Lessons Learned - Entrepreneurship and Business Plan
From just an idea out of ten, from a personal frustration we all shared, LeadTeam became real after a 6 month hard working process.
All in all, what did we learn? What difficulties did we surpass?
Firstly, we experienced how far from reality a team can be when it builds the first Business Model. Regarding University Students we tested up to 15 Hypothesis, from which 7 were invalid and made us rethink our initial decisions. For instance, we adapted the features we included in all the editions – free, premium and university integration. Another example would be the integration with Facebook, which emerged from a series of interviewees’ suggestions! Now we know that we will address a real problem with a solution our customers’ value.
Take-away: As good as the team can be, it does not possess all the answers – one has to get out and talk with as much potential customers as possible, always opened to critics and to reconsider initial decision.
However, getting the number of interviews and surveys we stipulated at first in such a short time frame was extremely difficult. Although we are ourselves University Students and had a great base just in Católica, we decided it was more valuable to interview students from different countries and universities. This made the process of contacting – waiting for response – connect on skype, more time-consuming.
Moreover, we felt difficulties in contacting with Universities. This was one of our biggest mistakes - as we trusted our own University would be opened to give as much input as possible to guarantee our success, we decided to wait for this interview, to, then, create a more completed script to the other Universities. It was until too late we decided to interview other Universities with a simpler script – in the end we were able to do 2 interviews in only one week – Colombia and Quebec Universities.
Take-away: Interview process takes a lot of time, so the best way is to start early and have a plan B, contacting more people than the initial objective. Make sure the script is simple and valuable, otherwise it is possible the other party will not be interested in responding.
There are many tools available to test Hypothesis. Today, interview is not the only solution. Create Landing Pages (A/B testing), Adwords, engage in different Social Media channels (see which one is more effective and reach more and more feedback) and prototype and re-prototype (really, use Invision App with power point, it is great), is extremely easy and very valuable! We validated many hypothesis in this way, complementing interviews and surveys.
Take-away: Take advantage of the existent tools. The teachers give a lot of examples and if you Google what you are searching it will exist! If it does not, well, you just found a business opportunity :)
One particular element of the Business Model we struggled was the Financial Analysis. We did not understand the costs related with platform development. We tried to talk with an expert and send him several emails from different members of the group, but we had no luck. So, we had to do an extensive research on the subject and choose real possible partners, like 1&1 for website hosting and servers. In the end, it proved to be enlighten making LeadTeam real and showing us what more hypothesis we really needed to test! For instance, pricing.
On the other hand, the Business Plan was a surprising important step in our development. “Do not do the Business Plan only for investors, do it for yourself” – and this is true. Organizing LeadTeam we refined many elements of Business Model, as we now completely understand University Students needs and can envision how LeadTeam will function.
Take-away: Financial Analysis and Business Plan are not only important for investors but also to organize ideas and refine the Business Model.
Finally, as all the groups (and this is one of the benefits of groupwork) we shared different opinions at times. This Hypothesize approach was extremely valuable in these situations as the solution for every discussion was: Let’s test it.
Take-away: different opinions are valuable, so in case of doubt, just hypothesize and test – you might be surprised!
All in all, this was a great experience where we have been through many difficulties, late nights and discussions. But with every problem that arises comes a learning, and we can say for certain that we learned a lot. We now have the necessary tools to start our own business or, who knows, continue with LeadTeam’s dream of redefining teamwork, making University Students (our own…) lives easier!
All in all, what did we learn? What difficulties did we surpass?
Firstly, we experienced how far from reality a team can be when it builds the first Business Model. Regarding University Students we tested up to 15 Hypothesis, from which 7 were invalid and made us rethink our initial decisions. For instance, we adapted the features we included in all the editions – free, premium and university integration. Another example would be the integration with Facebook, which emerged from a series of interviewees’ suggestions! Now we know that we will address a real problem with a solution our customers’ value.
Take-away: As good as the team can be, it does not possess all the answers – one has to get out and talk with as much potential customers as possible, always opened to critics and to reconsider initial decision.
However, getting the number of interviews and surveys we stipulated at first in such a short time frame was extremely difficult. Although we are ourselves University Students and had a great base just in Católica, we decided it was more valuable to interview students from different countries and universities. This made the process of contacting – waiting for response – connect on skype, more time-consuming.
Moreover, we felt difficulties in contacting with Universities. This was one of our biggest mistakes - as we trusted our own University would be opened to give as much input as possible to guarantee our success, we decided to wait for this interview, to, then, create a more completed script to the other Universities. It was until too late we decided to interview other Universities with a simpler script – in the end we were able to do 2 interviews in only one week – Colombia and Quebec Universities.
Take-away: Interview process takes a lot of time, so the best way is to start early and have a plan B, contacting more people than the initial objective. Make sure the script is simple and valuable, otherwise it is possible the other party will not be interested in responding.
There are many tools available to test Hypothesis. Today, interview is not the only solution. Create Landing Pages (A/B testing), Adwords, engage in different Social Media channels (see which one is more effective and reach more and more feedback) and prototype and re-prototype (really, use Invision App with power point, it is great), is extremely easy and very valuable! We validated many hypothesis in this way, complementing interviews and surveys.
Take-away: Take advantage of the existent tools. The teachers give a lot of examples and if you Google what you are searching it will exist! If it does not, well, you just found a business opportunity :)
One particular element of the Business Model we struggled was the Financial Analysis. We did not understand the costs related with platform development. We tried to talk with an expert and send him several emails from different members of the group, but we had no luck. So, we had to do an extensive research on the subject and choose real possible partners, like 1&1 for website hosting and servers. In the end, it proved to be enlighten making LeadTeam real and showing us what more hypothesis we really needed to test! For instance, pricing.
On the other hand, the Business Plan was a surprising important step in our development. “Do not do the Business Plan only for investors, do it for yourself” – and this is true. Organizing LeadTeam we refined many elements of Business Model, as we now completely understand University Students needs and can envision how LeadTeam will function.
Take-away: Financial Analysis and Business Plan are not only important for investors but also to organize ideas and refine the Business Model.
Finally, as all the groups (and this is one of the benefits of groupwork) we shared different opinions at times. This Hypothesize approach was extremely valuable in these situations as the solution for every discussion was: Let’s test it.
Take-away: different opinions are valuable, so in case of doubt, just hypothesize and test – you might be surprised!
All in all, this was a great experience where we have been through many difficulties, late nights and discussions. But with every problem that arises comes a learning, and we can say for certain that we learned a lot. We now have the necessary tools to start our own business or, who knows, continue with LeadTeam’s dream of redefining teamwork, making University Students (our own…) lives easier!
Lessons Learned - Week 12
No Business Plan survives the first contact with their clients. However, after this 6 month period of hypothesize – test – adapt Business Model process, ours will survive!
What kind of information should our Business Plan include?
It should start with an Executive Summary such as who reads it gets a comprehensive overview of LeadTeam.
Then, we need to identify our vision, mission and values – this is our essence, it is essential to define who LeadTeam is and what does it want to reach. Why do we exist? It was the first time we thought concretely about this, but it came out extremely natural, as, despite not written, we all knew what LeadTeam was.
A one-year objective will give the investors a perceptions of where do we want to be in the short-term. In our case we focused on the number of users and Universities we will serve, as this is a measure of how close we are to our mission and vision. Moreover, these two metrics are highly related with our costs (variable cost structure) and revenues – our overall performance.
Knowing this we started presenting our customer segments and how we would create value to each. Here we used many of the conclusions we reached with our testing. For instance, when describing University Students we knew exactly their main problems and how they currently solved these problems (what platforms they used for example). On the other hand, we tried to transmit our Value Proposition through comprehensive images. For instance, what kind of processes are we automating? Why is this important to this customer segment?
After explaining how we will make money (Revenue Model) the different LeadTeam editions (LeadTeam free, premium and universities) as well as the different distribution channels (LeadTeam Desktop, App, Tablet and Facebook) we focused on our Marketing Plan. We decided to focus on the three main steps: Getting, Keeping and Growing Customers. How will we do this? Why is it going to work? What do we have so far (how many students did we reach)?
Then, we explained our main decisions in how LeadTeam is functioning, in such a way our Value Proposition will be fully delivered.
The Financial Analysis takes an important role, so investors can understand exactly how much return should they expect from their investment. This made us focus not only on cost structure and revenue foreecast, but also in analysing the IRR and Breakeven point.
At this point it becomes essential to understand in what kind of environment we are moving. Is this a growing market? Does it have a lot of potential? Who are our competitors and how are we surpassing them? In the value curve we focused on projecting only 3 competitors: Moodle, Facebook and Cloud Services. However, we did a thorough comparison of all our main competitors (strengths and weakness divided in different attributes), which we included in the appendix.
Then, how will we implement our project? What are the main milestones and calendar? This is important, so that investors understand what to expect and what kind of targets and objectives do we have!
Finally, what kind of risks are we facing, what are our main strengths and weakness, how we are resolving them and mitigating.
What kind of information should our Business Plan include?
It should start with an Executive Summary such as who reads it gets a comprehensive overview of LeadTeam.
Then, we need to identify our vision, mission and values – this is our essence, it is essential to define who LeadTeam is and what does it want to reach. Why do we exist? It was the first time we thought concretely about this, but it came out extremely natural, as, despite not written, we all knew what LeadTeam was.
A one-year objective will give the investors a perceptions of where do we want to be in the short-term. In our case we focused on the number of users and Universities we will serve, as this is a measure of how close we are to our mission and vision. Moreover, these two metrics are highly related with our costs (variable cost structure) and revenues – our overall performance.
Knowing this we started presenting our customer segments and how we would create value to each. Here we used many of the conclusions we reached with our testing. For instance, when describing University Students we knew exactly their main problems and how they currently solved these problems (what platforms they used for example). On the other hand, we tried to transmit our Value Proposition through comprehensive images. For instance, what kind of processes are we automating? Why is this important to this customer segment?
