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Steve Blank "Entrepreneurial education"
The document summarizes Steve Blank's talk on demolishing the status quo in entrepreneurial education. In 3 sentences: The talk discusses how startups search for a business model while established companies execute known models; it argues that business schools focus on managing large companies and don't teach the customer development process essential for startups; and it proposes establishing entrepreneurship schools that teach the iterative business model development process used by startups.
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Steve Blank "Entrepreneurial education"
- 1. Demolishing the StatusQuo in Entrepreneurial Education
- 2. I Write aBlog www.steveblank.com
- 3. This Talk isBased On Business Model Generation Four Steps to the Epiphany The Lean Startup
- 4. This Talk • What’s a Startup? • Search versus Execution • Entrepreneurship As a Mgmt Science • B-Schools = Large company mgmt • Incubators = the transition • E-School = the conclusion
- 5. First - What’s AStartup? Six Types of Startups
- 6. Lifestyle Startups Work to Live their Passion Startup • Serve known customer with known product • Pay for their passion
- 7. Small Business Startups Work to Feed the Family Small Startup Business • Serve known customer with known product • Feed the family
- 8. Small Business Startups Work to Feed the Family Small Startup Business Exit Criteria • known customer - Business Model found known product - Profitable business • Feed the family - Existing team < €100K in revenue
- 9. Small Business Startups Small Startup Business - Business Model found - Profitable business - Existing team < $10M in revenue • 5.7 million small businesses in the U.S. <500 employees • 99.7% of all companies • ~ 50% of total U.S. workers http://www.sba.gov/advo/stats/sbfaq.pdf
- 10. Scalable Startup Search Scalable Large Startup Company Goal is to solve for: unknown customer and unknown features
- 11. Scalable Startup Born to Be Big Search Execute Scalable Large Startup Company Exit Criteria - Business model found - Total Available Market > €300m - Can grow to €50/year
- 12. Scalable Startup Search Execute Scalable Large Startup Company - Total Available Market > $500m - Company can grow to $100m/year - Business model found - Focused on execution and process - Typically requires “risk capital” • In contrast a scalable startup is designed to grow big • Typically needs risk capital • What Silicon Valley means when they say “Startup”
- 13. The Transition –Founders Leave Scalable Large Transition Startup Company Search Build Execute Founders depart - Operating executives - Professional Mgmt - Process - Beginning of scale
- 14. Buyable Startup Born to Be Big Search Sell Scalable €3 to 30M Startup Acquisition Goal is to solve for: Internet, Mobile, Gaming Apps
- 15. Buyable Startup Search Sell Scalable €3 to e0M Startup Acquisition Goal is to solve for: Sell to larger company Internet and Mobile Apps
- 16. What’s A Startup? Search Execute Scalable Large Startup Company -Business Model found - i.e. Product/Market fit - Repeatable sales model - Managers hired A Startup is a temporary organization used to search for a repeatable and scalable business model
- 17. Large Company SustainingInnovation Innovate or Evaporate Sustaining Innovation Scalable Large Transition Startup Company • Existing Market / Known customer •Known product feature needs
- 18. Large Company DisruptiveInnovation New Large Transition Division Company Disruptive Innovation •New Market •New tech, customers, channels
- 19. Large Company DisruptiveInnovation New Large Transition Division Company Disruptive Innovation •Build •Acquire - IP - Talent - Product - Customers - Business
- 20. Social Entrepreneurship Startups Social Large Startup Non-Profit • Solve pressing social problems • Social Enterprise: Profitable • Social Innovation: New Strategies
- 21. Each of thesestartups require different skills They Can Not Be Taught the Same Way
- 22. Search Versus Execution WhyAccountants Don’t Run Startups
- 23. Startups Search andPivot The Search for the Business Model Scalable Large Transition Startup Company Business Model found - customer needs/product features found i.e. Product/Market fit -Found by founders, not employees - Repeatable sales model - Managers hired
- 24. Startups Search, CompaniesExecute The Search for the Business Model The Execution of the Business Model Scalable Large Transition Startup Company -Business Model found - Cash-flow breakeven - Product/Market fit - Profitable - Repeatable sales model - Managers hired - Rapid scale - New Senior Mgmt ~ 150 people
- 25. Metrics Versus Accounting The Execution of the Business Model Scalable Large Transition Startup Company Traditional Accounting -Balance Sheet - Cash Flow Statement - Income Statement
- 26. Metrics Versus Accounting TheSearch for the Business Model The Execution of the Business Model Scalable Large Transition Startup Company Startup Metrics - Customer Acquisition Cost Traditional Accounting - Balance Sheet - Viral coefficient - Cash Flow Statement - Customer Lifetime Value - Income Statement - Average Selling Price/Order Size - Monthly burn rate - etc.
