SlideShare ist ein Scribd-Unternehmen logo
1 von 168
Downloaden Sie, um offline zu lesen
 
                      	
  
    Customer	
  Development	
  for	
  Startups	
  
                        	
  
                        	
  
                                        	
  
                                        	
  
                                        	
  
                                        	
  
                                        	
  
                                        	
  
                              Henrik	
  Berglund	
  
                     Chalmers	
  University	
  of	
  Technology	
  
                       Center	
  for	
  Business	
  Innova8on	
  
                           henber@chalmers.se	
  
                         www.henrikberglund.com	
  
                                @khberglund	
  
                                          	
  
2013-­‐02-­‐15	
                                                      1	
  
Presenta8on	
  based	
  on	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                          by	
  Steve	
  Blank	
  and	
  Bob	
  Dorf	
  
                                             	
  
                         More	
  info:	
  www.steveblank.com	
  
Buy	
  the	
  book:	
  hJp://www.amazon.com/gp/product/0984999302/	
  	
  
Using	
  slides	
  from	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
developed	
  by	
  Steve	
  Blank	
  and	
  Bob	
  Dorf	
  
                            	
  

   hJp://www.slideshare.net/sblank/	
  	
  	
  
Agenda	
  
1.  Startups	
  (Old	
  and	
  new	
  view)	
  
2.  Business	
  Models	
  
       	
  WS	
  
3.  Customer	
  Development	
  
       	
  WS	
  
Part	
  1	
  

          Startups	
  
(What	
  We	
  Used	
  to	
  Believe	
  
  What	
  We	
  Now	
  Know)	
  
What	
  We	
  Used	
  to	
  Believe	
  
Startups	
  are	
  a	
  Smaller	
  Version	
  	
  
     of	
  a	
  Large	
  Company	
  
What	
  We	
  Now	
  Know	
  
Startups	
  Search	
  	
  
Companies	
  Execute	
  
Startups	
  ≠	
  Small	
  companies	
  
What	
  We	
  Used	
  to	
  Believe	
  


      Strategy	
  
 
Start by developing a Business Plan…
 
…make the financial forecasts…
 
…then Execute
What	
  We	
  Now	
  Know	
  


  Strategy	
  
             	
  
5-­‐Year	
  Plans	
  
 
Develop and Execute the Business Plan
Why?
No Business Plan survives
first contact with customers
“Everybody	
  has	
  a	
  plan	
  un@l	
  they	
  get	
  punched	
  in	
  the	
  face”	
  
	
  	
  Mike	
  Tyson	
  
Searching for a Business Model
        comes before
  Executing a business plan
Business	
  Models	
  
Solu8on	
                                                   Unique	
  Value	
                                                           Unfair	
  Advantage	
                                                        Customer	
  Segments	
  
Problem	
  
                                                                                        Proposi8on	
                                                                 Not	
  easily	
  copied	
  or	
  bought	
  
                                                                                                                                                                                                                                                  Customers;	
  Users	
  
                                                                                        Why	
  you	
  are	
  different	
  and	
  worth	
  	
  gecng	
  aJen8on	
  
                                                                                        	
  
                                                                                        Result	
  customers	
  want	
  
                                                                                        	
  	
  	
  +	
  specific	
  period	
  of	
  8me	
  
                                                                                        	
  	
  	
  +	
  address	
  objec8ons	
  




                                                                                                                                                                                                                   	
  

                          Key	
  Metrics	
  
                                                                       Acquisi8on	
  
                                                                       Ac8va8on	
                                                                                   Channels	
                                     	
  	
  	
  Direct	
  
                                                                                                                                                                                                                   	
  	
  	
  Distributor	
  
                                                                       Reten8on	
                                                                                                                                  	
  	
  	
  OEM	
  
Alterna8ves	
                                                          Revenue	
                                                                                                                                   	
  	
  	
  Retail	
  
                                                                       Referral	
                                                                                                                                  	
  	
  	
  VAR	
  
                                                                                                                                                                                                                   	
  	
  	
  Web	
  



 Alterna8ves	
  
                                                                                                                                                                                                                                                  Early	
  Adopters	
  




                            Interview	
  30-­‐50	
  customers	
                                                                                                                                             Type:	
                                Fixed	
  Pricing:	
       Dynamic	
  Pricing	
  
  Cost	
  Structure	
       Build	
  MVP	
  
                            Ongoing	
  burn	
  (fixed	
  and	
  variable	
  costs)	
  
                                                                                                                                 Revenue	
  Streams	
                                                       Asset	
  sales	
  
                                                                                                                                                                                                            Usage	
  fee	
  
                                                                                                                                                                                                                                                   List	
  price	
  
                                                                                                                                                                                                                                                   Product	
  feature	
  
                                                                                                                                                                                                                                                                             Nego8a8on	
  
                                                                                                                                                                                                                                                                             Yield	
  management	
  
                                                                                                                                                                                                            Subscrip8on	
  fees	
                  Customer	
  segment	
     Real-­‐8me	
  market	
  
                                                                                                                                                                                                            Lending/Ren8ng/Leasing	
               Volume	
  
                                                                                                                                                                                                            Licensing	
  
                                                                                                                                                                                                            Brokerage	
  fees	
  
                                                                                                                                                                                                            Adver8sing	
  
Search	
                  Execu@on	
  

               Business	
  Model	
  	
     Opera@ng	
  Plan	
  +	
  
Strategy	
  
                Hypotheses	
               Financial	
  Model	
  
What	
  We	
  Used	
  to	
  Believe	
  


       Process	
  
We	
  Built	
  Startups	
  by	
  	
  
Managing	
  Processes	
  
   Product	
  Management	
  
                +	
  
   Waterfall	
  Engineering	
  
Tradi8onal	
  Development	
  Process	
  


   Concept	
     Product	
  Dev.	
     Alpha/Beta	
     Launch/	
  
                                          Test	
        1st	
  Ship	
  
Tradi8onal	
  Development	
  Process	
  
                            Has	
  Two	
  Implicit	
  Assump8ons	
  

Customer	
  Problem:	
  known	
  
              Concept	
             Product	
  Dev.	
     Alpha/Beta	
      Launch/	
  
                                                             Test	
         1st	
  Ship	
  


Product	
  Features:	
  known	
  



              Works	
  well	
  for	
  incremental	
  development	
  projects	
  
                          targe@ng	
  exis@ng	
  customers.	
  
Tradi8on	
  –	
  Hire	
  Marke8ng	
  


               Concept	
          Product	
  Dev.	
                     Alpha/Beta	
                       Launch/	
  
                                                                           Test	
                          1st	
  Ship	
  


                             -­‐ 	
  Create	
  Marcom	
  	
     -­‐	
  Hire	
  PR	
  Agency	
     -­‐	
  Create	
  Demand	
  
Marke@ng	
                   	
  	
  Materials	
                -­‐	
  Early	
  Buzz	
            -­‐	
  Launch	
  Event	
  
                             -­‐	
  Create	
  Posi@oning	
                                        -­‐	
  “Branding”	
  
Tradi8on	
  –	
  Hire	
  Sales	
  


               Concept	
           Product	
  Dev.	
                       Alpha/Beta	
                                   Launch/	
  
                                                                              Test	
                                      1st	
  Ship	
  


                              -­‐ 	
  Create	
  Marcom	
  	
     -­‐	
  Hire	
  PR	
  Agency	
                 -­‐	
  Create	
  Demand	
  
Marke@ng	
                    	
  	
  Materials	
                -­‐	
  Early	
  Buzz	
                        -­‐	
  Launch	
  Event	
  
                              -­‐	
  Create	
  Posi@oning	
                                                    -­‐	
  “Branding”	
  


                                                                 -­‐	
  Hire	
  Sales	
  VP	
                  -­‐	
  Build	
  Sales	
  
Sales	
                                                          -­‐	
  Hire	
  1st	
  	
  Sales	
  Staff	
     Organiza@on	
  
Tradi8on	
  –	
  Hire	
  Business	
  Development	
  


               Concept	
          Product	
  Dev.	
                       Alpha/Beta	
                                    Launch/	
  
                                                                             Test	
                                       1st	
  Ship	
  


                             -­‐ 	
  Create	
  Marcom	
  	
     -­‐	
  Hire	
  PR	
  Agency	
                 -­‐	
  Create	
  Demand	
  
Marke@ng	
                   	
  	
  Materials	
                -­‐	
  Early	
  Buzz	
                        -­‐	
  Launch	
  Event	
  
                             -­‐	
  Create	
  Posi@oning	
                                                    -­‐	
  “Branding”	
  


                                                                -­‐	
  Hire	
  Sales	
  VP	
                  -­‐	
  Build	
  Sales	
  
Sales	
                                                         -­‐	
  Hire	
  1st	
  	
  Sales	
  Staff	
     Organiza@on	
  

Business	
  	
                                                   -­‐	
  Hire	
  First	
  Bus	
  Dev	
         -­‐	
  Do	
  deals	
  for	
  FCS	
  
Development	
  
Example	
  -­‐	
  Recognize	
  these?	
  
  Online	
  clothes	
  retailer	
  specialized	
  in	
  
  fashion	
  and	
  sports	
  (e.g.	
  Adidas,	
  Fila,	
  Vans,	
  
  Converse,	
  DKNY	
  and	
  Fred	
  Perry).	
  	
  
  Raised	
  $160	
  million	
  (JP	
  Morgan,	
  Goldman	
  
  Sachs,	
  Bernard	
  Arnault,	
  BeneJon	
  +	
  six).	
  
  Developed	
  an	
  innova8ve	
  site	
  with	
  3D,	
  
  zoom,	
  360⁰	
  rota8on	
  and	
  virtual	
  
  mannequins,	
  powered	
  by	
  lots	
  of	
  JavaScript	
  
  and	
  Flash	
  Anima8ons.	
  
  Rapidly	
  grew	
  to	
  420	
  people	
  and	
  spent	
  
  heavily	
  on	
  PR	
  pre	
  launch.	
  
  Delayed	
  launch	
  repeatedly	
  due	
  to	
  
  technological	
  problems.	
  
  Finally	
  launched	
  in	
  18	
  countries	
  
  simultaneously	
  	
  8:59	
  November	
  3	
  1999	
  EST.	
  
Henrik Berglund - Customer Development for startups
What	
  happened?	
  
40	
  %	
  of	
  visitors	
  could	
  not	
  access	
  the	
  site.	
  	
        	
  “Eighty-­‐one	
  minutes	
  	
  
                                                                               to	
  pay	
  too	
  much	
  money	
  
Mac	
  users	
  could	
  not	
  operate	
  the	
  site	
  at	
  all.	
  	
  
                                                                               for	
  a	
  pair	
  of	
  shoes	
  that	
  I	
  
The	
  site	
  was	
  very	
  difficult	
  to	
  use	
  and	
  full	
  of	
      am	
  s8ll	
  going	
  to	
  have	
  to	
  
errors,	
  oren	
  causing	
  computers	
  to	
  freeze.	
  	
  	
                 wait	
  a	
  week	
  to	
  get?”	
  
Extremely	
  slow	
  to	
  load	
  without	
  broadband.	
  
Only	
  one	
  in	
  four	
  aJempts	
  to	
  make	
  a	
  
purchase	
  worked.	
  	
  
Low	
  conversion	
  rates	
  (0.25%).	
  
Conversion	
  rates	
  did	
  double	
  by	
  Christmas.	
  
30%	
  returns,	
  not	
  10%	
  as	
  projected.	
  
A	
  “low-­‐bandwidth	
  version”	
  was	
  relaunched	
  
within	
  months.	
  
But	
  low	
  sales	
  +	
  high	
  costs	
   =>	
  Bankruptcy.	
  
Validated	
  Business	
  Model?	
  
"Our	
  strong	
  investor	
  base	
  offers	
  a	
  solid	
  
founda@on	
  for	
  boo.com.	
  The	
  fact	
  that	
  
such	
  interna@onal	
  investors	
  have	
  
invested	
  in	
  boo.com	
  reflects	
  the	
  power	
  
of	
  our	
  business	
  model	
  and	
  the	
  boo.com	
  
brand."	
  	
  
	
  
Patrik	
  Hedelin,	
  Execu2ve	
  Chairman.	
  
(Press	
  Release,	
  Nov	
  3	
  1999)	
  
The	
  problem	
  –	
  untested	
  assump8ons!	
  
                                        Value	
  	
  proposi@on	
                         Customer	
  
         Key	
  ac@vi@es	
          Fashion	
  and	
  sports	
  online,	
              rela@onships	
  
         Partnering,	
  	
        Realis@c	
  shopping	
  experience,	
           Paid	
  &	
  Earned	
  Media	
  
         E-­‐commerce,	
                “Life-­‐s@le	
  choice”	
                 Visitor	
  numbers,	
  
         Global	
  taxes	
  &	
                          .	
                      Conversion	
  rates	
  
         payments,	
                                   	
                                            	
  
                                                                                            Customer	
  
         Marke@ng	
                                    	
                                            	
  
                                                                                            segments	
  
Key	
  partners	
  
Brands,	
  
Warehouses,	
  
                             Visualiza@on	
  of	
                                           “young,	
  well-­‐off,	
  
                                                                                            fashion-­‐	
  conscious	
  
                                                                                            18	
  to	
  24	
  year	
  olds”	
  
Logis@cs	
  
	
  
                              the	
  business	
                                             	
  	
  
                                                                                            	
  
                             model	
  framwork	
  
              Cost	
  structure	
                                                  Revenue	
  	
  
                                    Key	
                 Channels	
               Streams	
  
              Call	
  centres,	
                          Buying	
  online,	
  
                                    resources	
                                    Online	
  sales/	
  full	
  retail	
  
              Return	
  rates,	
                          Channel	
  conflicts,	
   price,	
  
                                    Developers,	
  
              Inventory	
                                 Zone	
  pricing	
  
                                    Risk	
  capital	
                              CAC	
  &	
  Life@me	
  Value	
  
What’s	
  wrong	
  with	
  this	
  picture?	
  
