Commercializing Your Idea

January 29, 2014

© 2014 John Seiffer

The purpose of a The purpose of a business is to create business is to create __________________________________________

The Cruelest words ever

written:

Build a better mousetrap, and …

The purpose of a The purpose of a business is to create business is to create __________________________________________

There is only one valid There is only one valid definition of business definition of business purpose: purpose:

To create a To create a CUSTOMER.CUSTOMER.

- Peter Drucker

Definition of a Definition of a CUSTOMER?CUSTOMER?

WHY?

The Hard Part is…

Selling, not Creating Value

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Eric Ries tried the “Build First” approach.

6 months

40,000 lines of code

6 months

40,000 lines of code

6 months

40,000 lines of code

Nobody Cared

Did I waste 6 months?

Should I have

Did I provide any

6 months40,000 lines of code

3 months?20,000 lines of code?

6 months40,000 lines of code

3 months?20,000 lines of code?

1 month?0 lines of code?

Lean = No Waste

Lean = No Waste

Waste = Making Something People Don’t

Want to Buy

A startup is a temporary organization designed to search for a repeatable and scalable business model.”

- Steve Blank

• The purpose of a startup is to DISCOVER.

• Progress is measured by LEARNING – not sales.

Learning requires•Falsifiable Hypothesis •Experiment•Data•Defined level of success or failure

Hypothesis about what?

Who your customers are.

And what they want to pay for.

Who Decides what value is?

PainsGains& Jobs

Pains, Gains & Jobs

http://www.businessmodelgeneration.com/downloads/value_proposition_canvas.pdf

Search for a repeatable and scalable business model.”

- Steve Blank

Search For:

Search For: Someone

Search For: SomeoneWho has a problem

Search For: SomeoneWho has a problem

That they care enough to pay for

Search For: SomeoneWho has a problem

That they care enough to pay forThat you can solve

Search For: SomeoneWho has a problem

That they care enough to pay forThat you can solveProfitably

The Business Model Formula

(LTV – CA) *N = $$$$

(LTV – CA) *N = $$$$

Where are investors?

Funding is not the answer if the business model is not sound!

Real money comes from customers.

Vendor FundingSell your RightsLicenseJoint VentureSBIR

Customer FundingSikorsky ChallengeCrowd FundingDECD

www.ctinnovations.com/funding/sbirwww.sikorsky.com/EChallenge http://www.ct.gov/ecd/cwp/view.asp?a=3931&q=462616http://www.ct.gov/ecd/cwp/view.asp?a=1097&Q=253518 http://angelinvestorforum.com/submit_business_plan.html

John@CEOBootCamp.com203-775-6676

John Seiffer