- 27. Customer Validation VersusSales The Execution of the Business Model Scalable Large Transition Startup Company Sales -Sales Organization - Scalable - Price List/Data Sheets - Revenue Plan
- 28. Customer Validation VersusSales The Search for the Business Model The Execution of the Business Model Scalable Large Transition Startup Company Customer Validation - Early Adopters Sales - Sales Organization - Pricing/Feature unstable - Scalable - Not yet repeatable - Price List/Data Sheets -“One-off’s” - Revenue Plan - Done by founders
- 29. Customer Development Versus Product Management The Execution of the Business Model Scalable Large Transition Startup Company Product Management - Delivers MRD’s - Feature Spec’s - Competitive Analysis - Prod Mgmt driven
- 30. Customer Development Versus Product Management The Search for the Business Model The Execution of the Business Model Scalable Large Transition Startup Company Customer Development Product Management - Delivers MRD’s - Hypothesis Testing - Feature Spec’s - Minimum Feature Set - Competitive Analysis - Pivots - Founder-driven
- 31. Engineering Versus Agile Development The Execution of the Business Model Scalable Large Transition Startup Company Engineering - Requirements Docs. - Waterfall Development - QA - Tech Pubs
- 32. Engineering Versus Agile Development The Search for the Business Model The Execution of the Business Model Scalable Large Transition Startup Company Agile Development Engineering - Requirements Docs. - Continuous Deployment - Waterfall Development - Continuous Learning - QA - Self Organizing Teams - Tech Pubs - Minimum Feature Set - Pivots
- 33. Startups Model, CompaniesPlan The Execution of the Business Model Scalable Large Transition Startup Company Business Plan -Plan describes “knowns” - Known features for line extensions - Known customers/markets - Known business model
- 34. Startups Model, CompaniesPlan The Search for the Business Model The Execution of the Business Model Scalable Large Transition Startup Company Business Model -Plan describes “knowns” - Known features for line extensions - Unknown customer needs - Known customers/markets - Unknown feature set - Known business model - Unknown business model - Model found by iteration
- 35. Startups Are NotSmall Versions of Large Companies Scalable Large Transition Startup Company Search Build Execute Yet our curriculums assume they are – we teach that the knowledge is interchangeable
- 36. Entrepreneurship as a ManagementScience E-School instead of B-School
- 37. Business as aManagement Science • 1601 East India Company • 300 years of companies without MBA credentials •1908 Harvard first MBA
- 38. Business School Topics Business School Scalable Large Transition Startup Company -Execution - Strategy - Accounting - Products - Engineering - Management -Administration
- 39. Business School Courses Business School Scalable Large Transition Startup Company Courses -Managerial Finance/Accounting - Managing Groups and Teams - Financial Accounting - Operations - Modeling for Optimization - Global Value Chain Strategies
- 40. B-School Results? • U.S.corporations went from local to national then international •Cadre of experienced managers to match • Experts on finance and growth (Dupont/GM) B-Schools made the 20th Century the American business century
- 41. Business School Focuson Large Company Strategies Execution versus Search
- 42. Business School Limitations •MostProfessors consult for large corporations • Most believe startups are just smaller versions of large companies • Most B-school entrepreneurship programs are side-shows
- 43. Irony: 21st Century JobGrowth will Come from New Ventures
- 44. Incubators a Reaction to the lack of Practical University Entrepreneurship • 1959 Josephy Mancuso - Batavia Industrial Ctr. • 1996 IdeaLab •2005 Y-Combinator •2011 100+ Incubators world-wide
- 45. Startup Incubators •Hands-on (experiencevs. theory) • Goal: create a company and jobs • Full-time residential, stipend-based program • Curriculum: product development + best practices
- 46. What’s Missing? A RepeatableMethodology Not Just War Stories
- 47. Startups Are NotSmaller Versions of Large Companies Large Companies Execute Known Business Models
- 48. Startups Are NotSmaller Versions of Large Companies Startups Search for Unknown Business Models
- 49. E-School •Complete curriculum withHands-on emphasis • Goal: methodology for startup creation • Can be taught anywhere - University - Incubator - Remotely • Curriculum: about the search for a business model
- 50. The Business Model: Anycompany can be described in 9 building blocks
- 51. CUSTOMER SEGMENTS which customersand users are you serving? which jobs do they really want to get done?
- 52. VALUE PROPOSITIONS whatare you offering them? what is that getting done for them? do they care?
- 53. CHANNELS how does eachcustomer segment want to be reached? through which interaction points?
- 54. CUSTOMER RELATIONSHIPS what relationships are you establishing with each segment? personal? automated? acquisitive? retentive?
- 55. REVENUE STREAMS what are customers really willing to pay for? how? are you generating transactional or recurring revenues?
- 56. KEY RESOURCES which resourcesunderpin your business model? which assets are essential?
- 57. KEY ACTIVITIES which activitiesdo you need to perform well in your business model? what is crucial? 57
- 58. KEY PARTNERS which partnersand suppliers leverage your model? who do you need to rely on?
- 59. COST STRUCTURE what isthe resulting cost structure? which key elements drive your costs?
- 60. key value customer activities proposition relationships key customer partners segments cost revenue structure key streams resources channels 60 images by JAM
- 61.
- 62. sketch out your businessmodels
- 63.
