What is your business'value proposition - what investors want to know.
This is a primer for entrepreneurs and, frankly, intrapreneurs on working out a solid value proposition and business model. Follow this structure for writing elevator pitches, business plans, or explaining what the heck you are doing to your grandma.
31. well you need to go and
listen to customers in the
wild
(notice that I did not say ‘talk to customers’)
32. a bunch of them
(In B-School, we call this Market Research because we need to sound fancy. It’s
not. Grab any book on surveys, focus groups, or anything that IDEO puts out for
free on the web about Design Thinking)
33. and ask them why, why,
why, why, why
(5 times if you are from 6-sigma)
47. if you do not find the right
set of pain points
48. you’ve got no hope of
motivating the customer
to buy
(of course, there is always brainwashing, blackmail, monopolies, or violent force .
Yay military-industrial complex!)
49. in other words, you need a
product that will be
valued by a customer
53. it does not make for a
sustainable business
(Well unless the 1 customer is the US government….of course these days, their accounts
payable is sketchy)
54. what you need to do is
find a set of interrelated
pain points
64. STEP ONE: TOTAL
ADDRESSABLE MARKET
“Our Total Addressable Market
(everyone who could ever buy)
is made up of 100 million
people, and annually worth $10
billion”
65. STEP TWO: TARGET
SEGMENT
“we’re targeting customers in
SE Asia first. This segment
includes 40 million
customers and is annually
worth $1 billion”
66. STEP THREE: MARKET
SHARE
“in SE Asia, we’ll capture 5%, 15%, &
30% market share in years 1, 2, & 3.
our expected revenue is $300
million by year 3 & 12 million
customers using us”
(including market growth over time)
67. whatever the case,
however you express it, a
value proposition must
show that you will be
valuable over time
68. PART THREE
a value proposition makes
you valunique
(Give me some vocabulary latitude in the name of alliteration, please!)
69. more often than not,
entrepreneurs come to me
and claim that they have
no competitors
70. my response is to
immediately file their plan
in the circular file cabinet*
* AKA, “trash bin”
75. it means that there’s really
no money there
(the best way to identify competitors is to simply ask potential customers during market
research who they think your competitors are)
79. they’ll do that with
intellectual property, lock-
ins at one, more, or all of
the points in the value
chain, government or
industry partnerships, etc
80. so you’ll need a battle
plan as to how you’ll get
past the barriers
81. second, once you get
some traction, followers
will try to pull you down
from behind
83. so you’ll need to put up
your own entry barriers to
slow them down
84. you’ll do that with
intellectual property, lock-
ins at one, more, or all of
the points in the value
chain, government or
industry partnerships, etc
85. finally, you’ll need to
differentiate yourself from
the competitors relative to
the customer pain points
136. SHARE THIS DECK
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