MINIMUM VIABLE PRODUCTS

+MEDICAL VENTURES

ZEN CHUMIT HEALTHCARE VENTURES HST.978

EARLY STAGE MEDICAL VENTURES

DISCOVERPAINFUL UNMET NEEDS

USER EMPATHYDESIGN THINKING

PRODUCT + EXPERIENCE RAPID OPEN TESTING

ACCELERATED EVIDENCE

VIA

EVIDENCE-BASED ENTREPRENEURSHIP

– Frank Robinson

“product with the highest return on investment

versus risk"

MVP DEFINITION

EXAMPLE DIGITAL HEALTHCARE

MINIMUM VIABLE PRODUCTS

I INVESTED AT THE PROTOTYPE STAGE

PILLPACK’S FIRST 48 HOURSMVP PAPER PROTOTYPING CUSTOMER EXPERIENCE

PILLPACK.COM TODAY

INSTAGRAM 4 DOCTORSJOB: SOLVE DOCTOR SMARTPHONE HIPAA VIOLATIONS

Figure1.com

FIGURE1.COM MVP

12 MONTHS TO CROWDSOURCE LARGEST SET OF

CONSENTED MEDICAL IMAGES!

CROWDSOURCED DIAGNOSIS MVP:REASON I INVESTED!

MVP DEFINITION

– Eric Ries

“… MVP is that product which has just those features (and no more) that

allows you to ship a product that resonates with early adopters; some of whom will

pay you money or give you feedback.”

“The MVP is often an ad on Google. Or a PowerPoint slide. Or a dialog box. Or a landing page.

You can often build it in a day or a week.”

MVP DEFINITION

PRODUCT IS INSUFFICIENT

MARKET = PRODUCT * CUSTOMERS

WILL CUSTOMERS VALUE+

CHANGE BEHAVIOR?

VENTURE = MARKET*ADOPTION*SHARE

MVP DESIGN PROCESS

OBSERVE

PITCHDESIGN

TEST +

LEARNPITCH to efficiently communicategather external feedback(in)validate problems/solutionsand recruit team

EARLY STAGE VENTURESSEARCH FOR QUICK TRUTH

MEASURE NOT WHAT THEY SAY

WHAT THEY DO!

OBSERVE GROUND TRUTH

EX) CHINA HEALTHCARE EXPERIENCES

VALU

E

TIMECRITICAL MILESTONES

Acquisition/IPO Exit Reimbursement Published clinical results Market Introduction

Salesforce hired Europe & Japan distribution

FDA Approval

Manufacturing ramp Human pivotal study Corporate partnership First human data

First Hiccup & Danger of Momentum Loss CEO hired Pilot manufacturing Patent grant First FDA meeting Regulatory opinionsMoney raised & team hired

Animal testing Clinician feedback Patent disclosure Prototype/Reduction to Practice Market AnalysisIdea

MILESTONES + VALUEENTREPRENEURS SEE ALL AS CRITICAL

VALU

E

TIMECRITICAL MILESTONES

Acquisition/IPO Exit Reimbursement Published clinical results Market Introduction

Salesforce hired Europe & Japan distribution

FDA Approval

Manufacturing ramp Human pivotal study Corporate partnership First human data

First Hiccup & Danger of Momentum Loss CEO hired Pilot manufacturing Patent grant First FDA meeting Regulatory opinionsMoney raised & team hired

Animal testing Clinician feedback Patent disclosure Prototype/Reduction to Practice Market AnalysisIdea

SO MANY MILESTONESENTREPRENEURS SEE ALL AS CRITICAL

FOCUS MVP FASTER LAUNCH, ROI PRIORITIZE RISKS

DE-RISK PRODUCTS + VENTURESVA

LUE

TIME

Market Adoption Risk Reimbursement + Consumer Drivers

Physician & Patient Adoption Distribution

Regulatory Risk Safety & Efficacy

Management RiskTechnology Risk

PRIORITIZE UP FRONT

THE 50% RULEAlmost every failed company has a product.