After explaining how we will make money (Revenue Model) the different LeadTeam editions (LeadTeam free, premium and universities) as well as the different distribution channels (LeadTeam Desktop, App, Tablet and Facebook) we focused on our Marketing Plan. We decided to focus on the three main steps: Getting, Keeping and Growing Customers. How will we do this? Why is it going to work? What do we have so far (how many students did we reach)?
Then, we explained our main decisions in how LeadTeam is functioning, in such a way our Value Proposition will be fully delivered.
The Financial Analysis takes an important role, so investors can understand exactly how much return should they expect from their investment. This made us focus not only on cost structure and revenue foreecast, but also in analysing the IRR and Breakeven point.
At this point it becomes essential to understand in what kind of environment we are moving. Is this a growing market? Does it have a lot of potential? Who are our competitors and how are we surpassing them? In the value curve we focused on projecting only 3 competitors: Moodle, Facebook and Cloud Services. However, we did a thorough comparison of all our main competitors (strengths and weakness divided in different attributes), which we included in the appendix.
Then, how will we implement our project? What are the main milestones and calendar? This is important, so that investors understand what to expect and what kind of targets and objectives do we have!
Finally, what kind of risks are we facing, what are our main strengths and weakness, how we are resolving them and mitigating.
Lessons Learned - Week 11
Previous week, our (tough) mission was to identify the key costs and build the financial plan of our business. Hence, three financial sheets have been covered by each group on the Monday class: the Cash Flow statements, the Profit & Loss document and the Balance sheet. Each group estimated the financial projections for the three first years of the start-up life. Despite all of us have been following finance courses and got experience and knowledge regarding this discipline, estimating costs and income resulted to be highly confusing for each group. Indeed, worried about being economically viable, one mistake has been quite recurrent: we all have been too much optimist regarding income while under-estimating our costs hence, our financial projections were not very realist.
The teachers probably anticipated how hard was it and particularly, how frustrating it was to be told the work we made was completely wrong so they decided to attribute a “Reward Prize” to each group, based on 5 different characteristics: structure, validation, presentations, business models, interviews and design. After receiving the 1st prize for the best blog according to the “hypothesis validation”, our team felt great again! It was also a nice way to learn from the others and be tempted to check their work.
Furthermore, we discussed how to make a great and appealing pitch presentation, which is the final step. It was useful to watch at the pitch made by the representative of the Tred Company during the TechDemoDay. [Link: https://www.youtube.com/watch?v=EjJjKxsRDlU]. This was inspiring and as we were eager to learn more about “how to make a great pitch” so we kept looking for other ones and found out an interesting one: Twoodo.
[Link: https://www.youtube.com/watch?v=XSk3xO2-3rE]
So, as a group, we discussed afterwards what we liked about those pitches, shared our points of view and what could we take from them thus, converged to the idea that, the more minimalist a digital support is and the clearer the discourse is, the better it looks and sounds. Moreover, the way you behave in front of the crowd and investors play an important role. An added value for the pitch is to coordinate the speaking part with a video support (prototype in the back sound off) so as to help people understand better the concept.
To make the most of a pitch, Guy Kawasaki, addressed a message to young entrepreneurs (like us) by developing the “10(slides)/20(minutes)/30 (font size)” pitch rule. However, this rule has been adapted to us so as to fit more with our content and needs: 7(minutes)/10(slides)/28(font size). It’s more relevant to focus on 10 specific points which are:
The teachers probably anticipated how hard was it and particularly, how frustrating it was to be told the work we made was completely wrong so they decided to attribute a “Reward Prize” to each group, based on 5 different characteristics: structure, validation, presentations, business models, interviews and design. After receiving the 1st prize for the best blog according to the “hypothesis validation”, our team felt great again! It was also a nice way to learn from the others and be tempted to check their work.
Furthermore, we discussed how to make a great and appealing pitch presentation, which is the final step. It was useful to watch at the pitch made by the representative of the Tred Company during the TechDemoDay. [Link: https://www.youtube.com/watch?v=EjJjKxsRDlU]. This was inspiring and as we were eager to learn more about “how to make a great pitch” so we kept looking for other ones and found out an interesting one: Twoodo.
[Link: https://www.youtube.com/watch?v=XSk3xO2-3rE]
So, as a group, we discussed afterwards what we liked about those pitches, shared our points of view and what could we take from them thus, converged to the idea that, the more minimalist a digital support is and the clearer the discourse is, the better it looks and sounds. Moreover, the way you behave in front of the crowd and investors play an important role. An added value for the pitch is to coordinate the speaking part with a video support (prototype in the back sound off) so as to help people understand better the concept.
To make the most of a pitch, Guy Kawasaki, addressed a message to young entrepreneurs (like us) by developing the “10(slides)/20(minutes)/30 (font size)” pitch rule. However, this rule has been adapted to us so as to fit more with our content and needs: 7(minutes)/10(slides)/28(font size). It’s more relevant to focus on 10 specific points which are:
Next Monday we will train a first time in front of the class so as to do it as professionally as possible and be very well-prepared to do it in front of real business angels.
Lessons Learned - Week 10
Hello everyone !
As usually, we started the class with our progressed work of the week. We presented our chain value, organizational chart and new business model.
Then, the teacher told us about the cost structure in a project. Indeed, for our project we need to come up with a financial plan, which is basically about being financially sustainable or not. To have this financial plan, we first need to figure out what our costs will be. In order to do that, we need to identify each item, and ask a request proposal; a lot of people can provide us the information.
To define the cost structure we need to ask the right questions: what is the model’s cost structure? What are the resources with a greater impact on costs? What are the most expensive activities? We need to figure out how much we need and then how we are going to have it. There are 2 types of costs: they can either be fixed (all costs than you can predict to be similar at each period: facilities and infrastructure, industrial equipment, warehouse); or the costs can be variable (marketing, third party provided services, raw materials,…). It is usually better to have more variable costs than fixed costs.
After a small presentation with each team explaining what their cost should be composed of, we talked a bit more about the Financial Plan itself. We learned that there actually are many templates on the web to build one, but an Excel sheet would be enough.
As Bill Hewlett, Hewlett Packard said: “You cannot manage what you cannot measure… and what gets measured gets done”, which means that we must be able to explain and justify our financial datas to the founders. The Financial Plan presents, in an orderly and organized manner, the results generated in the financial decision making process. It is not only about looking at the profit made, but to pay attention to the cash flow. If the money coming in is not sufficient with the money coming out, the company will go bankrupt. It must not be too complicated; the Financial Plan is a tool that we must be able to explain.
The main components of the Financial Plan are:
•Income Statement
It provides information on the revenue we are going to generate but also about our cost structure. It displays the values of all income and expenses incurred.
Results = Income – Expenditures
•Balance Sheet
It is a picture of the company at a certain time, reflects the values of the assets, the liabilities and equity.
Equity = Assets - Liabilities
•CashFlow Statement
It shows the changes that occur in a given period of time in the cash accounts and their equivalents, structuring these variations by nature.
Variation CF = Operational CF + Investment CF + Financial CF
Then, we talked about the capital needs, which is basically the sources of financing we can have for our project
- The founders: represents the capital start from savings.
- Family and friends: they are the people that support you from the beginning you started to work on your project.
- Business Angels: they can invest on equity of your company.
- Venture capitalists: they can invest even further than the business angels.
- Acquisitions & Equity Market
- Bank
An effective technique for start-ups is the “bootstrapping”. It means starting a business without external help or capital and by being very cautious with the expenses. Some examples of bootstrapping can be for example Start selling as soon as possible having fewer products than necessary, start working at home to avoid facilities expenses, not receiving any wages at the beginning, etc. It is very important knowing that the majority of start-ups actually never get any financing. In that case bootstrapping is the only solution, and it is usually the most successful.
As usually, we started the class with our progressed work of the week. We presented our chain value, organizational chart and new business model.
Then, the teacher told us about the cost structure in a project. Indeed, for our project we need to come up with a financial plan, which is basically about being financially sustainable or not. To have this financial plan, we first need to figure out what our costs will be. In order to do that, we need to identify each item, and ask a request proposal; a lot of people can provide us the information.
To define the cost structure we need to ask the right questions: what is the model’s cost structure? What are the resources with a greater impact on costs? What are the most expensive activities? We need to figure out how much we need and then how we are going to have it. There are 2 types of costs: they can either be fixed (all costs than you can predict to be similar at each period: facilities and infrastructure, industrial equipment, warehouse); or the costs can be variable (marketing, third party provided services, raw materials,…). It is usually better to have more variable costs than fixed costs.
After a small presentation with each team explaining what their cost should be composed of, we talked a bit more about the Financial Plan itself. We learned that there actually are many templates on the web to build one, but an Excel sheet would be enough.
As Bill Hewlett, Hewlett Packard said: “You cannot manage what you cannot measure… and what gets measured gets done”, which means that we must be able to explain and justify our financial datas to the founders. The Financial Plan presents, in an orderly and organized manner, the results generated in the financial decision making process. It is not only about looking at the profit made, but to pay attention to the cash flow. If the money coming in is not sufficient with the money coming out, the company will go bankrupt. It must not be too complicated; the Financial Plan is a tool that we must be able to explain.
The main components of the Financial Plan are:
•Income Statement
It provides information on the revenue we are going to generate but also about our cost structure. It displays the values of all income and expenses incurred.
Results = Income – Expenditures
•Balance Sheet
It is a picture of the company at a certain time, reflects the values of the assets, the liabilities and equity.
Equity = Assets - Liabilities
•CashFlow Statement
It shows the changes that occur in a given period of time in the cash accounts and their equivalents, structuring these variations by nature.
Variation CF = Operational CF + Investment CF + Financial CF
Then, we talked about the capital needs, which is basically the sources of financing we can have for our project
- The founders: represents the capital start from savings.
- Family and friends: they are the people that support you from the beginning you started to work on your project.
- Business Angels: they can invest on equity of your company.
- Venture capitalists: they can invest even further than the business angels.
