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Frame your Value and Growth Hypothesis

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Frame your Value and Growth Hypothesis

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Frame your Value and Growth Hypothesis

  1. 1. Frame a Value and Growth Hypothesis Sanjay Vijayakumar
  2. 2. Why?
  3. 3. Reason #1: Customers use your product by paying a price because of the value that it provides
  4. 4. Reason#2: Once you find initial customers, you will need to an efficient method to find more of them to grow into a business.
  5. 5. Remember: Every Startup is on a journey/adventure to become a sustainable business.
  6. 6. Remember: To become a sustainable business, a startup needs to generate more money (income) than its expenses.
  7. 7. What is Value? What is Price?
  8. 8. Price is what customers pay. Value is what customers get.
  9. 9. Example:Bullet Bike Value : Riding Pleasure
  10. 10. Example:Bullet Shares Value : ROI
  11. 11. Facebook User: Price is Free Value: Networking with friends
  12. 12. Facebook Stock: Price $$ Value:ROI
  13. 13. Food @ Regular Hotel v/s Food@ 5 Star Hotel
  14. 14. At a 5 Star Hotel - You will get a high quality Ambience Service Restrooms Quality of Utensils Quality of Food And this reflects in the price that you pay for the value (better quality ambience, service etc..) you get.
  15. 15. Tip: Technology is not your business. Its only an enabler to your business. Business starts when a. you provide value through a product to customers b. who pays a price for the value and c. you find a way to grow profitably to repeat a.
  16. 16. To Do#1: Frame your value hypothesis statements
  17. 17. Hypothesis: We believe Customers will use product <Name of your product> because/for <fill in the blanks with your value/reasons why customers will use the product>
  18. 18. Growth Hypothesis is assumption how new users will find your product.
  19. 19. To Do#2: Frame your growth hypothesis statements
  20. 20. Statement: We will find our initial customers by..<fill in the blanks with how you plan to get new customers>
  21. 21. Tip: These value and growth hypothesis are the assumptions that your team would be testing in the coming six months. Fundamental difference between college and SV.CO is this crucial step of finding customers. You can move forward in steps 4-10 only by finding real customers in real world by providing real value.
  22. 22. Time Steps 1. Idea 2. Prototype 3. Early Customers 4. Efficiently adding customers 5. Scaling Business Operations 6. Being Operational Break-even 7. Generating Business Profits 8. Defending Profits from competition 9. Recovering Business Investments 10. Return on Investment for Shareholders Teams attempt at-least 4 products to find customers T= 10 yearsT= 6 months T= 0
  23. 23. Useful Resource: https://blog.kissmetrics.co m/dropbox-hacked- growth/
  24. 24. Also write down your insight in your timeline entry as to what you learnt by trying to formulate your value and growth hypothesis.
  25. 25. Insight = new learning, action items or other todo tasks. All because you performed this task.
  26. 26. Insight pointers: While choosing an idea from the ideas list, select a market you understand or think you can learn the best, as it will allow you to go very deep into that domain/market and become and expert to find the real customer pain. Solving for this real customer pain will help you find the real value and growth hypothesis.
  27. 27. Don’t forget to check the Rubric for pointers.

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