MEMSI June 2018: Disciplined Entrepreneurship Overview | Who is your customer?
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We introduce Prof. Bill Aulet's Disciplined Entrepreneurship framework, and launch into the first theme: Who is your customer?
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MEMSI June 2018: Disciplined Entrepreneurship Overview | Who is your customer?
- 1. MIT Entrepreneurship and Maker Skills Integrator Disciplined Entrepreneurship Introduction Elaine Chen May 2018
- 2. Over 30K companies, 4.6M jobs, $2T revenues/yr MIT’S ENTREPRENEURIAL LEGACY
- 4. AT MIT, WE BELIEVE ENTREPRENEURSHIP IS A CRAFT THAT CAN BE TAUGHT.
- 5. Spirit of a pirate Skills of a Navy Seal +
- 7. SKILLS
- 8. THE SINGLE NECESSARY AND SUFFICIENT CONDITION FOR A SUCCESSFUL BUSINESS 8
- 9. But… just that is not enough Need to solve customer problems with a great product Problem Solution Problem-solution fit
- 10. But… even that is not enough 10 You have to make money You have to know how to run your business You have to build a company that lasts
- 14. Questions? 14
- 16. MIT Entrepreneurship and Maker Skills Integrator DE Theme 1: Who is your customer? Elaine Chen May 2018
- 17. Theme 1: Who is your customer?
- 19. Problem 19
- 20. “Who is your Customer?” 20 2 3 4 5 9 1
- 21. Step 1: Segmentation 21 Chain Gyms (Discount/Mains tream) Chain Gyms (High end) Varsity Athletic Weight Rooms (College) Professional Weight Rooms Home Gyms Rehab Facilities Apartment/Hotel / Offices Olympic Training Facilities High End Non Chain Gyms Examples • YMCA, Gold’s Gym, Anytime Fitness, Planet Fitness, etc • Equinox, LA Fitness, David Barton, New York Sports Club • School Facilities • Team Facilities • Home Gyms • Private Training Facilities • Home Gym • Joint Ventures (etc), Brigham Young Women’s Hospital (etc) • Finance/Consultin g Offices • High end apartments/hotels • Training complex in CO, NC, etc • Velocity sports performanc e, etc Pros • Market size • Expand to other locations • Prioritize top of the line • Expand to other locations • More money • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Prioritize safety • Wealthy • Large market • Expand to other locations • Prioritize safety and patient improvement • Progress tracking is huge • Some not supervised – safety is important • Expand to other locations • Care about athlete improvement, health, and safety • Easier to expand to other markets • Care about athlete improveme nt, health and safety. Cons • Value Proposition • Limited funds • Value Proposition • Limited funds • Contacts • Difficult to expand to other colleges • Contacts • Difficult to expand to other facilities • Want things for free • Difficult to expand • Funds may be limited • Patients do not typically lift heavy weights • Not a main part of business • More serious athletes do not frequent these locations • Contacts • Market size • Difficult to expand to other locations • Trainers usually there to spot and track Motivations (for economic buyer) • Money – bringing in new customers, retaining old ones • Money – bringing in new customers, retaining old ones • Image • Athlete Improvement • Recruiting athletes • Athlete Improvement • Safety • Athlete Improvement • Money • Athlete improvement • Less time spent monitoring and tracking patients • Money – Attracting customers or employees • Happiness/well being of employees • Athlete Improvement • Money – Attracting new customers • Athlete Improveme nt Regulatory Climate • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated Competitive Environment • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Less competitive • Highly Competitive • Highly Competitive • Highly Competitiv e Early Adopters • No • Yes • Yes • Yes • Varies • No • No • Yes • Yes
- 22. Step 1: Segmentation 22 Chain Gyms (Discount/Mains tream) Chain Gyms (High end) Varsity Athletic Weight Rooms (College) Professional Weight Rooms Home Gyms Rehab Facilities Apartment/Hotel / Offices Olympic Training Facilities High End Non Chain Gyms Examples • YMCA, Gold’s Gym, Anytime Fitness, Planet Fitness, etc • Equinox, LA Fitness, David Barton, New York Sports Club • School Facilities • Team Facilities • Home Gyms • Private Training Facilities • Home Gym • Joint Ventures (etc), Brigham Young Women’s Hospital (etc) • Finance/Consultin g Offices • High end apartments/hotels • Training complex in CO, NC, etc • Velocity sports performanc e, etc Pros • Market size • Expand to other locations • Prioritize top of the line • Expand to other locations • More money • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Prioritize safety • Wealthy • Large market • Expand to other locations • Prioritize safety and patient improvement • Progress tracking is huge • Some not supervised – safety is important • Expand