- Acquisitions & Equity Market
- Bank
An effective technique for start-ups is the “bootstrapping”. It means starting a business without external help or capital and by being very cautious with the expenses. Some examples of bootstrapping can be for example Start selling as soon as possible having fewer products than necessary, start working at home to avoid facilities expenses, not receiving any wages at the beginning, etc. It is very important knowing that the majority of start-ups actually never get any financing. In that case bootstrapping is the only solution, and it is usually the most successful.
Lessons Learned - Week 9
Hello everyone,
Last Monday session, EBP class started with our different versions of the “Minimum Viable Product” and Revenue streams model presentations. Defining the MVP was particularly useful to value which methods to use and implement hence, be able to revise, remove or come up with more hypothesis to finally prioritize them in a more accurate way and adapt our BM.
Afterwards, we focused on three very essential points of the Business Canvas which are the identification of the key activities to implement and key resources our business requires and also who will be our key partners.
According to the key activities, the value chain modelized by M.Porter highly helped us to make the difference between the activities that might be considered as the primary/main activities and those which are secondary/support activities. The primary activities are truly at the core of our business while the secondary ones support it. Besides, it’s useful to define if key activities need to be optimized, automated or outsourced. For instance, according to us, even if the financial aspects of LeadTeam might be supervised by the top management, we have been considering outsourcing the financial management (mainly because of lack of financial skills).
To be a good entrepreneur, three dimensions have to be taken into account: entrepreneurship, managerial and technical skills are required to perform. Most important: those characteristics have to be fairly-balanced. This concept, called the E-Myth, has been developed by M.Geber. Obviously, among the three dimensions, the first one coming up in mind is to be a creative entrepreneur. This implies to define strategic innovative goals to reach and challenges to overcome. However, it’s not enough: as a good entrepreneur you also have to behave like an experienced manager plus, get the skills a technician is supposed to have. The main idea underlined by this E-myth refers to: equilibrium is reachable by ordinary people but aims to produce extraordinary results [M.Geber]. Hence, once activities defined and tasks divided between the different departments thus, we can design the decision making process diagram to figure out, step by step, where, when, how, by who and which interventions to make. Indeed, even if activities are interrelated, everyone has to make its part to maximize results and success. The metaphor of a “symphonic orchestra” is highly relevant to understand to what extent roles and functions have to be delimited. Otherwise, without process, the result is a cacophonia.
Moreover, key resources also are highly strategic stakes to consider. Launching a business require financial and material capital (money, equipment and capacities) but also human capital (people who have skills and knowledge). It’s crucial to estimate and value resources needed beforehand so as to run the business efficiently on the long-run while lowering failure risks. That’s why, once the value chain model defined, it’s important to design properly the organizational chart so as to determine the internal hierarchy. Furthermore, developing a job specifications form -which include the position description, main objectives to reach plus, tactical and strategic tasks to do- may lead to choose the best candidate to achieve our business goals.
Finally, last but not the least, establishing key partnerships might contribute to develop in a more efficient way our business: for instance, partners can exchange key resources and develop services together. Hence, it creates shared value and synergies. There are different types of partnerships such as strategic alliances (mergers & acquisition), cooperation, joint-venture or buyer-seller relationships. The most important is to build a win-win strategy for both partners so everyone get opportunities and advantages from the other one. Obviously, the type of partnership chosen depends on the firm size, mutual willingness and cross-motivations to establish it. Depending on the partnership you are building, results might differ in a significant way. Regarding LeadTeam, in order to develop an app on Facebook, our goal is to access a huge customer dabatase since facebook is the most social media used for team works plus, we will benefit from the viral effect of Facebook and its brand awareness. A partnership with the social media is necessary however it’s evident we are not planning to implement a merger: we have to be realistic. Thus, we are thinking about getting to an agreement and cooperate with the Facebook media.
Next class presentation, we will go deeper in our resources, activities and partners component analysis. So, more progress are coming!
Last Monday session, EBP class started with our different versions of the “Minimum Viable Product” and Revenue streams model presentations. Defining the MVP was particularly useful to value which methods to use and implement hence, be able to revise, remove or come up with more hypothesis to finally prioritize them in a more accurate way and adapt our BM.
Afterwards, we focused on three very essential points of the Business Canvas which are the identification of the key activities to implement and key resources our business requires and also who will be our key partners.
According to the key activities, the value chain modelized by M.Porter highly helped us to make the difference between the activities that might be considered as the primary/main activities and those which are secondary/support activities. The primary activities are truly at the core of our business while the secondary ones support it. Besides, it’s useful to define if key activities need to be optimized, automated or outsourced. For instance, according to us, even if the financial aspects of LeadTeam might be supervised by the top management, we have been considering outsourcing the financial management (mainly because of lack of financial skills).
To be a good entrepreneur, three dimensions have to be taken into account: entrepreneurship, managerial and technical skills are required to perform. Most important: those characteristics have to be fairly-balanced. This concept, called the E-Myth, has been developed by M.Geber. Obviously, among the three dimensions, the first one coming up in mind is to be a creative entrepreneur. This implies to define strategic innovative goals to reach and challenges to overcome. However, it’s not enough: as a good entrepreneur you also have to behave like an experienced manager plus, get the skills a technician is supposed to have. The main idea underlined by this E-myth refers to: equilibrium is reachable by ordinary people but aims to produce extraordinary results [M.Geber]. Hence, once activities defined and tasks divided between the different departments thus, we can design the decision making process diagram to figure out, step by step, where, when, how, by who and which interventions to make. Indeed, even if activities are interrelated, everyone has to make its part to maximize results and success. The metaphor of a “symphonic orchestra” is highly relevant to understand to what extent roles and functions have to be delimited. Otherwise, without process, the result is a cacophonia.
Moreover, key resources also are highly strategic stakes to consider. Launching a business require financial and material capital (money, equipment and capacities) but also human capital (people who have skills and knowledge). It’s crucial to estimate and value resources needed beforehand so as to run the business efficiently on the long-run while lowering failure risks. That’s why, once the value chain model defined, it’s important to design properly the organizational chart so as to determine the internal hierarchy. Furthermore, developing a job specifications form -which include the position description, main objectives to reach plus, tactical and strategic tasks to do- may lead to choose the best candidate to achieve our business goals.
Finally, last but not the least, establishing key partnerships might contribute to develop in a more efficient way our business: for instance, partners can exchange key resources and develop services together. Hence, it creates shared value and synergies. There are different types of partnerships such as strategic alliances (mergers & acquisition), cooperation, joint-venture or buyer-seller relationships. The most important is to build a win-win strategy for both partners so everyone get opportunities and advantages from the other one. Obviously, the type of partnership chosen depends on the firm size, mutual willingness and cross-motivations to establish it. Depending on the partnership you are building, results might differ in a significant way. Regarding LeadTeam, in order to develop an app on Facebook, our goal is to access a huge customer dabatase since facebook is the most social media used for team works plus, we will benefit from the viral effect of Facebook and its brand awareness. A partnership with the social media is necessary however it’s evident we are not planning to implement a merger: we have to be realistic. Thus, we are thinking about getting to an agreement and cooperate with the Facebook media.
Next class presentation, we will go deeper in our resources, activities and partners component analysis. So, more progress are coming!
Lessons Learned - Week 8
As every Monday, we started by presenting our
progress of the week. We could present to the class our new blog. We showed and
explained the channels we chose to get, keep and grow the customers. We also
briefly talked about our hypothesis concerning the channels, but also the social
media we are using to get more traffic such as: Pinterest, Instagram, Facebook,
LinkedIn. Finally we showed our new landing page, which reached for the moment
130 visitors. The professor advised us to use other platforms, such as ScoopIt
to update easily all our social medias with the same content. He also told us
not to forget recommendations in order to activate more visitors on our landing
page.
The Revenue Sources
After exploring all the presentations of the different groups, we focused on the revenue sources. There are different types and many possibilities.
The revenue sources can be direct:
- Transactions: most common revenue source, through the transaction of a product or a service.
- Use: usually the consumer pays for the quantity he uses such as gaz or water consumption for example.
- Renting: of a product as an apartment for example.
- Licensing: revenue usually coming from a software development.
- Subscription: a good source of income. Once the customer subscribes, he provides through his subscription a sort of monthly rent for the company.
- Pre-Pay: can be a good way of financing a company since the customer pays before getting the product or service.
- Freemium: directly concerns our Business Model. Consists of providing a service for free and to propose an additional paying version. It is a supposed to be a very efficient source of income. Although the free version needs to be good enough to first acquire the customer, and the additional features must be well-thought so that the customer will be interested in purchasing it. The risk is that the conversion rate is too low, and it usually takes some time for the people to convert once they have the free version.
- Pay-per-use: occurs most commonly in the web-based services, and usually involves cases where the transaction values are small and can be automated.
- Intermediation: adding an intermediary to facilitate the transaction, such as eBay for instance.
- Advertising: using advertisement as an income.
Or they can be indirect:
- Referral revenues: Acquiring new customers who are suggested by existing customers
- Affiliate revenues: a system of revenue sharing between one site to another site (the advertiser) in order to get traffic. It enables to receive a monthly revenue from the amount of traffic generated.
- Renting Mailing lists: rent a list to another company can be another source of revenue.
- Renting available resources: It can be a work space for example.
The Pricing Models
After defining our sources of revenues concerning our project, we focused on the different pricing models:
- Cost Based Pricing
- Value Based Pricing
- Competitive Pricing
- Volume Pricing
- Portfolio Pricing
- “Shaver” Price
- Feature Pricing
To best define the pricing fitting our value proposition, we must not only focus on a market competition study, but also find out how much the potential customers are willing to pay. We also must be able to think about all the different possibilities to get different revenues sources. As an example, we went through the “55 Time-Tested Information Programs and Products” of John Eggen.