What failed startups don’t have is enough paying customers.

Spend your time building product and

testing channels in parallel

50% product and 50% traction/distribution

– Ash Maurya, Lean Canvas

SMALL VENTURE TAKE JUST AS MUCH TIME AS BIG ONESPA

IN x

USER

S = VA

LUE

TIME

1

aim bigger!

RIGHTNEED?

BIGPROBLEMWIN! accelerate

FASTTRACTION

PRODUCT MARKET FITOBSERVE > SEGMENT > DESIGN

BUSINESSMODELGENERATION.COM

VALUE PROP > BUSINESS MODELDESIGN > TEST > ITERATE

TESTING BUSINESS MODELS

MEDICAL BIZ MODEL 10 STEPS TO DESCRIBE WHO USES, PRESCRIBES, PAYS, DISTRIBUTES

10) PITCH THE NEW EXPERIENCE: PRIMARY USER

DECIDER PRESCRIBER

LOCATION + DISTRIBUTOR

WHO PAYS? HOW MUCH?

1) WHO VALUES & PAYS? 2) HIGH VALUE SEGMENTS + ROI HIGH RISK SEGMENTS KEY METRICS

3) WHERE DO LOW COST + HIGH ACTIVATION, JOURNEY INTERSECT?

ACTIVATION 4) WHAT ACTIVATES PRIMARY USER? WHEN IN JOURNEY?

5) TECH OR TRUSTED INFLUENCER? WHEN INTERVENE + TRIGGERS?

6) HOW CLOSE LOOP TO DELIVER NEW EXPERIENCE + BETTER CARE?

RETENTION VALUE

7) WHAT BRINGS USER BACK? MONITORING OR SUBSCRIBER BIZ? ADD-ON REVENUES?

8) WHAT NEW MACRO TRENDS DRIVE? 9) HOW PARTNERS REVISIT/EXTEND?

HOW IS SOLUTION DISCOVERED? WHY WILL THEY CHANGE & ADOPT?

PRICE VERSUS VALUE

ONE-TIME USE? CHRONIC SUBSCRIBER? LIFETIME VALUE VS COST OF REACHING

IS A PRESCRIBER REQUIRED? NON-TRADITIONAL INFLUENCER? EMPLOYER? DISCHARGE NURSE?

WHERE IS THE BEST EXPERIENCE? NEW MODES/PLACES TO REACH RETAILER, APP STORE, ECOM… HOME, HOSPITAL, CLINIC, PHARMACY…PATIENT, PCP, CAREGIVER, PARENT….

© HACKINGMEDICINE.MIT.EDU

1) Need / Problem2) Validated Unmet Need3) Customer / User4) Sub-Segment Customers + Markets5) Value Proposition6) Business Model7) Experiment + Learn8) Quantify9) Repeat

MVP DESIGN PROCESS

PITCH AT EACH STEP!

PILLPACK.COM CASE STUDYFounder Domain KnowledgeUnmet Need?Which Customers?Which Segments?

What Model?What Experiments?What Metric?

1) Need / Problem2) Validated Unmet Need3) Customer / User4) Sub-Segment Customers + Markets5) Value Proposition6) Business Model7) Experiment + Learn8) Quantify9) Repeat

EARLY STAGEVENTURE TOOLSET

The Value Proposition Canvas

Gain CreatorsDescribe how your products and services create customer gains. How do they create benefits your customer expects, desires or would be surprised by, including functional utility, social gains, positive emotions, and cost savings?

