Lean start up bootcamp 4 measure test pivot or perservere
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The document outlines essential strategies for startups and businesses on whether to pivot or persevere after a six-month bootcamp focused on applying entrepreneurial principles. Key concepts include the importance of validated learning, identifying effective growth engines, and recognizing when to pivot based on customer feedback and traction. It emphasizes testing value propositions, understanding market dynamics, and adjusting business models for sustainable growth.
Lean start up bootcamp 4 measure test pivot or perservere
- 2. Test and Measure – To Pivot or Persevere
- 3. The goals of the Bootcamp • At the end of the six months to have worked through the principles of the book • To apply many of them to real world situations that apply to our own businesses • To embed some functions into your activity that give you a cutting edge
- 4. This book is for: • Start-ups • Stale businesses on the cusp of adopting new ideas • Existing businesses struggling with growing pains • Anyone who wants to learn about how to develop their business
- 5. Mantra stands Fail fast & Learn faster
- 6. Let’s Refresh ourselves on some of what we have covered • Most businesses fail because they build something that no-one wants • Failing fast means we preserve more capital and can pivot more • The currency of start-up is learning – validated learning through a Minimum Viable Produce (MVP) • Vision leads to steering • Ideas and assumptions are not the same – Ideas have embedded assumptions that need testing • Finding the ‘Big Idea’ and testing it
- 7. The Goal this Morning To go away with a set of tools and thinking to help you to decide if you should ‘pivot’ or ‘persevere’
- 8. Why this is important?
- 9. How and What to Test Value & Growth
- 10. A new mindset
- 11. Reasons why we succeed
- 12. Research Shows Bill Gross, Idealab, The single biggest reason why startups succeed https://www.hotjar.com/blog/the-passion- fallacy?
- 13. Value – to whom?
- 14. PEST(LE) • Political • Economic • Social • Technological • Legal • Environmental
- 16. TIMING
- 17. Customer Driven Sustainable Growth 1. Word of mouth 2. Products that sell themselves 3. Paid for advertising 4. Repeated purchase
- 18. 3-Engines of growth Sticky Engine of Growth – focus on & measure: 1. Customer retention 2. Lifetime value 3. Look after the customers you have before looking for new ones
- 19. Viral Engine of Growth – focus on & measure: 1. Value creation 2. Brand and brand design 3. Match everything about your product or service to your customers 3-Engines of growth
- 20. 3-Engines of growth Paid Engine of Growth – focus on & measure: 1. Campaign costs 2. Conversion factors 3. Returns on Investment – don’t make excuses for poorly performing ads
- 21. What is your current engine? Take 5 minutes and look at the worksheet Think about your current engine of growth – does it match the aspirations of the business? If you could change it – how would you? Make some notes and think about some tactics
- 22. Lift-off or Fail
- 23. The ‘Runway’ Working Capital remaining divided by the monthly spend. RESPONSE 1. Cut back expenditure on costs 2. Raise more cash Both actions result in a slowdown in getting through the Build-Measure-Learn Loop
- 25. Innovation Accounting Engine of Growth Registration rate (% of leads who become prospects) Activation rate (% of prospects who do what you ask) Retention rate (% of Weeks stay connected / 52) Referral (% of existing customers who bring in new customers) Revenue – as a % of total Lifetime Value
- 27. Why? Is your business on the right road?
- 28. Don’t know? Revert back to the ‘Vision’
- 29. PIVOT Place one foot on the ground for stability – then turn!
- 30. Types of Pivot 1. Zoom-in: A single feature becomes the whole product. Niche and specialise 2. Zoom-out: A single feature cannot sustain a whole product. Whole product now becomes a single feature 3. Customer segment: change of customer in that the segment you originally targeted are not the ones you are serving
- 31. Types of Pivot (cont.) 4. Customer need: the original problem we were solving is now less of an issue – so we develop 5. Platform: apps become websites and vice-versa 6. Business architecture: high margin – low volume becomes low margin – high volume or vice- versa
- 32. Types of Pivot (cont.) 7. Value capture: a change in the revenue stream. A movement away from the exchange to long term access 8. Engine of growth: a change in the marketing strategy that moves us from retention to viral 9. Sales Channel: a change in the route to market. We stop selling through an agent an go direct to the customer
- 33. Types of Pivot (cont.) 10.Technology: sustaining innovation by switching the old methods in with the new ways. A new CRM system, an upgraded website etc.
- 34. 3 Reasons why we don’t ‘Pivot’ 1. Vanity metrics – numbers that simply confirm what we believe to be true and of value 2. Lack of a clear hypothesis for testing. We have growth, customers seem happy etc. 3. Fear that the vision we have shared might be wrong
- 35. 3-signs we should ‘Pivot’ 1. Gut instinct – you fess-up to that nagging doubt in the back of your mind 2. A lack of ‘traction’ – customers who don’t engage, don’t enthuse and resist paying 3. Overwhelming interest in one feature – and not the rest
- 36. Finally
- 37. To come 08 Nov 2016 – Root cause analysis – The 5-Whys 13 Dec 2016 – The accelerate through innovation
- 38. Any Questions? Back on the 8th of November