Incremental innovation-ivs-sapporo-may-2013-130523002944-phpapp01 (1)

Incremental Innovation.“Make Stuff Suck Less.”

Dave McClure500 Startups

slideshare.net/dmc500hats

#TONYSTARK#DOESNTSUCK

http://marvel.com/ironman3

Most Things Suck.

• But, It’s Easy 2 Make Them Better. – Especially Because of Technology.– And Because of Tony Stark.– They Make it Easy To Copy & Improve their Innovations

• TIP: DO NOT TRY TO BE TONY STARK. • JUST COPY / USE THEIR STUFF. (and Make It Slightly Better)

• 99% of the time -- Copy/Use Other People’s Amazing Stuff.• 1% of the time -- Come Up With Your Own Innovative Stuff. • Improve the Innovation by 1% Every Month.

Over Time, Things Sucks Less.

• Fire• The Wheel• Farming• Pigs, Cows, Chickens• Iron, Steel• Ships• Printing Press• Textiles• Steam Engine

• Electricity• Cars, Airplanes• Telephone• Radio, TV• Cable• The Internet• Social Networks• FB, Twitter, YouTube• Mobile Phones

Why No Flying Cars Yet?(Teleportation? Sexy Robots?)

• Because That Stuff is Really Hard.• Not So Many Tony Starks / Elon Musks Around.• You Ain’t All That Smart. • Or That Rich.• But, You Might Get To Use Their Stuff.

We Are Mental Midgets Who Stand on Shoulders of Giant Geeks

• Da Vinci• Sir Isaac Newton• James Watt• Nicola Tesla• Marie Curie

• Gates• Jobs• Bezos• Larry & Sergei• Zuck

#INCREMENTALINNOVATION#ITERATIONFTW

How 2 Boil a Frog

You Don’t Have to be Tony Stark

• Just Copy/Use the Stuff that Tony Stark Makes.– Tip: Since Most People Suck, They Won’t Notice U Aren’t Tony Stark.

• Copy/Use 99% All The Amazing Stuff Out There.• Innovate on the other 1%.• Innovate 1% More Every Month.

• Then Kick Back and Have a Beer.

Most Businesses Suck @ Innovation.

• They Don’t Know Technology.• They Don’t Know How to Code.• They Don’t Know SEO or SEM.• They Don’t Know Email Marketing.• They Don’t Know Social, Video, Local, Mobile.• They Don’t Know Good Design or UX.• They Don’t Know How to Cut & Paste.• They Don’t Know How to Use PayPal.

Most Things Are Not Amazing.

• But, We Can Easily Make Most Things Better.

• Tech + Web = Reduced Overhead Costs.• Search + Social Platforms = Better Marketing.• Copy Existing Business Model = Reduced Risk.

• FOCUS = Make ONEthing / SOMEthing Better.

#EVILPLAN#MWAHAHA

Everyone Needs An Evil Plan (Hugh MacLeod)

Formula 4 Awesome:Notice Things That Suck. Make Them Suck Less.

• Most Brick & Mortar Businesses Are Inefficient.• Lots of Overhead, Shitty UX, Crappy Marketing.

• Copy Their Business Model (It Already Works).• Reduce Overhead Cost (Go Online).• Increase Marketing Efficiency (Go Online).

• Copy/Integrate 99% Awesome Stuff (aka Tech)• Innovate on the Remaining 1%.

• Keep Innovating 1%. Every Month.• Beat Them Like a Drum, Every Day & 2x on Sunday.

Ok, Let’s Try It.

• Find an existing, physical-world big dumb business that makes money, but kinda sucks.

• Verify they have high overhead costs, inefficient [offline] marketing, crappy service.

• Copy the business model, reduce overhead costs, improve marketing.

• Add some awesome technology, and then innovate on ONE important thing.

Problem: Ordering Food Sucks.(see blog post “Why Menus Suck”)

• Issues:– Waiters– Menus– Pictures– Sharing– Discounts– Customer Lists– Food Quality– Food Service– Reviews– Delivery Time– Payment

• Solutions:– ElaCarte– KitchIt– FoodA– Chewse– CraftCoffee– LoveWithFood– GoldBely– TeaLet– Ordr.in– MileHighOrganics– WholeShare

#BRANDING101#THINKDIFFERENT

Here’s To The Crazy Ones. (Jobs)

3 Basic Types of Brands:Virgin, Southwest, [Niche]

• Virgin = “Mass Luxury” (+ sexy)– High-End Look & Feel, priced just barely within reach of most middle-

class customers, who love the “red-carpet” treatment

• Southwest = “Convenience & Value” (+ funny)– Shit that just works, not very expensive, great value for

everybody. (Who doesn’t like Southwest?)

• [Niche] = “Just for You & Me”– Designed for well-defined customer segments / attributes.– Less competition, higher margins, better retention– Ex: Gay, Old, Black, Short, Female, Moms, Left-Handed, Etc

Thanks.

http://500.co

Dave McClureFounding Partner & Chief Troublemaker, 500 Startups

00’s & 10’s:• VC: Founders Fund, Facebook fbFund, 500 Startups• Angel: Mashery, Mint.com, SlideShare, Twilio, WildFire, SendGrid• Marketing: PayPal, Simply Hired, Mint.com, oDesk, O’Reilly

80’s & 90’s:• Entrepreneur: Aslan Computing (acq’d by Servinet/Panurgy)• Developer: Windows / SQL DB consultant (Intel, MSFT)• Engineer: Johns Hopkins‘88, BS Eng / Applied Math

500 StartupsGlobal Seed Fund & Startup Accelerator

• What is 500?– $65M+ under management– 25 people / 12 investing partners– Locations: SV, NYC, MEX, BRZ, IND, CHN, SEasia– 1000+ Founders / 200+ Mentors– Insanity 24x7x365

• 500+ Portfolio Co’s / 30+ Countries– Wildfire (acq GOOG, $350M)– Twilio– SendGrid– TaskRabbit– MakerBot– 9GAG– Viki– Gengo– AppStack– VivaReal– MindSnacks– Visual.ly

500 Startups: Global Seed FundOver 100+ startups outside US, in 35+ countries

• Q4/12 added: Germany, Korea, Peru; + Russia, Israel, Turkey in Q1/13• Priorities in 2012: Brazil, Mexico, India• Priorities In 2013: China, SE Asia, MENA, Eastern Europe