Neuroentrepreneurship symposium 2015 Academy of Management
CORE_CONSULTING
1. Determining the highest probability of success based on
our core knowledge of human behavior
CORE
Strategic Consulting for Forward Thinkers
2. Problem
Idea or
Intuition
Gut Instinct: Products
are often created as a
result of a guess about
human behavior
!
“I love this product, I think
other people will too”
!
“There is definitely a need for
this product, so many people
experience this problem”
!
“That product works for that
market, this similar one will
work for this similar market”
3. Problem
Idea or
Intuition
Product
Gut Instinct: Products
are often created as a
result of a guess about
human behavior
“I love this product, I think
other people will too”
!
“There is definitely a need for
this product, so many people
experience this problem”
!
“That product works for that
market, this similar one will
work for this similar market”
The product must first
be created to generate
data about how it is
being used
!
Data allows us to asses how
accurate our guess is. Pre-
existing data about the
market or similar products
may help guide our guess.
Software has a strategic
advantage, as it provides a
multitude of ways to collect
data and iterate quickly.
4. Problem
Idea or
Intuition
Product Data
Data tells you what
people do, not WHY
they do it
!
Data is generated as the
result of human behavior. It is
then assessed and new
guesses are made about how
to improve products to
continue the cycle until the
desired behavior is achieved.
!
This cycle is analogous to
throwing darts at a dartboard
blindfolded and adjusting our
aim based on spectator
feedback
Gut Instinct: Products
are often created as a
result of a guess about
human behavior
“I love this product, I think
other people will too”
!
“There is definitely a need for
this product, so many people
experience this problem”
!
“That product works for that
market, this similar one will
work for this similar market”
The product must first
be created to generate
data about how it is
being used
!
Data allows us to asses how
accurate our guess is. Pre-
existing data about the
market or similar products
may help guide our guess.
Software has a strategic
advantage, as it provides a
multitude of ways to collect
data and iterate quickly.
5. Problem
Idea or
Intuition
Product Data
Gut Instinct: Products are
often created as a result of a
guess about human behavior
!
“I love this product, I think other
people will too”
!
“There is definitely a need for this
product, so many people experience
this problem”
!
“That product works for that market,
this similar one will work for this
similar market”
The product must first be
created to generate data
about how it is being used
!
Data allows us to asses how accurate
our guess is. Pre-existing data about
the market or similar products may
help guide our guess. Software has a
strategic advantage, as it provides a
multitude of ways to collect data and
iterate quickly.
Data tells you what people
do, not WHY they do it
!
Data is generated as the result of
human behavior. It is then assessed
and new guesses are made about
how to improve products to
continue the cycle until the desired
behavior is achieved.
This cycle is analogous to
throwing darts at a dartboard
blindfolded and adjusting our
aim based on spectator
feedback
6. Solution
Start with First Principles: Behavioral
Science
!
Can I determine WHY people perform certain behaviors and use this to my
advantage in the Product Creation Cycle? YES! Behavioral scientists have generated
enormous amounts of data and applicable theory - USE it to remove the blindfold!
!
7. Solution
Start with First Principles: Behavioral
Science
!
Can I determine WHY people perform certain behaviors and use this to my
advantage in the Product Creation Cycle? YES! Behavioral scientists have generated
enormous amounts of data and applicable theory - USE it to remove the blindfold!
!
“Human behavior and culture is the product of complex, evolved psychological mechanisms. These information-
processing mechanisms comprise the human mind and help to explain the connection between evolutionary biology and
the complex, irreducible social and cultural phenomena studied by anthropologists, sociologists, economists, and
historians. There is a universal human nature, and this universality primarily exists at the level of evolved psychological
mechanisms. These evolved psychological mechanisms are adaptations, constructed by natural selection over
evolutionary time. Finally, the evolved structure of the human mind is adapted to the way of life of Pleistocene hunter-
gatherers, not necessarily to our modern circumstances.” – Dr. John Tooby
8. Solution
Start with First Principles: Behavioral
Science
!
Goal: Use what we already know about human behavior to provide the right product
to the right audience.
Can I determine WHY people perform certain behaviors and use this to my
advantage in the Product Creation Cycle? YES! Behavioral scientists have generated
enormous amounts of data and applicable theory - USE it to remove the blindfold!
!
