Experiential course in entrepreneurship and startup business models. Day 3: total addressable market, value proposition and persona exercises

1. Lean @ ITP
An experiential 2 week workshop
TAM, SAM, TM,
Personas and Value Propositions
Jan 13, 2016
Jen van der Meer + Christin Roman
NYU ITP

2. We Are Here
Intro
Team
Formation
Why +
Personas
+ How to
Interview
Personas +
Value Props
+ Generative
Design
Vision +
Story +
Oz Test
Relationships
Channels +
First Test
How to listen,
interpret,
decide
Cost/Revs
+Activities/
Resources/
Partners
Indie vs. VC?
Motivation +
Team
Story x 2
Lessons
Learned
Jan 11 Jan 12 Jan 13 Jan 14 Jan 15
Jan 19 Jan 20 Jan 21 Jan 22

3. Today’s Lecture +
Workshops
• What did you learn?
• Where to aim: big TAM, small niche
• Integrate customer research findings with the
Persona
• Value prop madlibs
• Shaping your idea (3 iterations) - generative
concept development

4. Aim at TAM,
Start with Niche

5. TAM, SAM, TM
TAM =
Total Addressable
Market
“people who live
paycheck-to-paycheck in
the US”

6. How do you find TAM data?
Academic / Government sources
3rd party market research
Bottoms up analysis
Top down analysis
What is an incredible source?
What if you get different
estimates from different sources?

7. TAM, SAM, TM
SAM =
Served Addressable
Market
“people who live
paycheck to paycheck
in the US”
“with smartphones”

8. TAM, SAM, TM
TM = Target Market
“people who live paycheck
to paycheck in the US”
“with smartphones”
“a specific segment, or
niche, with the most need,
that we are targeting in the
first 1-2 years”

9. Point of confusion:
“If we serve that tiny group, that specific need -
are we setting ourselves up to be small, and not
scale (and not get funding?”

10. Aim:
1) Find a deep painpoint for a highly targeted
group, and serve them well
2) Directing you towards a larger potential
addressable market
(in that order)

11. Personas

12. You can’t aim at
everyone, first
“Serve a unique customer
segment”
“Target a specific niche”
“Aim for your most
profitable segment” “It’s better to dominate a
micro segment than to aim
for everyone and hit nobody”
“Define your Archetypes”

13. Use Personas to
Find the Pain
From: Business Model Canvas, Value Proposition
Design, Alexander Osterwalder, The Innovators’s
Solution, Clay Christensen and Michael Raynor

14. Uncover the
“job to be done”
Fast Food Milkshake
40% of milkshakes
purchased by commuters in
the morning - to go
What job customers hire milkshakes to do: On a a long, boring commute,
customers “needed something to keep that extra hand busy and to make the
commute more interesting.” - Clayton Christensen, HBR
http://hbswk.hbs.edu/item/clay-christensens-milkshake-marketing

15. Uncover the
“job to be done”
Soylent

16. Uncover the
“job to be done”
DIY
Soylent

17. Discovering Pain:
Plans Known needs
Behavior

18. Values
Norms
Assumptions
Taboo Beliefs
Unknown Needs
Go deeper to find unmet
needs, hidden pains:

19. Persona Tool
Context:
#stillathome
#notanadultyet
Name:
Peyton
Age:
24
Living with
Mom at
home
Motivations/Goals:
Independence
Freedom
Apartment
Bike to work
Pay off college loan
Interests:
Roller derby
Raising money for
breast cancer
Jewelry making
Pains:
Can’t seem to save
At breakeven/loss
each month
Bad credit rating
Fears + Secrets:
Afraid of getting
rejected for an
apartment
Really likes
mom’s support

20. Persona Tool
Context:
Name:
Age:
Living:
Motivations/Goals:
Interests:
Pains:
Fears + Secrets:
Draw pic
Tribes/Hashtags

21. Value Proposition(s)

22. KEY PARTNERS KEY ACTIVITIES VALUE
PROPOSITION
CUSTOMER
RELATIONSHIPS
CUSTOMER
SEGMENTS
KEY
RESOURCES
CHANNELS
COST STRUCTURE REVENUE STREAMS
STRATEGYZER + OSTERWALDER BUSINESS MODEL CANVAS
Product Market Fit

23. Value Proposition
Silicon Valley / Tech Version
“Who do you want to create
value for and what jobs need
to be done?”
Value proposition(s) outline
how exactly your products and
services create value for one
or more of your customer
segments.
- Alexander Osterwalder, Value
Proposition Design.
Madison Avenue / Branding
“A statement of the benefits
delivered by the brand that
provide value to the customer.
Communicates the benefits that
add value, why we are
different, the brand-customer
relationship, and gives
customers an “RTB” - reason
to buy (or believe).
-David Aacker, Building Strong Brands.

24. Value Proposition
My company __(company name)______________
is developing _(defined offering)______________
to help __(a target audience)_________________
_(solve this problem / pain) __________________
(with this secret sauce)____________________
(with this proof point to the customer)_______
Lean ITP Value Prop Madlibs

25. Let’s Commercialize!
Researchers use chemicals
to manipulate the behavior
of mice
with effects that last up to an
hour…
to control the hunger and
activity levels of mice
The Scientist, 2015.
http://www.the-scientist.com/?articles.view/
articleNo/42878/title/Mouse-Mind-Control/

26. Value Proposition
My company __MINDTETHER_________________
is developing _a mind tether spray_____________
to help __busy moms_________________________
_compel their children to complete homework____
with our proprietary mind control chemicals____
effects last up to an hour with minor side effects!
Lean ITP Value Prop Madlibs

27. For tomorrow

28. Present
What are your core hypotheses?
What tests did you run?
What do you believe will be true?
What did you find out?