There is a misconception that to be a startup you need to have a team that can build a full product. And only when the product is built can you attract customers and convince them to pay! But this approach takes a lot of time, and an abundance of resources that are unavailable to most entrepreneurs. In this workshop, Poornima will share strategies for brainstorming, validating your idea, launching it, and even attracting early adopters who are willing to pay, as a scrappy startup.

1. Will it Launch?
...
Poornima Vijayashanker
Sponsored by: Tampa Bay Technology Forum
June 27, 2013
poornima@femgineer.com
@poornima
#willitlaunch
1

2. Introduction
• Duke University - ECE & CS
• R&D Engineer @ Synopsys
• Founding Engineer @ Mint
• Founder of BizeeBee
• Founder of Femgineer
2

3. Will it Launch?
• Ideation
• Brainstorming
• Customers
• Concierge MVP
• Pricing
• Business Model
• Measuring success
3

4. BIG VISION + small steps
4

5. Resist the urge to BUILD.
5

6. “Value in a startup is validating learning
NOT creation of stuff.”
Eric Ries, Lean Startup
6

7. Uncertainty.
7

8. Limited resources.
8

9. Learning
ReleasingBuilding
Balancing act.
9

10. Let’s get started.
10

11. 1. Come up with a hypothesis.
2. Figure out what you want to measure
3. Run an experiment.
4. Measure results from experiment.
5. Learn.
6. Move on to next hypothesis.
11

12. No idea!
Too many
ideas!
Is
this the right
idea?!
12

13. Where do ideas come from?
13

14. Creative minds.
14

15. The idea fairy.
Past experiencesPassions
Pains
Reading
Conversations
Supplemental Reading: A 5-Step Technique for Producing Ideas Circa 1939
Interests
Hobbies
Digesting
15

16. Don’t jump into building...
16

17. • Don’t fear thought crime!
• Put a team together.
• Make a list of people to reach out to: mentors, potential
teammates, experts, influencers.
• Don’t fall in love with an idea!
• Fall in love with the process with the process of generating
and executing ideas.
• Realize that ideas evolve.
Ideation Philosophy
17

18. More on Thought Crime
• Get another company to steal your
idea.
• Tell them your idea!
• Execution is key.
• Eventually someone will steal your
idea if it is good.
• Market leader.
• Domain expertise.
18

19. Two Paths in Ideation
Invention
understand advances & limitations
in technology & create a
commercially viable product
e.g. transistors v. vacuum tube
key to modern day electronics,
incandescent light bulb vs.
candle and heating oil
Re-Invention
improve upon an existing product
e.g. Mint - Quicken
come up with a new take on an old
concept
e.g. Twitter - telegram, sms
19

20. Invention
• List new forms of technology that interest you
• Understand the limitations
• Potential applications
• Existing technology
• Why is this so popular?
• What are its limitations?
• New forms of technology v. existing forms of technology
• How does it outperform existing technology? (saves money/time, takes up less
space, more reliable, longer life, higher quality)
• What is limiting it from becoming popular? (regulation, additional R&D, change in
behavior)
20

21. Re-Invention
• List 5 things you have thought of improving
• Who faces these pains?
• Have they tried to solve the pain themselves or
are there solutions out there that solve these
pains?
• For each existing solution list why this solution rocks and why it
sucks.
• What are some related pains?
21

22. Techniques.
22

23. 23

24. Mind Mapping
• Visual Outline of Information
• Ground Rules
• 1-2 hours per session with breaks.
• Don’t discount or judge any ideas!
• Take your time & don’t rush.
• Capture all ideas and connections.
• MindMeister
Supplemental Reading: Mind Mapping Guidelines
24

25. Mind Mapping Example
Blog
Education
Speaking
Online Offline
Entrepreneurship
Engineering
Leadership
Engineering
Co-Working
Incubators
Twitter
Blog Readers
Marketing
Product
Development
Spotlighting
women
Practices
Startups
Technology
Startups
Recruiting
25

26. Your idea is GOOD but it can be BETTER.
26

27. Brainstorming
• Work on ideas individually first!
• Ground Rules
• Pick a time everyone is available
• 1-2 hours per session with breaks.
• Don’t discount or judge any ideas!
• 1 person at a time has the floor.
• Take your time & don’t rush.
• Capture all ideas and connections.
• Thank everyone for their time!
Supplemental Reading: 5 Powerful Ways to Brainstorm with Teams,
An Outsider’s Outlook: Bringing in People to Brainstorm for Your Startup
27

28. CAN this product be built?
28

29. SHOULD this product be built?
29

30. Can we build a SUSTAINABLE business?
30

31. Do I WANT to build a business?
31

32. Let’s start building a business...
32

33. first thing we need...
33

34. first thing we need...
34

35. CUSTOMERS!
35

36. Who do we THINK are our customers?
36

37. 37

38. • High Level Segmentation
• Within market what are the various customer demographics
• Take 3 competitors
• Dig into what customers love/hate
• Understand substitutes
• Easy to displace? Customer’s comfort with change or being ready for it.
Customer Segmentation
38

39. Needs of neglected
segment
- what doesn’t
competitor ‘get’?
- what will make this
group loyal?
Willing to switch?
What will it take?
- price
- features
- credibility
- comfort
39

