Research, Competitive Analysis, Market and Awkward Co-Founder Discustions

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DKParker, LLC
2019
Flat6 Labs Bahrain Bootcamp – Day 1
Dave Parker
@DaveParkerSEA
www.dkparker.com/blog
Dave@dkparker.com
@DaveParkerSEA

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2019
Day 1 Agenda
¤ Intro
¤ About Dave
¤ Venture Scale Companies
¤ Venture Ready
¤ 13 Slides
¤ Research & Competitive Analysis
¤ Markets
¤ Awkward Co-Founder Discussions

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About Dave
¤ 5X founder, Board Member, former SVP Programs at UP
Global (Startup Weekend + Startup America)
¤ Startup Next creator
¤ Startup Week
¤ Author – soon to launch “6 Month Startup – Ideation to
Revenue”
¤ 8 transactions – 6 sell side, 2 buy side
¤ VC/Investor

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Rules of the Road
¤ #GiveFirst – you have complimentary skills around you
¤ Don’t Ramble – I’ll interrupt
¤ Network – you need to build you network for the future
starting today
¤ Ask questions as we go – especially if I talk too fast!

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Introduce yourself & Q&A
¤ Before breaks, we’ll pause for Q&A
¤ Introduce your company
¤ Follow the prompt
¤ Ask your questions

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Dave’s Madlibs Pitch
Hi, I’m <your name here>, and my company <your Company
name here> the problem I’m solving is <insert problem here>. Our
product <insert product info here> is designed for our target
customer of <insert target customer here>. We make money by
<insert method here> and our team is the right team because
<insert why you’re awesome here>. I need help with <insert help
needed here>.

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Score Yourself 1-4
Team: Why you, balanced team (talents, diversity), domain experts,
serially successful founders, great company experience
Idea: Are you solving a problem? New or existing problem, big category
(vs tool), early/late continuum, technical achievable, pain pill or vitamin
Product: do you have a product, how mature, customer first, solid design,
clear roadmap to scale
Market/Customer: big market (TAM/SOM), cash available, new or nascent
market?
Competition: How many incumbents, funding status, are you incremental
better or 10X better?
Traction: Customer validation, revenue, improving unit economics?
Timing: Why now? Are you late, early, too early?
Revenue Model/Finance: How will you monetize your idea? Do you have
a basic budget on spending, big or small economics
IP/Moat: Is your idea defensible? Can you build a moat over time?
Clear Ask: What do you need help with? Advice, funding, introduction,
help finding staff?
Total out of 40

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Venture Ready
Fast NO
¤ Market
¤ Team
¤ Product
¤ Traction
Slow Yes
¤ Idea
¤ Competition
¤ Business Model/Finance
¤ Timing
¤ Intellectual Property/Moat
¤ Clear Ask

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¤ https://docs.google.com/forms/d/1xedt0itkjGlQb3AvThM
eH5Cjf0yWtajeCUO7mJBkKDU/edit#responses

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Improving Weaknesses
¤ Where were you weak
¤ How would you answer differently
¤ What can you change now

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Creating
Value:
Product,
Team &
Market
Business Model

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Capturing
Value:
Reasonable to
Exceptional
Returns –
Traction & Idea
Business Model

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Delivering
Value:
Price,
Economics,
S&M
Business Model

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Creating Value:
Product
Delivering
Value: Price,
Economics,
S&M
Capturing
Value
Reasonable to
Exceptional
Returns
Defining Business Model

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2019
Creating
Value:
Product
Delivering
Value:
Marketing
and Sales
Capturing
Value
Reasonable to
Exceptional
Returns
Defining Business Model

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DKParker, LLC
2019
Creating Value:
Product
Delivering
Value:
Marketing
and Sales
Capturing Value
Reasonable to
Exceptional
Returns
Defining Business Model

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2019
Startup Epochs

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Epochs
¤ BC
¤ Pre Internet
¤ Pre Game of Thrones
¤ Pre Product-Market Fit
¤ AD
¤ Post Internet
¤ Post Game of Thrones
¤ Post Product-Market Fit

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Why Startups Fail

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Launch & Survive

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Judging a Startup – Bill Gross
Ultimate success – AT SCALE – Assumes good market

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Surfing Analogy
¤ The Wave
¤ The Board
¤ The Surfer
¤ The Trend
¤ The Product
¤ The Leader/Team
Market timing = bad waves
Small waves are bad
Bad product
Wrong person/team for the market
Are all three lined up for you?