- 64. 9 Guesses Guess Guess Guess Guess Guess Guess Guess Guess Guess
- 65. Customer Development The founders ^Get Out of the Building
- 66. Customer Development The SearchFor the Business Model Customer Customer Customer Company Discovery Validation Creation Building Pivot
- 67. Customer Discovery Customer Customer Customer Company Discovery Validation Creation Building • Stop selling, start listening • Test your hypotheses • Continuous Discovery • Done by founders
- 68. Turning Hypotheses toFacts Test Hypotheses: •Product • Market Type • Competition
- 69. Test Hypotheses: •Problem • Customer • User • Payer
- 70. Test Hypotheses: •Channel
- 71. Test Hypotheses Test Test : Hypothese Test Hypotheses: •Demand s: Hypothese •Product Creation •Problem s: • Market • •Channel Type Customer • • Test • User (Customer Competitive Hypotheses: • Payer ) •Channel • Test Hypotheses: Test Hypotheses: (Problem) •Size of •Pricing Model / Opportunity/Market Pricing
- 72. Test Agile Hypotheses Test Test : Hypothese Test Developme Hypotheses: •Demand s: nt Hypothese •Product Creation •Problem s: • Market • •Channel Customer Type Customer • Developme • Test • User (Customer nt Team Competitive Hypotheses: • Payer ) •Channel • Test Hypotheses: Test Hypotheses: (Problem) •Size of •Pricing Model / Opportunity/Market Pricing
- 73. The Minimum ViableProduct (MVP) • Smallest feature set that gets you the most … - orders, learning, feedback, failure…
- 74. The Pivot •The heartof Customer Development •Iteration without crisis •Fast, agile and opportunistic
- 75. Pivot Cycle TimeMatters •Speed of cycle minimizes cash needs •Minimum feature set speeds up cycle time • Near instantaneous customer feedback drives feature set
- 76. The Pivot A Pivotis the change of one or more Business Model Canvas Components
- 77. The Pivot Product Strong clinical Development Doctors: data IP Earlier Training Leading doctors A Pivot is the change of one or more Clinical trials FDA detection Maintenance Conferences Key Opinion Price OB/GYNs Leaders Business Model Canvas Components PCPs Publishing Accuracy CME courses 3rd party manufacturers Patients: Distributors Radiation Free Breast Cancer Non-Invasive IP Direct Sales to Foundations hospitals Leading doctors ACOG Distributor Technical ACS Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item Marketing Costs Per use fees
- 78. How Does ThisReally Work? Stanford Lean LaunchPad Class
- 79. How Does ThisReally Work? Stanford Lean LaunchPad Class 8 Weeks From an Idea to a Business
- 80. Pivot Example Robotic Weeding Talked 75 Customers in 8 Weeks
- 81.
- 82. 20 interviews, 6site visits… We got OUR Boots dirty Weeding Visited two farms in Salinas Valley to better understand problem Interviewed: • Bolthouse Farms, Large Agri-Industry in Bakersfield • White Farms, Large Peanut farmer in Georgia • REFCO Farms, large grower in Salinas Valley • Rincon Farms, large grower in Salinas Valley • Small Organic Corn/Soy grower in Nebraska • Heirloom Organics, small owner/operator, Santa Cruz Mts • Two small organic farmers at farmers market • Ag Services of Salinas, Fertilizer applicator Mowing Interviewed: • Golf: Stanford Golf course • Parks: Stanford Grounds Supervisor, head of maintenance and lead operator (has crew of 6) • Toro dealer (large mower manufacturer) • User of back-yard mowing system • Maintenance Services for City of Los Altos • Colony Landscaping (Mowing service for stadiums)
- 83. Business Plan Autonomous Vehicles for Mowing & Weeding - Innovation Dealers sell, Mowing - Dealers - Customer We reduce installs and - Owners of (Mowing and Education operating cost supports customer public or Ag) - Dealer training - Labor reduction commercially - Vehicle OEMs - Better Co. trains dealers, used green (John Deere, utilization of supports dealers spaces (e.g. golf Toro, Jacobsen, assets (eg mow or courses) etc) weed at nights) - Landscaping Engineers on - Improved - Mowing service provider - Research labs Autonomous performance (less Dealers vehicles, GPS, rework, food - Ag Dealers Weeding path-planning safety) - Farmers with manual weeding operations Dealer discount Asset sale COGS seek a 50-60% Gross Margin Our revenue stream derives from selling the Heavy R&D investment equipment
- 84. Found weeding inorganic crops is HUGE problem; 50 - 75% of costs Crews of 100s-1000 Back-breaking task (Ilegal) labor harder to get 1-5 weedings per year/field $250-3,500 per acre and increasing Food contamination risk
- 85. Decision to make– mowing vs weeding Application If ROI is < 1 Labor costs Autonomous TAM yr they will significant? would solve buy problem? Mowing of Yes. Yes Yes Adjusted up to Professionally xxx large fields run organizations Weeding in Agri Industry: YES! for TAM increased YES! organic crops Not necessarily to $2.6 B (Total Agriculture organic) Large They are Key need is Growers: Yes spending weed vs. crop Target Market $500/ac! differentiation (organic Small specialty) Growers: No 162 M/yr 18%/yr growth
- 86. Autonomous vehiclesWEEDING - Innovation Dealers sell, - Low density - Ag Dealers - Customer We reduce installs and vegetable - Ag Service Education operating cost supports customer growers providers - Dealer training - Labor reduction - High density (100 to 1) Co. trains dealers, vegetable - Research labs - Reduced risk of supports dealers growers contamination - Thinning - Mitigate labor operations Engineers on availability - Ag Dealers - Conventional Machine Vision concerns - Ag Service vegetables Two problems: providers - Identification - Elimination Dealer discount Asset sale COGS seek a 50-60% Gross Margin Our revenue stream derives from selling the Heavy R&D investment equipment