   Concept	
        Product	
  Dev.	
            Alpha/Beta	
     Launch/	
  
                                                    Test	
        1st	
  Ship	
  


 •  Both	
  Customer	
  Problems	
  and	
  Product	
  Features	
  
    are	
  hypotheses	
  
 •  Emphasis	
  on	
  execu8on	
  rather	
  than	
  learning	
  and	
  
    discovery	
  
 •  No	
  relevant	
  milestones	
  for	
  marke8ng	
  and	
  sales	
  
 •  Oren	
  leads	
  to	
  premature	
  scaling	
  and	
  a	
  heavy	
  
    spending	
  hit	
  if	
  product	
  launch	
  fails	
  
                                          	
  




  You	
  do	
  not	
  know	
  if	
  you	
  are	
  wrong	
  un@l	
  you	
  
                are	
  out	
  of	
  money/business	
  
Concept	
          Product	
  Dev.	
                       Alpha/Beta	
                                    Launch/	
  
                                                                             Test	
                                       1st	
  Ship	
  


                             -­‐ 	
  Create	
  Marcom	
  	
     -­‐	
  Hire	
  PR	
  Agency	
                 -­‐	
  Create	
  Demand	
  
Marke@ng	
                   	
  	
  Materials	
                -­‐	
  Early	
  Buzz	
                        -­‐	
  Launch	
  Event	
  
                             -­‐	
  Create	
  Posi@oning	
                                                    -­‐	
  “Branding”	
  


                                                                -­‐	
  Hire	
  Sales	
  VP	
                  -­‐	
  Build	
  Sales	
  
Sales	
                                                         -­‐	
  Hire	
  1st	
  	
  Sales	
  Staff	
     Organiza@on	
  

Business	
  	
                                                   -­‐	
  Hire	
  First	
  Bus	
  Dev	
         -­‐	
  Do	
  deals	
  for	
  FCS	
  
Development	
  
What	
  We	
  Now	
  Know	
  


   Process	
  
      	
  
More startups fail from
a lack of customers than from a
failure of product development
Because	
  


•  We	
  have	
  processes	
  to	
  manage	
  	
  
     product	
  development	
  
     	
  
•  We	
  have	
  no	
  process	
  to	
  manage	
  	
  
     customer	
  development	
  
	
  
An	
  Inexpensive	
  Fix	
  
Focus	
  on	
  Customers	
  and	
  Markets	
  from	
  Day	
  
                        One!	
  
                        Value proposition
           Key activities                     Customer
                                            relationships


                                                     Customer
Key partners                                         segments
                  Visualiza@on	
  of	
  
                   the	
  business	
  
                  model	
  framwork	
  
      Cost           Key           Channels      Revenue
      structure      resources                   streams
Problem	
                 Solu8on	
           Unique	
  Value	
     Unfair	
  	
     Customer	
  	
  
                                              Proposi8on	
          Advantage	
      Segments	
  




                         Key	
  Metrics	
                           Channels	
  




 Cost	
  Structure	
                                     Revenue	
  Streams	
  
How?	
  
Product	
  and	
  Customer	
  Development	
  

                     Product Development

  Concept	
       Product	
  Dev.	
         Alpha/Beta	
     Launch/	
  
                                               Test	
        1st	
  Ship	
  

                                        +

                       Customer Development


      Customer        Customer               Customer        Company
      Discovery       Validation             Creation        Building
Product	
  and	
  Customer	
  Development	
  




   Problem:	
  unknown	
     Solu8on:	
  unknown	
  
Search	
                      Execu@on	
  

Strategy	
      Business	
  Model	
  	
  
                                                 Opera8ng	
  Plan	
  +	
  
                 Hypotheses	
  
                                                 Financial	
  Model	
  


Process	
          Customer	
  &	
             Product	
  Management	
  
                                            &	
  Waterfall	
  Development	
  
               Agile	
  Development	
  
What	
  We	
  Used	
  to	
  Believe	
  


Organiza@on	
  
Hire and Build a
Functional Organization
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
What	
  We	
  Now	
  Know	
  


Organiza@on	
  
Founders run a
 Customer Development Team

No sales, marketing and business
          development
Search	
                           Execu@on	
  
 Strategy	
           Business	
  Model	
  	
  
                                                           Opera8ng	
  Plan	
  +	
  
                       Hypotheses	
  
                                                           Financial	
  Model	
  


                    Customer	
  Development,	
          Product	
  Management	
  
 Process	
  
                      Agile	
  Development	
       Agile	
  or	
  Waterfall	
  Development	
  


                      Customer	
  	
                   Func@onal	
  Organiza@on	
  
Organiza@on	
  
                  Development	
  Team,	
  	
              	
  by	
  Department	
  
                    Founder-­‐driven	
  
search	
  


             execu8on	
  
Part	
  2	
  

Business	
  Models	
  
What’s	
  a	
  Company?	
  
What’s	
  a	
  Company?	
  

  A	
  business	
  organiza@on,	
  which	
  sells	
  a	
  
product	
  or	
  service	
  in	
  exchange	
  for	
  revenue	
  
                       and	
  profit	
  
How	
  are	
  Companies	
  organized?	
  
How	
  are	
  Companies	
  organized?	
  

    Companies	
  are	
  organized	
  around	
  	
  	
  	
  	
  	
  	
  
          Business	
  Models	
  
How	
  are	
  Companies	
  organized?	
  

Companies	
  are	
  organized	
  around	
  Business	
  
                      Models	
  
What’s	
  a	
  Startup?	
  
What’s	
  a	
  Startup?	
  

                A	
  temporary	
  organiza8on	
  	
  
                      designed	
  to	
  search	
  	
  
for	
  a	
  repeatable	
  and	
  scalable	
  business	
  model	
  
What’s	
  a	
  Startup?	
  

                A	
  temporary	
  organiza8on	
  	
  
                      designed	
  to	
  search	
  	
  
for	
  a	
  repeatable	
  and	
  scalable	
  business	
  model	
  
What’s	
  a	
  Startup?	
  

                A	
  temporary	
  organiza8on	
  	
  
                      designed	
  to	
  search	
  	
  
for	
  a	
  repeatable	
  and	
  scalable	
  business	
  model	
  
The	
  goal	
  is	
  not	
  to	
  remain	
  a	
  startup	
  


                                                                   Large	
  
    Startup	
                    Transi@on	
  
                                                                 Company	
  




The	
  goal	
  of	
  a	
  startup	
  is	
  to	
  become	
  a	
  large	
  company!	
  
                  Failure	
  =	
  failure	
  to	
  transi@on.	
  
Business	
  Models	
  
           Key activities                 Value           Customer
                                       proposition      relationships


Key partners
                                                                   Customer
                                                                   segments




         Cost              Key                   Channels     Revenue
         structure         resources                          streams

hJp://www.businessmodelalchemist.com/	
  
Problem	
                               Solu8on	
                       Unique	
  Value	
                              Unfair	
  	
                          Customer	
  	
  
                                                                        Proposi8on	
                                   Advantage	
                           Segments	
  

What	
  are	
  you	
  customers’	
   Key	
  features	
                 Single,	
  clear,	
  compelling	
  	
         That	
  can’t	
  be	
  easily	
  	
     Who	
  are	
  your	
  customers?	
  
key	
  jobs/pains/gains?	
           	
                                message	
  that	
  states	
  why	
  	
        bought,	
  or	
  imitated?	
            	
  
                                     MVP	
                             you	
  are	
  different	
  and	
  	
           	
                                      Who	
  are	
  earlyvangelists?	
  
                                                                       worth	
  buying	
  from	
                                                             	
  




                                     Key	
  Metrics	
                                                                 Channels	
  
                                      What	
  metrics	
  are	
  	
                                                   How	
  do	
  you	
  reach	
  	
  
                                      most	
  cri8cal	
  	
                                                          customers?	
  
                                      to	
  track?	
                                                                 	
  




 Cost	
  Structure	
                                                                          Revenue	
  Streams	
  
      Customer	
  Acquisi8on	
  Costs	
  	
                                                         Revenue	
  Model	
  
      Distribu8on	
  Costs	
                                                                        Life	
  Time	
  Value	
  	
  
      Hos8ng	
                                                                                      Revenue/pricing	
  
      People	
                                                                                      etc.	
  
      etc.	
  	
  
      	
  
      Fixed/variable	
  
Problem	
                               Solu8on	
                       Unique	
  Value	
                              Unfair	
  	
                          Customer	
  	
  
                                                                        Proposi8on	
                                   Advantage	
                           Segments	
  

What	
  are	
  you	
  customers’	
   Key	
  features	
                 Single,	
  clear,	
  compelling	
  	
         That	
  can’t	
  be	
  easily	
  	
     Who	
  are	
  your	
  customers?	
  
key	
  jobs/pains/gains?	
           	
                                message	
  that	
  states	
  why	
  	
        bought,	
  or	
  imitated?	
            	
  
                                     MVP	
                             you	
  are	
  different	
  and	
  	
           	
                                      Who	
  are	
  earlyvangelists?	
  
                                                                       worth	
  buying	
  from	
                                                             	
  




                                     Key	
  Metrics	
                                                                 Channels	
  
                                      What	
  metrics	
  are	
  	
                                                   How	
  do	
  you	
  reach	
  	
  
                                      most	
  cri8cal	
  	
                                                          customers?	
  
                                      to	
  track?	
                                                                 	
  




 Cost	
  Structure	
                                                                          Revenue	
  Streams	
  
      Customer	
  Acquisi8on	
  Costs	
  	
                                                         Revenue	
  Model	
  
      Distribu8on	
  Costs	
                                                                        Life	
  Time	
  Value	
  	
  
      Hos8ng	
                                                                                      Revenue/pricing	
  
      People	
                                                                                      etc.	
  
      etc.	
  	
  
      	
  
      Fixed/variable	
  
Customers	
  and	
  problems	
  

Who	
  is	
  the	
  customer?	
  
Mul8-­‐sided	
  market?	
  
Different	
  from	
  user?	
  




hJp://www.businessmodelalchemist.com/2012/08/achieve-­‐product-­‐market-­‐fit-­‐with-­‐our-­‐brand-­‐
new-­‐value-­‐proposi8on-­‐designer.html	
  
Customers	
  and	
  problems	
  
                                  -­‐	
  jobs	
  to	
  be	
  done	
  

What	
  func8onal	
  jobs	
  is	
  your	
  customer	
  
trying	
  get	
  done?	
  (e.g.	
  perform	
  or	
  
complete	
  a	
  specific	
  task,	
  solve	
  a	
  specific	
  
problem…)	
  
	
  
What	
  social	
  jobs	
  is	
  your	
  customer	
  trying	
  
to	
  get	
  done?	
  (e.g.	
  trying	
  to	
  look	
  good,	
  
gain	
  power	
  or	
  status…)	
  
	
  
What	
  emo8onal	
  jobs	
  is	
  your	
  customer	
  
                                                                    “What	
  jobs	
  are	
  the	
  customers	
  you	
  are	
  
trying	
  get	
  done?	
  (e.g.	
  esthe8cs,	
  feel	
  good,	
  
                                                                    targe2ng	
  trying	
  to	
  get	
  done”	
  
security…)	
  
Customers	
  and	
  problems	
  
                                                -­‐	
  customer	
  pains	
  

What	
  does	
  your	
  customer	
  find	
  too	
  costly?	
  
(e.g.	
  takes	
  a	
  lot	
  of	
  8me,	
  costs,	
  effort)	
  	
  
	
  
What	
  makes	
  your	
  customer	
  feel	
  bad?	
  	
  	
  
(e.g.	
  frustra8ons,	
  annoyances)	
  	
  
	
  
How	
  are	
  current	
  solu8ons	
  under-­‐
performing	
  for	
  your	
  customer?	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  
(e.g.	
  lack	
  of	
  features,	
  performance,	
  
malfunc8on)	
  	
                                                                                “What	
  are	
  the	
  costs,	
  nega2ve	
  emo2ons,	
  bad	
  
	
                                                                                               situa2ons	
  etc.	
  that	
  your	
  customer	
  risks	
  
What	
  nega8ve	
  social	
  consequences	
  does	
                                              experiencing	
  before,	
  during,	
  and	
  a>er	
  ge?ng	
  
your	
  customer	
  encounter	
  or	
  fear?	
  	
  	
  	
  	
  	
  	
  	
  	
                   the	
  job	
  done.”	
  
(e.g.	
  loss	
  of	
  face,	
  power,	
  trust,	
  or	
  status)	
  	
  
Customers	
  and	
  problems	
  
                                  -­‐	
  customer	
  gains	
  

Which	
  savings	
  would	
  make	
  your	
  customer	
  
happy?	
  (e.g.	
  in	
  terms	
  of	
  8me,	
  money	
  and	
  
effort)	
  
	
  
What	
  would	
  make	
  your	
  customer’s	
  job	
  or	
  
life	
  easier?	
  (e.g.	
  flaJer	
  learning	
  curve,	
  
more	
  services,	
  lower	
  cost	
  of	
  ownership)	
  
	
  
What	
  posi8ve	
  social	
  consequences	
  does	
  
your	
  customer	
  desire?	
  (e.g.	
  makes	
  them	
  
look	
  good,	
  increase	
  in	
  power,	
  status)	
  
                                                                   “What	
  are	
  the	
  benefits	
  your	
  customer	
  
	
  
                                                                   expects,	
  desires	
  or	
  would	
  be	
  surprised	
  by.”	
  
What	
  are	
  customers	
  looking	
  for?	
  (e.g.	
  
good	
  design,	
  guarantees,	
  features)	
  
	
  
What	
  do	
  customers	
  dream	
  about?	
  (e.g.	
  
big	
  achievements,	
  big	
  reliefs)	
  
Problem	
                               Solu8on	
                       Unique	
  Value	
                              Unfair	
  	
                          Customer	
  	
  
                                                                        Proposi8on	
                                   Advantage	
                           Segments	
  

What	
  are	
  you	
  customers’	
   Key	
  features	
                 Single,	
  clear,	
  compelling	
  	
         That	
  can’t	
  be	
  easily	
  	
     Who	
  are	
  your	
  customers?	
  
key	
  jobs/pains/gains?	
           	