The Minimum Viable Product
Finally, we have been learning about the minimum viable product, by watching the video “The Lean Approach, The minimum viable product” presented by Steve Blank. There are 3 types of MVP: the MPV 1 that we already worked on with the interviews and PSM approach, the MPV 2 with the landing page that we have created, and finally the MPV 3 that will be about creating a prototype such as a website. It doesn’t have to be a complete solution, the goal of the MPV is to avoid developing anything that will not interest our customers. We need to test it and receive their feedback. For this, we must use tools that are measurable. If a prduct is viable, it means that people will be willing to use our solution and to pay for it.
The Revenue Sources
After exploring all the presentations of the different groups, we focused on the revenue sources. There are different types and many possibilities.
The revenue sources can be direct:
- Transactions: most common revenue source, through the transaction of a product or a service.
- Use: usually the consumer pays for the quantity he uses such as gaz or water consumption for example.
- Renting: of a product as an apartment for example.
- Licensing: revenue usually coming from a software development.
- Subscription: a good source of income. Once the customer subscribes, he provides through his subscription a sort of monthly rent for the company.
- Pre-Pay: can be a good way of financing a company since the customer pays before getting the product or service.
- Freemium: directly concerns our Business Model. Consists of providing a service for free and to propose an additional paying version. It is a supposed to be a very efficient source of income. Although the free version needs to be good enough to first acquire the customer, and the additional features must be well-thought so that the customer will be interested in purchasing it. The risk is that the conversion rate is too low, and it usually takes some time for the people to convert once they have the free version.
- Pay-per-use: occurs most commonly in the web-based services, and usually involves cases where the transaction values are small and can be automated.
- Intermediation: adding an intermediary to facilitate the transaction, such as eBay for instance.
- Advertising: using advertisement as an income.
Or they can be indirect:
- Referral revenues: Acquiring new customers who are suggested by existing customers
- Affiliate revenues: a system of revenue sharing between one site to another site (the advertiser) in order to get traffic. It enables to receive a monthly revenue from the amount of traffic generated.
- Renting Mailing lists: rent a list to another company can be another source of revenue.
- Renting available resources: It can be a work space for example.
The Pricing Models
After defining our sources of revenues concerning our project, we focused on the different pricing models:
- Cost Based Pricing
- Value Based Pricing
- Competitive Pricing
- Volume Pricing
- Portfolio Pricing
- “Shaver” Price
- Feature Pricing
To best define the pricing fitting our value proposition, we must not only focus on a market competition study, but also find out how much the potential customers are willing to pay. We also must be able to think about all the different possibilities to get different revenues sources. As an example, we went through the “55 Time-Tested Information Programs and Products” of John Eggen.
The Minimum Viable Product
Finally, we have been learning about the minimum viable product, by watching the video “The Lean Approach, The minimum viable product” presented by Steve Blank. There are 3 types of MVP: the MPV 1 that we already worked on with the interviews and PSM approach, the MPV 2 with the landing page that we have created, and finally the MPV 3 that will be about creating a prototype such as a website. It doesn’t have to be a complete solution, the goal of the MPV is to avoid developing anything that will not interest our customers. We need to test it and receive their feedback. For this, we must use tools that are measurable. If a prduct is viable, it means that people will be willing to use our solution and to pay for it.
Lessons Learned - Week 7
Last class we presented both our Value Curve and Insights regarding the eleven interviews we have done. Now, once we have the 20 interviews we will conclude whether our hypothesis are valid or not and then change our Business Model accordingly! Let’s see what our clients want us to change!
Our focus this week was on Channels and Customers Relationships elements of the Business Model Canvas.
Channels
Defining Channels implies understanding that they have four main roles - Marketing, Sales, Distribution and the usually forgotten, After Sales Support – and that each channel must be coherent with the set already chosen.
Marketing Marketing conveys messages to our customers. So which freely channels are available today and are most suitable for a company like ours?
Company Website is widely used by every company. Today, it is quite improbable that one can find a company without a specific website.
Similarly, e-mail is part of our everyday lives, with email users sending 204.000.000 messages every minute! So email marketing has become a relevant free channel to convey messages.
Blogs and Social Media are a hot topic in Marketing. Thousands of articles have been written to understand how to use these tools to reach the consumers – not only as marketing but also to build a relationship (as we will see below). As you will see, we will be using these channels heavily, since University Students are active users of not only Facebook but many other platforms. Moreover, building communities around the idea and the product is essential. It brings brand loyalty but also consumers start answering each other’s questions and helping the company when something is wrong.
Search Engine Optimization – SEO, build your website in such a way it maximizes its visibility in a search engine. Normally, by including as many words as possible in the description that customer target would search online. We can do this in our blog!
Viral Marketing is one of our most powerful tools which we will discuss later.
All in all, we have the sensation we are lucky for having so many free options nowadays, where the Internet plays a decisive role in people’s lives. This way we can not only use them with minimal budget, but also test which are the most appropriate ones to our targets.
Regarding paid channels, PPC (Pay per click) is the recommended one – being AdWords the most effective, since Google generates highest traffic. During a minute Google receives roughly 4.000.000 search queries.
Sales Here we can have the traditional Agents-Distributors-Retail and Sales Force channels, or alternatively, Telesales, Value-added Resellers (like SAP which sells through software consulting firms) and the Internet. In fact, Internet and other related media are modifying distribution channels with the Pee-to-peer Marketing pioneered by Ebay. Amazon makes $83.000 in online sales per minute. Besides, Interactive TV is seen today as viable direct marketing channel in the future! Let’s wait and see how the channels will evolve!
Customer Relationship
Customer Relationship is all about getting customers, retain them and grow our customer base. We need to decide what kind of relationship we want to hold with them and if all these is coherent with our Business Model.
Getting, Keeping and Growing customers imply different processes in the consumer mind, so they must be addressed separately with different tools and strategies.
For instance, Getting Customers follows four essential steps until the Sale. First, we acquire the potential customers – we let them know we exist, we create brand awareness. Then, activation phase starts, with a call for action – this is where the relationship starts. Retention will be when the customers already engaged several times with us and are truly interested in our product. Finally, a sale happens.
In this first phase, creating a blog, a website, engaging in email marketing, SEO, using Social Media, providing Free testing, getting Testimonials and leveraging Viral Marketing is crucial. Regarding the latter, Viral Marketing is all about making your customers your sales force, normally increasing sales exponentially. For instance, the Old Spice commercial (https://www.youtube.com/watch?v=owGykVbfgUE) which had millions and millions of views on Youtube and also many other “copy-cats” to make fun!
On the other hand, after this expense of getting a customer, we should not let them go! Make sure you have updated, interest content in your blog. Start addressing the clients by name, talking directly with them, making it more personal and building a true relationship. Keep your Communities going on – answer questions, trigger relevant discussions between them! Send newsletters with up-to-date information and new events to come. Based on this, notice how Drip Marketing plays an important role – continually engage with your customers, don’t forget about them during a whole month! The customers probably don’t have the need we satisfy every day, so, if we just create a contact from now and then, we probably won’t get the exact moment they have that need. No, we have to be reminded when they have that need, we must be part of their consideration set, occupy a place in their mind!
Finally, we need to constantly grow our customer base. In this sense, we have next-selling, up-selling (buys a new model, a new product the company releases), cross-selling (different from initially bought, other line of products) and, the most desired one, Recommendation (they actually start recommending you)!
Creating Traffic
So we have our Landing page! That is great! But now, how will we make sure it has traffic? Many tools were presented in class, and many other tools are available today for us to create traffic!
We started by Adwords and how it works! This is a PPC - paid option - nevertheless, very effective one with a fairly high CTR (click-through-rate). Just really need to choose the right keywords! How? Just think: if I was my customer, what would Iook for? Would I write “teamwork platform”? Probably not! They are not actually looking for a new solution! They are looking for our features. One should also consider different spellings like “team work” vs. “teamwork” or “group work”, always guessing on how the target will think. Finally, Google provides an interesting tool which we can leverage to find the right words.
All kinds of tools and platforms were presented! From a Facebook page, to Linkedin Ads and Groups! Hacker News from Y-Combinator (we will talk about Y-Combinator in our inspirations, coming soon) which are a tough, tough audience! Pinterest, generating traffic through Pinning it and Following! Slideshare where we can upload our slides so everyone can see them! And so on… many, many tools are available today and we are going to leverage them to create a Business Model that our customers want.
Our focus this week was on Channels and Customers Relationships elements of the Business Model Canvas.
Channels
Defining Channels implies understanding that they have four main roles - Marketing, Sales, Distribution and the usually forgotten, After Sales Support – and that each channel must be coherent with the set already chosen.
Marketing Marketing conveys messages to our customers. So which freely channels are available today and are most suitable for a company like ours?
Company Website is widely used by every company. Today, it is quite improbable that one can find a company without a specific website.
Similarly, e-mail is part of our everyday lives, with email users sending 204.000.000 messages every minute! So email marketing has become a relevant free channel to convey messages.
Blogs and Social Media are a hot topic in Marketing. Thousands of articles have been written to understand how to use these tools to reach the consumers – not only as marketing but also to build a relationship (as we will see below). As you will see, we will be using these channels heavily, since University Students are active users of not only Facebook but many other platforms. Moreover, building communities around the idea and the product is essential. It brings brand loyalty but also consumers start answering each other’s questions and helping the company when something is wrong.
Search Engine Optimization – SEO, build your website in such a way it maximizes its visibility in a search engine. Normally, by including as many words as possible in the description that customer target would search online. We can do this in our blog!
Viral Marketing is one of our most powerful tools which we will discuss later.
All in all, we have the sensation we are lucky for having so many free options nowadays, where the Internet plays a decisive role in people’s lives. This way we can not only use them with minimal budget, but also test which are the most appropriate ones to our targets.
Regarding paid channels, PPC (Pay per click) is the recommended one – being AdWords the most effective, since Google generates highest traffic. During a minute Google receives roughly 4.000.000 search queries.