- 87. 1 Week –1 CarrotBot
- 88. CARROTBOT Machine Vision data collection platform Monochrome & Color Cameras Laser-line sweep (depth measurement) Encoders CarrotBot 1.0 (position/velocity) Onboard data acquisition & power
- 89. The Business PlanCanvas Updated •Technology •Farming Design conventions. •Marketing •Demo, demo, •Demo and and demo!! customer •Cost •Proximity is •Organic •Research Labs feedback paramount Farmers Reduction •Equipment •Weeding •Remove labor Manufacturers Service force pains •Distribution Providers •Eliminate bio- Network •Conventional waste hazards •Service •IP – Patents Farmers Providers •Video •Dealers Classifier Files •Direct Service •Robust •Indirect Service Technology • … then Dealers •Asset Sale Value-Driven •Direct Service with equipment rental •… then Asset Sale
- 90. Visit Highlights Above: Organic Carrots, 7wks. Top right: Conventional carrots Bottom Right: Very weedy. Will require multiple passes of hand weeding
- 91. Visit Highlights Carrot vs. Weeds Due to small root systems, carrots have no chance against weeds
- 92. Visit Highlights Organic Broccoli,closely cultivated. Weeds close to plants are hand-
- 93. Visit Highlights State ofthe Art in Weeding Technology
- 94. Customer Hypothesis Pre- Large Test Growers Us Dealer Industrial Growers Industrial Hypothesis Confirmed • Growers interested in own equipment Growers • Industrial (10,000s of acres) Post- • Large (1,000s of acres) Large • Willing to pay $100k for one Test Growers unit Us Dealer Service • Smaller growers (100s of acres) Providers usually subcontract the labor services or rent equipment Equipment Rental • All purchases through local dealers •Customer service is essential
- 95. Customer Map #1– Industrial Growers Example: Bolthouse Farms – Large Industrial Carrot Producer – 8K acres/yr End User • Equipment Operator Influencer • Local Farm Mgr • Cliff Kirkpatrick, visited Recommender • Director, Ag Equipment Technology Operator • Justin Grove, interviewed Decision Maker • VP, Growing Operations Approver • CFO, CEO (Jeff Dunn) Cliff, Farm Mgr
- 96. Customer Map #2– Service Providers Example: Ag Services – Service Provider, Salinas Valley End User • Equipment Operator Influencer • Grower Recommender • Service Mgr Me (left), Marty (middle, Service Mgr), Doug (right, Grower) Decision Maker & Approver • ?? (service mgr’s boss)
- 97. The Business PlanCanvas Updated •Technology •Farming Design conventions. •Marketing •Demo, demo, •Mid/Large •Demo and and demo!! Organic Farmers customer •Cost •Proximity is •Agricultural •Research Labs feedback paramount Reduction corporations •Equipment •Remove labor •Weeding Service Manufacturers force pains Providers •Distribution •Eliminate bio- Network •Service •IP – Patents waste hazards •Mid/Large Providers •Video •Direct Service Conventional Classifier Files •Indirect Service Farmers •Robust • … then Dealers Technology •Direct Service with equipment rental Value-Driven •($1,500/d; 120d/yr ) •Low density: $1,500/d •High density: $6,000/d
- 98. World Ag Expointerviews: the need is real and wide spread • 10+ interviews at show – Everyone confirmed the need – Robocrop, UK based, crude competitor sells for $171 K • Revenue Stream – Mid to small growers prefer a service – Large growers prefer to buy, but OK with service until technology is proven – Charging for labor cost saved is OK, as we provide other benefits (food safety, labor availability)
- 99. The Business PlanCanvas Updated •Technology •Farming Design conventions. •Marketing •Demo, demo, •Mid/Large •Research Labs •Demo and and demo!! Organic Farmers •Equipment customer •Cost •Proximity is •Agricultural Manufacturer feedback Reduction paramount corporations •Distribution •Remove labor •Weeding Service Network force pains Providers •Service •Eliminate bio- Providers •IP – Patents waste hazards •Mid/Large •2 or 3 Key •Video •Direct Service Conventional Farms Classifier Files •Indirect Service Farmers •Robust • … then Dealers Technology Value-Driven •Direct Service with • R&D equipment rental • Bill of Materials •Low density: $1,500/d • Training & Service •High density: $6,000/d • Sales
- 100. Autonomous weeding -Final - Innovation Direct - Low density - Ag Service - Customer We reduce - Provide high vegetable providers Education operating cost quality service at growers - Dealer training - Labor reduction competitive price - High density - Research (100 to 1) vegetable Institutes (eg UC - Reduced risk of growers Davis, Laser contamination - Thinning Zentrum - Mitigate labor operations Hannover) Engineers on availability Direct - Conventional Machine Vision concerns - Alliance with vegetables - 3-4 key farms Two problems: service providers - Identification - Eventually sell - Elimination through dealers Costs for service provision Service provision COGS seek a 50-60% Gross Margin - Charge by the acre with modifier according to Heavy R&D investment weed density - Eventually move to asset sale
- 101. MammOptics Final project presentationfor E 245 Winter 2011
- 102. MammOptics Initial Idea Breast cancer Mammography Leading cause of cancer in women 15%-25% false negatives rate 190,000 diagnosis every year US 25% false positives rate 41,000 deaths every year US Requires X-ray radiation Increasing diagnosis rates Low resolution MammOptics Novel technology based on RF-modulated optical spectroscopy - Earlier detection - Non- radiative
- 103. MammOptics Technology Comparison Invasivenes False False Device Time Risk Resolution s Pos. Neg. Cost Required MammOptics I.I.T.Y.I.W.H.T.K.Y Mammography High High .6 cm 25% 30% 20-50k 20 min. MRI Medium Medium .1 cm 70% 5% 1000k 45 min. Ultra-Sound Very Low Very Low >.6 cm >30% >40% 5-15k 20 min.