                                message	
  that	
  states	
  why	
  	
        bought,	
  or	
  imitated?	
            	
  
                                     MVP	
                             you	
  are	
  different	
  and	
  	
           	
                                      Who	
  are	
  earlyvangelists?	
  
                                                                       worth	
  buying	
  from	
                                                             	
  




                                     Key	
  Metrics	
                                                                 Channels	
  
                                      What	
  metrics	
  are	
  	
                                                   How	
  do	
  you	
  reach	
  	
  
                                      most	
  cri8cal	
  	
                                                          customers?	
  
                                      to	
  track?	
                                                                 	
  




 Cost	
  Structure	
                                                                          Revenue	
  Streams	
  
      Customer	
  Acquisi8on	
  Costs	
  	
                                                         Revenue	
  Model	
  
      Distribu8on	
  Costs	
                                                                        Life	
  Time	
  Value	
  	
  
      Hos8ng	
                                                                                      Revenue/pricing	
  
      People	
                                                                                      etc.	
  
      etc.	
  	
  
      	
  
      Fixed/variable	
  
Unique	
  Value	
  Proposi@ons/Solu@on	
  

What	
  are	
  your	
  products	
  and	
  
services?	
  
	
  
How	
  do	
  they	
  create	
  value	
  for	
  
the	
  customer	
  segments?	
  
Unique	
  Value	
  Proposi@ons/Solu@on	
  
Can	
  your	
  product/service:	
  
	
  
•  Produce	
  savings?	
  

•  Make	
  your	
  customers	
  feel	
  
   beJer?	
  	
  

•  Put	
  an	
  end	
  to	
  difficul8es?	
  

•  Wipe	
  out	
  nega8ve	
  social	
  
   consequences?	
  
Unique	
  Value	
  Proposi@ons/Solu@on	
  
Can	
  your	
  product/service:	
  
	
  
•  Outperform	
  current	
  
     solu8ons?	
  	
  

•  Produce	
  outcomes	
  that	
  go	
  
   beyond	
  their	
  expecta8ons?	
  	
  

•  Make	
  your	
  customer’s	
  job	
  
   or	
  life	
  easier?	
  	
  

•  Create	
  posi8ve	
  social	
  
     consequences?	
  	
  
	
  
	
  
Product	
  Market	
  Fit	
  
Gecng	
  this	
  right	
  is	
  essen8al!	
  
Product	
  Market	
  Fit	
  
Gecng	
  this	
  right	
  is	
  essen8al!	
  
Problem	
                               Solu8on	
                       Unique	
  Value	
                              Unfair	
  	
                          Customer	
  	
  
                                                                        Proposi8on	
                                   Advantage	
                           Segments	
  

What	
  are	
  you	
  customers’	
   Key	
  features	
                 Single,	
  clear,	
  compelling	
  	
         That	
  can’t	
  be	
  easily	
  	
     Who	
  are	
  your	
  customers?	
  
key	
  jobs/pains/gains?	
           	
                                message	
  that	
  states	
  why	
  	
        bought,	
  or	
  imitated?	
            	
  
                                     MVP	
                             you	
  are	
  different	
  and	
  	
           	
                                      Who	
  are	
  earlyvangelists?	
  
                                                                       worth	
  buying	
  from	
                                                             	
  




                                     Key	
  Metrics	
                                                                 Channels	
  
                                      What	
  metrics	
  are	
  	
                                                   How	
  do	
  you	
  reach	
  	
  
                                      most	
  cri8cal	
  	
                                                          customers?	
  
                                      to	
  track?	
                                                                 	
  




 Cost	
  Structure	
                                                                          Revenue	
  Streams	
  
      Customer	
  Acquisi8on	
  Costs	
  	
                                                         Revenue	
  Model	
  
      Distribu8on	
  Costs	
                                                                        Life	
  Time	
  Value	
  	
  
      Hos8ng	
                                                                                      Revenue/pricing	
  
      People	
                                                                                      etc.	
  
      etc.	
  	
  
      	
  
      Fixed/variable	
  
How	
  Do	
  You	
  Want	
  Your	
  Product	
  to	
  Get	
  to	
  
                   Your	
  Customer?	
  

       "      Yourself

       "      Through someone else

       "      Retail

       "      Wholesale

       "      Bundled with other goods or services




                                                                82	
  
Web	
  Channels	
  




                      83	
  
Physical	
  Channels	
  




                           84	
  
How	
  Does	
  Your	
  Customer	
  Want	
  to	
  Buy	
  
  Your	
  Product	
  from	
  your	
  Channel?	
  

           "     •  Same day

           "     •  Delivered and installed
                  •  Downloaded
           "     •  Bundled with other
           "        products

           "     •  As a service
                  •  …
           "
                                                           85	
  
Problem	
                               Solu8on	
                       Unique	
  Value	
                              Unfair	
  	
                          Customer	
  	
  
                                                                        Proposi8on	
                                   Advantage	
                           Segments	
  

What	
  are	
  you	
  customers’	
   Key	
  features	
                 Single,	
  clear,	
  compelling	
  	
         That	
  can’t	
  be	
  easily	
  	
     Who	
  are	
  your	
  customers?	
  
key	
  jobs/pains/gains?	
           	
                                message	
  that	
  states	
  why	
  	
        bought,	
  or	
  imitated?	
            	
  
                                     MVP	
                             you	
  are	
  different	
  and	
  	
           	
                                      Who	
  are	
  earlyvangelists?	
  
                                                                       worth	
  buying	
  from	
                                                             	
  




                                     Key	
  Metrics	
                                                                 Channels	
  
                                      What	
  metrics	
  are	
  	
                                                   How	
  do	
  you	
  reach	
  	
  
                                      most	
  cri8cal	
  	
                                                          customers?	
  
                                      to	
  track?	
                                                                 	
  




 Cost	
  Structure	
                                                                          Revenue	
  Streams	
  
      Customer	
  Acquisi8on	
  Costs	
  	
                                                         Revenue	
  Model	
  
      Distribu8on	
  Costs	
                                                                        Life	
  Time	
  Value	
  	
  
      Hos8ng	
                                                                                      Revenue/pricing	
  
      People	
                                                                                      etc.	
  
      etc.	
  	
  
      	
  
      Fixed/variable	
  
Customer	
  Rela@onships	
  
Customer	
  Rela@onships	
  
Problem	
                               Solu8on	
                       Unique	
  Value	
                              Unfair	
  	
                          Customer	
  	
  
                                                                        Proposi8on	
                                   Advantage	
                           Segments	
  

What	
  are	
  you	
  customers’	
   Key	
  features	
                 Single,	
  clear,	
  compelling	
  	
         That	
  can’t	
  be	
  easily	
  	
     Who	
  are	
  your	
  customers?	
  
key	
  jobs/pains/gains?	
           	
                                message	
  that	
  states	
  why	
  	
        bought,	
  or	
  imitated?	
            	
  
                                     MVP	
                             you	
  are	
  different	
  and	
  	
           	
                                      Who	
  are	
  earlyvangelists?	
  
                                                                       worth	
  buying	
  from	
                                                             	
  




                                     Key	
  Metrics	
                                                                 Channels	
  
                                      What	
  metrics	
  are	
  	
                                                   How	
  do	
  you	
  reach	
  	
  
                                      most	
  cri8cal	
  	
                                                          customers?	
  
                                      to	
  track?	
                                                                 	
  




 Cost	
  Structure	
                                                                          Revenue	
  Streams	
  
      Customer	
  Acquisi8on	
  Costs	
  	
                                                         Revenue	
  Model	
  
      Distribu8on	
  Costs	
                                                                        Life	
  Time	
  Value	
  	
  
      Hos8ng	
                                                                                      Revenue/pricing	
  
      People	
                                                                                      etc.	
  
      etc.	
  	
  
      	
  
      Fixed/variable	
  
WS	
  
Map	
  out	
  your	
  Business	
  Model?	
  




       60	
  minutes	
  
Be	
  clear	
  about	
  Product	
  Market	
  Fit!	
  
Part	
  3	
  

Customer	
  Development	
  
To	
  repeat	
  
To	
  repeat	
  


         More	
  startups	
  fail	
  from	
  	
  
 a	
  lack	
  of	
  customers	
  than	
  from	
  a	
  
failure	
  of	
  product	
  development…	
  
…	
  because	
  they	
  think	
  startups	
  =	
  small	
  companies…	
  
…they	
  focus	
  on	
  execu8ng	
  the	
  plan…	
  
     Concept	
         Product	
  Dev.	
            Alpha/Beta	
     Launch/	
  
                                                       Test	
        1st	
  Ship	
  


    •  Both	
  Customer	
  Problems	
  and	
  Product	
  Features	
  
       are	
  hypotheses	
  
    •  Emphasis	
  on	
  execu8on	
  rather	
  than	
  learning	
  and	
  
       discovery	
  
    •  No	
  relevant	
  milestones	
  for	
  marke8ng	
  and	
  sales	
  
    •  Oren	
  leads	
  to	
  premature	
  scaling	
  and	
  a	
  heavy	
  
       spending	
  hit	
  if	
  product	
  launch	
  fails	
  
                                             	
  




     You	
  do	
  not	
  know	
  if	
  you	
  are	
  wrong	
  un@l	
  you	
  
                   are	
  out	
  of	
  money/business	
  
…	
  so	
  they	
  scale	
  on	
  untested	
  assump8ons…	
  
…	
  and	
  end	
  up	
  going	
  bust.	
  



“We	
  have	
  been	
  too	
  visionary.	
  We	
  
wanted	
  everything	
  to	
  be	
  perfect,	
  and	
  
we	
  have	
  not	
  had	
  control	
  of	
  costs"	
  	
  
	
  
Ernst	
  Malmsten	
  
(BBC	
  News,	
  May	
  18	
  2000)	
  
So	
  what	
  to	
  do?	
  
Henrik Berglund - Customer Development for startups
Focus	
  on	
  Customers	
  and	
  Markets	
  from	
  Day	
  
                        One!	
  
                        Value proposition
           Key activities                     Customer
                                            relationships


                                                     Customer
Key partners                                         segments
                  Visualiza@on	
  of	
  
                   the	
  business	
  
                  model	
  framwork	
  
      Cost           Key           Channels      Revenue
      structure      resources                   streams
Product	
  and	
  Customer	
  Development	
  

                     Product Development

  Concept	
       Product	
  Dev.	
         Alpha/Beta	
     Launch/	
  
                                               Test	
        1st	
  Ship	
  

                                        +

                       Customer Development


      Customer        Customer               Customer        Company
      Discovery       Validation             Creation        Building
Product	
  and	
  Customer	
  Development	
  




   Problem:	
  unknown	
     Solu8on:	
  unknown	
  
Customer	
  Development:	
  Key	
  Ideas	
  

•  Parallel	
  process	
  to	
  Product	
  Development	
  (agile)	
  

•  Measurable	
  checkpoints	
  not	
  @ed	
  to	
  FCS	
  but	
  to	
  customer	
  
   insights	
  

•  Emphasis	
  on	
  itera@ve	
  learning	
  and	
  discovery	
  before	
  execu@on	
  

•  Must	
  be	
  done	
  by	
  small	
  team	
  including	
  CEO/project	
  leader	
  
Customer	
  Development	
  Heuris8cs	
  

•  There	
  are	
  no	
  facts	
  inside,	
  so	
  get	
  out	
  of	
  the	
  building!	
  	
  

•  Develop	
  for	
  the	
  few,	
  not	
  for	
  the	
  many	
  

•  Earlyvangelists	
  make	
  your	
  company,	
  and	
  are	
  smarter	
  than	
  you!	
  

•  Develop	
  a	
  minimum	
  viable	
  product	
  to	
  maximize	
  fast	
  learning.	
  

•  Nail	
  it	
  before	
  you	
  scale	
  it	
  –	
  low	
  burn	
  by	
  design!	
  
Customer	
  Development:	
  Four	
  Stages	
  
    search	
  


                                                      execu8on	
  
        •  Customer	
  Discovery	
  
          	
  	
  	
  Ar8culate	
  and	
  Test	
  your	
  Business	
  Model	
  Hypotheses	
  
        •  Customer	
  Valida@on	
  
          	
  	
  	
  Sell	
  your	
  MVP	
  and	
  Validate	
  your	
  MB	
  &	
  Sales	
  Roadmap	
  
        •  Customer	
  Crea@on	
  
          	
  	
  	
  	
  Scale	
  via	
  relentless	
  execu8on	
  and	
  fill	
  the	
  sales	
  pipeline	
  
        •  Company	
  Building	
  
          	
  	
  	
  (Re)build	
  company’s	
  organiza8on	
  &	
  management	
  
Customer Discovery




•  Articulate and test
   your BM hypotheses
•  No selling, just listening
•  Must be done by CEO/
   project manager
building
                                               building
             block
                                                block
                   building
                    block
      building
                       building
building
                        block
                          block
 block
                                            building
                                             block
                 building
                        building
                  block
                           block


                         build
            g
                ing
                      building
     buildin              block
                                
      block
                                             block
But,	
  
Realize	
  it’s	
  just	
  Hypotheses!	
  
Guess
Guess    Guess
                                  Guess

                 Guess
         Guess           Guess




        Guess             Guess
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Test Customer Problem Hypotheses

”Do	
  you	
  have	
  this	
     	
  	
  
problem?”                	
      	
  	
  
1. 	
     	
             	
      	
  	
  
2. 	
     	
             	
      	
  	
  
3. 	
     	
             	
      	
  	
  
Test Customer Problem Hypotheses

”Do	
  you	
  have	
  this	
     	
  ”Tell	
  me	
  about	
  it,	
  how	
     	
  	
  
problem?”                	
      	
  do	
  you	
  solve	
  it	
  today?”      	
  	
  
1. 	
     	
             	
      	
  1.            	
              	
         	
  	
  
2. 	
     	
             	
      	
  2.            	
              	
         	
  	
  
3. 	
     	
             	
      	
  3.            	
              	
