635. Cities
  636. Lighting Companies
  637. Utilities
  638. 5 year full service Warranty
  639. After 5 years, service charge
  640. Utility to manage after warranty expiration
  641. Extended warranty option
  642. Environmental, bird, wildlife groups (regulations, publicity)
  643. City councils and neighborhood/??? (new regulations, permits).
  644. Lighting Manufacturers
  645. Electricians and Contractors for Installation/Maintenance
  646. Cheap manufacturing process- Intellectual property
  647. $1.5 MM of capital to start manufacturing and distribution for year 1 and 2
  648. Manufacturing Parts
  649. Endorsements by environmental groups, and local governments
  650. Direct sales to cities (long term)
  651. Web site
  652. Home Depot
  653. Cost-driven model to provide inexpensive, quality product
  654. Manufacturing costs and customer acquisition costs.
  655. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained (must be in future)
  656. Direct Sales
  657. Service Calls
  658. Leasing</li></li></ul><li>Business Model Canvas – Week 6<br /><ul><li>Build relationship with city engineers and council members
  659. Understand customer, influencers, motivations, problems, competitors
  660. Form partnerships for maximum reach
  661. Submit bids for city RFPs
  662. Retrofit wind turbine for street and highway lamps.
  663. Use competitive, local, renewable energy, strong green symbol
  664. Diversify energy portfolio,
  665. Fast payback than alternatives.
  666. Cities
  667. Lighting Companies
  668. Utilities
  669. County – State Level
  670. 5 year maintenance and warranty
  671. After 5 years, service charge
  672. Utility to manage after warranty expiration
  673. Extended warranty option
  674. Environmental, bird, wildlife groups (regulations, publicity)
  675. City councils (new regulations, permits).
  676. Light manufacturers, installers to package product/services
  677. Electricians, contractors, light maintenance for additional workforce
  678. Cheap manufacturing process- Intellectual property
  679. $1.5 MM of capital to start manufacturing and distribution for year 1 and 2
  680. Endorsements by environmental groups, city consortiums for renewable energy, public utilities, city council planning department
  681. Direct sales to the city or utility, and forming long term relationship for maintenance and replacements.
  682. Cost-driven model to provide inexpensive, quality product
  683. Manufacturing costs and customer acquisition costs.
  684. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained.
  685. Asset sales and service calls
  686. Leasing and PPA? (under review)</li></li></ul><li>Business Model Canvas – Week 7<br /><ul><li>Build relationship with city engineers and council members
  687. Understand customer, influencers, motivations, problems, competitors
  688. Form partnerships for maximum reach
  689. Submit bids for city RFPs
  690. Retrofit wind turbine for street and highway lamps.
  691. Use competitive, local, renewable energy, strong green symbol
  692. Diversify energy portfolio,
  693. Fast payback than alternatives.
  694. Cities
  695. Utilities
  696. County – State Level
  697. 5 year maintenance and warranty
  698. After 5 years, service charge
  699. Utility to manage after warranty expiration
  700. Extended warranty option
  701. Environmental, bird, wildlife groups
  702. City councils (new regulations, permits).
  703. Light manufacturers,
  704. Installers/maintainers
  705. Research Labs
  706. Turbine Certifiers
  707. Cheap manufacturing process- Intellectual property
  708. $1.5 MM of capital to start manufacturing and distribution for year 1 and 2
  709. Endorsements by environmental groups, city consortiums for renewable energy, public utilities, city council planning department
  710. Direct sales to the city or utility, and forming long term relationship for maintenance and replacements.
  711. Cost-driven model to provide inexpensive, quality product
  712. Manufacturing costs and customer acquisition costs.
  713. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained.
  714. Asset sales and service calls
  715. Leasing and PPA (Future)</li></li></ul><li>Business Model Canvas – Final <br /><ul><li>Continuously advertise and recruit new customers (city councils)
  716. Build relationship with city engineers and council members
  717. Understand customer, influencers, motivations, problems, competitors
  718. Form partnerships (developers, cities, installers, maintenance) for maximum reach
  719. Submit bids for city RFPs
  720. Continue R&D
  721. Get certifications
  722. Gain Credibility
  723. Retrofit wind turbine for street and highway lamps.
  724. Create own wind turbines with pole manufacturers
  725. Be owner of cheap green status symbol
  726. Diversify green energy portfolio
  727. Fast payback than alternatives
  728. Cities (pilot)
  729. Cities leasing
  730. Lighting Companies
  731. Developer -> Utilities -> City
  732. 5 year full service Warranty,
  733. After 5 years, service charge
  734. Utility to manage after warranty expiration
  735. Extended warranty option
  736. City council (new regulations, permits).
  737. Environmental, bird, wildlife groups (regulations, publicity)
  738. Lighting Manufacturers
  739. Electricians and Contractors for Installation/Maintenance
  740. Research Labs
  741. Turbine Certifiers
  742. Small Wind Developers
  743. Utilities
  744. Cheap manufacturing process- Intellectual property
  745. R&D talent
  746. Endorsements by environmental groups, and local governments
  747. Finance
  748. Direct sales to cities (long term) PILOTS
  749. Small Wind Developer
  750. Cost-driven model to provide inexpensive, quality product
  751. Manufacturing costs and customer acquisition costs.
  752. May consider in-house leasing option, if upfront costs is large obstacle for customer and sufficient funding obtained (must be in future)
  753. Leasing, PPA
  754. Direct Sales to wind developers?
  755. Leasing, PPA
  756. Direct Sales to wind developers?</li>

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