- 104. MammOptics Business Model Canvas 1 of 4 Product Strong clinical Development data IP Training Hospitals Clinical trials Maintenance Leading doctors Pioneering FDA Radiation-free 3rd party radiologists in Earlier detection manufacturers hospitals Non-invasive Distributors IP Leading doctors Direct sales to Technical hospitals Expertise Product Development Clinical trials Capital equipment sales Operating Costs and disposable item
- 105. MammOptics Business ModelCanvas 1 1 of 4 Business Model Canvas of 4 Product Strong clinical Development data IP Training Hospitals Clinical trials Maintenance Leading doctors Pioneering FDA Radiation-free 3rd party radiologists in Earlier detection manufacturers hospitals Non-invasive Distributors IP Leading doctors Direct sales to Technical hospitals Expertise Product Development Clinical trials Capital equipment sales Operating Costs and disposable item
- 106. Finding the rightcustomer From radiologists to gynecologists
- 107. MammOptics Excursionsinto hospitals Debra Ikeda Leading Jason Davies doctors Jafi Alissa Lipson Sunita Pal 6 women >40 Patients 8 women <40 Alicia X-ray Technicians mammography Hospital Paul Billings Managers Holly V. Gautier
- 108. MammOptics Hospitalpurchasing decision tree
- 109. MammOptics Hospitalpurchasing decision tree
- 110. MammOptics Private practicepurchasing decision tree
- 111. MammOptics Private practicepurchasing decision tree
- 112. MammOptics Business ModelCanvas 2 of 4 Product Doctors: Strong clinical Development Earlier data Hospitals (Capital IP detection Training Spending Clinical trials Price Maintenance Pioneering Committee) FDA Accuracy Doctors Leading doctors Hospitals 3rd party Patients: OB/GYNs manufacturers Radiation Free PCPs Distributors Non-Invasive IP Direct Sales to Research doctors Leading doctors Hospitals Technical Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item
- 113. MammOptics Business ModelCanvas 2 of 4 Product Doctors: Strong clinical Development Earlier data Hospitals (Capital IP detection Training Spending Clinical trials Price Maintenance Pioneering Committee) FDA Accuracy Doctors Leading doctors Hospitals 3rd party Patients: OB/GYNs manufacturers Radiation Free PCPs Distributors Non-Invasive IP Direct Sales to Research doctors Leading doctors Hospitals Technical Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item
- 114. Getting to ourcustomer he world of direct sales and medical marketing
- 115. MammOptics Interviews Breast Cancer Be Bright Pink Advocacy Groups Jennifer Glover Dr. Cindy Woo OB/GYNs Dr. Jags Powers Dr. Aaron Shuvkan Katrina Bell Medical Sales Tanay Dudhela Jed Hwang FDA/Clinical Phyllis Whitely Trials Carl Simpson
- 116. MammOptics Marketing Key Opinion Leaders (KOLs) American College of Obstetricians Medical Journals and Gynecologists (ACOG) Market Adoption Breast Cancer Continuing Advocacy Groups Medical Education Conferences
- 117. MammOptics Marketing Strong influence on doctors via ACOG Key Opinion Leaders Standard of Care Strongly (KOLs) American College influenced by of Obstetricians and Gynecologists KOLs Medical Journals (ACOG) Access to ACOG by Market former Adoption member American College of Obstetricians Continuing and Gynecologists Medical Education (ACOG) Conferences
- 118. MammOptics Marketing Researchers Researchers with strong conducting peer important Key Opinion Leaders recommendati clinical trials (KOLs) Researchers ons American College Outsourced of Obstetricians with survey Journals Medical numerous and Gynecologists (ACOG) research publications Market Adoption American College of Obstetricians Continuing and Gynecologists Medical Education (ACOG) Conferences
- 119. MammOptics Marketing Focus on Key Opinion Leaders prominent (KOLs) Needtwo big journals publications American College of Obstetricians Medical Journals and Gynecologists (ACOG) Market Choose KOL as Adoption Principal Investigators (PI) American College of Obstetricians Continuing and Gynecologists Medical Education (ACOG) Conferences
- 120. MammOptics Marketing Key Opinion Leaders (KOLs) American College of Obstetricians Medical Journals and Gynecologists (ACOG) Effective Market method for Adoption educating doctors American College of Obstetricians Workshop must Continuing and Gynecologists Medical Education (ACOG) be approved by ACOG Doctors Conferences required to Taught by attend objective workshops medical
- 121. MammOptics Marketing Key Opinion Leaders (KOLs) American College of Obstetricians Medical Journals and Gynecologists (ACOG) Market Adoption American College of Obstetricians Continuing ACOG Education and Gynecologists Medical (ACOG) Annual Opportunity Clinical for feedback Conferences Meeting from doctors Miami Breast Cancer Conference