         	
  	
  
Test Customer Problem Hypotheses

”Do	
  you	
  have	
  this	
     	
  ”Tell	
  me	
  about	
  it,	
  how	
     	
  ”Does	
  something	
  like	
  this	
  
problem?”                	
      	
  do	
  you	
  solve	
  it	
  today?”      	
  solve	
  your	
  problem?”	
  
1. 	
     	
             	
      	
  1.            	
              	
         	
  1.	
  
2. 	
     	
             	
      	
  2.            	
              	
         	
  2.	
  
3. 	
     	
             	
      	
  3.            	
              	
         	
  3.	
  

Listen	
  carefully	
  to	
  what	
  they	
  say	
  at	
  each	
  step!	
  
	
  
Focus	
  on	
  learning	
  -­‐	
  Don’t	
  try	
  to	
  sell	
  them	
  on	
  your	
  idea!	
  
	
  
In	
  the	
  process	
  you	
  find	
  out	
  about	
  other	
  BM	
  parts	
  as	
  well:	
  
workflow,	
  benefits	
  (to	
  users	
  &	
  others),	
  preferred	
  channels,	
  cri@cal	
  
influencers,	
  respected	
  peers	
  etc…	
  
	
  
You	
  want	
  to	
  become	
  a	
  domain	
  expert!	
  
Finding	
  people	
  

Introduc8ons	
  (ask	
  everyone	
  you	
  know)	
  
	
  
•  Provide	
  the	
  exact	
  text	
  that	
  they	
  can	
  copy	
  and	
  paste	
  into	
  
     a	
  tweet	
  or	
  email	
  (They’re	
  doing	
  you	
  a	
  favor!	
  Make	
  it	
  as	
  
     easy	
  as	
  possible	
  for	
  them)	
  
•  Tell	
  them	
  exactly	
  how	
  you	
  are	
  going	
  to	
  communicate	
  
   with	
  their	
  contacts	
  (They’re	
  risking	
  a	
  bit	
  of	
  social	
  capital	
  
   for	
  you.	
  Be	
  very	
  clear	
  that	
  you	
  won’t	
  spam	
  or	
  annoy	
  
   people)	
  
•  Tell	
  them	
  your	
  goals	
  (What	
  do	
  you	
  think	
  you’ll	
  get/learn	
  
   if	
  they	
  make	
  this	
  intro	
  for	
  you?	
  People	
  want	
  to	
  know	
  
   that	
  they’re	
  contribu8ng	
  to	
  a	
  bigger	
  picture!)	
  
	
  
Finding	
  people	
  

           AdWords,	
  Facebook	
  Ads,	
  Promoted	
  Tweets	
  
           	
  
           Summarize	
  your	
  idea	
  and	
  get	
  it	
  in	
  front	
  of	
  people	
  who	
  
           have	
  expressed	
  an	
  interest	
  in	
  it	
  by	
  having	
  searched	
  for	
  
           your	
  keywords	
  and	
  clicked	
  your	
  ad	
  –	
  get	
  conversa8ons	
  
           (and/or	
  test	
  hypotheses	
  using	
  landing	
  pages).	
  	
  
           	
  




hJp://www.cindyalvarez.com/best-­‐prac8ces/customer-­‐
development-­‐interviews-­‐how-­‐to-­‐finding-­‐people	
  
Finding	
  people	
  

TwiJer	
  Search	
  
	
  
Look	
  for	
  people	
  who	
  have	
  already	
  discussed	
  a	
  similar	
  
product,	
  problem,	
  or	
  solu8on	
  and	
  address	
  a	
  tweet	
  directly	
  
to	
  them:	
  
	
  
       “@username	
  Would	
  love	
  yr	
  feedback	
  on	
  [product/
       problem/solu2on]	
  –	
  shd	
  only	
  take	
  2mins	
  [URL]	
  thanks!”	
  
Finding	
  people	
  

Google	
  Alerts	
  
	
  
Set	
  up	
  Google	
  Alerts	
  for	
  your	
  product/problem/solu8on	
  –	
  
when	
  it	
  finds	
  relevant	
  blog	
  posts	
  or	
  comments,	
  email	
  and	
  
ask	
  for	
  feedback:	
  
       	
  
       “I	
  read	
  your	
  [post/comment]	
  about	
  [product/problem/
       solu2on].	
  	
  I’m	
  currently	
  working	
  on	
  a	
  related	
  idea	
  and	
  I	
  
       think	
  your	
  opinion	
  would	
  be	
  very	
  valuable	
  to	
  me	
  –	
  could	
  
       you	
  take	
  2	
  minutes	
  and	
  check	
  out	
  [URL]?	
  	
  Thank	
  you	
  –	
  
       I’d	
  be	
  happy	
  to	
  return	
  the	
  favor	
  any	
  2me.”	
  
	
  
	
  
Interview	
  8ps	
  




hJp://www.giffconstable.com/2011/07/12-­‐8ps-­‐for-­‐customer-­‐
development-­‐interviews-­‐revised/	
  
Web	
  

Much	
  faster	
  to	
  build	
  =>	
  	
  
get	
  quan8ta8ve	
  feedback	
  sooner.	
  
	
  
Use	
  a	
  low-­‐fi	
  landing	
  page	
  as	
  subs8tute	
  for	
  
(and	
  introduc8on	
  to)	
  conversa8ons.	
  
	
  
Key	
  to	
  drive	
  traffic	
  through	
  AdWords/
Facebook	
  Ads/Promoted	
  Tweets	
  etc.	
  
	
  
Build	
  (design	
  test),	
  measure	
  (run	
  test)	
  and	
  
analyze	
  (evaluate	
  test)!	
  	
  
Landing	
  page	
  design	
  




hJp://blog.kissmetrics.com/landing-­‐page-­‐blueprint/	
  
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Reality check!	
  



CustDev	
  and	
  ProdDev	
  teams	
  meet	
  and	
  discuss	
  
the	
  lessons	
  learned	
  from	
  the	
  field.	
  
	
  
     ”Here	
  is	
  what	
  we	
  thought	
  about	
  customers	
  and	
  
     their	
  problems,	
  here	
  is	
  what	
  we	
  found	
  out”	
  
	
  
BM	
  hypotheses,	
  product	
  specs	
  or	
  both	
  are	
  jointly	
  
revised.	
  	
  
Test	
  Solu8on	
  Hypothesis	
  

1)	
  ”We	
  believe	
  you	
  have	
  this	
  important	
  problem”	
  	
  
	
  	
  –	
  listen	
  (check).	
  
	
  	
  
2)	
  Demo	
  how	
  your	
  product	
  solves	
  the	
  problem.	
  Focusing	
  
on	
  a	
  few	
  key	
  features.	
  
	
  
Include	
  workflow	
  story:	
  ”life	
  	
  before	
  our	
  product”	
  and	
  	
  
”life	
  arer	
  our	
  product”	
  –	
  listen!	
  
	
  
3)	
  ”What	
  would	
  this	
  solu8on	
  need	
  to	
  have	
  for	
  you	
  to	
  
purchase	
  it?”	
  Listen,	
  ask	
  follow	
  up	
  ques8ons.	
  
Henrik Berglund - Customer Development for startups
“A	
  new	
  way	
  for	
  people	
  to	
  pay	
  for	
  train	
  
8ckets	
  at	
  rail	
  sta8ons	
  using	
  an	
  
electronic	
  payment	
  service,	
  like	
  PayPal,	
  
on	
  their	
  mobile	
  phone.”	
  
Henrik Berglund - Customer Development for startups
Dropbox	
  
•  1st	
  solu8on	
  test:	
  a	
  three	
  minute	
  video	
  made	
  in	
  the	
  
   founder’s	
  apartment	
  before	
  a	
  complete	
  code	
  was	
  
   wriJen.	
  
     –  Generated	
  valuable	
  feedback	
  from	
  visionary	
  customers.	
  
•  2nd	
  solu8on	
  test:	
  another	
  video	
  of	
  the	
  product	
  that	
  was	
  
   posted	
  on	
  a	
  social	
  network.	
  
     –  Wai8ng	
  list	
  jumped	
  from	
  5	
  000	
  to	
  75	
  000.	
  
•  Dropbox’s	
  original	
  intent	
  was	
  to	
  build	
  and	
  ship	
  their	
  
   product	
  in	
  eight	
  weeks.	
  	
  
•  Instead,	
  they	
  gathered	
  feedback	
  and	
  launched	
  a	
  public	
  
   version	
  18	
  months	
  later.	
  
Henrik Berglund - Customer Development for startups
Test Product Hypotheses	
  

Arer	
  demoing,	
  ask	
  about	
  other	
  things:	
  	
  
  Posi8oning	
  –	
  how	
  do	
  they	
  describe	
  the	
  product?	
  
  Product	
  category	
  (new,	
  exis8ng,	
  resegmented)	
  
  Compe8tors	
  
  Features	
  needed	
  for	
  first	
  version	
  
  Preferred	
  revenue	
  model	
  
  Pricing	
  
  Addi8onal	
  service	
  needs	
  
  Marke8ng	
  –	
  how	
  do	
  they	
  find	
  this	
  type	
  of	
  product?	
  
  Purchasing	
  process	
  
  Who	
  has	
  a	
  budget?	
  
  etc.	
  
Web	
  

Build	
  out	
  a	
  high-­‐fidelity	
  web	
  page	
  with	
  “func8oning”	
  
back-­‐end,	
  based	
  on	
  lessons	
  learned.	
  	
  
	
  
“Mechanical	
  Turk”-­‐solu8on.	
  
	
  
Ask	
  for	
  money:	
  first	
  “pre-­‐order”	
  then	
  charging.	
  
	
  
Con8nue	
  to	
  test,	
  measure	
  and	
  analyze!	
  	
  
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
Reality check!	
  



CustDev	
  and	
  ProdDev	
  teams	
  meet	
  and	
  discuss	
  
the	
  lessons	
  learned.	
  
	
  
     ”Here	
  is	
  what	
  we	
  thought	
  about	
  product	
  
     features	
  and	
  here	
  is	
  what	
  we	
  found	
  out”	
  
     	
  
BM	
  hypotheses,	
  product	
  specs	
  or	
  both	
  are	
  again	
  
jointly	
  revised.	
  
Customer	
  Discovery:	
  Exit	
  Criteria	
  

    Consistent	
  answers	
  from	
  “enough”	
  people?	
  
    What	
  are	
  your	
  customers	
  top	
  problems?	
  
         How	
  much	
  will	
  they	
  pay	
  to	
  solve	
  them?	
  

    Does	
  your	
  product	
  concept	
  solve	
  them?	
  
         Do	
  customers	
  agree?	
  	
  
         How	
  much	
  will	
  they	
  pay	
  for	
  it?	
  When?	
  

    Can	
  you	
  draw	
  a	
  day-­‐in-­‐the-­‐life	
  of	
  a	
  customer?	
  
         Before	
  &	
  arer	
  your	
  product	
  

    Can	
  you	
  draw	
  the	
  org	
  charts	
  of	
  users,	
  buyers	
  
    and	
  channels?	
  	
  
Customer Validation




•  Develop	
  and	
  sell	
  MVP	
  to	
  passionate	
  earlyvangelists	
  
•  Validate	
  a	
  repeatable	
  sales	
  roadmap	
  
•  Verify	
  the	
  business	
  model	
  
Minimal	
  Viable	
  Product	
  

Based	
  on	
  your	
  insights	
  from	
  Customer	
  Discovery,	
  sell	
  
the	
  smallest	
  feature	
  set	
  customers	
  are	
  willing	
  to	
  pay	
  
for!	
  
	
  
     •  Purpose	
  1:	
  Reduce	
  wasted	
  engineering	
  hours	
  	
  
          	
  (and	
  wasted	
  code)	
  
     	
  
     •  Purpose	
  2:	
  Get	
  something	
  into	
  the	
  hands	
  of	
  
              earlyvangelists	
  as	
  soon	
  as	
  possible	
  =>	
  maximize	
  
              learning!	
  (cf.	
  landing	
  page)	
  
The	
  Apple	
  I,	
  Apple’s	
  first	
  product,	
  was	
  sold	
  as	
  an	
  assembled	
  circuit	
  
board	
  and	
  lacked	
  basic	
  features	
  such	
  as	
  a	
  keyboard,	
  monitor,	
  and	
  
case.	
  	
  
The	
  owner	
  of	
  this	
  unit	
  added	
  a	
  keyboard	
  and	
  a	
  wooden	
  case.	
  
hJp://en.wikipedia.org/wiki/Apple_Inc.	
  
Henrik Berglund - Customer Development for startups
Minimal	
  Viable	
  Product	
  

               The	
  MVP	
  is	
  not	
  the	
  goal	
  =	
  Requires	
  commitment	
  
               to	
  itera8on!	
  
               	
  
                      •  “A	
  complex	
  system	
  that	
  works	
  is	
  invariably	
  
                           found	
  to	
  have	
  evolved	
  from	
  a	
  simple	
  system	
  
                           that	
  worked.”	
  
                      	
  
                      •  “A	
  complex	
  system	
  designed	
  from	
  scratch	
  
                           never	
  works	
  and	
  cannot	
  be	
  made	
  to	
  work.	
  
                           You	
  have	
  to	
  start	
  over,	
  beginning	
  with	
  a	
  
                           working	
  simple	
  system.”	
  
John	
  Gall	
  System-­‐an8cs:	
  How	
  Systems	
  Really	
  Work	
  and	
  Especially	
  How	
  They	
  Fail	
  
Types	
  of	
  earlyvangelists	
  

	
                                                                          Not	
  
	
                                                                         helpful	
  
       1.	
  Has	
  a	
  problem	
  
       2.	
  Understands	
  he	
  or	
  she	
  has	
  a	
  problem	
  
       3.	
  Ac8vely	
  searching	
  for	
  a	
  solu8on	
  
       4.	
  Cobbled	
  together	
  an	
  interim	
  solu8on	
  
       5.	
  CommiJed	
  and	
  can	
  quickly	
  fund	
  a	
  solu8on	
   Jackpot!	
  
Customer	
  Valida8on:	
  Exit	
  Criteria	
  

       Do	
  you	
  have	
  a	
  proven	
  sales	
  roadmap?	
  