“Human behavior and culture is the product of complex, evolved psychological mechanisms. These information-
processing mechanisms comprise the human mind and help to explain the connection between evolutionary biology and
the complex, irreducible social and cultural phenomena studied by anthropologists, sociologists, economists, and
historians. There is a universal human nature, and this universality primarily exists at the level of evolved psychological
mechanisms. These evolved psychological mechanisms are adaptations, constructed by natural selection over
evolutionary time. Finally, the evolved structure of the human mind is adapted to the way of life of Pleistocene hunter-
gatherers, not necessarily to our modern circumstances.” – Dr. John Tooby
9. Our Approach
Idea or
Intuition
Theory Data
Experiment
Behavioral Science
Incorporate, at each step in the process, the Theory and Data that
we already have about WHY people do the things they do
!
1.Filter our Intuition/Ideas to determine how to create products
that are closer to or initial target
2.Structure our data generation and testing in ways that are more
meaningful
3.Analyze the information we gather about our product through a
frame that helps us answer the WHY more accurately
!
Each cycle of this process incurs significant cost:
financial capital, energy, and time. Using behavioral
science not only allows us to reduce iterations and
more efficiently achieve the desired behavior, but
allows to optimize for benefit through creating
better, more targeted, more monetizable products.
!
10. Our Approach
Idea or
Intuition
Product1
Theory Data
Behavioral Science
Incorporate, at each step in the process, the Theory and Data that
we already have about WHY people do the things they do:
!
1. Filter our Intuition/Ideas to determine how to create
products that are closer to our initial target
2.Structure our data generation and testing in ways that are more
meaningful
3.Analyze the information we gather about our product through a
frame that helps us answer the WHY more accurately
!
Each cycle of this process incurs significant cost:
financial capital, energy, and time. Using behavioral
science not only allows us to reduce iterations and
more efficiently achieve the desired behavior, but
allows to optimize for benefit through creating
better, more targeted, more monetizable products.
!
Experiment
11. Our Approach
Idea or
Intuition
Product Data1 2
Theory Data
Behavioral Science
Incorporate, at each step in the process, the Theory and Data that
we already have about WHY people do the things they do:
!
1. Filter our Intuition/Ideas to determine how to create products
that are closer to our initial target
2. Structure our data generation and testing in ways that are
more meaningful
3.Analyze the information we gather about our product through a
frame that helps us answer the WHY more accurately
!
Each cycle of this process incurs significant cost:
financial capital, energy, and time. Using behavioral
science not only allows us to reduce iterations and
more efficiently achieve the desired behavior, but
allows to optimize for benefit through creating
better, more targeted, more monetizable products.
!
Experiment
12. Our Approach
Idea or
Intuition
Product Data1 2
3
Theory Data
Behavioral Science
Incorporate, at each step in the process, the Theory and Data that
we already have about WHY people do the things they do:
!
1. Filter our Intuition/Ideas to determine how to create products
that are closer to our initial target
2. Structure our data generation and testing in ways that are more
meaningful
3. Analyze the information we gather about our product
through a frame that helps us answer the WHY more
accurately
!
Each cycle of this process incurs significant cost:
financial capital, energy, and time. Using behavioral
science not only allows us to reduce iterations and
more efficiently achieve the desired behavior, but
allows to optimize for benefit through creating
better, more targeted, more monetizable products.
Experiment
13. Our Approach
Idea or
Intuition
Product Data1 2
3
Theory Data
Behavioral Science More specifically, one strategy for how we will use
behavioral science is to understand the mechanics of
experience and how we can use those mechanics to
target the correct audience in order to achieve maximal
probability of success.
!
!
!
!
!
Each cycle of this process incurs significant cost: financial capital, energy, and time. Using
behavioral science not only allows us to reduce iterations and more efficiently achieve the desired
behavior, but allows to optimize for benefit through creating better, more targeted, more
monetizable products.
Experiment
14. Mechanics of Experience
Dynamic Cycle of Experience
Subject
StimuliStructure
Our experience of reality can be organized into the combination of three distinct but collaborative entities.
1) The Subject: The individual experiencing a stimuli in a set structure. The subject has its own set of
limiting factors including its attention, arousal, emotional state and conscious decision making ability.
2) The Stimuli: The actual stimuli that the subject is experiencing. for example a piece of music (auditory),
an app (visual/spatial), or an item of clothing (somatosensory-visual). Stimuli will interact with a subjects
sensory organs and neuro-mechanics in multiple combinations.
