Lecture on Business Model Canvas and Customer Interviews

1. Sebastian Fittko on Business Model and Idea Validation at Workshop „Mehrwertiges Unternehmertum“, Zeppelin Universität 1

2. About Sebastian Intro Business Idea Intro Business Model Canvas Q&A How to validate a Business Idea Q&A

5. NEW IDEA Image curtsey: http://www.ﬂickr.com/commons

6. Without Execution & Insights Image curtsey: http://www.ﬂickr.com/commons

7. Traction Time Problem/ Solution Fit Product/Market Fit Image curtsey: http://www.ﬂickr.com/commons Scale

8. GET OUT AND EXECUTE!! Image curtsey: http://www.ﬂickr.com/commons

9. How to get insights?

10. Insights Where is the pain? Image curtsey: http://www.ﬂickr.com/commons

11. Ask your potential customers!

12. Qualitative Asking for customer‘s intent Image curtsey: http://www.ﬂickr.com/commons

14. Quantitative Measure customer behavior Image curtsey: http://www.ﬂickr.com/commons

15. How to execute?

16. Start here? Image curtsey: http://www.ﬂickr.com/commons

17. Image curtsey: http://www.ﬂickr.com/commons

18. „Everybody has a plan until they get punched in the mouth.“ – Mike Tyson

20. Day Month No. Who are our Key Partners? Who are our key suppliers? Which Key Resources are we acquiring from partners? Which Key Activities do partners perform? What Key Activities do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue streams? What Key Resources do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue Streams? What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive? What value do we deliver to the customer? Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment? Which customer needs are we satisfying? What type of relationship does each of our Customer Segments expect us to establish and maintain with them? Which ones have we established? How are they integrated with the rest of our business model? How costly are they? For whom are we creating value? Who are our most important customers? Through which Channels do our Customer Segments want to be reached? How are we reaching them now? How are our Channels integrated? Which ones work best? Which ones are most cost-efficient? How are we integrating them with customer routines? For what value are our customers really willing to pay? For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues? This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http:/ /creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA. BIG thanks to Alex Osterwalder! You can download the here: http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf Year

21. google business model canvas or http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf

22. Bla Bla Bla Bla Image curtsey: http://www.ﬂickr.com/commons Bla

24. Day Month No. Who are our Key Partners? Who are our key suppliers? Which Key Resources are we acquiring from partners? Which Key Activities do partners perform? What Key Activities do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue streams? What Key Resources do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue Streams? What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive? What value do we deliver to the customer? Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment? Which customer needs are we satisfying? What type of relationship does each of our Customer Segments expect us to establish and maintain with them? Which ones have we established? How are they integrated with the rest of our business model? How costly are they? For whom are we creating value? Who are our most important customers? Through which Channels do our Customer Segments want to be reached? How are we reaching them now? How are our Channels integrated? Which ones work best? Which ones are most cost-efficient? How are we integrating them with customer routines? For what value are our customers really willing to pay? For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues? This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http:/ /creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA. BIG thanks to Alex Osterwalder! You can download the here: http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf Year

25. Day Month Year No. Who are our Key Partners? Who are our key suppliers? Which Key Resources are we acquiring from partners? Which Key Activities do partners perform? What Key Activities do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue streams? Hypothesis What value do we deliver to the customer? Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment? Which customer needs are we satisfying? Hypothesis What type of relationship does each of our Customer Segments expect us to establish and maintain with them? Which ones have we established? How are they integrated with the rest of our business model? How costly are they? For whom are we creating value? Who are our most important customers? Hypothesis Hypothesis Hypothesis What Key Resources do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue Streams? Through which Channels do our Customer Segments want to be reached? How are we reaching them now? How are our Channels integrated? Which ones work best? Which ones are most cost-efficient? How are we integrating them with customer routines? Hypothesis What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive? For what value are our customers really willing to pay? For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues? Hypothesis Hypothesis This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http:/ /creativecommons.org/licenses/by-sa/3.0/ or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA. BIG thanks to Alex Osterwalder! You can download the here: http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf

26. Go out an ask your customers

27. Get your numbers right! Image curtsey: http://www.ﬂickr.com/commons

29. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams

31. Newness: You solve a unsolved problem! Image curtsey: http://www.ﬂickr.com/photos/72439897@N02/6623264623/sizes/l/in/photostream/

32. Performance: Your product has a better performance than the competition! Image curtsey: http://www.babez.de/wp-content/myfotos/bf-performance-gt660/bf-performance-gt-660-02.jpg

33. Customization: You enable to customize products by the user http://media.cmgdigital.com/shared/img/photos/2013/02/10/58/41/MichaelDell1jpgCopy.jpg.JPG

34. Getting things done: You help your customers to get things done. http://capmembers.com/media/cms/working_together_in_space_hires_E77D1F50E1332.jpg

35. Design, UX, CX: You have just a stunning design, UX and CX. http://3.bp.blogspot.com/_wuUoxyO0BNI/TCsb1xIOeuI/AAAAAAAAIWw/k9ph1nqXj2w/s1600/P1040804.JPG

36. Price: You can oﬀer you product simply cheaper than the competion could. http://www.gemeinde-asbach.de/img/ALDI.JPG

37. Cost reduction: You help your cusomers to reduce cost. http://cdn.physorg.com/newman/gfx/news/hires/2012/1-containershi.jpg