       Organiza8on	
  chart?	
  Influence	
  map?	
  
       No	
  staffing	
  un8l	
  roadmap	
  is	
  proven!	
  
       	
  

       Do	
  you	
  understand	
  the	
  sales	
  cycle?	
  
       LTV,	
  CAC,	
  ROI	
  for	
  customers	
  etc.	
  
       	
  

       Do	
  you	
  have	
  a	
  set	
  of	
  orders	
  ($’s)	
  of	
  the	
  
       product	
  valida8ng	
  the	
  roadmap?	
  
       	
  
       Is	
  the	
  business	
  model	
  scalable?	
  
       LTV	
  >	
  CAC	
  
If	
  yes	
  –	
  Start	
  execu8ng	
  
If	
  no	
  –	
  Pivot!	
  




          • 	
  The	
  heart	
  of	
  Customer	
  Development	
  
          • 	
  Change	
  without	
  crisis	
  	
  
          	
  	
  (and	
  without	
  firing	
  execu8ves)	
  
“The	
  idea	
  that	
  successful	
  startups	
  change	
  direc2ons	
  but	
  
stay	
  grounded	
  in	
  what	
  they've	
  learned”	
  
Henrik Berglund - Customer Development for startups
Henrik Berglund - Customer Development for startups
YouTube - Customer Need Pivot
Henrik Berglund - Customer Development for startups
Pivot	
  




    Adapt	
  the	
  Business	
  Model	
  
    un8l	
  you	
  can	
  prove	
  it	
  
    works	
  
search	
  


             execu8on	
  
Customer	
  Crea8on	
  




•  Grow	
  customers	
  from	
  few	
  to	
  many	
  
•  Comes	
  arer	
  proof	
  of	
  sales	
  
•  Inject	
  $’s	
  for	
  scale	
  
•  This	
  is	
  where	
  you	
  “cross	
  the	
  chasm”	
  
	
  
Company Building




•  (Re)build	
  company’s	
  organiza8on	
  &	
  management	
  
•  Dev.-­‐centric	
  ⇒	
  Mission-­‐centric	
  ⇒	
  Process-­‐centric	
  
Summary	
  –	
  Customer	
  Development	
  




      •  Customer	
  Discovery	
  
        	
  	
  	
  Ar8culate	
  and	
  Test	
  your	
  Business	
  Model	
  Hypotheses	
  
      •  Customer	
  Valida@on	
  
        	
  	
  	
  Sell	
  your	
  MVP	
  and	
  Validate	
  your	
  BM	
  &	
  Sales	
  Roadmap	
  
      •  Customer	
  Crea@on	
  
        	
  	
  	
  	
  Scale	
  via	
  relentless	
  execu8on	
  and	
  fill	
  the	
  sales	
  pipeline	
  
      •  Company	
  Building	
  
        	
  	
  	
  (Re)build	
  company’s	
  organiza8on	
  &	
  management	
  
Don’t	
  do	
  a	
  Boo!	
  
Concept	
                              Product	
  Dev.	
     Alpha/Beta	
     Launch/	
  
                                                                Test	
        1st	
  Ship	
  




     “We	
  have	
  been	
  too	
  visionary.	
  We	
  
     wanted	
  everything	
  to	
  be	
  perfect,	
  and	
  
     we	
  have	
  not	
  had	
  control	
  of	
  costs"	
  	
  
     	
  
     Ernst	
  Malmsten	
  
     (BBC	
  News,	
  May	
  18	
  2000)	
  
WS	
  
Develop	
  a	
  Customer	
  Discovery	
  Plan?	
  

•  What	
  are	
  the	
  key	
  ques8ons	
  I	
  need	
  answered?	
  
      –  (hint:	
  customers,	
  problems)	
  
•    Who	
  do	
  I	
  need	
  to	
  talk	
  with?	
  
•    How	
  will	
  I	
  get	
  them	
  to	
  talk	
  to	
  me?	
  
•    When	
  will	
  this	
  happen?	
  
•    How	
  will	
  I	
  know	
  I	
  am	
  done?	
  
      –  With	
  problem	
  discovery?	
  
      –  With	
  solu8on	
  discovery?	
  
Tips	
  
                                    	
  
•  Each	
  team	
  learns	
  and	
  evaluates	
  a	
  tool,	
  and	
  
   then	
  reports	
  back	
  to	
  the	
  whole	
  group:	
  

    –  CrazyEgg.com	
  
    –  KISSMetrics	
  
    –  Unbounce	
  
    –  Qualaroo	
  
    –  Marketo.com	
  
    	
  
Presenta8on	
  based	
  on	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                                             	
  
                          by	
  Steve	
  Blank	
  and	
  Bob	
  Dorf	
  
                                             	
  
                         More	
  info:	
  www.steveblank.com	
  
Buy	
  the	
  book:	
  hJp://www.amazon.com/gp/product/0984999302/	
  	
  
Using	
  slides	
  from	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
                        	
  
developed	
  by	
  Steve	
  Blank	
  and	
  Bob	
  Dorf	
  
                            	
  

   hJp://www.slideshare.net/sblank/	
  	
  	
  

Weitere ähnliche Inhalte

Was ist angesagt?

Be one solutions_-_company_presentation
Be one solutions_-_company_presentationBe one solutions_-_company_presentation
Be one solutions_-_company_presentationAnochi.com.
 
Intrepid Capabilities Summary
Intrepid Capabilities SummaryIntrepid Capabilities Summary
Intrepid Capabilities Summaryrsperry
 
Compensation Plan
Compensation PlanCompensation Plan
Compensation Planuncgrass
 
KeyBanc Basic Materials & Packaging Conference
KeyBanc Basic Materials & Packaging ConferenceKeyBanc Basic Materials & Packaging Conference
KeyBanc Basic Materials & Packaging Conferenceirneenahpaperinc
 
WESTBURY ELECTRONIC SERVICE INC.
WESTBURY ELECTRONIC SERVICE INC.WESTBURY ELECTRONIC SERVICE INC.
WESTBURY ELECTRONIC SERVICE INC.guyvingelli
 

Was ist angesagt? (8)

Tech innovation s11_npi
Tech innovation s11_npiTech innovation s11_npi
Tech innovation s11_npi
 
Be one solutions_-_company_presentation
Be one solutions_-_company_presentationBe one solutions_-_company_presentation
Be one solutions_-_company_presentation
 
Q2 2009 Earning Report of Greene King Plc
Q2 2009 Earning Report of Greene King PlcQ2 2009 Earning Report of Greene King Plc
Q2 2009 Earning Report of Greene King Plc
 
Intrepid Capabilities Summary
Intrepid Capabilities SummaryIntrepid Capabilities Summary
Intrepid Capabilities Summary
 
Ppc project scope
Ppc project scopePpc project scope
Ppc project scope
 
Compensation Plan
Compensation PlanCompensation Plan
Compensation Plan
 
KeyBanc Basic Materials & Packaging Conference
KeyBanc Basic Materials & Packaging ConferenceKeyBanc Basic Materials & Packaging Conference
KeyBanc Basic Materials & Packaging Conference
 
WESTBURY ELECTRONIC SERVICE INC.
WESTBURY ELECTRONIC SERVICE INC.WESTBURY ELECTRONIC SERVICE INC.
WESTBURY ELECTRONIC SERVICE INC.
 

Andere mochten auch

Andere mochten auch (8)

Talk gewci @ inphb
Talk gewci @ inphbTalk gewci @ inphb
Talk gewci @ inphb
 
Talk @ Ourebi: Leadership, Paying homage to Mandela
Talk @ Ourebi: Leadership, Paying homage to MandelaTalk @ Ourebi: Leadership, Paying homage to Mandela
Talk @ Ourebi: Leadership, Paying homage to Mandela
 
Talk @ cied
Talk @ ciedTalk @ cied
Talk @ cied
 
Talk @ novotel, beyond s valley
Talk @ novotel, beyond s valleyTalk @ novotel, beyond s valley
Talk @ novotel, beyond s valley
 
Talk gewci @ ul 2015
Talk gewci @ ul 2015Talk gewci @ ul 2015
Talk gewci @ ul 2015
 
Talk for journalist @ mde
Talk for journalist @ mdeTalk for journalist @ mde
Talk for journalist @ mde
 
Agile Leadership Training
Agile Leadership TrainingAgile Leadership Training
Agile Leadership Training
 
Henrik Berglund - Crossing the Chasm
Henrik Berglund - Crossing the ChasmHenrik Berglund - Crossing the Chasm
Henrik Berglund - Crossing the Chasm
 

Ähnlich wie Henrik Berglund - Customer Development for startups

Hakema Moneytalks Presentation
Hakema Moneytalks PresentationHakema Moneytalks Presentation
Hakema Moneytalks PresentationTechnopolis Plc
 
Krista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured Speaker
Krista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured SpeakerKrista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured Speaker
Krista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured SpeakerAPPEALIE - SaaS Awards
 
Ai Lead Scoring And Lead Rating
Ai Lead Scoring And Lead RatingAi Lead Scoring And Lead Rating
Ai Lead Scoring And Lead RatingReinhard Janning
 
Madigan Portfolio09
Madigan Portfolio09Madigan Portfolio09
Madigan Portfolio09edmadigan
 
3 2013 smb group presentation
3 2013 smb group presentation3 2013 smb group presentation
3 2013 smb group presentationSMB Group
 
Venture Incubation
Venture IncubationVenture Incubation
Venture Incubationjagan339
 
Stephen Ulanoski - GE
Stephen Ulanoski - GEStephen Ulanoski - GE
Stephen Ulanoski - GEBen Allen
 
Henrik Berglund - WS - Startup Camp 2013
Henrik Berglund - WS - Startup Camp 2013Henrik Berglund - WS - Startup Camp 2013
Henrik Berglund - WS - Startup Camp 2013Henrik Berglund
 
Pragmatic Marketer Volume 8 Issue 2
Pragmatic Marketer Volume 8 Issue 2Pragmatic Marketer Volume 8 Issue 2
Pragmatic Marketer Volume 8 Issue 2Pragmatic Marketing
 
Oracle CRM On Demand Product Strategy And Roadmap
Oracle CRM On Demand Product Strategy And RoadmapOracle CRM On Demand Product Strategy And Roadmap
Oracle CRM On Demand Product Strategy And RoadmapJerome Leonard
 
Inclusion Innovates Brochure
Inclusion Innovates BrochureInclusion Innovates Brochure
Inclusion Innovates BrochureKevin Carter
 
Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...
Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...
Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...Dan Olsen
 
Creating A Product Backlog
Creating A Product BacklogCreating A Product Backlog
Creating A Product BacklogRussell Pannone
 
A Quick Story about IN
A Quick Story about INA Quick Story about IN
A Quick Story about INSamer Hamze
 
The Pragmatic Marketer: Volume 8, Issue 1
The Pragmatic Marketer: Volume 8, Issue 1The Pragmatic Marketer: Volume 8, Issue 1
The Pragmatic Marketer: Volume 8, Issue 1Pragmatic Marketing
 

Ähnlich wie Henrik Berglund - Customer Development for startups (20)

Hakema Moneytalks Presentation
Hakema Moneytalks PresentationHakema Moneytalks Presentation
Hakema Moneytalks Presentation
 
How to win SAP as a new client
How to win SAP as a new clientHow to win SAP as a new client
How to win SAP as a new client
 
Krista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured Speaker
Krista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured SpeakerKrista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured Speaker
Krista Anderson-Copperman- 2019 APPEALIE SaaS Conference Featured Speaker
 
Ai Lead Scoring And Lead Rating
Ai Lead Scoring And Lead RatingAi Lead Scoring And Lead Rating
Ai Lead Scoring And Lead Rating
 
Madigan Portfolio09
Madigan Portfolio09Madigan Portfolio09
Madigan Portfolio09
 
3 2013 smb group presentation
3 2013 smb group presentation3 2013 smb group presentation
3 2013 smb group presentation
 
Venture Incubation
Venture IncubationVenture Incubation
Venture Incubation
 
Stephen Ulanoski - GE
Stephen Ulanoski - GEStephen Ulanoski - GE
Stephen Ulanoski - GE
 
Henrik Berglund - WS - Startup Camp 2013
Henrik Berglund - WS - Startup Camp 2013Henrik Berglund - WS - Startup Camp 2013
Henrik Berglund - WS - Startup Camp 2013
 
Pragmatic Marketer Volume 8 Issue 2
Pragmatic Marketer Volume 8 Issue 2Pragmatic Marketer Volume 8 Issue 2
Pragmatic Marketer Volume 8 Issue 2
 
certificate
certificatecertificate
certificate
 
Audit Services
Audit ServicesAudit Services
Audit Services
 
Oracle CRM On Demand Product Strategy And Roadmap
Oracle CRM On Demand Product Strategy And RoadmapOracle CRM On Demand Product Strategy And Roadmap
Oracle CRM On Demand Product Strategy And Roadmap
 
Business Process Management Succeeding With BPM
Business Process Management Succeeding With BPMBusiness Process Management Succeeding With BPM
Business Process Management Succeeding With BPM
 
Inclusion Innovates Brochure
Inclusion Innovates BrochureInclusion Innovates Brochure
Inclusion Innovates Brochure
 
Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...
Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...
Product Management by Numbers: Using Metrics To Optimize Your Product by Dan ...
 