- 122. MammOptics Marketing Key Opinion Leaders (KOLs) American College of Obstetricians Medical Journals and Gynecologists (ACOG) Trusted information Market source for Adoption patients Breast Cancer Continuing Advocacy Groups Access to Medical Education media Critical opinion outlets Conferences leader for technology adoption
- 123. MammOptics Channel Strategiesand Costs High value Direct Sales Individual Individual medical products Doctors Doctors (e.g. cardiovascular stents) • Doctor education • Direct feedback from doctors • Very expensive Commodity Purchasing Purchasing Distributors Administrators Administrators medical products (e.g. latex gloves) • No doctor education • No customer feedback • Inexpensive
- 124. MammOptics Channel Strategiesand Costs Sales strategy 1 Sales strategy 2 5 dedicated sales people Continue with core $150,000 each/year group of sales people Hire nurses or technicians with established Use women’s relationships healthcare equipment Early adopter feedback distributor Already established network of customers
- 125. MammOptics Pricing Strategy Equipment Lease model Per-use Consumable model Cost of the $50,000 $5,000 $5,000 $25,000 device Service per $3,000 $10,000 0 0 year Per-use fee 0 0 $50 0 Consumable 0 0 0 $20
- 126. MammOptics Pricing Strategy Equipment Lease model Per-use Consumable model Cost of the $50,000 $5,000 $5,000 $25,000 device Service per $3,000 $10,000 0 0 year Per-use fee 0 0 $50 0 Consumable 0 0 0 $20
- 127. MammOptics CustomerWorkflow Current market Insurance Mammography Radiologist Technician Hospital Administration ACOG Doctor ACS specialty committee
- 128. MammOptics CustomerWorkflow Current market Insurance But what would happen if we Mammography Radiologist replace mammography? Technician Hospital Administration ACOG Doctor ACS specialty committee
- 129. MammOptics CustomerWorkflow Insurance Mammography Radiologis Breast Technicians Hospitals t Radiologists Loss of jobs Eliminates loss leader Loss of jobs Puts emphasis on biopsies Technician Hospital Administration ACOG Doctor ACS specialty committee
- 130. MammOptics CustomerWorkflow Insurance Mammography Radiologist Technician Hospital Administration ACOG Doctor ACS specialty committee
- 131. MammOptics CustomerWorkflow Insurance Mammography Radiologis Insurance ACOG/ACS t Same cost as mammography Improved healthcare ($140) (mammography weak technique) Reduced number of biopsies ($1000) Technician Hospital Administration ACOG Doctor ACS specialty committee
- 132. MammOptics CustomerWorkflow Insurance Mammography Radiologist Technician Hospital Administration ACOG Doctor ACS specialty committee
- 133. MammOptics CustomerWorkflow Insurance Patient PCP Mammography Radiologist OB/GY N Technician Hospital MammOptics Administration ACOG Doctor ACS specialty committee
- 134. MammOptics CustomerWorkflow Insurance Patient PCP Mammography Radiologis PCP OB/GYNs OB/GY Patient MammOptics t N Increased revenue Improved healthcare Revenue More complete patient care Comfort Technician Hospital MammOptic Administration s ACOG Doctor ACS specialty committee
- 135. MammOptics CustomerWorkflow Insurance Patient PCP Mammography Radiologist OB/GY N Technician Hospital MammOptics Administration ACOG Doctor ACS specialty committee
- 136. MammOptics Business Model Canvas 3 of 4 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance Leading doctors FDA Conferences Key Opinion Price OB/GYNs Publishing Accuracy CME courses PCPs Leaders 3rd party manufacturers Patients: Distributors Radiation Free Breast Cancer Non-Invasive IP Direct Sales to Foundations hospitals Leading doctors ACOG Distributor Technical ACS Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item Marketing Costs Per use fees
- 137. MammOptics Business Model Canvas 3 of 4 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance Leading doctors FDA Conferences Key Opinion Price OB/GYNs Reimburseme Accuracy CME courses PCPs Leaders ntPublishing 3rd party manufacturers Patients: Distributors Radiation Free Breast Cancer Non-Invasive IP Direct Sales to Foundations hospitals Leading doctors ACOG Distributor Technical ACS Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item Marketing Costs Per use fees
- 138. Building the company Thebackstage of a medical device company
- 139. MammOptics Interviews Stanford FDA Clinical Trials StatisticsSteve Axelrod Marga Ortigas- Wedekind Manufacturing Nick Mourlas Don Archambault Shannon Bergstedt Reimbursement Ali Habib Venture Dana Mead Capitalists Bill Starling Doctors/Sales Dr. Aron Shuftan Jed Hwang
- 140. MammOptics Partners Manufacturing Choose manufacturing facility close to home
- 141. MammOptics Partners Manufacturing Reimbursement Difficult to get coverage for new product.