Pain Relievers

Do they…

Create savings that make your customer happy? (e.g. in terms of time, money and effort, …)

Produce outcomes your customer expects or that go beyond their expectations? (e.g. better quality level, more of something, less of something, …)

Copy or outperform current solutions that delight your customer? (e.g. regarding specific features, performance, quality, …)

Make your customer’s job or life easier? (e.g. flatter learning curve, usability, accessibility, more services, lower cost of ownership, …)

Create positive social consequences that your customer desires? (e.g. makes them look good, produces an increase in power, status, …)

Do something customers are looking for? (e.g. good design, guarantees, specific or more features, …)

Fulfill something customers are dreaming about? (e.g. help big achievements, produce big reliefs, …)

Produce positive outcomes matching your customers success and failure criteria? (e.g. better performance, lower cost, …)

Help make adoption easier? (e.g. lower cost, less investments, lower risk, better quality, performance, design, …)

Rank each gain your products and services create according to its relevance to your customer. Is it substantial or insignificant? For each gain indicate how often it occurs.

Describe how your products and services alleviate customer pains. How do they eliminate or reduce negative emotions, undesired costs and situations, and risks your customer experiences or could experience before, during, and after getting the job done?

Do they…

Produce savings? (e.g. in terms of time, money, or efforts, …)

Make your customers feel better? (e.g. kills frustrations, annoyances, things that give them a headache, …)

Fix underperforming solutions? (e.g. new features, better performance, better quality, …)

Put an end to difficulties and challenges your customers encounter? (e.g. make things easier, helping them get done, eliminate resistance, …)

Wipe out negative social consequences your customers encounter or fear? (e.g. loss of face, power, trust, or status, …)

Eliminate risks your customers fear? (e.g. financial, social, technical risks, or what could go awfully wrong, …)

Help your customers better sleep at night? (e.g. by helping with big issues, diminishing concerns, or eliminating worries, …)

Limit or eradicate common mistakes customers make? (e.g. usage mistakes, …)

Get rid of barriers that are keeping your customer from adopting solutions? (e.g. lower or no upfront investment costs, flatter learning curve, less resistance to change, …)

Rank each pain your products and services kill according to their intensity for your customer. Is it very intense or very light?

For each pain indicate how often it occurs. Risks your customer experiences or could experience before, during, and after getting the job done?

Products & ServicesList all the products and services your value proposition is built around.

Which products and services do you offer that help your customer get either a functional, social, or emotional job done, or help him/her satisfy basic needs?

Which ancillary products and services help your customer perform the roles of:

Buyer (e.g. products and services that help customers compare offers, decide, buy, take delivery of a product or service, …)

Co-creator (e.g. products and services that help customers co-design solutions, otherwise contribute value to the solution, …)

Transferrer (e.g. products and services that help customers dispose of a product, transfer it to others, or resell, …)

Products and services may either by tangible (e.g. manufactured goods, face-to-face customer service), digital/virtual (e.g. downloads, online recommendations), intangible (e.g. copyrights, quality assurance), or financial (e.g. investment funds, financing services).

Rank all products and services according to their importance to your customer. Are they crucial or trivial to your customer?

GainsDescribe the benefits your customer expects, desires or would be surprised by. This includes functional utility, social gains, positive emotions, and cost savings.

Pains

Customer Job(s)

Describe negative emotions, undesired costs and situations, and risks that your customer experiences or could experience before, during, and after getting the job done.

What does your customer find too costly? (e.g. takes a lot of time, costs too much money, requires substantial efforts, …)

What makes your customer feel bad? (e.g. frustrations, annoyances, things that give them a headache, …)

How are current solutions underperforming for your customer? (e.g. lack of features, performance, malfunctioning, …)

What are the main difficulties and challenges your customer encounters? (e.g. understanding how things work, difficulties getting things done, resistance, …)

What negative social consequences does your customer encounter or fear? (e.g. loss of face, power, trust, or status, …)

What risks does your customer fear? (e.g. financial, social, technical risks, or what could go awfully wrong, …)

What’s keeping your customer awake at night? (e.g. big issues, concerns, worries, …)

What common mistakes does your customer make? (e.g. usage mistakes, …)

What barriers are keeping your customer from adopting solutions? (e.g. upfront investment costs, learning curve, resistance to change, …)

Describe what a specific customer segment is trying to get done. It could be the tasks they are trying to perform and complete, the problems they are trying to solve, or the needs they are trying to satisfy.