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13 Slides

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13 Slides for Your Pitch
1. Title, Value Proposition,
Contact Info
2. Presentation Overview
3. Traction
4. Problem/Solution
5. Market
6. Timing
7. Product Roadmap/Demo
8. How You Make Money/Key
Metrics
9. Go-To-Market
10. Secret Sauce/Moat/IP
11. Team
12. Competitive Analysis
13. Clear Ask
Blog Post

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Dave’s Madlibs Pitch
Hi, I’m <your name here>, and my company <your Company
name here> the problem I’m solving is <insert problem here>. Our
product <insert product info here> is designed for our target
customer of <insert target customer here>. We make money by
<insert method here> and our team is the right team because
<insert why you’re awesome here>. I need help with <insert help
needed here>.

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BREAK

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Categorizing your Solution
Product Service
B2B Salesforce Consulting
B2C Games For profit school

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Hard Problems – start at the base

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What problem/opportunity
¤ What’s the problem
¤ Pain Pill
¤ Vitamin
¤ What’s the opportunity
¤ Solving for who?
¤ Can you create and capture value?
¤ Who will pay?

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Product & Companies
¤ Products aren’t fundable – Companies are fundable
¤ Lifestyle businesses – won’t funded
¤ Local vs. Scalable businesses
Which one will you be?
¤ Services vs Product
¤ Exit multiples

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Should you build it?

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And than there’s this ($120M)

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RESEARCH

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Research
¤ You are not the customer
¤ Methods of Research
¤ Blue Ocean
¤ Gartner Magic Quadrant
¤ Documentation and Analysis
¤ Google Search – what are the keywords someone would
type to find your solution
¤ Crunchbase Search – funding, timing, categories
¤ Competitive Product/Service pricing

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Pattern Matching
¤ Stage
¤ Customer Type
¤ Categories

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Research Project
¤ “Can I have your financial model?”
¤ 6 Year – 2,650 Funded Companies
¤ Results
¤ 16 Revenue Models – increasing level of complexity
¤ 4 Basic Sales Models
¤ Time from Seed to B Round

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Research
¤ Create a Google Sheet with your research
¤ One tab for research, one for competitors
¤ Who has written about your market
¤ Professionals, bloggers, others
¤ Who has raised capital in this market
¤ What’s the state of the “Wave?”

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DKParker, LLC
2019
Dave’s Madlibs Pitch
Hi, I’m <your name here>, and my company <your Company
name here> the problem I’m solving is <insert problem here>. Our
product <insert product info here> is designed for our target
customer of <insert target customer here>. We make money by
<insert method here> and our team is the right team because
<insert why you’re awesome here>. I need help with <insert help
needed here>.

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Competitive Analysis

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Specific Competitors
¤ Feature List
¤ Product positioning
¤ Gaps
¤ Pricing
¤ Target customer/profile
¤ Marketing approach

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Competitor List & Notes
Competitor URL Crunchbase
Link
Amount
Funded
Team Features Notes

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Getting Data
¤ Right Mouse click
¤ Keywords, meta data
¤ Pull keywords for competitors – Google Sheet
¤ Tools
¤ https://www.semrush.com/
¤ https://topics.seomonitor.com/query
¤ Google Keyword tool
¤ Social
¤ https://www.rivaliq.com/

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Who has tried this before?
¤ What about Analyst report?
¤ Why did they fail?
¤ Use Wayback Machine to look back

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Looking Back
¤ Feature List – then and now
¤ Product Positioning
¤ Pricing changes over time

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A Note Regarding Biases

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Questions?
Where to source your data for
your research?