Creating A Product Backlog
Creating A Product BacklogCreating A Product Backlog
Creating A Product Backlog
 
A Quick Story about IN
A Quick Story about INA Quick Story about IN
A Quick Story about IN
 
The Pragmatic Marketer: Volume 8, Issue 1
The Pragmatic Marketer: Volume 8, Issue 1The Pragmatic Marketer: Volume 8, Issue 1
The Pragmatic Marketer: Volume 8, Issue 1
 
Tech innovation s2_invention to innovation
Tech innovation s2_invention to innovationTech innovation s2_invention to innovation
Tech innovation s2_invention to innovation
 

Mehr von Henrik Berglund

Researching Entrepreneurship using Phenomenological Methods
Researching Entrepreneurship using Phenomenological MethodsResearching Entrepreneurship using Phenomenological Methods
Researching Entrepreneurship using Phenomenological MethodsHenrik Berglund
 
Customer Development - Identifying and Testing Startup Hypotheses
Customer Development - Identifying and Testing Startup HypothesesCustomer Development - Identifying and Testing Startup Hypotheses
Customer Development - Identifying and Testing Startup HypothesesHenrik Berglund
 
Coming up with a good startup idea
Coming up with a good startup ideaComing up with a good startup idea
Coming up with a good startup ideaHenrik Berglund
 
Startups, Clones and Metrics
Startups, Clones and MetricsStartups, Clones and Metrics
Startups, Clones and MetricsHenrik Berglund
 
Henrik Berglund, Venture Cup, feb 2013
Henrik Berglund, Venture Cup, feb 2013Henrik Berglund, Venture Cup, feb 2013
Henrik Berglund, Venture Cup, feb 2013Henrik Berglund
 
Cbi Day Henrik - Introduction - Users and Radical Innovation
Cbi Day Henrik - Introduction - Users and Radical InnovationCbi Day Henrik - Introduction - Users and Radical Innovation
Cbi Day Henrik - Introduction - Users and Radical InnovationHenrik Berglund
 
Cbi day bob dorf customer development
Cbi day bob dorf customer developmentCbi day bob dorf customer development
Cbi day bob dorf customer developmentHenrik Berglund
 
Bob Dorf "The four steps 12 step program"
Bob Dorf "The four steps 12 step program"Bob Dorf "The four steps 12 step program"
Bob Dorf "The four steps 12 step program"Henrik Berglund
 
Henrik Berglund - A tale of two Kirzners
Henrik Berglund - A tale of two KirznersHenrik Berglund - A tale of two Kirzners
Henrik Berglund - A tale of two KirznersHenrik Berglund
 

Mehr von Henrik Berglund (9)

Researching Entrepreneurship using Phenomenological Methods
Researching Entrepreneurship using Phenomenological MethodsResearching Entrepreneurship using Phenomenological Methods
Researching Entrepreneurship using Phenomenological Methods
 
Customer Development - Identifying and Testing Startup Hypotheses
Customer Development - Identifying and Testing Startup HypothesesCustomer Development - Identifying and Testing Startup Hypotheses
Customer Development - Identifying and Testing Startup Hypotheses
 
Coming up with a good startup idea
Coming up with a good startup ideaComing up with a good startup idea
Coming up with a good startup idea
 
Startups, Clones and Metrics
Startups, Clones and MetricsStartups, Clones and Metrics
Startups, Clones and Metrics
 
Henrik Berglund, Venture Cup, feb 2013
Henrik Berglund, Venture Cup, feb 2013Henrik Berglund, Venture Cup, feb 2013
Henrik Berglund, Venture Cup, feb 2013
 
Cbi Day Henrik - Introduction - Users and Radical Innovation
Cbi Day Henrik - Introduction - Users and Radical InnovationCbi Day Henrik - Introduction - Users and Radical Innovation
Cbi Day Henrik - Introduction - Users and Radical Innovation
 
Cbi day bob dorf customer development
Cbi day bob dorf customer developmentCbi day bob dorf customer development
Cbi day bob dorf customer development
 
Bob Dorf "The four steps 12 step program"
Bob Dorf "The four steps 12 step program"Bob Dorf "The four steps 12 step program"
Bob Dorf "The four steps 12 step program"
 
Henrik Berglund - A tale of two Kirzners
Henrik Berglund - A tale of two KirznersHenrik Berglund - A tale of two Kirzners
Henrik Berglund - A tale of two Kirzners
 

Kürzlich hochgeladen

Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access
 
PDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdfPDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdfHajeJanKamps
 
The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003
The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003
The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003believeminhh
 
PDT 89 - $1.4M - Seed - Plantee Innovations.pdf
PDT 89 - $1.4M - Seed - Plantee Innovations.pdfPDT 89 - $1.4M - Seed - Plantee Innovations.pdf
PDT 89 - $1.4M - Seed - Plantee Innovations.pdfHajeJanKamps
 
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)tazeenaila12
 
UNLEASHING THE POWER OF PROGRAMMATIC ADVERTISING
UNLEASHING THE POWER OF PROGRAMMATIC ADVERTISINGUNLEASHING THE POWER OF PROGRAMMATIC ADVERTISING
UNLEASHING THE POWER OF PROGRAMMATIC ADVERTISINGlokeshwarmaha
 
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBBPMedia1
 
Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access
 
Team B Mind Map for Organizational Chg..
Team B Mind Map for Organizational Chg..Team B Mind Map for Organizational Chg..
Team B Mind Map for Organizational Chg..dlewis191
 
NASA CoCEI Scaling Strategy - November 2023
NASA CoCEI Scaling Strategy - November 2023NASA CoCEI Scaling Strategy - November 2023
NASA CoCEI Scaling Strategy - November 2023Steve Rader
 
Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024Winbusinessin
 
Project Brief & Information Architecture Report
Project Brief & Information Architecture ReportProject Brief & Information Architecture Report
Project Brief & Information Architecture Reportamberjiles31
 
Entrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizationsEntrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizationsP&CO
 
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...Khaled Al Awadi
 
Fabric RFID Wristbands in Ireland for Events and Festivals
Fabric RFID Wristbands in Ireland for Events and FestivalsFabric RFID Wristbands in Ireland for Events and Festivals
Fabric RFID Wristbands in Ireland for Events and FestivalsWristbands Ireland
 
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...TalentView
 
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdfGraham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdfAnhNguyen97152
 
7movierulz.uk
7movierulz.uk7movierulz.uk
7movierulz.ukaroemirsr
 

Kürzlich hochgeladen (20)

Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024Borderless Access - Global Panel book-unlock 2024
Borderless Access - Global Panel book-unlock 2024
 
PDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdfPDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdf
 
The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003
The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003
The Vietnam Believer Newsletter_MARCH 25, 2024_EN_Vol. 003
 
PDT 89 - $1.4M - Seed - Plantee Innovations.pdf
PDT 89 - $1.4M - Seed - Plantee Innovations.pdfPDT 89 - $1.4M - Seed - Plantee Innovations.pdf
PDT 89 - $1.4M - Seed - Plantee Innovations.pdf
 
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
 
Investment Opportunity for Thailand's Automotive & EV Industries
Investment Opportunity for Thailand's Automotive & EV IndustriesInvestment Opportunity for Thailand's Automotive & EV Industries
Investment Opportunity for Thailand's Automotive & EV Industries
 
UNLEASHING THE POWER OF PROGRAMMATIC ADVERTISING
UNLEASHING THE POWER OF PROGRAMMATIC ADVERTISINGUNLEASHING THE POWER OF PROGRAMMATIC ADVERTISING
UNLEASHING THE POWER OF PROGRAMMATIC ADVERTISING
 
WAM Corporate Presentation Mar 25 2024.pdf
WAM Corporate Presentation Mar 25 2024.pdfWAM Corporate Presentation Mar 25 2024.pdf
WAM Corporate Presentation Mar 25 2024.pdf
 
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
 
Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024
 
Team B Mind Map for Organizational Chg..
Team B Mind Map for Organizational Chg..Team B Mind Map for Organizational Chg..
Team B Mind Map for Organizational Chg..
 
NASA CoCEI Scaling Strategy - November 2023
NASA CoCEI Scaling Strategy - November 2023NASA CoCEI Scaling Strategy - November 2023
NASA CoCEI Scaling Strategy - November 2023
 
Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024Ethical stalking by Mark Williams. UpliftLive 2024
Ethical stalking by Mark Williams. UpliftLive 2024
 
Project Brief & Information Architecture Report
Project Brief & Information Architecture ReportProject Brief & Information Architecture Report
Project Brief & Information Architecture Report
 
Entrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizationsEntrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizations
 
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
 
Fabric RFID Wristbands in Ireland for Events and Festivals
Fabric RFID Wristbands in Ireland for Events and FestivalsFabric RFID Wristbands in Ireland for Events and Festivals
Fabric RFID Wristbands in Ireland for Events and Festivals
 
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
 
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdfGraham and Doddsville - Issue 1 - Winter 2006 (1).pdf
Graham and Doddsville - Issue 1 - Winter 2006 (1).pdf
 