What functional jobs are you helping your customer get done?(e.g. perform or complete a specific task, solve a specific problem, …)

What social jobs are you helping your customer get done? (e.g. trying to look good, gain power or status, …)

What emotional jobs are you helping your customer get done? (e.g. esthetics, feel good, security, …)

What basic needs are you helping your customer satisfy? (e.g. communication, sex, …)

Besides trying to get a core job done, your customer performs ancillary jobs in differ-ent roles. Describe the jobs your customer is trying to get done as: Buyer (e.g. trying to look good, gain power or status, …)

Co-creator (e.g. esthetics, feel good, security, …)

Transferrer (e.g. products and services that help customers dispose of a product, transfer it to others, or resell, …)

Rank each job according to its significance to your customer. Is it crucial or is it trivial? For each job indicate how often it occurs.

Outline in which specific context a job is done, because that may impose

constraints or limitations. (e.g. while driving, outside, …)

Which savings would make your customer happy?(e.g. in terms of time, money and effort, …)

What outcomes does your customer expect and what would go beyond his/her expectations? (e.g. quality level, more of something, less of something, …)

How do current solutions delight your customer? (e.g. specific features, performance, quality, …)

What would make your customer’s job or life easier? (e.g. flatter learning curve, more services, lower cost of ownership, …)

What positive social consequences does your customer desire? (e.g. makes them look good, increase in power, status, …)

What are customers looking for? (e.g. good design, guarantees, specific or more features, …)

What do customers dream about? (e.g. big achievements, big reliefs, …)

How does your customer measure success and failure? (e.g. performance, cost, …)

What would increase the likelihood of adopting a solution? (e.g. lower cost, less investments, lower risk, better quality, performance, design, …)

Rank each gain according to its relevance to your customer. Is it substantial or is it insignificant? For each gain indicate how often it occurs.

Rank each pain according to the intensity it represents for your customer.Is it very intense or is it very light.? For each pain indicate how often it occurs.

On:

Iteration:

Designed by:Designed for:Day Month Year

No.

Customer Segment

www.businessmodelgeneration.com

Use in Conjunction with the Business Model Canvas Copyright of Business Model Foundry GmbH

Value PropositionCreate one for each Customer Segment in your Business Model

What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?

Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?

For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?

For whom are we creating value?Who are our most important customers?

What type of relationship does each of our CustomerSegments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?

What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?

What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?

Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?

What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?

Day Month Year

No.

This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/

or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.

ELEVATOR PITCH TEMPLATE• I AM A _____________________ AND I CARE ABOUT ________________________________________

• MY GOAL IS TO IMPROVE

• EXPERIENCE OF ______________________________ (ALS PATIENT, CAREGIVER, ER NURSE…)

• QUALITY OF ______________________________ (CLINICAL METRIC, EXPERIENCE, PAIN…)

• ACCESS TO _______________________________ (SERVICE, EXPERTISE, PROCEDURE, PRODUCT)

• FREQUENCY/RATE OF ____________________________________ (TEST, BEHAVIOR, DX, SURG)

• EFFICIENCY OF _______________________________________ (TEST, DX, EXPERIENCE, SURG…)

• PROFITS OF _________________________________________ (PHARMACY, DOC, HOSP, FIELD…)

• FIRST TARGET CUSTOMER IS ___________________________________ (DESCRIBE SINGLE USER TYPE)

• THEY SUFFER FROM __________________________________________ (DISEASE, EXPERIENCE, PAIN…)

• WE CAN IMPROVE THEIR EXPERIENCE/HEALTH BY __________________________________________

• TODAY THEY SOLVE THIS BY __________________ BUT THE PROBLEM IS ________________________

• OUR SOLUTION IS TO ATTACK __________________________________________________________

• STARTING WITH ___________________________________________ (FOCUSED POPULATION)