Sales Here we can have the traditional Agents-Distributors-Retail and Sales Force channels, or alternatively, Telesales, Value-added Resellers (like SAP which sells through software consulting firms) and the Internet. In fact, Internet and other related media are modifying distribution channels with the Pee-to-peer Marketing pioneered by Ebay. Amazon makes $83.000 in online sales per minute. Besides, Interactive TV is seen today as viable direct marketing channel in the future! Let’s wait and see how the channels will evolve!
Customer Relationship
Customer Relationship is all about getting customers, retain them and grow our customer base. We need to decide what kind of relationship we want to hold with them and if all these is coherent with our Business Model.
Getting, Keeping and Growing customers imply different processes in the consumer mind, so they must be addressed separately with different tools and strategies.
For instance, Getting Customers follows four essential steps until the Sale. First, we acquire the potential customers – we let them know we exist, we create brand awareness. Then, activation phase starts, with a call for action – this is where the relationship starts. Retention will be when the customers already engaged several times with us and are truly interested in our product. Finally, a sale happens.
In this first phase, creating a blog, a website, engaging in email marketing, SEO, using Social Media, providing Free testing, getting Testimonials and leveraging Viral Marketing is crucial. Regarding the latter, Viral Marketing is all about making your customers your sales force, normally increasing sales exponentially. For instance, the Old Spice commercial (https://www.youtube.com/watch?v=owGykVbfgUE) which had millions and millions of views on Youtube and also many other “copy-cats” to make fun!
On the other hand, after this expense of getting a customer, we should not let them go! Make sure you have updated, interest content in your blog. Start addressing the clients by name, talking directly with them, making it more personal and building a true relationship. Keep your Communities going on – answer questions, trigger relevant discussions between them! Send newsletters with up-to-date information and new events to come. Based on this, notice how Drip Marketing plays an important role – continually engage with your customers, don’t forget about them during a whole month! The customers probably don’t have the need we satisfy every day, so, if we just create a contact from now and then, we probably won’t get the exact moment they have that need. No, we have to be reminded when they have that need, we must be part of their consideration set, occupy a place in their mind!
Finally, we need to constantly grow our customer base. In this sense, we have next-selling, up-selling (buys a new model, a new product the company releases), cross-selling (different from initially bought, other line of products) and, the most desired one, Recommendation (they actually start recommending you)!
Creating Traffic
So we have our Landing page! That is great! But now, how will we make sure it has traffic? Many tools were presented in class, and many other tools are available today for us to create traffic!
We started by Adwords and how it works! This is a PPC - paid option - nevertheless, very effective one with a fairly high CTR (click-through-rate). Just really need to choose the right keywords! How? Just think: if I was my customer, what would Iook for? Would I write “teamwork platform”? Probably not! They are not actually looking for a new solution! They are looking for our features. One should also consider different spellings like “team work” vs. “teamwork” or “group work”, always guessing on how the target will think. Finally, Google provides an interesting tool which we can leverage to find the right words.
All kinds of tools and platforms were presented! From a Facebook page, to Linkedin Ads and Groups! Hacker News from Y-Combinator (we will talk about Y-Combinator in our inspirations, coming soon) which are a tough, tough audience! Pinterest, generating traffic through Pinning it and Following! Slideshare where we can upload our slides so everyone can see them! And so on… many, many tools are available today and we are going to leverage them to create a Business Model that our customers want.
Lessons Learned - Week 6
Hello everyone,
Let us remind you briefly what we learnt during our 6th and last “Entrepreneurship and Business Plan” session of this nice third trimester at Catolica University. We had to cover many subjects that couldn’t have been explained in a deep way on the 5th session and go further on our 6th session content.
First, we started the Monday morning by presenting our profiled customer segment and explicit quickly our empathy map related to each customer segment. That’s to say, what does he see, how does he feel, what does he hear, what does he say and do and finally which are the pain suffered and what could be the gains thanks to our innovative idea. Hence, according to LeadTeam project, we designed the empathy map for:
- The University Students characterized by John, a digital dependent 22 years old Irish business student (ginger hair, of course). He is willing to get international work experience and have a great career in a large MNE so as to further be skilled to successfully launch his own start-up.
- The University Segment and designed the profile of Joao Da Silva, Director of the Informatics System Department at Catolica University in Lisbon for two years. As an early product adapter, we imagined Joao being a “normal nerd guy”: a bit shy and quite introverted 40 years old Portuguese married man. Moreover, he is highly interested in discovering inventions, new kind of devices and networks.
- The Advertiser Segment characterized by Sarah, a trend seeker 26 years old german working woman who works as a marketer junior in a large multinational firm. Truly ambitious, she is really focused on her professional life success and aims to be a Marketing Director in a few years.
How to process to make interviews?
Defining the right sample size (at least 50 interviews to make it relevant), selecting the hypothesis that need to be tested, establishing the validation metrics, creating the script, writing the interview form, scheduling and making interviews (20 to30 min), filling the document right after, analyzing the results.
We focused more particularly on designing the script which consists basically in:
1. Interview introduction: making a short overall presentation by explaining the reason of this interview so as to introduce ourselves and make the interviewee comfortable (2min.),
2. Questions regarding segmentation: checking if the interviewee belongs to our targeted customer segment by asking him/her some basic questions relative to demographic, social, economic segmentation criteria. This is a key step because in the case the person doesn’t fit our segmentation criteria, we have to stop the interview process and find another person;
3. Explaining which problems we have identified and try to solve (mainly based on our value proposition) and validating those problems by asking the interviewee to rank them from the 1st most important problem experienced to the 15th. Thereby, we will be able to discover the TOP 3 problems
4. Identifying and validating the provided solution by encouraging the interviewee through open questions to tell us his point of view regarding which solution is a good one and ranking solutions to get the TOP 3;
5. Interview conclusion to collection suggestions and comments and end up the interview thanking the person for his/her time
Some tips have been highlighted to realize useful interviews:
§ When making the interview, the form is a great tool to consolidate results and analyze them.
§ Don’t record because then, the interviewee doesn’t feel that comfortable while talking
§ Open questions are the more efficient way to encourage the interviewee to talk freely about what does he feel and experience
§ Act neutral while formulating questions, our opinions shouldn’t be perceived
§ During the interview, collect verbal but also non-verbal communication
§ Excel spreadsheet might be a great tool to proceed to the statistical analysis
What is the Value Curve?
The Value Curve describes the Value Proposition of our Business Model. Basically, it’s a drawing graph which allows us to compare our strategy to the one of our competitors (one or two). To do it, we have to identify value attributes (price, quality, convenience, user-friendly), select 8 of them and define who our direct competitors in the industry are. Then, once identified attributes and competitors, it’s time to evaluate by allocating a ranking from 0 to 7 according to the importance of those components for each company (0= not important at all, 7= excellent). For instance, if you consider airlines companies: Easyjet key strategy is based on low price while AirFrance KLM is an expensive major company and performs in terms of executive class option. Hence, it allows us to discover what our clients seek and value and define our key factors of differentiation and compare them to our main competitors. Obviously, it’s impossible to be at the top level for each attribute so, efforts have to be made so as to be excellent on few of them and decrease attention on other less relevant factors. The Blue Ocean Strategy, theory conceptualized by Kim, W C and Mauborgne, helps us identifying attributes that might be created, eliminated, increased, decreased.
For 10 minutes, each group has to focus on drawing the value curve of its BM but time was flying and we couldn’t present orally what we found out.
How to make surveys?
The purpose of the survey is to test our different hypothesis related to our all BM components and evaluate the potential of success of our project. To launch the survey campaign, a generator service has to be chosen and emails address database should be created to attract many visitors and get a huge quantitative sample. Survey formulation has to be short (10 questions are enough), clear, concise, mostly using closed end questions to be answered by “yes/no” and with only one open question to get some suggestions. Moreover, most important questions should be in the beginning of the form because people pay more attention at the first questions and then get quite tired of answering.
Emailmeform.com, Monkey.com, Googlesurvey.com, Wufoo.com
Landing Page
This tool provide a powerful method in order to quantify effectively the interest of our customers in our idea. It allows us to test different hypothesis (namely those related to CS, VP, Channels, RS) by inviting people to visit our landing page, sending the web link to our email address database and proceed to the A/B test. The idea is quite simple: you have two equal pages with one difference (option A or B) and the website assigns randomly people to the A or B page. Then, we can evaluate which option is the most attractive, successful by analyzing the percentage that clicked on A VS the percentage that clicked on B. A landing page has to look nice and well designed: that’s to say not too many information on it (use concise and consistent titles to send key message) plus, a photo/video might help the targeted customer to understand better the concept. A button and “call to action” should stand out.
KickOffLabs.com, Unbounce.com, LaunchRock.com
So, next week, on lovely Monday morning and for the first class of this fourth trimester, we will be glad to present to the class our 10 interviews, our value curve and our landing page!
Let us remind you briefly what we learnt during our 6th and last “Entrepreneurship and Business Plan” session of this nice third trimester at Catolica University. We had to cover many subjects that couldn’t have been explained in a deep way on the 5th session and go further on our 6th session content.
First, we started the Monday morning by presenting our profiled customer segment and explicit quickly our empathy map related to each customer segment. That’s to say, what does he see, how does he feel, what does he hear, what does he say and do and finally which are the pain suffered and what could be the gains thanks to our innovative idea. Hence, according to LeadTeam project, we designed the empathy map for:
- The University Students characterized by John, a digital dependent 22 years old Irish business student (ginger hair, of course). He is willing to get international work experience and have a great career in a large MNE so as to further be skilled to successfully launch his own start-up.
- The University Segment and designed the profile of Joao Da Silva, Director of the Informatics System Department at Catolica University in Lisbon for two years. As an early product adapter, we imagined Joao being a “normal nerd guy”: a bit shy and quite introverted 40 years old Portuguese married man. Moreover, he is highly interested in discovering inventions, new kind of devices and networks.
- The Advertiser Segment characterized by Sarah, a trend seeker 26 years old german working woman who works as a marketer junior in a large multinational firm. Truly ambitious, she is really focused on her professional life success and aims to be a Marketing Director in a few years.
How to process to make interviews?