- 142. MammOptics Reimbursement Partners Insurances CPT Codes $75-$150
- 143. MammOptics Partners Manufacturing Reimbursement 510K vs. PMA Largest cost Biggest financial risk FDA Clinical Trials
- 144. MammOptics ClinicalTrials Stage 1 Feasibility Pilot trials Comparison 50 patients with $600K mammograph y 6 months 12/4/2009
- 145. MammOptics ClinicalTrials Stage 2 Interim trials Prove superior safety-efficacy Stage 1 500 patients & sensitivity Pilot trials $7.2M 6 months 15 months 12/4/2009
- 146. MammOptics ClinicalTrials Stage 2 Interim trials Stage 1 Stage 3 FDA class II, Pilot trials FDA pivotal 510(K) w/ trials trials Focus on 1500 patients superiority & $20.5M economic end- points 6 months 15 months 24 months 12/4/2009
- 147. MammOptics ClinicalTrials Stage 4 Post-market Stage 2 studies Interim trials 2000 patients Stage 1 Stage 3 $26.8M Pilot trials FDA pivotal trials Specific Cat III CPT/ACP Codes Market traction 6 months 15 months 24 months 24 months 12/4/2009
- 148. MammOptics ClinicalTrials Stage 4 Post-market Stage 2 studies Interim trials $26.8M Stage 1 $7.2M Stage 3 Pilot trials FDA pivotal trials $600K $20.5M 6 months 15 months 24 months 24 months 12/4/2009
- 149. MammOptics ClinicalTrials 12/4/2009
- 150. MammOptics Partners Manufacturing Reimbursement Financial timeline Funding FDA Clinical Trials
- 151. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2/ IPO M&A Q3 $40M Series D $50 MM Cash Reserve $30M Series C $30.5 MM $35 MM $20M $15M Series B $9 MM $10M Series A $5M $3.5 MM Initialize System Financial Regulatory / Clinical Launch Proof of Beta Marketable Milestones timeline Second Release Design Concept Prototype Product Beta- Laborator Versio 1st 2nd Release y n Release Test Prototype Testin Test Publicatio g Publicatio n Milestones n Clinical Pilot Clinical Post-Market Clinical Studie US Interim Trials US Pivotal Clinical Results Studies s Trials Non-Specific Codes Regulatory/ IP Provision IRB / Cat III FDA – Class II – 510 (k) Specific Codes Milestones al Patent IDE CPT with Clinical Trials (Cat. I CPT / APC) Applicatio IC and Initial n and Technolog Processin Product System y g Patents Launch Patents Licensing 151 12/4/2009
- 152. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 $40M Cash Reserve $30M $20M $15M $10M $5M Initialize Proof of Milestones Design Concept Milestones Clinical Provision Regulatory/ IP Milestones al Patent Technolog y Licensing 152 12/4/2009
- 153. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 $40M Cash Reserve $30M $20M $15M $10M Series A $5M $3.5 MM Initialize System Proof of Beta Milestones Design Concept Prototype Beta- Laborator Versio y n Prototype Testin g Milestones Clinical Pilot Studie s Regulatory/ IP Provision Milestones al Patent Technolog y Licensing 153 12/4/2009
- 154. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 $40M Cash Reserve $30M $20M $15M Series B $9 MM $10M Series A $5M $3.5 MM System Regulatory / Clinical Beta Marketable Milestones Design Prototype Product Beta- Laborator Versio y n Prototype Testin g Milestones Clinical Pilot Studie s Regulatory/ IP IRB / Milestones IDE Applicatio IC and n and Processin System g Patents Patents 154 12/4/2009
- 155. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 $40M Cash Reserve $30M Series C $20M $30.5 MM $15M Series B $9 MM $10M $5M System Regulatory / Clinical Milestones Second Release Design 1st Release Test Publicatio Milestones n Clinical Pilot Studie US Interim Trials US Pivotal Clinical s Trials Regulatory/ IP IRB / Cat III Milestones IDE CPT Applicatio IC and n and Processin System g Patents Patents 155
- 156. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 $40M Series D Cash Reserve $30M Series C $30.5 MM $35 MM $20M $15M $10M $5M Regulatory / Clinical Launch Milestones Second Release Design 2nd Release Test Publicatio Publicatio n Milestones n Clinical Clinical US Interim Trials US Pivotal Clinical Results Trials Non-Specific Codes Regulatory/ IP FDA – Class II – 510 (k) Milestones with Clinical Trials Initial Product Launch 156 12/4/2009
- 157. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2/ IPO M&A Q3 $40M Series D $50 MM Cash Reserve $30M $35 MM $20M $15M $10M $5M Regulatory / Clinical Launch Milestones Design Publicatio n Milestones Clinical Clinical Post-Market Clinical Results Studies Non-Specific Codes Regulatory/ IP FDA – Class II – 510 (k) Specific Codes Milestones with Clinical Trials (Cat. I CPT / APC) Initial Product Launch 12/4/2009
- 158. MammOptics Financial / Operations Timeline 2012 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2/ IPO M&A Q3 $40M Series D $50 MM Cash Reserve $30M Series C $30.5 MM $35 MM $20M $15M Series B $9 MM $10M Series A $5M $3.5 MM Initialize System Regulatory / Clinical Launch Proof of Beta Marketable Milestones Second Release Design Concept Prototype Product Beta- Laborator Versio 1st 2nd Release y n Release Test Prototype Testin Test Publicatio g Publicatio n Milestones n Clinical Pilot Clinical Post-Market Clinical Studie US Interim Trials US Pivotal Clinical Results Studies s Trials Non-Specific Codes Regulatory/ IP Provision IRB / Cat III FDA – Class II – 510 (k) Specific Codes Milestones al Patent IDE CPT with Clinical Trials (Cat. I CPT / APC) Applicatio IC and Initial n and Technolog Processin Product System y g Patents Launch Patents Licensing 158 12/4/2009
- 159. MammOptics Business Model Canvas 4 of 4 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance KOLs FDA Conferences 3rdparty Price OB/GYNs Reimburseme Accuracy CME courses PCPs manufacturers nt Publishing Distributors Immediate Breast Cancer Results Foundations ACOG Patients: IP Radiation Free Direct Sales to ACS hospitals Leading doctors Non-Invasive Clinical trial Distributor Technical designer Online Expertise Product Development Clinical trials Per use fees Operating Costs Marketing Costs
- 160. MammOptics Business ModelCanvas 4 of 4 Product Strong clinical Development data IP Training Clinical trials Maintenance KOLs FDA Conferences 3rdparty Earlier detection OB/GYNs Reimburseme Non invasive CME courses PCPs manufacturers nt Publishing Breast Cancer Price Foundations Accuracy ACOG Immediate Results ACS Direct Sales to IP Clinical trial hospitals Leading doctors designer Distributor Technical Expertise Online Product Development Clinical trials Per use fees Operating Costs Marketing Costs
