Thinking lean presentation
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This document discusses the Lean Startup methodology for startups and investors. It outlines some common problems founders face such as not knowing their target customer or problem to solve. The Lean Startup approach advocates building a minimum viable product, getting customer feedback early through discovery and validation, and iterating quickly through a process of build-measure-learn. Key metrics for startups include acquisition, activation, retention, and revenue. Tools and techniques discussed include MVPs, analytics, A/B testing, and virality mechanics. The document argues the Lean Startup approach enables better risk assessment for investors in early stage companies.
Thinking lean presentation
- 1. Thinking Lean – For Startups And InvestorsChu Tzu Mingwww.impersuasion.comNote: Applicable for software/ web type companies only coz I know nothing much about anything else
- 2. Why I am HereI became moderately good at Excel after 10 years in the venture capital industry.I have scars and tattoos to share with you. I had to unlearn what I learned. We share so we can learn from mistakes.Movement – is the next cornerstone in corporate culture“You don’t get extra points for learning things the hard way “ – Mr. Kawasaki
- 3. Textbook Model (Kilang Model)Write Bplan (30 pages and forecasts)What’s wrong with this?Nothing. It just doesn’t work very often, it’s wasteful and it gets people into debtForm TeamGet FundingOh, that’s the risk inherent in early stage companies, too bad…Build ProductMarketingThe ones that succeed – know who to sell to somehow and end up doing what they did b4.Sell/Hire Sales guyRIP
- 4. How Things Get ScrewyFounders:They don’t know what problem they’re solving, feature driven instead. They confuse a feature with a ‘product’.They’re not subject matter experts – yet.Lack a clear/repeatable path to the customerThey don’t know if customer thinks they add value. (The “I think so” syndrome)They don’t know who’s going to buy immediatelyThey always say I need the money first to start. Many end up getting old.‘Corporate Drama’ – investors, fellow founders are lazy/greedy/ team problem/ husband and wife/bf/gf
- 5. This Lean Startup* Thing…Evaluate Team/Equity contributionWrite 2 page Bplan/ProblemForm TeamSmall Funding/Bootstrap/MSISell/Hire Sales guyBuild Prototype/ MVPCustomer DiscoveryProduct/market fit/ValidationRepeat Orders/ FeedbackVC Round: OptionalTest MarketingCustomer DevelopmentRefining Sales MethodologyScaleNote*: Eric Ries, Steve Blank’s Four Steps to the EpiphanyLean Startup Steps/Activities
- 6. “So What’s Different?” – It’s Actionable Data To Validate Learnings- ‘Calculated’ Risks-80/20 principleLean Not Waste
- 7. Small Wins
- 8. Agile/Pivot
- 9. Accountability“You Scale Only When You Have RECURRING Customers And Revenue”
- 10. The FunnelAcquisition – FB, SEO, Paid TrafficActivation – Attention Confirmed. Clicks, Likes, sign ups, comments, downloadsRetention – Returning visits, usage, comments Referral– Invites, Backlinks, shares, mentions, retweetsRevenue, Goal - $$$, sign ups, Invites Your Goals May Be One Any Of The Metrics Themselves
- 11. Virality – MechanicsInvites SentNo of People Infected Who InviteNo of People Who accept InvitationY (Activation Rate)= 100 or 100/10,000=1%X (Volume)= 100,000Z (Invite Rate)= 1or 1/100 =1%Viral Coefficient=xyz > 1=10,000* 1% * 1%=1Think how Movies Work, Malaysiakini, Gmail
- 12. Network MarketingMetricsAARRRCosts Of Customer AcquisitionVirality/Word of Mouth (lowers AvgCost Per CustAcquistion)A/B testing (offline/online) on ConversionsSales Conversions Customer Lifetime Value
- 13. How Does This Fit Again?AcquisitionRevenue/GoalReferralActivationRetentionX InvitesY Accept InvitesZ ReinvitesDEFINE AARRR OBJECT PURPOSEDEFINE XYZ ElementsDEFINE ACTIONS
- 14. Tools & LeverageMinimum Viable Product (MVP)LAMP/RORAmazon AWS, herokuWordpress, Uservoiceprogrammableweb, GOOG, FB, OdeskPPCSurvey monkey/Poll daddyGoogle Analytics/Crazy eggWebsite optimizer/Tracking UrlsRobert Cialdini, InfluenceDirect response MarketingLinkedinDan Kennedy/Joe PolishNegotiation SkillsViral Loop (Tell a friend), FBAutomated Email marketing/sequencesSEO/Online PR/Online PRBuild PrototypeTest MarketingTraffic, bootstrapFB groups, pages, emailsRefining Sales MethodologyScaling
- 22. “What About Investors? -LS Enables Intelligent Risk Assessment For Early Stage Companies”
- 23. Deal AssessmentMetrics – Clearer Risk Profile To Early Stage ProjectsMarket Definition And Size (ground up), Keyword ResearchAARRRAnalytics, funnels, conversions, time on siteROE (Return On Effort)Leverage Metrics: How much faster, better, cheaper?Invest less, less onerous terms (to the entrepreneur), close more deals.Talk to customers or to-be customers.Is this problem something they would pay to solveWould they buy it today if it was ready?
- 24. CaveatsDon’t measure for the sake of measuringMake ‘Lean Startup’ a habit when you have no money/limited budget. It’s hard to do it when you have loads of cash.
- 25. ResourcesEric Ries, Steve Blank’s blogsAsh Maurya’s blogQuicksprout.comViral Loop- Adam PenenbergFounders at work - LivingstonBooks on dealing with difficult peoplePrayingTenacity through exerciseDave McClure’s prez on SlideshareRework – Jason Fried/David Hansson80/20 Principle – Richard Kochwww.impersuasion.com