Defining the right sample size (at least 50 interviews to make it relevant), selecting the hypothesis that need to be tested, establishing the validation metrics, creating the script, writing the interview form, scheduling and making interviews (20 to30 min), filling the document right after, analyzing the results.
We focused more particularly on designing the script which consists basically in:
1. Interview introduction: making a short overall presentation by explaining the reason of this interview so as to introduce ourselves and make the interviewee comfortable (2min.),
2. Questions regarding segmentation: checking if the interviewee belongs to our targeted customer segment by asking him/her some basic questions relative to demographic, social, economic segmentation criteria. This is a key step because in the case the person doesn’t fit our segmentation criteria, we have to stop the interview process and find another person;
3. Explaining which problems we have identified and try to solve (mainly based on our value proposition) and validating those problems by asking the interviewee to rank them from the 1st most important problem experienced to the 15th. Thereby, we will be able to discover the TOP 3 problems
4. Identifying and validating the provided solution by encouraging the interviewee through open questions to tell us his point of view regarding which solution is a good one and ranking solutions to get the TOP 3;
5. Interview conclusion to collection suggestions and comments and end up the interview thanking the person for his/her time
Some tips have been highlighted to realize useful interviews:
§ When making the interview, the form is a great tool to consolidate results and analyze them.
§ Don’t record because then, the interviewee doesn’t feel that comfortable while talking
§ Open questions are the more efficient way to encourage the interviewee to talk freely about what does he feel and experience
§ Act neutral while formulating questions, our opinions shouldn’t be perceived
§ During the interview, collect verbal but also non-verbal communication
§ Excel spreadsheet might be a great tool to proceed to the statistical analysis
What is the Value Curve?
The Value Curve describes the Value Proposition of our Business Model. Basically, it’s a drawing graph which allows us to compare our strategy to the one of our competitors (one or two). To do it, we have to identify value attributes (price, quality, convenience, user-friendly), select 8 of them and define who our direct competitors in the industry are. Then, once identified attributes and competitors, it’s time to evaluate by allocating a ranking from 0 to 7 according to the importance of those components for each company (0= not important at all, 7= excellent). For instance, if you consider airlines companies: Easyjet key strategy is based on low price while AirFrance KLM is an expensive major company and performs in terms of executive class option. Hence, it allows us to discover what our clients seek and value and define our key factors of differentiation and compare them to our main competitors. Obviously, it’s impossible to be at the top level for each attribute so, efforts have to be made so as to be excellent on few of them and decrease attention on other less relevant factors. The Blue Ocean Strategy, theory conceptualized by Kim, W C and Mauborgne, helps us identifying attributes that might be created, eliminated, increased, decreased.
For 10 minutes, each group has to focus on drawing the value curve of its BM but time was flying and we couldn’t present orally what we found out.
How to make surveys?
The purpose of the survey is to test our different hypothesis related to our all BM components and evaluate the potential of success of our project. To launch the survey campaign, a generator service has to be chosen and emails address database should be created to attract many visitors and get a huge quantitative sample. Survey formulation has to be short (10 questions are enough), clear, concise, mostly using closed end questions to be answered by “yes/no” and with only one open question to get some suggestions. Moreover, most important questions should be in the beginning of the form because people pay more attention at the first questions and then get quite tired of answering.
Emailmeform.com, Monkey.com, Googlesurvey.com, Wufoo.com
Landing Page
This tool provide a powerful method in order to quantify effectively the interest of our customers in our idea. It allows us to test different hypothesis (namely those related to CS, VP, Channels, RS) by inviting people to visit our landing page, sending the web link to our email address database and proceed to the A/B test. The idea is quite simple: you have two equal pages with one difference (option A or B) and the website assigns randomly people to the A or B page. Then, we can evaluate which option is the most attractive, successful by analyzing the percentage that clicked on A VS the percentage that clicked on B. A landing page has to look nice and well designed: that’s to say not too many information on it (use concise and consistent titles to send key message) plus, a photo/video might help the targeted customer to understand better the concept. A button and “call to action” should stand out.
KickOffLabs.com, Unbounce.com, LaunchRock.com
So, next week, on lovely Monday morning and for the first class of this fourth trimester, we will be glad to present to the class our 10 interviews, our value curve and our landing page!
Lessons Learned - Week 5
We started this week
presenting our competitors analysis and our TAM, SAM and SOM for each one of
the three segments we are considering in our business model. We struggled a
little bit getting to those numbers and we know that we will need to
recalculate some of them later on during the idea development process, however,
we consider it was a pretty good first approximation.
During this last session we focused on the “Customer Segments” element of the Business Model Canvas! Indeed, it is extremely important to analyze business models through the lenses of the customer – “Successful innovation requires a deep understanding of customers, including environment, daily routines, concerns, and aspirations.” We talked about two main frameworks that can give us a special insight on our targets: Empathy Map and Persona.
The Empathy Map frameworks is a “really simple customer profiler” that goes beyond the traditional demographic characteristics and focus also on the environment and the consumer’s behavior, concerns, and aspirations. This provides a special insight in consumers’ perspectives, allowing us to grasp what they really need from our company – how can we improve what they see, hear, think, gain and are challenged by? - and adapt the Business Model accordingly (for instance, Customer Relationships if we found that they are always online and do not require face-to-face interaction).
Applying the Framework! What we did in class for the CitizenM and now for LeadTeam Platform:
§ Brainstormed to better understand our customers
§ Choose one character per customer segment
§ We gave a name and defined some basic demographic characteristics such as age, education level, marital status and income level. For example, John is 22 years old Irish Business Administration student, currently single and from a medium-high income family.
§ Finally we responded to six main questions about him:
What does the person see? What and who he sees in the environment .
What does the person listens? How the environment influences him.
What does the person think and feel? Who is in fact our customer on the inside, what is in his mind.
What does the person say and do? How he behaves and what he says in public – sometimes what he says and does may be different!
What are the pains? Frustrations, obstacles and risks he may be concerned about. Some examples were given, such as difficulty in using and poor performance.
What are the gains? We need to understand what he really needs, what he wants to achieve! For instance, does he want to improve performance? Or is he more interested in boosting his power and influence?
In the other hand, the Persona is about making a profile outline of a person among the customer segment who can represent in a more concrete way this segment we are targeting. Actually we define a lot of personal information and we add descriptions regarding his objectives, a day-in-a-life of his is presented as well as varied information of his interests, activities and personality. It is just if we were talking about a real person.
This kind of exercise really helped us to develop an important degree of empathy to these characters we created and that represent the people our business model is addressing. Actually, doing this with our team was a great moment to let our creativity flow and develop sort of an interpersonal relationship to John, Joao and Sarah; the customers and users of our platform. Now it is like we know them and we understand in a better way how our solution could meet their needs and preferences.
See you next class!
During this last session we focused on the “Customer Segments” element of the Business Model Canvas! Indeed, it is extremely important to analyze business models through the lenses of the customer – “Successful innovation requires a deep understanding of customers, including environment, daily routines, concerns, and aspirations.” We talked about two main frameworks that can give us a special insight on our targets: Empathy Map and Persona.
The Empathy Map frameworks is a “really simple customer profiler” that goes beyond the traditional demographic characteristics and focus also on the environment and the consumer’s behavior, concerns, and aspirations. This provides a special insight in consumers’ perspectives, allowing us to grasp what they really need from our company – how can we improve what they see, hear, think, gain and are challenged by? - and adapt the Business Model accordingly (for instance, Customer Relationships if we found that they are always online and do not require face-to-face interaction).
Applying the Framework! What we did in class for the CitizenM and now for LeadTeam Platform:
§ Brainstormed to better understand our customers
§ Choose one character per customer segment
§ We gave a name and defined some basic demographic characteristics such as age, education level, marital status and income level. For example, John is 22 years old Irish Business Administration student, currently single and from a medium-high income family.
§ Finally we responded to six main questions about him:
What does the person see? What and who he sees in the environment .
What does the person listens? How the environment influences him.
What does the person think and feel? Who is in fact our customer on the inside, what is in his mind.
What does the person say and do? How he behaves and what he says in public – sometimes what he says and does may be different!
What are the pains? Frustrations, obstacles and risks he may be concerned about. Some examples were given, such as difficulty in using and poor performance.
What are the gains? We need to understand what he really needs, what he wants to achieve! For instance, does he want to improve performance? Or is he more interested in boosting his power and influence?
In the other hand, the Persona is about making a profile outline of a person among the customer segment who can represent in a more concrete way this segment we are targeting. Actually we define a lot of personal information and we add descriptions regarding his objectives, a day-in-a-life of his is presented as well as varied information of his interests, activities and personality. It is just if we were talking about a real person.
This kind of exercise really helped us to develop an important degree of empathy to these characters we created and that represent the people our business model is addressing. Actually, doing this with our team was a great moment to let our creativity flow and develop sort of an interpersonal relationship to John, Joao and Sarah; the customers and users of our platform. Now it is like we know them and we understand in a better way how our solution could meet their needs and preferences.
See you next class!
Lessons Learned - Week 4
Last Monday, our group, LeadTeam, started by a
7 minutes presentation where we had to explain in front of the class the three
hypothesis most relevant to test and validate among the ten we formulated
previously. We strongly believe hypothesis part formulation is truly important
given our assumptions are at the core of our business model development and success
(or failure). That’s why, selecting only three was quite unsettling.
Despite the quick and perhaps subjective choice we made, we thought afterwards
it was a good exercise to do, in order to prioritize our components. Thus, we
also realized we mainly focused on customer segments and value proposition
components.
Hence, after the presentation, we appreciated receiving some interesting feedbacks from the teacher according to:
Ø First, proceed to interviews before making surveys in order to analyze deeper our segments needs and the best way to reach them efficiently;
Ø Secondly, add some more relevant hypothesis related, for instance, to how to establish our partnerships with Facebook and test the usefulness of it plus, our web channel strategy so as to test and validate them.