7movierulz.uk
7movierulz.uk7movierulz.uk
7movierulz.uk
 

Henrik Berglund - Customer Development for startups

  • 1.     Customer  Development  for  Startups                   Henrik  Berglund   Chalmers  University  of  Technology   Center  for  Business  Innova8on   henber@chalmers.se   www.henrikberglund.com   @khberglund     2013-­‐02-­‐15   1  
  • 2. Presenta8on  based  on                   by  Steve  Blank  and  Bob  Dorf     More  info:  www.steveblank.com   Buy  the  book:  hJp://www.amazon.com/gp/product/0984999302/    
  • 3. Using  slides  from                           developed  by  Steve  Blank  and  Bob  Dorf     hJp://www.slideshare.net/sblank/      
  • 4. Agenda   1.  Startups  (Old  and  new  view)   2.  Business  Models    WS   3.  Customer  Development    WS  
  • 5. Part  1   Startups   (What  We  Used  to  Believe   What  We  Now  Know)  
  • 6. What  We  Used  to  Believe  
  • 7. Startups  are  a  Smaller  Version     of  a  Large  Company  
  • 8. What  We  Now  Know  
  • 9. Startups  Search     Companies  Execute  
  • 10. Startups  ≠  Small  companies  
  • 11. What  We  Used  to  Believe   Strategy  
  • 12.   Start by developing a Business Plan…
  • 13.   …make the financial forecasts…
  • 15. What  We  Now  Know   Strategy    
  • 17.   Develop and Execute the Business Plan
  • 18. Why?
  • 19. No Business Plan survives first contact with customers
  • 20. “Everybody  has  a  plan  un@l  they  get  punched  in  the  face”      Mike  Tyson  
  • 21. Searching for a Business Model comes before Executing a business plan
  • 23. Solu8on   Unique  Value   Unfair  Advantage   Customer  Segments   Problem   Proposi8on   Not  easily  copied  or  bought   Customers;  Users   Why  you  are  different  and  worth    gecng  aJen8on     Result  customers  want        +  specific  period  of  8me        +  address  objec8ons     Key  Metrics   Acquisi8on   Ac8va8on   Channels        Direct        Distributor   Reten8on        OEM   Alterna8ves   Revenue        Retail   Referral        VAR        Web   Alterna8ves   Early  Adopters   Interview  30-­‐50  customers   Type:   Fixed  Pricing:   Dynamic  Pricing   Cost  Structure   Build  MVP   Ongoing  burn  (fixed  and  variable  costs)   Revenue  Streams   Asset  sales   Usage  fee   List  price   Product  feature   Nego8a8on   Yield  management   Subscrip8on  fees   Customer  segment   Real-­‐8me  market   Lending/Ren8ng/Leasing   Volume   Licensing   Brokerage  fees   Adver8sing  
  • 24. Search   Execu@on   Business  Model     Opera@ng  Plan  +   Strategy   Hypotheses   Financial  Model  
  • 25. What  We  Used  to  Believe   Process  
  • 26. We  Built  Startups  by     Managing  Processes   Product  Management   +   Waterfall  Engineering  
  • 27. Tradi8onal  Development  Process   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship  
  • 28. Tradi8onal  Development  Process   Has  Two  Implicit  Assump8ons   Customer  Problem:  known   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   Product  Features:  known   Works  well  for  incremental  development  projects   targe@ng  exis@ng  customers.  
  • 29. Tradi8on  –  Hire  Marke8ng   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   -­‐   Create  Marcom     -­‐  Hire  PR  Agency   -­‐  Create  Demand   Marke@ng      Materials   -­‐  Early  Buzz   -­‐  Launch  Event   -­‐  Create  Posi@oning   -­‐  “Branding”  
  • 30. Tradi8on  –  Hire  Sales   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   -­‐   Create  Marcom     -­‐  Hire  PR  Agency   -­‐  Create  Demand   Marke@ng      Materials   -­‐  Early  Buzz   -­‐  Launch  Event   -­‐  Create  Posi@oning   -­‐  “Branding”   -­‐  Hire  Sales  VP   -­‐  Build  Sales   Sales   -­‐  Hire  1st    Sales  Staff   Organiza@on  
  • 31. Tradi8on  –  Hire  Business  Development   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   -­‐   Create  Marcom     -­‐  Hire  PR  Agency   -­‐  Create  Demand   Marke@ng      Materials   -­‐  Early  Buzz   -­‐  Launch  Event   -­‐  Create  Posi@oning   -­‐  “Branding”   -­‐  Hire  Sales  VP   -­‐  Build  Sales   Sales   -­‐  Hire  1st    Sales  Staff   Organiza@on   Business     -­‐  Hire  First  Bus  Dev   -­‐  Do  deals  for  FCS   Development  
  • 32. Example  -­‐  Recognize  these?   Online  clothes  retailer  specialized  in   fashion  and  sports  (e.g.  Adidas,  Fila,  Vans,   Converse,  DKNY  and  Fred  Perry).     Raised  $160  million  (JP  Morgan,  Goldman   Sachs,  Bernard  Arnault,  BeneJon  +  six).   Developed  an  innova8ve  site  with  3D,   zoom,  360⁰  rota8on  and  virtual   mannequins,  powered  by  lots  of  JavaScript   and  Flash  Anima8ons.   Rapidly  grew  to  420  people  and  spent   heavily  on  PR  pre  launch.   Delayed  launch  repeatedly  due  to   technological  problems.   Finally  launched  in  18  countries   simultaneously    8:59  November  3  1999  EST.  
  • 34. What  happened?   40  %  of  visitors  could  not  access  the  site.      “Eighty-­‐one  minutes     to  pay  too  much  money   Mac  users  could  not  operate  the  site  at  all.     for  a  pair  of  shoes  that  I   The  site  was  very  difficult  to  use  and  full  of   am  s8ll  going  to  have  to   errors,  oren  causing  computers  to  freeze.       wait  a  week  to  get?”   Extremely  slow  to  load  without  broadband.   Only  one  in  four  aJempts  to  make  a   purchase  worked.     Low  conversion  rates  (0.25%).   Conversion  rates  did  double  by  Christmas.   30%  returns,  not  10%  as  projected.   A  “low-­‐bandwidth  version”  was  relaunched   within  months.   But  low  sales  +  high  costs   =>  Bankruptcy.  
  • 35. Validated  Business  Model?   "Our  strong  investor  base  offers  a  solid   founda@on  for  boo.com.  The  fact  that   such  interna@onal  investors  have   invested  in  boo.com  reflects  the  power   of  our  business  model  and  the  boo.com   brand."       Patrik  Hedelin,  Execu2ve  Chairman.   (Press  Release,  Nov  3  1999)  
  • 36. The  problem  –  untested  assump8ons!   Value    proposi@on   Customer   Key  ac@vi@es   Fashion  and  sports  online,   rela@onships   Partnering,     Realis@c  shopping  experience,   Paid  &  Earned  Media   E-­‐commerce,   “Life-­‐s@le  choice”   Visitor  numbers,   Global  taxes  &   .   Conversion  rates   payments,       Customer   Marke@ng       segments   Key  partners   Brands,   Warehouses,   Visualiza@on  of   “young,  well-­‐off,   fashion-­‐  conscious   18  to  24  year  olds”   Logis@cs     the  business         model  framwork   Cost  structure   Revenue     Key   Channels   Streams   Call  centres,   Buying  online,   resources   Online  sales/  full  retail   Return  rates,   Channel  conflicts,   price,   Developers,   Inventory   Zone  pricing   Risk  capital   CAC  &  Life@me  Value  
  • 37. What’s  wrong  with  this  picture?   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   •  Both  Customer  Problems  and  Product  Features   are  hypotheses   •  Emphasis  on  execu8on  rather  than  learning  and   discovery   •  No  relevant  milestones  for  marke8ng  and  sales   •  Oren  leads  to  premature  scaling  and  a  heavy   spending  hit  if  product  launch  fails     You  do  not  know  if  you  are  wrong  un@l  you   are  out  of  money/business  
  • 38. Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   -­‐   Create  Marcom     -­‐  Hire  PR  Agency   -­‐  Create  Demand   Marke@ng      Materials   -­‐  Early  Buzz   -­‐  Launch  Event   -­‐  Create  Posi@oning   -­‐  “Branding”   -­‐  Hire  Sales  VP   -­‐  Build  Sales   Sales   -­‐  Hire  1st    Sales  Staff   Organiza@on   Business     -­‐  Hire  First  Bus  Dev   -­‐  Do  deals  for  FCS   Development  
  • 39. What  We  Now  Know   Process    
  • 40. More startups fail from a lack of customers than from a failure of product development
  • 41. Because   •  We  have  processes  to  manage     product  development     •  We  have  no  process  to  manage     customer  development    
  • 43. Focus  on  Customers  and  Markets  from  Day   One!   Value proposition Key activities Customer relationships Customer Key partners segments Visualiza@on  of   the  business   model  framwork   Cost Key Channels Revenue structure resources streams
  • 44. Problem   Solu8on   Unique  Value   Unfair     Customer     Proposi8on   Advantage   Segments   Key  Metrics   Channels   Cost  Structure   Revenue  Streams  
  • 46. Product  and  Customer  Development   Product Development Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   + Customer Development Customer Customer Customer Company Discovery Validation Creation Building
  • 47. Product  and  Customer  Development   Problem:  unknown   Solu8on:  unknown  
  • 48. Search   Execu@on   Strategy   Business  Model     Opera8ng  Plan  +   Hypotheses   Financial  Model   Process   Customer  &   Product  Management   &  Waterfall  Development   Agile  Development  
  • 49. What  We  Used  to  Believe   Organiza@on  
  • 50. Hire and Build a Functional Organization
  • 53. What  We  Now  Know   Organiza@on  
  • 54. Founders run a Customer Development Team No sales, marketing and business development
  • 55. Search   Execu@on   Strategy   Business  Model     Opera8ng  Plan  +   Hypotheses   Financial  Model   Customer  Development,   Product  Management   Process   Agile  Development   Agile  or  Waterfall  Development   Customer     Func@onal  Organiza@on   Organiza@on   Development  Team,      by  Department   Founder-­‐driven  
  • 56. search   execu8on  
  • 57. Part  2   Business  Models  
  • 59. What’s  a  Company?   A  business  organiza@on,  which  sells  a   product  or  service  in  exchange  for  revenue   and  profit  
  • 60. How  are  Companies  organized?  
  • 61. How  are  Companies  organized?   Companies  are  organized  around               Business  Models  
  • 62. How  are  Companies  organized?   Companies  are  organized  around  Business   Models  
  • 64. What’s  a  Startup?   A  temporary  organiza8on     designed  to  search     for  a  repeatable  and  scalable  business  model  
  • 65. What’s  a  Startup?   A  temporary  organiza8on     designed  to  search     for  a  repeatable  and  scalable  business  model  
  • 66. What’s  a  Startup?   A  temporary  organiza8on     designed  to  search     for  a  repeatable  and  scalable  business  model  
  • 67. The  goal  is  not  to  remain  a  startup   Large   Startup   Transi@on   Company   The  goal  of  a  startup  is  to  become  a  large  company!   Failure  =  failure  to  transi@on.  
  • 68. Business  Models   Key activities Value Customer proposition relationships Key partners Customer segments Cost Key Channels Revenue structure resources streams hJp://www.businessmodelalchemist.com/  
  • 69. Problem   Solu8on   Unique  Value   Unfair     Customer     Proposi8on   Advantage   Segments   What  are  you  customers’   Key  features   Single,  clear,  compelling     That  can’t  be  easily     Who  are  your  customers?   key  jobs/pains/gains?     message  that  states  why     bought,  or  imitated?     MVP   you  are  different  and       Who  are  earlyvangelists?   worth  buying  from     Key  Metrics   Channels   What  metrics  are     How  do  you  reach     most  cri8cal     customers?   to  track?     Cost  Structure   Revenue  Streams   Customer  Acquisi8on  Costs     Revenue  Model   Distribu8on  Costs   Life  Time  Value     Hos8ng   Revenue/pricing   People   etc.   etc.       Fixed/variable  
  • 70. Problem   Solu8on   Unique  Value   Unfair     Customer     Proposi8on   Advantage   Segments   What  are  you  customers’   Key  features   Single,  clear,  compelling     That  can’t  be  easily     Who  are  your  customers?   key  jobs/pains/gains?     message  that  states  why     bought,  or  imitated?     MVP   you  are  different  and       Who  are  earlyvangelists?   worth  buying  from     Key  Metrics   Channels   What  metrics  are     How  do  you  reach     most  cri8cal     customers?   to  track?     Cost  Structure   Revenue  Streams   Customer  Acquisi8on  Costs     Revenue  Model   Distribu8on  Costs   Life  Time  Value     Hos8ng   Revenue/pricing   People   etc.   etc.       Fixed/variable  
  • 71. Customers  and  problems   Who  is  the  customer?   Mul8-­‐sided  market?   Different  from  user?   hJp://www.businessmodelalchemist.com/2012/08/achieve-­‐product-­‐market-­‐fit-­‐with-­‐our-­‐brand-­‐ new-­‐value-­‐proposi8on-­‐designer.html  
  • 72. Customers  and  problems   -­‐  jobs  to  be  done   What  func8onal  jobs  is  your  customer   trying  get  done?  (e.g.  perform  or   complete  a  specific  task,  solve  a  specific   problem…)     What  social  jobs  is  your  customer  trying   to  get  done?  (e.g.  trying  to  look  good,   gain  power  or  status…)     What  emo8onal  jobs  is  your  customer   “What  jobs  are  the  customers  you  are   trying  get  done?  (e.g.  esthe8cs,  feel  good,   targe2ng  trying  to  get  done”   security…)  
  • 73. Customers  and  problems   -­‐  customer  pains   What  does  your  customer  find  too  costly?   (e.g.  takes  a  lot  of  8me,  costs,  effort)       What  makes  your  customer  feel  bad?       (e.g.  frustra8ons,  annoyances)       How  are  current  solu8ons  under-­‐ performing  for  your  customer?                             (e.g.  lack  of  features,  performance,   malfunc8on)     “What  are  the  costs,  nega2ve  emo2ons,  bad     situa2ons  etc.  that  your  customer  risks   What  nega8ve  social  consequences  does   experiencing  before,  during,  and  a>er  ge?ng   your  customer  encounter  or  fear?                   the  job  done.”   (e.g.  loss  of  face,  power,  trust,  or  status)    
  • 74. Customers  and  problems   -­‐  customer  gains   Which  savings  would  make  your  customer   happy?  (e.g.  in  terms  of  8me,  money  and   effort)     What  would  make  your  customer’s  job  or   life  easier?  (e.g.  flaJer  learning  curve,   more  services,  lower  cost  of  ownership)     What  posi8ve  social  consequences  does   your  customer  desire?  (e.g.  makes  them   look  good,  increase  in  power,  status)   “What  are  the  benefits  your  customer     expects,  desires  or  would  be  surprised  by.”   What  are  customers  looking  for?  (e.g.   good  design,  guarantees,  features)     What  do  customers  dream  about?  (e.g.   big  achievements,  big  reliefs)  
  • 75. Problem   Solu8on   Unique  Value   Unfair     Customer     Proposi8on   Advantage   Segments   What  are  you  customers’   Key  features   Single,  clear,  compelling     That  can’t  be  easily     Who  are  your  customers?   key  jobs/pains/gains?     message  that  states  why     bought,  or  imitated?     MVP   you  are  different  and       Who  are  earlyvangelists?   worth  buying  from     Key  Metrics   Channels   What  metrics  are     How  do  you  reach     most  cri8cal     customers?   to  track?     Cost  Structure   Revenue  Streams   Customer  Acquisi8on  Costs     Revenue  Model   Distribu8on  Costs   Life  Time  Value     Hos8ng   Revenue/pricing   People   etc.   etc.       Fixed/variable  
  • 76. Unique  Value  Proposi@ons/Solu@on   What  are  your  products  and   services?     How  do  they  create  value  for   the  customer  segments?  
  • 77. Unique  Value  Proposi@ons/Solu@on   Can  your  product/service:     •  Produce  savings?   •  Make  your  customers  feel   beJer?     •  Put  an  end  to  difficul8es?   •  Wipe  out  nega8ve  social   consequences?  
  • 78. Unique  Value  Proposi@ons/Solu@on   Can  your  product/service:     •  Outperform  current   solu8ons?     •  Produce  outcomes  that  go   beyond  their  expecta8ons?     •  Make  your  customer’s  job   or  life  easier?     •  Create  posi8ve  social   consequences?        
  • 79. Product  Market  Fit   Gecng  this  right  is  essen8al!  
  • 80. Product  Market  Fit   Gecng  this  right  is  essen8al!  