to other locations • Care about athlete improvement, health, and safety • Easier to expand to other markets • Care about athlete improveme nt, health and safety. Cons • Value Proposition • Limited funds • Value Proposition • Limited funds • Contacts • Difficult to expand to other colleges • Contacts • Difficult to expand to other facilities • Want things for free • Difficult to expand • Funds may be limited • Patients do not typically lift heavy weights • Not a main part of business • More serious athletes do not frequent these locations • Contacts • Market size • Difficult to expand to other locations • Trainers usually there to spot and track Motivations (for economic buyer) • Money – bringing in new customers, retaining old ones • Money – bringing in new customers, retaining old ones • Image • Athlete Improvement • Recruiting athletes • Athlete Improvement • Safety • Athlete Improvement • Money • Athlete improvement • Less time spent monitoring and tracking patients • Money – Attracting customers or employees • Happiness/well being of employees • Athlete Improvement • Money – Attracting new customers • Athlete Improveme nt Regulatory Climate • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated Competitive Environment • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Less competitive • Highly Competitive • Highly Competitive • Highly Competitiv e Early Adopters • No • Yes • Yes • Yes • Varies • No • No • Yes • Yes Key point for this exercise: • What are the columns? • What are the rows?
- 23. Step 2: Beachhead market 23 Chain Gyms (Discount/Mains tream) Chain Gyms (High end) Varsity Athletic Weight Rooms (College) Professional Weight Rooms Home Gyms Rehab Facilities Apartment/Hotel / Offices Olympic Training Facilities High End Non Chain Gyms Examples • YMCA, Gold’s Gym, Anytime Fitness, Planet Fitness, etc • Equinox, LA Fitness, David Barton, New York Sports Club • School Facilities • Team Facilities • Home Gyms • Private Training Facilities • Home Gym • Joint Ventures (etc), Brigham Young Women’s Hospital (etc) • Finance/Consultin g Offices • High end apartments/hotels • Training complex in CO, NC, etc • Velocity sports performanc e, etc Pros • Market size • Expand to other locations • Prioritize top of the line • Expand to other locations • More money • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Prioritize safety • Wealthy • Large market • Expand to other locations • Prioritize safety and patient improvement • Progress tracking is huge • Some not supervised – safety is important • Expand to other locations • Care about athlete improvement, health, and safety • Easier to expand to other markets • Care about athlete improveme nt, health and safety. Cons • Value Proposition • Limited funds • Value Proposition • Limited funds • Contacts • Difficult to expand to other colleges • Contacts • Difficult to expand to other facilities • Want things for free • Difficult to expand • Funds may be limited • Patients do not typically lift heavy weights • Not a main part of business • More serious athletes do not frequent these locations • Contacts • Market size • Difficult to expand to other locations • Trainers usually there to spot and track Motivations (for economic buyer) • Money – bringing in new customers, retaining old ones • Money – bringing in new customers, retaining old ones • Image • Athlete Improvement • Recruiting athletes • Athlete Improvement • Safety • Athlete Improvement • Money • Athlete improvement • Less time spent monitoring and tracking patients • Money – Attracting customers or employees • Happiness/well being of employees • Athlete Improvement • Money – Attracting new customers • Athlete Improveme nt Regulatory Climate • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated Competitive Environment • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Less competitive • Highly Competitive • Highly Competitive • Highly Competitiv e Early Adopters • No • Yes • Yes • Yes • Varies • No • No • Yes • Yes
- 24. Step 2: Beachhead market 24 Chain Gyms (Discount/Mains tream) Chain Gyms (High end) Varsity Athletic Weight Rooms (College) Professional Weight Rooms Home Gyms Rehab Facilities Apartment/Hotel / Offices Olympic Training Facilities High End Non Chain Gyms Examples • YMCA, Gold’s Gym, Anytime Fitness, Planet Fitness, etc • Equinox, LA Fitness, David Barton, New York Sports Club • School Facilities • Team Facilities • Home Gyms • Private Training Facilities • Home Gym • Joint Ventures (etc), Brigham Young Women’s Hospital (etc) • Finance/Consultin g Offices • High end apartments/hotels • Training complex in CO, NC, etc • Velocity sports performanc e, etc Pros • Market size • Expand to other locations • Prioritize top of the line • Expand to other locations • More money • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Care about athlete improvement, health, and safety • Easier to expand to follow on markets • Prioritize safety • Wealthy • Large market • Expand to other locations • Prioritize safety and patient improvement • Progress tracking is huge • Some not supervised – safety is important • Expand to other locations • Care about athlete improvement, health, and safety • Easier to expand to other markets • Care about athlete improveme nt, health and safety. Cons • Value Proposition • Limited funds • Value Proposition • Limited funds • Contacts • Difficult to expand to other colleges • Contacts • Difficult to expand to other facilities • Want things for free • Difficult to expand • Funds may be limited • Patients do not typically lift heavy weights • Not a main part of business • More serious athletes do not frequent these locations • Contacts • Market size • Difficult to expand to other locations • Trainers usually there to spot and track Motivations (for economic buyer) • Money – bringing in new customers, retaining old ones • Money – bringing in new customers, retaining old ones • Image • Athlete Improvement • Recruiting athletes • Athlete Improvement • Safety • Athlete Improvement • Money • Athlete improvement • Less time spent monitoring and tracking patients • Money – Attracting customers or employees • Happiness/well being of employees • Athlete Improvement • Money – Attracting new customers • Athlete Improveme nt Regulatory Climate • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated • Regulated Competitive Environment • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Highly Competitive • Less competitive • Highly Competitive • Highly Competitive • Highly Competitiv e Early Adopters • No • Yes • Yes • Yes • Varies • No • No • Yes • Yes Chain gyms (High End)
- 25. Step 2: Beachhead Market 25 • High End Chain Gyms • Pros • Less concerned with equipment price • More concerned with image • Easier to expand into other locations • Easier to expand into follow on markets • Large Market Size • Cons • Current lack of contacts • Equipment will have to be extremely good quality/high end • Value proposition – improving athletes isn’t their main motivation • Other Potential Markets • Varsity Athletics Programs/Professional Programs • Home Gyms • Mainstream/Budget Gyms
- 26. Step 3: End User Profile 26 • Full-Time Structural Engineer • 25 Years Old • Previous High School Athlete • Lifts at least 4 times per week • Brings notepad to gym
- 27. Step 4: TAM 27
- 28. Step 5: Persona
- 29. Profile, not persona 29 • Full-Time Structural Engineer • 25 Years Old • Previous High School Athlete • Lifts at least 4 times per week • Brings notepad to gym
- 30. Real persona 2013 Revenue: $514M Headcount: 1000-2000 BU Headcount: N/A – 1 BU Jim’s team 200 Behaviors • Reports to the BU General Manager • Manages the software organization (all aspects) and the associated budget • Primarily concerned with strategy, leadership, management – high level • Relies on direct reports (dev, devOps, SQA managers) to recommend the right technical decisions Demographics • 48 years old • Bachelor’s in Electrical Engineering degree from UNY Stony Brooks • Has been managing teams for 25 years; last wrote production code 10 years ago • Married with high school children • Drives a Mercedes SUV • Mac, iPhone 5, iPad Mini, W8 for work Needs and goals • Above all: his goal is to meet or exceed revenue goals for his business unit by releasing software on time and as planned with marketing and sales • He wants to keep the staff happy and to attract hot new talent to join his team • He needs to conserve budget – fixed $/y to spend on tools, R&D – zero sums game
- 31. Step 9: Identify your next customers • More head trainers @ gyms • Equinox Dartmouth • EBF by George Foreman • David Barton Gym • BFX Studio • Commonwealth Sports Club • Equinox Franklin Street • Ethos Fitness + Performance • ZONE5 Fitness • … etc 31 • More people like Chris • Mike • Sam • Jake • George • Sasha • Steve • Jeff • Ben • … etc
- 32. How personas are created: Through Primary Market Research 32
- 33. From PMR to personas
- 34. If things go well, convergence is rapid In 5 interviews: subjects started self- organizing In 10 interviews: Top persona hypotheses emerge In 20 interviews: personas fully validated
- 36. “Who is your Customer?” - reprise 36 2 3 4 5 9 1
- 37. 37
- 39. Resources • Martin Trust Center’s First Time Founders FAQ/Knowledge base http://entrepreneurship.mit.edu/faq • Quick and dirty market sizing https://miteship.zendesk.com/hc/en- us/articles/204854316 • How to do secondary market research within the MIT library system (must be an MIT student to have access) https://miteship.zendesk.com/hc/en-us/articles/207216396 39
- 40. Questions? 40