38. Risk reduction: Reducing risk for you customers (more reliable product or service) http://ﬁles.mercedes-fans.de/images/2010/09/mercedes-benz-hightech-airbag-gurtstraffer-w126-innovationtf012.jpg

39. Accessibility: Making things accessible to your cusomers they could not aﬀord or access before. http://www.airlinereporter.com/wp-content/uploads/2010/10/airlines1.jpg

40. Wake the world a better place: Solving social or environmental problems for the good of the society. http://www.airlinereporter.com/wp-content/uploads/2010/10/airlines1.jpg

43. What are you aiming for? „Being in a good market with a product that can satisfy that market.“ – Marc Andreessen Image curtsey: http://www.ﬂickr.com/commons

44. Go where the beef is and people want your stuﬀ!! Image curtsey: http://www.ﬂickr.com/commons

45. Mass market Image curtsey: http://1.bp.blogspot.com/-wYRDKwwuvZk/Tq6Esx2CoAI/AAAAAAAABkg/d7jEc7vPzT0/s1600/Crowd_Obama_Inauguration_Day_Big.jpg

46. Niche Market Image curtsey: http://www.trashness.com/wp-content/uploads/2012/06/preppy-hipster.jpg

47. Segmented Image curtsey: http://www.kotorikits.com/ekmps/shops/mummymadeit/resources/Design/father-and-son.jpg

48. Diversiﬁziert Image curtsey:http://4.bp.blogspot.com/-ECdDDi3kO50/TaHu-p5cQcI/AAAAAAAAAAM/np6_jKgDQ0U/s1600/Farmers-Market-foods.jpg

49. Multi Sided Image curtsey:http://naturalgeographic.net/wp/wp-content/uploads/2013/08/rock-concert.jpg

50. Key Partner Key Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationshi p Revenue Streams

51. Key Activities Key Ressources How you serve the customer Customer Segment

53. Maintaining your customer relationship http://www.bruchsal.org/sites/default/ﬁles/1_40_Jahre_Dinner_for_one.jpg

55. Service Sales

56. Recurring Revenue

57. Retail

58. Commision

59. Licensing

60. Advertising

61. Renting

62. Donation http://www.sternsinger.org/ﬁleadmin/upload/Presse/DKS/Sternsinger-Fotos/Inventar/Inventar04.jpg

64. Key Partner Key Partner Key Activities Activities Key Resources Cost Structure Value Proposition Channels Customer Segment Customer Relationship Revenue Streams

67. Key Partner Key Activities Value Proposition Key Resources Cost Structure Channels Customer Segment Customer Relationshi p ≤ Revenue Streams Revenue Streams

68. About Sebastian Intro Business Idea How to Work with Business Model Canvas Q&A How to Validate Q&A

69. Any Questions? Image curtsey: http://www.ﬂickr.com/commons

70. About Sebastian Intro Business Idea Intro Business Model Canvas Q&A How to Validate Q&A

71. How to gather customer insights and validate decisions? Image curtsey: http://www.ﬂickr.com/commons

72. Quantitative Measure customer behavior Image curtsey: http://www.ﬂickr.com/commons

73. vs.

74. Qualitative Asking for customer intend Image curtsey: http://www.ﬂickr.com/commons

75. We do this in two steps: 1st step Validate Problem 2nd step Validate Solution Do they care? Do they need it? Do they have budget for it? Who really is they? Does our solution really solve their Problem? Do they understand the solution? Would they pay for it?

76. Numbers are a horrible way to understand customer intend! Image curtsey: http://www.ﬂickr.com/commons

77. So go and ask your customers!

78. “If I had asked people what they wanted, they would have said faster horses.” – Henry Ford Image curtsey: http://www.ﬂickr.com/commons

79. The hard things in customer interviews Knowing who your customer is. Deﬁne narrow segmentation! 5-10 customers per segment.

80. The hard things in customer interviews Ask the right way. Did or do, NEVER would. Don‘t ask for opinions. Don‘t assume problems.

81. The hard things in customer interviews Use their feedback. Know what you want to learn. Test your riskiest assumptions. Learn or pivot.

82. The hard things in customer interviews Be prepared to kill your idea!

83. The interview Design a questionnaire based on your assumptions. Testrun the interview. Let them speak. Ask open questions. Let them be the expert. In person, no Skype, no online survey, no phone, no email! Don‘t do more interviews if feedback repeats!

84. The interview – protocol No laptop. Use Post-its. Write down exact customer phrase.

85. NEVER delegate interviews! Interviews should be done by the product deciders. Lern to talk and listen to your customers! Image curtsey: http://www.ﬂickr.com/commons

86. Review with your team! Use exact wording by the customer. Understand their answers in their context. Reﬂect and rethink your assumptions. Which assuptions turned out wrong? See what you‘ve learned. Adapt your solution.

87. Validate Solution. Come back to interviewees. Focus ﬁrst on current solution. Discuss ﬂaws of current solutions. Show mockups and interactive demos. Get improvement feedback. Get them to commit. Pay a price? Build a MVP. or iterate.

88. If you were wrong – be HAPPY! You don‘t wasted your money, time and money Iterate or pivot Usually a successful startup didn‘t start with the ﬁnal solution Image curtsey: http://www.ﬂickr.com/commons

89. About Sebastian Intro Business Idea How to Work with Business Model Canvas Q&A How to Validate Q&A

90. Any Questions? Image curtsey: http://www.ﬂickr.com/commons

91. THX! contact: sebastian.ﬁttko@gmail.com twitter: @forstartups XING – Linkedin

92. Must-reads!