- 161. MammOptics Business Model Canvas 1 Product Strong clinical Development data IP Training Hospitals Clinical trials Radiation-free Maintenance Pioneering Leading doctors FDA Earlier detection Doctors 3rd party Non invasive Hospitals manufacturers Distributors IP Direct Sales to Leading doctors hospitals Technical Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item
- 162. MammOptics Business Model Canvas 2 Product Strong clinical Development data IP Training Clinical trials Radiation-free Maintenance Pioneering Hospitals FDA Earlier detection Doctors Leading doctors Non invasive Hospitals 3rd party manufacturers Distributors Research IP Direct Sales to Hospitals Leading doctors hospitals Technical Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item
- 163. MammOptics Business Model Canvas 3 Product Doctors: Strong clinical Development Earlier data Hospitals (Capital IP detection Training Spending Clinical trials Price Maintenance Pioneering Committee) FDA Accuracy Doctors Leading doctors Hospitals 3rd party Patients: manufacturers Radiation Free Distributors Non-Invasive IP Direct Sales to Research hospitals Leading doctors Hospitals Technical Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item
- 164. MammOptics Business Model Canvas 4 Product Doctors: Strong clinical Development Earlier data Hospitals (Capital IP detection Training Spending Clinical trials Price Maintenance Pioneering Committee) FDA Accuracy Doctors Leading doctors Immediate Hospitals 3rd party Results OB/GYNs manufacturers PCPs Distributors Patients: IP Radiation Free Direct Sales to Research hospitals Leading doctors Non-Invasive Hospitals Technical Breast Cancer Expertise Foundations Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item
- 165. MammOptics Business Model Canvas 5 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance Leading doctors FDA Conferences Key Opinion Price OB/GYNs Reimburseme Accuracy CME courses PCPs Leaders ntPublishing 3rd party manufacturers Patients: Distributors Radiation Free Breast Cancer Non-Invasive IP Direct Sales to Foundations hospitals Leading doctors ACOG Distributor Technical ACS Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item Marketing Costs
- 166. MammOptics Business Model Canvas 6 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance KOLs FDA Conferences 3rd party Price OB/GYNs Reimburseme Accuracy CME courses PCPs manufacturers nt Publishing Distributors Immediate Breast Cancer Results Foundations ACOG Patients: IP Radiation Free Direct Sales to ACS hospitals Leading doctors Non-Invasive Technical Distributor Expertise Product Development Clinical trials Capital Equipment Sales Operating Costs and disposable item Marketing Costs Per use fees
- 167. MammOptics Business ModelCanvas 7 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance KOLs FDA Conferences 3rdparty Price OB/GYNs Reimburseme Accuracy CME courses PCPs manufacturers nt Publishing Distributors Immediate Breast Cancer Results Foundations ACOG Patients: IP Radiation Free Direct Sales to ACS hospitals Leading doctors Non-Invasive Clinical trial Distributor Technical designer Expertise Product Development Clinical trials Per use fees Operating Costs Marketing Costs
- 168. MammOptics Business ModelCanvas 8 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance KOLs FDA Conferences 3rd party Price OB/GYNs Reimburseme Accuracy CME courses PCPs manufacturers nt Publishing (local) Immediate Breast Cancer Results Foundations ACOG Patients: IP Radiation Free Direct Sales to ACS hospitals Leading doctors Non-Invasive Clinical trial Distributor Technical designer Expertise Product Development Clinical trials Per use fees Operating Costs Marketing Costs
- 169. MammOptics Business ModelCanvas 9 Product Strong clinical Development Doctors: data IP Earlier Training Clinical trials detection Maintenance KOLs FDA Conferences 3rd party Price OB/GYNs Reimburseme Accuracy CME courses PCPs manufacturers nt Publishing (local) Immediate Breast Cancer Results Foundations ACOG Patients: IP Radiation Free Direct Sales to ACS hospitals Leading doctors Non-Invasive Clinical trial Distributor Technical designer Expertise Product Development Clinical trials Per use fees Operating Costs Marketing Costs
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- 171. How? • Customer Development – The Process • Narrative – Interviews – Surveys – Videos – Prototypes • Business Model Canvas – Scorekeeping • Real-time Feedback • Physical Reality Checks – Skype – Face-to-face
- 172. We Made Students BlogTheir Progress It Changed Everything
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- 174. Photos Videos
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- 181.
- 182. Business Model Canvasas the Scorecard
- 183. Business School Versus Entrepreneurship School Entrepreneurship School Business School Scalable Large Transition Startup Company -Hypothesis testing - Business Model design -Execution - Customer Development - Accounting - Agile Development - Products - Metrics - Engineering - Venture Finance - Management - Design Thinking - Administrative
- 184. Business School Versus Entrepreneurship Courses Entrepreneurship School Business School Scalable Large Transition Startup Company Courses - Lean Launchpad Courses - Customer/Agile Development - Managerial Finance/Accounting - Business Model Design - Managing Groups and Teams - Entrepreneurial Management - Financial Accounting - Creativity and Innovation - Operations - Entrepreneurial Finance - Modeling for Optimization - Global Value Chain Strategies - User-centric design
- 185. Business School Versus Entrepreneurship Courses Entrepreneurship School Business School Scalable Large Transition Startup Company Courses - Lean Launchpad I teach this - Customer/Agile Development - Business Model Design - Entrepreneurial Management - Creativity and Innovation - Entrepreneurial Finance - User-centric design
- 186. E-School •20th century focuson physical goods • East coast manufacturing-centric • East coast B-School-centric • 21st century focus on virtual and physical goods and channels • West coast engineering school-centric
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- 188. Adopted by theU.S. Government
- 189.