40. How do we attract them?
40

41. What do we want to OFFER them?
41

42. Concierge MVP
• An experiment is a product
• Questions
• Do consumers recognize they have the problem you are trying to solve?
• If there was a solution, would they buy it?
• Would they buy it from you?
• Can you build the solution for that problem?
• How can you build a simple version?
42

43. Channels.
43

44. Where do your customers hangout?
“early adopters “
^
44

45. Case Study #1: Food on the Table
• Creates weekly meal plans and grocery lists,
and hooks into grocery stores to find best deals
for ingredients
• Began with a single customer!
• Interviewed customers are local super markets.
• Signed up 1st customer and dropped off
groceries weekly.
• Collected $9.95 on each visit!
45

46. Case Study #2: Femgineer
• Blog that became a business
• Bootstrapped through customers
• Concierge MVP
46

47. Case Study #3: DropBox
• Validated concept through a video
47

48. Case Study #4: Zappos
• e-commerce platform
• Started with brick and mortar stores
• Focused on one market: shoes
• Simple site with same inventory that was in stores
48

49. How do you ask for the first $?
49

50. Early Sales
Customer
Development
Product
Development
Early Adopters: lesser feature set (enthusiasts)
Price of Pain
50

51. Price of pain.
51

52. Identifying Early Adopters
• Customer Pain
• Looking for a solution
• Using substitutes
• Know has a problem
• Has a problem
• expose through unhappiness
• wasting resources
• Has a budget
• talk about current spending
52

53. Pricing
• Models
• Single Use - based on type of product
• Ongoing - monthly subscription or a service fee
• License - limit types of usage or unlimited
• Factor in basic costs
• Under competitors pricing by doing a breakdown
• Why does their product cost what it does?
• Factor in substitutes
• ROI Calculation
• What is it worth to YOU?
53

54. Decision makers
Influencers
End
Users
• Decision Dilemmas: head v. heart
• Cost of Ownership
• Price
Recommenders
54

55. Customer Pain Your Benefit
Finding a Fit
‣ Listen to their needs and use that to sell your product
‣ If need be walk them through a cost analysis of their pain or ROI
‣ You are not doing a demo or a presentation
‣ You are working to get a NO as quickly as possible
‣ Create a list of disqualification questions
‣ Price
‣ Indecision is still a decision
55

56. • Channel (distributors)
• Volume Pricing
• Reservation Price
Additional Pricing Mechanisms
56

57. Marketing Metrics: The
Definitive Guide to
Measuring Marketing
Performance
Farris, Bendle, Pfeifer,
Reibstein
57

58. Produce ~300 bars/day with
current team.
Distributors need more!
Need $50k for manufacturing run.
58

59. Reservation Price: the price about
which a customer will not buy a
product.
59

60. • E-Commerce Site
• Get to shopping cart.
• Reduce abandonment!
• SaaS
• Monthly subscription
• Conversion v. cancellation rate
• Marketplace
• transaction fee
• Mobile App
• Media
Business Model
60

61. Stage of Business
• New
• Adoption Rate - Top of the funnel
• Engagement
• Growth
• Retention
• Monetization e.g. Pinterest pitch to investors
• Later Stage
• More nuanced but still one metric!
• Earnings
61

62. What are we trying to validate?
62

63. Hypothesis for our business.
63

64. Metrics.
64

65. Vanity Metrics.
65

66. “We received 1M likes!”
“We sent out 10M emails!”
66

67. Good metrics.
67

68. 1. Comparative
2. Understandable
3. Ratio or rate
68

69. Qualitative vs. Quantitative
69

70. Sometimes you have to pick up the phone!
70

71. KPI: key performance indicator.
71

72. Leading vs. Lagging Metrics
72

73. Correlated v. Causal
73

74. Be wary of correlated v. causal.
74

75. AARRR
75

76. What about quality?
76

77. Customer care about a product solving a
PROBLEM or serving a NEED.
77

78. If DESIGN is an ISSUE it will be
revealed when testing on early adopters.
78

79. What did we learn from our first
experiment?
79

80. Throw away your work!
80

81. Value v. Waste
81

82. Focus on learning FASTER and building LESS.
82

83. Review
• Ideation
• Brainstorming
• Customers
• Concierge MVP
• Pricing
• Measuring success
83

84. Q&A
84

85. What’s next?
85

86. GROUP MENTORING
Femgineer Friends
Visit femgineer.com/mentoring
ONLINE COURSE
Lean Product Development
Fall 2013
Visit femgineer.com/courses
86

87. Workshop
87

88. KEY OBJECTIVE(S) AGENDA
DELIVERABLE
Exercise
Create a questionnaire for
customers.
15 minutes 1. Who do you think your customer is?
2. Where do you think they hang out?
3. How do you plan to initially reach out to
them?
4. What do you plan to ask them? (Hint: this
should be based on a hypothesis you
have about your customer segment and
their pains.)
Present customer questionnaire.
88

89. KEY OBJECTIVE(S) AGENDA
DELIVERABLE
Exercise
First experiment to
attract early adopters.
15 minutes 1. What is your initial value proposition for
your customers?
2. How do you plan to convey the value
proposition to them?
3. What are you looking to measure?
Present Concierge MVP.
89