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Break

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Markets

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2019
Who is the Market & Customer

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Total Addressable Market
¤ Also called Total Available Market
¤ Think global – launch local
¤ The Upside
¤ Calculating – bottom up, Total number of customers X
Annual Revenue for your product
¤ Direct Data
¤ Explicate data
¤ Indirect Data
¤ Implicit data
¤ Triangulation Data
¤ A combination of different data sources

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Service Addressable Market
¤ Or Serviceable Available Market
¤ The part of the market that can actually be reached
¤ Sales and Marketing driven
¤ With the features you have now
¤ With the product roadmap you have
¤ Competition
¤ Not everyone that might use it, if they found it, if it was in
their language and currency

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Service Obtainable Market
¤ The subset of the market you can capture
¤ A proxy for short term upside
¤ Not Aspirational

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Who is the Market & Customer

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Launch Addressable Market
¤ Given you TAM, SAM and SOM – WHO is the customer?
¤ And limited features
¤ Who can you sell to today?
¤ B2B
¤ B2C
¤ Buyer profile
¤ What features will you need to launch to expand your
market and price?

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10, 100, 1000 Customers
¤ Have a plan for how you get your first customers
¤ 10 – it’s you and your co-founder
¤ 100 – still you, maybe one insides sales person, forming a
process to scale
¤ 1000 – not you, scalable processs

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Market Conditions
¤ Nascent/New market
¤ Uber, AirBnB
¤ Large markets - >$100M or $1B
¤ Large market provide “at bat” opportunities
¤ Small markets suck
¤ Headwinds or tailwinds?

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Who is your customer?
¤ Product vs. Services
¤ Product is something you can deliver or ship – can you make
$$ while you sleep
¤ Services require people to deliver on the value and promise
– consulting or a restaurant
¤ Who pays the bill?
¤ A business
¤ The Consumer
¤ The product user and who pays can be different as in
Facebook or Google that make money on advertising

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Why/How do they buy?
¤ Make Money vs. Save Money?
¤ Searching for product
¤ Needs to be sold
¤ More on this in Month 4

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Exercise - How Big is Your Market

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Dave’s Madlibs Pitch
Hi, I’m <your name here>, and my company <your Company
name here> the problem I’m solving is <insert problem here>. Our
product <insert product info here> is designed for our target
customer of <insert target customer here>. We make money by
<insert method here> and our team is the right team because
<insert why you’re awesome here>. I need help with <insert help
needed here>.

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Awkward Co-Founder Discussions

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Everyone Has Expectations
¤ Set up a process to get the expectations out in the open
¤ Pre-Incorporation
¤ Meeting 1 of 2
¤ Why do you want to do this
¤ Capital in vs out
¤ Timing of life
¤ Passion
¤ Go to Startup Equity Calculator

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Co-Founders – Part 1

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Co-founders, part 2
¤ Meeting 2 of 2
¤ Print out a copy- bring it to the meeting
¤ How far off are you? What responsibilities?
¤ At Incorporation
¤ Reverse vesting schedule
¤ What happens when someone leaves?
¤ Option pool 20%
¤ Why 50/50 is the only wrong decision

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Post Incorporation
¤ Milestones/Deliverables
¤ Slicing Pie
¤ Market rates
¤ Don’t over inflate
¤ Track time and contribution
¤ Regular meeting
¤ Weekly standups
¤ Make HR changes fast – they won’t get easier

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Pre-Mortum

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If Your Startup was to Fail, Why?
¤ What’s the number one reason
¤ Product
¤ Customer Acquisition
¤ Competition
¤ Lack of funding
¤ Rank

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For Tomorrow
¤ Did you discuss co-founder issues
¤ Are you clear on where they could blow your company
apart?
¤ Discuss – don’t try to resolve, yet

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DKParker, LLC
2019
Dave’s Madlibs Pitch
Hi, I’m <your name here>, and my company <your Company
name here> the problem I’m solving is <insert problem here>. Our
product <insert product info here> is designed for our target
customer of <insert target customer here>. We make money by
<insert method here> and our team is the right team because
<insert why you’re awesome here>. I need help with <insert help
needed here>.

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2019
Day 1Deliverables
¤ Track your Venture Ready Score Before/After
¤ What can you do over the next 90 days to improve
¤ List your research and sources
¤ Build your Competitive landscape
¤ Subscribe to Google Alerts for all competitors
¤ Write is your pre-mortum – if you were to fail, why would you fail
¤ Schedule both co-founders meetings
¤ Print out the Foundrs.com results
¤ Setup Slicing Pie
¤ Start drafting your 13 slides

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2019
THANKS!