CitySpark Seminar - Validating your market

CitySpark Seminars

Week 1

Validating your business idea

Today’s session

•  Recap and review

•  Understand what you need to do to be successful in stage two of the competition

•  Introduce the concept of Customer Development

•  Begin to apply it to your idea/vision

RECAP

A business design and doing competition

Having ideas…

& making them happen!

Academic excellence for business and the professions

“Doing not learning to do,

is the essence of entrepreneurship”

Guy Kawasaki

Stage one: Oct-Dec 2014

PROBLEM

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What’s the problem?

How big is the problem?

Whose problem is it?

How is it currently solved?

1 2

3 4

Startup design brief

Stage two: Feb-Mar 2015

SOLUTION

4 x workshops Feb – Mar 2015

Submission deadline

Thursday 19th March

Deadline Friday 21st November

www.citystarters.co.uk/cityspark

Stage two "nal Tuesday 31st March

5 x £3,000 prizes

Stage three: July 2015

PROTOTYPE

The UK’s leading pre-accelerator programme for early-stage startups

www.FFWDLondon.com

Back to stage two…

Judging criteria

•  Is there a clearly de"ned problem? •  Is there a clearly articulated & di#erentiated solution? •  Is the market clearly de"ned, addressable and

scalable? •  Is there a viable and sustainable business model? •  Is the plan backed-up by concrete evidence?

Sounds great, but what are you really

looking for?

ACTION

TRACTION

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Where do all startups start?

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I have a super duper techy innovation!!!

I have an idea!!!

I have a passion!!!

See: Bill Aulet, www.disciplinedentrepreneurship.com

Why do most startups fail?

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concept Dev testing launch customer

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See: Gi# Constance, www.talkingtohumans.com

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concept Dev testing launch customer

I’m sorry, but why do I need this

again?

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Introducing Steve Blank

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Key idea 1 Startups operate in Search mode

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Established companies

Execute against an established

business model

Startups

Need to search for a scalable & pro"table

business model

Key idea 2 The only way you can "nd a

business model is to “get out of the building!”

Academic excellence for business and the professions

Academic excellence for business and the professions

See: Gi# Constance, www.talkingtohumans.com

Academic excellence for business and the professions

Academic excellence for business and the professions

customer

Academic excellence for business and the professions

customer

Key idea 3 The Customer Development

process

Academic excellence for business and the professions Customer discovery

Customer validation

Problem – solution "t

Problem – market "t

Problem-Solution "t = You’ve identi"ed a real-world

customer problem and a possible solution

Product-Market "t = You’ve built a product that early adopters will pay you money for

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Customer discovery

Customer validation

Problem – solution "t

Problem – market "t

Yay, this is awesome!

Fail fast Fail cheap Fail small

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Exercise 1

•  15-mins, working individually or in teams

•  Take the business hypothesis worksheet and complete as many sections as possible

•  Make sure your answers are as concise and speci"c

as possible

•  Don’t over-think the exercise!!!

Exercise 2

•  15-mins, working in groups of 2 or 3

•  What assumptions have we made that, if proven wrong, would cause the business to fail?

•  Take the second worksheet and list as many of these assumptions as possible

•  Make your assumptions as concise and speci"c as

possible

The Chillow®

Assumptions

•  We believe that people care about pillow temperature •  We believe that people care about sleep quality when

purchasing a pillow •  We believe we can sell online to customers •  We believe our customers will be young urban professionals •  We believe that our very "rst customers will be new graduates

who need to out"t their apartments •  We believe that we can sell our pillows at a high enough price to

cover our costs •  We believe that we can raise enough capital to cover

investments in manufacturing

Exercise 2

•  15-mins, working in groups of 2 or 3

•  What assumptions have we made that, if proven wrong, would cause the business to fail?

•  Take the second worksheet and list as many of these assumptions as possible

•  Make your assumptions as concise and speci"c as

possible

Homework

•  Before next week’s session

•  Review your list and mark the assumptions that would have a large impact on your business and feel highly uncertain

•  Prioritise your top-3 assumptions

•  Download Talking to Humans PDF and read pages 1-27 (www.talkingtohumans.com)

RECAP

Key points •  We’re not just looking for hypothetical business ideas or plans –

we want to see action, traction and evidence

•  Every new business idea is an article of faith precariously perched on a big stack of assumptions

•  You need to challenge these assumptions right from the start – not sail blissfully towards an epic fail at the end

•  This means that you need to understand what assumptions you’re making

•  And then rank them in order of priority.

CitySpark Seminars

Week 2

Testing your assumptions

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