  • 81. Problem   Solu8on   Unique  Value   Unfair     Customer     Proposi8on   Advantage   Segments   What  are  you  customers’   Key  features   Single,  clear,  compelling     That  can’t  be  easily     Who  are  your  customers?   key  jobs/pains/gains?     message  that  states  why     bought,  or  imitated?     MVP   you  are  different  and       Who  are  earlyvangelists?   worth  buying  from     Key  Metrics   Channels   What  metrics  are     How  do  you  reach     most  cri8cal     customers?   to  track?     Cost  Structure   Revenue  Streams   Customer  Acquisi8on  Costs     Revenue  Model   Distribu8on  Costs   Life  Time  Value     Hos8ng   Revenue/pricing   People   etc.   etc.       Fixed/variable  
  • 82. How  Do  You  Want  Your  Product  to  Get  to   Your  Customer?   " Yourself " Through someone else " Retail " Wholesale " Bundled with other goods or services 82  
  • 85. How  Does  Your  Customer  Want  to  Buy   Your  Product  from  your  Channel?   " •  Same day " •  Delivered and installed •  Downloaded " •  Bundled with other " products " •  As a service •  … " 85  
  • 86. Problem   Solu8on   Unique  Value   Unfair     Customer     Proposi8on   Advantage   Segments   What  are  you  customers’   Key  features   Single,  clear,  compelling     That  can’t  be  easily     Who  are  your  customers?   key  jobs/pains/gains?     message  that  states  why     bought,  or  imitated?     MVP   you  are  different  and       Who  are  earlyvangelists?   worth  buying  from     Key  Metrics   Channels   What  metrics  are     How  do  you  reach     most  cri8cal     customers?   to  track?     Cost  Structure   Revenue  Streams   Customer  Acquisi8on  Costs     Revenue  Model   Distribu8on  Costs   Life  Time  Value     Hos8ng   Revenue/pricing   People   etc.   etc.       Fixed/variable  
  • 89. Problem   Solu8on   Unique  Value   Unfair     Customer     Proposi8on   Advantage   Segments   What  are  you  customers’   Key  features   Single,  clear,  compelling     That  can’t  be  easily     Who  are  your  customers?   key  jobs/pains/gains?     message  that  states  why     bought,  or  imitated?     MVP   you  are  different  and       Who  are  earlyvangelists?   worth  buying  from     Key  Metrics   Channels   What  metrics  are     How  do  you  reach     most  cri8cal     customers?   to  track?     Cost  Structure   Revenue  Streams   Customer  Acquisi8on  Costs     Revenue  Model   Distribu8on  Costs   Life  Time  Value     Hos8ng   Revenue/pricing   People   etc.   etc.       Fixed/variable  
  • 90. WS  
  • 91. Map  out  your  Business  Model?   60  minutes  
  • 92. Be  clear  about  Product  Market  Fit!  
  • 93. Part  3   Customer  Development  
  • 95. To  repeat   More  startups  fail  from     a  lack  of  customers  than  from  a   failure  of  product  development…  
  • 96. …  because  they  think  startups  =  small  companies…  
  • 97. …they  focus  on  execu8ng  the  plan…   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   •  Both  Customer  Problems  and  Product  Features   are  hypotheses   •  Emphasis  on  execu8on  rather  than  learning  and   discovery   •  No  relevant  milestones  for  marke8ng  and  sales   •  Oren  leads  to  premature  scaling  and  a  heavy   spending  hit  if  product  launch  fails     You  do  not  know  if  you  are  wrong  un@l  you   are  out  of  money/business  
  • 98. …  so  they  scale  on  untested  assump8ons…  
  • 99. …  and  end  up  going  bust.   “We  have  been  too  visionary.  We   wanted  everything  to  be  perfect,  and   we  have  not  had  control  of  costs"       Ernst  Malmsten   (BBC  News,  May  18  2000)  
  • 100. So  what  to  do?  
  • 102. Focus  on  Customers  and  Markets  from  Day   One!   Value proposition Key activities Customer relationships Customer Key partners segments Visualiza@on  of   the  business   model  framwork   Cost Key Channels Revenue structure resources streams
  • 103. Product  and  Customer  Development   Product Development Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   + Customer Development Customer Customer Customer Company Discovery Validation Creation Building
  • 104. Product  and  Customer  Development   Problem:  unknown   Solu8on:  unknown  
  • 105. Customer  Development:  Key  Ideas   •  Parallel  process  to  Product  Development  (agile)   •  Measurable  checkpoints  not  @ed  to  FCS  but  to  customer   insights   •  Emphasis  on  itera@ve  learning  and  discovery  before  execu@on   •  Must  be  done  by  small  team  including  CEO/project  leader  
  • 106. Customer  Development  Heuris8cs   •  There  are  no  facts  inside,  so  get  out  of  the  building!     •  Develop  for  the  few,  not  for  the  many   •  Earlyvangelists  make  your  company,  and  are  smarter  than  you!   •  Develop  a  minimum  viable  product  to  maximize  fast  learning.   •  Nail  it  before  you  scale  it  –  low  burn  by  design!  
  • 107. Customer  Development:  Four  Stages   search   execu8on   •  Customer  Discovery        Ar8culate  and  Test  your  Business  Model  Hypotheses   •  Customer  Valida@on        Sell  your  MVP  and  Validate  your  MB  &  Sales  Roadmap   •  Customer  Crea@on          Scale  via  relentless  execu8on  and  fill  the  sales  pipeline   •  Company  Building        (Re)build  company’s  organiza8on  &  management  
  • 108. Customer Discovery •  Articulate and test your BM hypotheses •  No selling, just listening •  Must be done by CEO/ project manager
  • 109. building building block block building block building building building block block block building block building building block block build g ing building buildin block block block
  • 110. But,   Realize  it’s  just  Hypotheses!  
  • 111. Guess Guess Guess Guess Guess Guess Guess Guess Guess
  • 114. Test Customer Problem Hypotheses ”Do  you  have  this       problem?”       1.           2.           3.          
  • 115. Test Customer Problem Hypotheses ”Do  you  have  this    ”Tell  me  about  it,  how       problem?”    do  you  solve  it  today?”     1.        1.         2.        2.         3.        3.        
  • 116. Test Customer Problem Hypotheses ”Do  you  have  this    ”Tell  me  about  it,  how    ”Does  something  like  this   problem?”    do  you  solve  it  today?”  solve  your  problem?”   1.        1.      1.   2.        2.      2.   3.        3.      3.   Listen  carefully  to  what  they  say  at  each  step!     Focus  on  learning  -­‐  Don’t  try  to  sell  them  on  your  idea!     In  the  process  you  find  out  about  other  BM  parts  as  well:   workflow,  benefits  (to  users  &  others),  preferred  channels,  cri@cal   influencers,  respected  peers  etc…     You  want  to  become  a  domain  expert!  
  • 117. Finding  people   Introduc8ons  (ask  everyone  you  know)     •  Provide  the  exact  text  that  they  can  copy  and  paste  into   a  tweet  or  email  (They’re  doing  you  a  favor!  Make  it  as   easy  as  possible  for  them)   •  Tell  them  exactly  how  you  are  going  to  communicate   with  their  contacts  (They’re  risking  a  bit  of  social  capital   for  you.  Be  very  clear  that  you  won’t  spam  or  annoy   people)   •  Tell  them  your  goals  (What  do  you  think  you’ll  get/learn   if  they  make  this  intro  for  you?  People  want  to  know   that  they’re  contribu8ng  to  a  bigger  picture!)    
  • 118. Finding  people   AdWords,  Facebook  Ads,  Promoted  Tweets     Summarize  your  idea  and  get  it  in  front  of  people  who   have  expressed  an  interest  in  it  by  having  searched  for   your  keywords  and  clicked  your  ad  –  get  conversa8ons   (and/or  test  hypotheses  using  landing  pages).       hJp://www.cindyalvarez.com/best-­‐prac8ces/customer-­‐ development-­‐interviews-­‐how-­‐to-­‐finding-­‐people  
  • 119. Finding  people   TwiJer  Search     Look  for  people  who  have  already  discussed  a  similar   product,  problem,  or  solu8on  and  address  a  tweet  directly   to  them:     “@username  Would  love  yr  feedback  on  [product/ problem/solu2on]  –  shd  only  take  2mins  [URL]  thanks!”  
  • 120. Finding  people   Google  Alerts     Set  up  Google  Alerts  for  your  product/problem/solu8on  –   when  it  finds  relevant  blog  posts  or  comments,  email  and   ask  for  feedback:     “I  read  your  [post/comment]  about  [product/problem/ solu2on].    I’m  currently  working  on  a  related  idea  and  I   think  your  opinion  would  be  very  valuable  to  me  –  could   you  take  2  minutes  and  check  out  [URL]?    Thank  you  –   I’d  be  happy  to  return  the  favor  any  2me.”      
  • 122. Web   Much  faster  to  build  =>     get  quan8ta8ve  feedback  sooner.     Use  a  low-­‐fi  landing  page  as  subs8tute  for   (and  introduc8on  to)  conversa8ons.     Key  to  drive  traffic  through  AdWords/ Facebook  Ads/Promoted  Tweets  etc.     Build  (design  test),  measure  (run  test)  and   analyze  (evaluate  test)!    
  • 123. Landing  page  design   hJp://blog.kissmetrics.com/landing-­‐page-­‐blueprint/  
  • 129. Reality check!   CustDev  and  ProdDev  teams  meet  and  discuss   the  lessons  learned  from  the  field.     ”Here  is  what  we  thought  about  customers  and   their  problems,  here  is  what  we  found  out”     BM  hypotheses,  product  specs  or  both  are  jointly   revised.    
  • 130. Test  Solu8on  Hypothesis   1)  ”We  believe  you  have  this  important  problem”        –  listen  (check).       2)  Demo  how  your  product  solves  the  problem.  Focusing   on  a  few  key  features.     Include  workflow  story:  ”life    before  our  product”  and     ”life  arer  our  product”  –  listen!     3)  ”What  would  this  solu8on  need  to  have  for  you  to   purchase  it?”  Listen,  ask  follow  up  ques8ons.  
  • 132. “A  new  way  for  people  to  pay  for  train   8ckets  at  rail  sta8ons  using  an   electronic  payment  service,  like  PayPal,   on  their  mobile  phone.”  
  • 134. Dropbox   •  1st  solu8on  test:  a  three  minute  video  made  in  the   founder’s  apartment  before  a  complete  code  was   wriJen.   –  Generated  valuable  feedback  from  visionary  customers.   •  2nd  solu8on  test:  another  video  of  the  product  that  was   posted  on  a  social  network.   –  Wai8ng  list  jumped  from  5  000  to  75  000.   •  Dropbox’s  original  intent  was  to  build  and  ship  their   product  in  eight  weeks.     •  Instead,  they  gathered  feedback  and  launched  a  public   version  18  months  later.  
  • 136. Test Product Hypotheses   Arer  demoing,  ask  about  other  things:     Posi8oning  –  how  do  they  describe  the  product?   Product  category  (new,  exis8ng,  resegmented)   Compe8tors   Features  needed  for  first  version   Preferred  revenue  model   Pricing   Addi8onal  service  needs   Marke8ng  –  how  do  they  find  this  type  of  product?   Purchasing  process   Who  has  a  budget?   etc.  
  • 137. Web   Build  out  a  high-­‐fidelity  web  page  with  “func8oning”   back-­‐end,  based  on  lessons  learned.       “Mechanical  Turk”-­‐solu8on.     Ask  for  money:  first  “pre-­‐order”  then  charging.     Con8nue  to  test,  measure  and  analyze!    
  • 142. Reality check!   CustDev  and  ProdDev  teams  meet  and  discuss   the  lessons  learned.     ”Here  is  what  we  thought  about  product   features  and  here  is  what  we  found  out”     BM  hypotheses,  product  specs  or  both  are  again   jointly  revised.  
  • 143. Customer  Discovery:  Exit  Criteria   Consistent  answers  from  “enough”  people?   What  are  your  customers  top  problems?   How  much  will  they  pay  to  solve  them?   Does  your  product  concept  solve  them?   Do  customers  agree?     How  much  will  they  pay  for  it?  When?   Can  you  draw  a  day-­‐in-­‐the-­‐life  of  a  customer?   Before  &  arer  your  product   Can  you  draw  the  org  charts  of  users,  buyers   and  channels?    
  • 144. Customer Validation •  Develop  and  sell  MVP  to  passionate  earlyvangelists   •  Validate  a  repeatable  sales  roadmap   •  Verify  the  business  model  
  • 145. Minimal  Viable  Product   Based  on  your  insights  from  Customer  Discovery,  sell   the  smallest  feature  set  customers  are  willing  to  pay   for!     •  Purpose  1:  Reduce  wasted  engineering  hours      (and  wasted  code)     •  Purpose  2:  Get  something  into  the  hands  of   earlyvangelists  as  soon  as  possible  =>  maximize   learning!  (cf.  landing  page)  
  • 146. The  Apple  I,  Apple’s  first  product,  was  sold  as  an  assembled  circuit   board  and  lacked  basic  features  such  as  a  keyboard,  monitor,  and   case.    
  • 147. The  owner  of  this  unit  added  a  keyboard  and  a  wooden  case.   hJp://en.wikipedia.org/wiki/Apple_Inc.  
  • 149. Minimal  Viable  Product   The  MVP  is  not  the  goal  =  Requires  commitment   to  itera8on!     •  “A  complex  system  that  works  is  invariably   found  to  have  evolved  from  a  simple  system   that  worked.”     •  “A  complex  system  designed  from  scratch   never  works  and  cannot  be  made  to  work.   You  have  to  start  over,  beginning  with  a   working  simple  system.”   John  Gall  System-­‐an8cs:  How  Systems  Really  Work  and  Especially  How  They  Fail  
  • 150. Types  of  earlyvangelists     Not     helpful   1.  Has  a  problem   2.  Understands  he  or  she  has  a  problem   3.  Ac8vely  searching  for  a  solu8on   4.  Cobbled  together  an  interim  solu8on   5.  CommiJed  and  can  quickly  fund  a  solu8on   Jackpot!  
  • 151. Customer  Valida8on:  Exit  Criteria   Do  you  have  a  proven  sales  roadmap?   Organiza8on  chart?  Influence  map?   No  staffing  un8l  roadmap  is  proven!     Do  you  understand  the  sales  cycle?   LTV,  CAC,  ROI  for  customers  etc.     Do  you  have  a  set  of  orders  ($’s)  of  the   product  valida8ng  the  roadmap?     Is  the  business  model  scalable?   LTV  >  CAC  
  • 152. If  yes  –  Start  execu8ng  
  • 153. If  no  –  Pivot!   •   The  heart  of  Customer  Development   •   Change  without  crisis        (and  without  firing  execu8ves)   “The  idea  that  successful  startups  change  direc2ons  but   stay  grounded  in  what  they've  learned”  
  • 156. YouTube - Customer Need Pivot
  • 158. Pivot   Adapt  the  Business  Model   un8l  you  can  prove  it   works  
  • 159. search   execu8on  
  • 160. Customer  Crea8on   •  Grow  customers  from  few  to  many   •  Comes  arer  proof  of  sales   •  Inject  $’s  for  scale   •  This  is  where  you  “cross  the  chasm”    
  • 161. Company Building •  (Re)build  company’s  organiza8on  &  management   •  Dev.-­‐centric  ⇒  Mission-­‐centric  ⇒  Process-­‐centric  
  • 162. Summary  –  Customer  Development   •  Customer  Discovery        Ar8culate  and  Test  your  Business  Model  Hypotheses   •  Customer  Valida@on        Sell  your  MVP  and  Validate  your  BM  &  Sales  Roadmap   •  Customer  Crea@on          Scale  via  relentless  execu8on  and  fill  the  sales  pipeline   •  Company  Building        (Re)build  company’s  organiza8on  &  management  
  • 163. Don’t  do  a  Boo!   Concept   Product  Dev.   Alpha/Beta   Launch/   Test   1st  Ship   “We  have  been  too  visionary.  We   wanted  everything  to  be  perfect,  and   we  have  not  had  control  of  costs"       Ernst  Malmsten   (BBC  News,  May  18  2000)  
  • 164. WS  
  • 165. Develop  a  Customer  Discovery  Plan?   •  What  are  the  key  ques8ons  I  need  answered?   –  (hint:  customers,  problems)   •  Who  do  I  need  to  talk  with?   •  How  will  I  get  them  to  talk  to  me?   •  When  will  this  happen?   •  How  will  I  know  I  am  done?   –  With  problem  discovery?   –  With  solu8on  discovery?  
  • 166. Tips     •  Each  team  learns  and  evaluates  a  tool,  and   then  reports  back  to  the  whole  group:   –  CrazyEgg.com   –  KISSMetrics   –  Unbounce   –  Qualaroo   –  Marketo.com    
  • 167. Presenta8on  based  on                   by  Steve  Blank  and  Bob  Dorf     More  info:  www.steveblank.com   Buy  the  book:  hJp://www.amazon.com/gp/product/0984999302/    
  • 168. Using  slides  from                           developed  by  Steve  Blank  and  Bob  Dorf     hJp://www.slideshare.net/sblank/