After a quick coffee break, we talked about the “P-S-M” which abbreviation refers to “Problem-Solution-Market” concept. This useful three elements concept is helpful to design a profitable Business Model and is based on the following logical ideas:
P. Entrepreneurs should first identify the current problems or strong needs faced by the customers and test it by a scale ranking process (ex: problems needs severity, pain caused intensity);
S. Build an innovative solution by delivering customers a product/service which might be able to solve this ongoing problem or fill customer needs while saving their time;
M. Finally, it’s crucial to define who are our market customers –B2B or B2C- and segment them according to specific criteria (demographic, behavioral, psychological etc.). Thereby, the solution will be addressed in a different way according to which kind of market customers the business is oriented to. Obviously, costs and easiness of measurement depend highly on the segmentation criteria strategy chosen: the demographical is easier and cheaper to run than the behavioral segmentation. Consequently, the final step consists in measuring the potential market size to target on a realistic basis. In order to define our market size and determine if the number of customers will be high enough to sustain our activity and make our business profitable enough, a tool has been presented: the TAM-SAM-SOM.
TAM= Total Available Market
SAM= Segmented Addressable Market
SOM= Share Of the Market
Moreover, there are two different approaches to size the market: the top down and the bottom up. The Top Down consists of defining a wide universe and apply filters until extracting the relevant market segment to reach. On the contrary, the bottom up approach aims to start with a specific segment to achieve and then intend to go to upper levels and estimate its size and growth. Depending on the approach chosen, it’s better to estimate the TAM-SAM-SOM elements: for instance, the top down is better to define the TAM-SAM whereas the bottom up is better to estimate the SOM-SAM.
So, considering those approaches, each team had to quickly estimate the potential market and the profits of its business project. According to our LeadTeam platform, we explained our top down approach and defined our TAM as the Portugal market (Portuguese university students, Portuguese Universities, Portuguese Advertising Companies). Consequently, we realized that our addressable segments were too tiny and profits very low so we learnt from this estimation that we had to extend to a wider segment -the European Market- to make our business profitable. Next Monday we will be able to explain our updated and more accurate estimations.
See you next class,
LeadTeam Project Team.
Hence, after the presentation, we appreciated receiving some interesting feedbacks from the teacher according to:
Ø First, proceed to interviews before making surveys in order to analyze deeper our segments needs and the best way to reach them efficiently;
Ø Secondly, add some more relevant hypothesis related, for instance, to how to establish our partnerships with Facebook and test the usefulness of it plus, our web channel strategy so as to test and validate them.
After a quick coffee break, we talked about the “P-S-M” which abbreviation refers to “Problem-Solution-Market” concept. This useful three elements concept is helpful to design a profitable Business Model and is based on the following logical ideas:
P. Entrepreneurs should first identify the current problems or strong needs faced by the customers and test it by a scale ranking process (ex: problems needs severity, pain caused intensity);
S. Build an innovative solution by delivering customers a product/service which might be able to solve this ongoing problem or fill customer needs while saving their time;
M. Finally, it’s crucial to define who are our market customers –B2B or B2C- and segment them according to specific criteria (demographic, behavioral, psychological etc.). Thereby, the solution will be addressed in a different way according to which kind of market customers the business is oriented to. Obviously, costs and easiness of measurement depend highly on the segmentation criteria strategy chosen: the demographical is easier and cheaper to run than the behavioral segmentation. Consequently, the final step consists in measuring the potential market size to target on a realistic basis. In order to define our market size and determine if the number of customers will be high enough to sustain our activity and make our business profitable enough, a tool has been presented: the TAM-SAM-SOM.
TAM= Total Available Market
SAM= Segmented Addressable Market
SOM= Share Of the Market
Moreover, there are two different approaches to size the market: the top down and the bottom up. The Top Down consists of defining a wide universe and apply filters until extracting the relevant market segment to reach. On the contrary, the bottom up approach aims to start with a specific segment to achieve and then intend to go to upper levels and estimate its size and growth. Depending on the approach chosen, it’s better to estimate the TAM-SAM-SOM elements: for instance, the top down is better to define the TAM-SAM whereas the bottom up is better to estimate the SOM-SAM.
So, considering those approaches, each team had to quickly estimate the potential market and the profits of its business project. According to our LeadTeam platform, we explained our top down approach and defined our TAM as the Portugal market (Portuguese university students, Portuguese Universities, Portuguese Advertising Companies). Consequently, we realized that our addressable segments were too tiny and profits very low so we learnt from this estimation that we had to extend to a wider segment -the European Market- to make our business profitable. Next Monday we will be able to explain our updated and more accurate estimations.
See you next class,
LeadTeam Project Team.
Lessons Learned - Week 3
Last class each team presented their
Business Model 1.0! After the LeadTeam presentation some interesting questions
from our colleagues were made: which features do we intend to incorporate in
the premium version; who is developing the platform; and if it was possible for
students from non-subscriber Universities to access the platform. This way we
got a grasp in what were the main concerns of one of our costumer segment,
“University Students”. Most important, the reaction to the existence of the
problem was extremely positive, since most students agreed the current solution
is not efficient enough.
Traditional Approach and Lean Start-up (taking into account the “Why the Lean Start-Up Changes Everything” by Steve Blank)
For decades and decades the recipe for start-ups was very straight forward: “if we build it, they will come”
The entrepreneur was expected to present a Business Plan. This static document should provide a description of the idea (problem and suggested solution) with a 5 year projection (Revenue, Cash Flow…). Notice that this approach is based on the assumption that “it’s possible to figure out most of the unknowns of a business in advance, before you raise money and actually execute the idea.”.
Then, the founder would pitch to several investors, assemble a team and invest thousands of resources in developing a final product/service, with little or none customer feedback, making it ready to launch. Finally, he would sell it as much as possible and finally get costumer feedback through the sales force.
The truth is that according to Shikhar Ghosh research[1]: 30% to 40% of the start-ups liquidate all assets and 95% fail to reach the expect return on investment. In other words, only after launching and spending thousands, the entrepreneurs knew that, in fact, the consumers do not needed the product/service as it was.
This is related with the product development process.
By understanding that (1) start-ups are not small sized large companies (they do not execute a BM, they look for one) (2) the Business Plan seldom resists the first contact with customers and (3) five-year plans are normally just fiction and a waste of time (4) the start-ups that normally succeed are those flexible enough to adapt accordingly with customer feedback and iterate rapidly, the Lean Start-up concept defined a start-up as: “a temporary organization designed to search for a repeatable and scalable business model.”
This methodology defends that what founders really have is just a series of testable hypothesis – what you think is good for your clients. Therefore, start-ups should start by constructing these hypothesizes using the Business Model Canvas framework.
This is what LeadTeam has been doing! We started by developing our Business Canvas 1.0 and now we have created 10 Hypothesis, thought of a way of testing them and what would be our validation criteria! Stay tune to see our results!
The second step should be getting out of the desk and going to test them with real potential clients and partners! After testing assumptions, the entrepreneurs ought to construct the called Minimum Viable Product (MVP) and try the solution among costumers, adapting as necessary. This cycle should continue, as founders readjust the Business Model (iterate) or completely change one or more hypotheses (pivot). Notice the cost difference between changing a Business Model and reconstructing a prototype built after years of research.
This process employs the customer development approach already mentioned in Lessons Learned 1.
Having the MVP, the question now is: How can we check that are people strongly motivated to use the product and pay the amount we have defined? How will we analyze the actions that tell me if they want to buy it?
In class we had a quick overview on how to test our hypothesis: We have to be in listening mode!!
1. Interviews
This is normally the first thing to do, as one learn a lot from these one-on-one conversations. Notice that we are not selling and convincing the customer, this is not a sale pitch (in fact, we don’t know what we will sell in the end).
In which concern interviews, Kevin Dewalt confirmed that roughly 20 interviews may take 2 to 3 weeks! He then developed a systematic procedure which boosts this process’ efficiency. You can read all about it in his blog[2], but there are a few points we would like to highlight!
The first is the “Intro Request Script”. This is basically a pitch to the person you are introducing yourself to and with whom you would like to do an interview. In this little text you should start by stating who you are, then what you are doing (briefly), what kind of person you need to interview and, finally, a finishing line asking: “Do you have time to give me some advice over a 20-min Skype call?”. These “advice” and “help” words are critical! Nevertheless, you should keep it easy to forward and short.
Another interesting advice is that if you are a student, you should add that to the e-mail. People will be more willing to help!
On the other hand, Ross Belmont created a template for these interviews. It focus on getting the problem (make sure you read between the lines), the current solution (questions like “What solution/process are they using today?” and “What is their state of mind (e.g. bored, frustrated, hurried, etc.) when doing this task?”) and what would they value in a possible solution (questions like “If they made these improvements, what would the benefits be?”)[3].
2. Surveys
Although the information you get is less, you can handle a much broader sample (150 answers saying what they think about your BM). Surveys should have 10 questions top – mainly closed questions.
3. AdWords
This tool will allow you to understand if clients are interested enough in the product/service to click in the Advert. Therefore, with by creating AdWords (although it is not free) you can quickly know about you pricing, value proposition and name decisions.
Other possibilities are Landing Pages, A/B Testing, Paper Prototyping, iPhone Prototyping, Product Prototyping, Crowdfunding Platforms, Wizard of Oz and Amazon/eBay.
Finally, once the product is readjusted enough, startups should start selling. The demand is built on marketing and sales departments, which allows the business to scale rapidly! It then passes to functional departments to execute the Model!
To know more about Lean Startups in a minute, check “Steve Blank: Why You Must Test Your Hypotheses” https://www.youtube.com/watch?v=_w-NUOjwMto
[1]http://online.wsj.com/news/articles/SB10000872396390443720204578004980476429190
[2] http://kevindewalt.com/2013/02/02/accelerate-your-customer-development-how-to-quickly-get-dozens-of-interviews/
[3] http://revolveapp.com/blog/bid/213179/A-Template-for-Lean-Startup-style-Customer-Development-Interviews
Traditional Approach and Lean Start-up (taking into account the “Why the Lean Start-Up Changes Everything” by Steve Blank)
For decades and decades the recipe for start-ups was very straight forward: “if we build it, they will come”
The entrepreneur was expected to present a Business Plan. This static document should provide a description of the idea (problem and suggested solution) with a 5 year projection (Revenue, Cash Flow…). Notice that this approach is based on the assumption that “it’s possible to figure out most of the unknowns of a business in advance, before you raise money and actually execute the idea.”.