3) The Structure: The environment, wether social, physical or societal in which the subject has learned how
to experience a particular stimuli from outside sources outside of his/her own experimentation.
15. Neuro-Economics And
Product Positioning
Unfamiliar Zone
Familiar Zone
The Experimental Zone™Weird
Cliche’
A Model of Reward
The Experimental Zone™ is the leading perceptual model of reward that incorporates Attention/Arousal, Emotion,
Repetition, Expectation/Anticipation, Memory/Learning, Reward, Decision and their associative brain areas and networks.
Put simply: there is a space in time for each mind that is the perfect blend of what is old and what is new, where the
individual or group is willing to experiment for a rewarding experience.This theory is a working model of both individual
and mass reward which underlies consumer and market behavior.
16. Crowd Dynamics and
Market Applications
Unfamiliar Zone
Familiar Zone
The Experimental Zone™
Weird
Cliche’
A Model For Reward Dynamic Cycle of Experience
Subject
Stimuli
Populations are made of individuals. Individual consumer experience is often shared amongst masses.
Based off of the understanding and database of experience and reward we can craft solutions and
applications that can help us make the most informed decisions about product, marketing and distribution
to target populations in the following ways:
1. Individual and population reward system identification
2. Product and brand shaping and longevity
3. Warm vs cold market behavior analysis
4. Product-population matching
5. Target audience mapping
6. Probability scenarios for critical mass perceptual reach
7. Trend identification and creation
Structure
Applications:
Individual Individual
Individual Individual
Population
Crowd Dynamics
17. Maximized Probability for
Success
Product and Brand Identity/Keywords
Associated Warm Market Populations
Warm Exposure Intersections
Warm Market Overlaps
Warmest Target Audience
Highest Probable Customer Conversion
The Core Approach ::
Highest Probability for Success
18. Team
Nathan Lomeli, Stanford University: Since graduating with a BA in Economics in 2009, Nathan has applied his knowledge of
human behavior to education. He has worked on data analytics for a San Francisco-based education technology startup, incorporating
econometric models in the analysis of user behavior. He has also applied research into psychometrics to the construction and analysis of
standardized tests used in public schools, research into cognitive psychology to curriculum development and educational content design, and
research into evolutionary and developmental psychology to school organizational policy and charter application writing. Nathan’s passion and
interests lie in understanding the innate drives that all humans share, particularly in regard to how we interact with and process information, and
using that understudying to create marketplace efficiency.
!
Stephen Henderson, Stanford University: Stevie’s passion for music and the brain has motivated extensive research and
consulting experience both academically and professionally. He graduated in 2011 with a BA in Music with honors research in Music Cognition
and completed a MA in 2012 in Music, Science and Technology at the Center for Computer Research in Music and Acoustics where he was
awarded the Carolyn Applebaum Award for excellence in Entrepreneurial Endeavors and Community Service. Stephen developed interdisciplinary
research methods to study the neuro-mechanics of sacred experience with music in his Honors Thesis “The Sound of Sacred” and used those
methods as the base for the perceptual theory he developed in early 2013 for the neuro-mechanics of reward known as The Experimental
Zone™. Stephen is a creative solutionist and has worked as a viral marketing strategist for a multi-million dollar label in LA, lectured at the
University of Hawaii Maui College and Stanford University in the realms of Music, Cognition,Technology, and Marketing Strategy. He also is a
professional recording artist, music producer, songwriter & music business consultant and has worked with numerous independent labels in the
US and Canada as well as many multi-grammy award winning producers and songwriters in Los Angeles, San Diego, Honolulu, Salt Lake City and
San Francisco over the last year.
!
Daniel Corsaro, Stanford University: Daniel graduated in 2008 with a BS in Management Science and Engineering and has
spent his career successfully bridging the challenging gap between business/consumer needs and their associated technological solutions. Daniel
has extensive start-up experience, most recently founding and successfully exiting mobile application company Appiphany. He worked worked with
technical teams to create software solutions that provided invaluable insight and direction to the company’s leadership at Fortune 15 McKesson’s
most profitable business unit. He brings financial, operational, and practical business understanding to the group and has a proven ability to lead
collaborative problem solving and product teams. His passion for creating elegant, efficient technological solutions to practical problems
underscores his interest in the application of behavioral science to product creation and positioning.