Then, the founder would pitch to several investors, assemble a team and invest thousands of resources in developing a final product/service, with little or none customer feedback, making it ready to launch. Finally, he would sell it as much as possible and finally get costumer feedback through the sales force.
The truth is that according to Shikhar Ghosh research[1]: 30% to 40% of the start-ups liquidate all assets and 95% fail to reach the expect return on investment. In other words, only after launching and spending thousands, the entrepreneurs knew that, in fact, the consumers do not needed the product/service as it was.
This is related with the product development process.
By understanding that (1) start-ups are not small sized large companies (they do not execute a BM, they look for one) (2) the Business Plan seldom resists the first contact with customers and (3) five-year plans are normally just fiction and a waste of time (4) the start-ups that normally succeed are those flexible enough to adapt accordingly with customer feedback and iterate rapidly, the Lean Start-up concept defined a start-up as: “a temporary organization designed to search for a repeatable and scalable business model.”
This methodology defends that what founders really have is just a series of testable hypothesis – what you think is good for your clients. Therefore, start-ups should start by constructing these hypothesizes using the Business Model Canvas framework.
This is what LeadTeam has been doing! We started by developing our Business Canvas 1.0 and now we have created 10 Hypothesis, thought of a way of testing them and what would be our validation criteria! Stay tune to see our results!
The second step should be getting out of the desk and going to test them with real potential clients and partners! After testing assumptions, the entrepreneurs ought to construct the called Minimum Viable Product (MVP) and try the solution among costumers, adapting as necessary. This cycle should continue, as founders readjust the Business Model (iterate) or completely change one or more hypotheses (pivot). Notice the cost difference between changing a Business Model and reconstructing a prototype built after years of research.
This process employs the customer development approach already mentioned in Lessons Learned 1.
Having the MVP, the question now is: How can we check that are people strongly motivated to use the product and pay the amount we have defined? How will we analyze the actions that tell me if they want to buy it?
In class we had a quick overview on how to test our hypothesis: We have to be in listening mode!!
1. Interviews
This is normally the first thing to do, as one learn a lot from these one-on-one conversations. Notice that we are not selling and convincing the customer, this is not a sale pitch (in fact, we don’t know what we will sell in the end).
In which concern interviews, Kevin Dewalt confirmed that roughly 20 interviews may take 2 to 3 weeks! He then developed a systematic procedure which boosts this process’ efficiency. You can read all about it in his blog[2], but there are a few points we would like to highlight!
The first is the “Intro Request Script”. This is basically a pitch to the person you are introducing yourself to and with whom you would like to do an interview. In this little text you should start by stating who you are, then what you are doing (briefly), what kind of person you need to interview and, finally, a finishing line asking: “Do you have time to give me some advice over a 20-min Skype call?”. These “advice” and “help” words are critical! Nevertheless, you should keep it easy to forward and short.
Another interesting advice is that if you are a student, you should add that to the e-mail. People will be more willing to help!
On the other hand, Ross Belmont created a template for these interviews. It focus on getting the problem (make sure you read between the lines), the current solution (questions like “What solution/process are they using today?” and “What is their state of mind (e.g. bored, frustrated, hurried, etc.) when doing this task?”) and what would they value in a possible solution (questions like “If they made these improvements, what would the benefits be?”)[3].
2. Surveys
Although the information you get is less, you can handle a much broader sample (150 answers saying what they think about your BM). Surveys should have 10 questions top – mainly closed questions.
3. AdWords
This tool will allow you to understand if clients are interested enough in the product/service to click in the Advert. Therefore, with by creating AdWords (although it is not free) you can quickly know about you pricing, value proposition and name decisions.
Other possibilities are Landing Pages, A/B Testing, Paper Prototyping, iPhone Prototyping, Product Prototyping, Crowdfunding Platforms, Wizard of Oz and Amazon/eBay.
Finally, once the product is readjusted enough, startups should start selling. The demand is built on marketing and sales departments, which allows the business to scale rapidly! It then passes to functional departments to execute the Model!
To know more about Lean Startups in a minute, check “Steve Blank: Why You Must Test Your Hypotheses” https://www.youtube.com/watch?v=_w-NUOjwMto
[1]http://online.wsj.com/news/articles/SB10000872396390443720204578004980476429190
[2] http://kevindewalt.com/2013/02/02/accelerate-your-customer-development-how-to-quickly-get-dozens-of-interviews/
[3] http://revolveapp.com/blog/bid/213179/A-Template-for-Lean-Startup-style-Customer-Development-Interviews
Lessons Learned - Week 2
The second class started with the importance to have a good, diverse, and skilled team.
The more diverse team it is, in terms of nationalities, gender, and skills, the best for our project and for our experience it will be. So, we all briefly introduced our teams and the idea of our project in front of the class.
Then, we discussed how to get from an idea to business and the significance of using criterias to select our ideas. This is the method we had effectively used to pick the best idea among our top 10.
In front of the class we used an elevator pitch which made our idea clearer and easier to memorize for the audience. Too much information is not useful. Our project, entitled LeadTeam for now, will help university students to solve inefficiency and loss of time by providing them a multitask team work platform, that is better than Facebook, Dropbox, Google Drive, Moodle, etc, because all the functions will be combined in one tool linked directly to the university.
We watched a video concerning the realization of a business model explaining in detail what the 9 components are. We illustrated these 9 components by realizing the Business Model of the company “Citizen M” which is a concept of an affordable luxury hotel, with check-in fully automated 24/7, and prefabricated rooms that are easy to assemble.
For the next class, we will realize our own Business Model Canvas for the LeadTeam !
The more diverse team it is, in terms of nationalities, gender, and skills, the best for our project and for our experience it will be. So, we all briefly introduced our teams and the idea of our project in front of the class.
Then, we discussed how to get from an idea to business and the significance of using criterias to select our ideas. This is the method we had effectively used to pick the best idea among our top 10.
In front of the class we used an elevator pitch which made our idea clearer and easier to memorize for the audience. Too much information is not useful. Our project, entitled LeadTeam for now, will help university students to solve inefficiency and loss of time by providing them a multitask team work platform, that is better than Facebook, Dropbox, Google Drive, Moodle, etc, because all the functions will be combined in one tool linked directly to the university.
We watched a video concerning the realization of a business model explaining in detail what the 9 components are. We illustrated these 9 components by realizing the Business Model of the company “Citizen M” which is a concept of an affordable luxury hotel, with check-in fully automated 24/7, and prefabricated rooms that are easy to assemble.
For the next class, we will realize our own Business Model Canvas for the LeadTeam !
Lessons Learned - Week 1
What is the single, most important
tool when developing a start-up? Are you thinking about the Business Plan?
That is the traditional reasoning, also connected with the Product Development Model. According to Steve Blank, No Business Plan Survives First Contact With A Customer. Behind this idea it is the way we are going to develop our start-up.
The objective is start by designing a Business Model (BM) - generate a hypothesis - then test it among costumers. According to their feedback and information, rapidly redesign and adapt our BM, as much as it is necessary, until fully meet our client’s expectations. Then, we are ready to Launch and only in the end we will be able to build our Business Plan. Yet, this iteration should be continuous. The reasoning is based in the Customer Development Model by Steve Blank - “Build and they will come” is not a strategy, it’s a prayer[i].
An important tool we will be recurrently applying is the Business Model Canvas, conceptualized by Alex Osterwalder. It allows an organization to translate its Business Model through nine basic building blocks: Customer Segments, Value Propositions, Channels, Customer Relationships, Revenue Streams, Key Activities, Key Resources, Key Partners and Cost Structure. This is how we will be able to constantly and quickly readjust our Business Model, always taking into account the four areas of customers, offer, infrastructure, and financial viability. We are sure we will be using 15,000 post-its and 100 meters of brown paper just like Daniel Egger from Brazil[ii]!
[i] “The Customer Development Manifesto: Reasons for the Revolution”, Steve Blank, 2009, http://steveblank.com/2009/09/03/the-customer-development-manifesto-reasons-for-the-revolution-part-2/
[ii] “Business Model Generation”, Alex Osterwalder and Ives Pigneau, 2009.
That is the traditional reasoning, also connected with the Product Development Model. According to Steve Blank, No Business Plan Survives First Contact With A Customer. Behind this idea it is the way we are going to develop our start-up.
The objective is start by designing a Business Model (BM) - generate a hypothesis - then test it among costumers. According to their feedback and information, rapidly redesign and adapt our BM, as much as it is necessary, until fully meet our client’s expectations. Then, we are ready to Launch and only in the end we will be able to build our Business Plan. Yet, this iteration should be continuous. The reasoning is based in the Customer Development Model by Steve Blank - “Build and they will come” is not a strategy, it’s a prayer[i].
An important tool we will be recurrently applying is the Business Model Canvas, conceptualized by Alex Osterwalder. It allows an organization to translate its Business Model through nine basic building blocks: Customer Segments, Value Propositions, Channels, Customer Relationships, Revenue Streams, Key Activities, Key Resources, Key Partners and Cost Structure. This is how we will be able to constantly and quickly readjust our Business Model, always taking into account the four areas of customers, offer, infrastructure, and financial viability. We are sure we will be using 15,000 post-its and 100 meters of brown paper just like Daniel Egger from Brazil[ii]!
[i] “The Customer Development Manifesto: Reasons for the Revolution”, Steve Blank, 2009, http://steveblank.com/2009/09/03/the-customer-development-manifesto-reasons-for-the-revolution-part-2/
[ii] “Business Model Generation”, Alex Osterwalder and Ives Pigneau, 2009.