• THEY WILL BE EARLY ADOPTERS BECAUSE __________________(PAIN, COST, RISK, FEAR, PAYER…)

• WE WILL REACH THEM THROUGH _____________ (CHANNEL, SPECIALTY, RETAIL, PHARMACIES…)

• IDEAL STRATEGIC PARTNERS _______________________________________________________

• BUT WE CAN ALSO ATTACK LARGER MARKET OF ________________________ (NEXT USER TYPE)

• OUR PRODUCT/SERVICE WILL BE PAID FOR BY __________________________________________

• BECAUSE THEY VALUE ____________________________________________ (UNIQUE QUALITIES)

© HACKINGMEDICINE.MIT.EDU

PATIENT SYMPTOMS

PATIENT JOURNEY MAP THE EXPERIENCE OF DIAGNOSING, TREATING, MONITORINGPRIORITIZE FOCUSED HIGH-IMPACT SOLUTION AROUND ONE PLAYER

MONITOROR

PREVENT

EDUCATION+

ACTIVATION

DIAGNOSIS+

TESTS

SEGMENTS+

TREATMENTS

BIGGEST GAPS, COSTSOUTCOMES

MONITORING+

MANAGING

PATIENT

CAREGIVER

NURSE

IDEAL LOCATION:

PCP PHYSICIAN

PHARMACIST

SPECIALIST

CLINICAL PI

PRIORITIZE ONE PLAYER:

© HACKINGMEDICINE.MIT.EDU

HEALTHCARE BIZ MODEL CANVAS

IDENTIFY KEY ADOPTER:

Patient

Specialist/PCP/Nurse

Hospital/Department

Insurer

Payor/Employer

Patient/DTC

Specialist/Nurse

Hospital

Payor

DISEASE SEGMENTS

NATURAL HISTORY

KEY RISKS/LIABILITIES REGULATORY PRO/CON

PERFORMANCE & EFFICACY METRICS Clin Data Cost/Timepoints

VALUE INFLECTION MILESTONES

SUBSTITUTES & COMPETITION

EXECUTION DIFFERENTIATION GO TO MARKET DIFFERENTIATION

Regulatory Path

Reimbursement Codes

Data Accelerants

Prescribers

Payors

Fulfillment

© HACKINGMEDICINE.MIT.EDU

EXPERIMENTAL PLAN KEY METRICS, CLEAR HYPOTHESIS, QUICK DATA CHEAPLYIF METRIC DOES NOT CHANGE BEHAVIOR, IT IS A BAD METRIC

© HACKINGMEDICINE.MIT.EDU

DESCRIBE THE PROBLEM: ________________________________________________________________________________________________________

DESCRIBE MIN VIABLE PRODUCT: ________________________________________________________________________________________________________

EXPERIMENT HYPOTHESIS: ________________________________________________________________________________________________________

EXPECTED OUTCOME: ________________________________________________________________________________

SUCCESS CRITERIA: ________________________________________________________________________________

KEY PARTNERS FOR EXPERIMENT ________________________________________________________________________________________________________

VARIABLES TO TEST: ________________________________________________________________________________________________________

CLINICAL METRICS (i.e. OUTCOMES, PAIN SCALE, DIAGNOSIS RATE, COMPLICATION RATE, READMISSION RATE) TECHNOLOGY METRICS (i.e. PERFORMANCE, SPECIFICITY, SELECTIVITY, FAILURE RATE, COST PER TEST) CUSTOMER METRICS ( i.e. SATISFACTION, RETURN VISITS, REPLY/CALL-BACK RATE) BUSINESS METRICS (i.e. USER ADOPTION, COST, BUYING DECISIONS, TIME REQUIRED, EFFICIENCY

HOW LOWER BARRIERS TO DATA GENERATION? ____________________________________________________________

WHO/HOW MEASURES? ______________________________________________________________________(INCENTIVE OR AGENCY PROBLEMS?)

WHAT ARE YOU DE-RISKING? ______________(USER ADOPTION RISK, SAFETY RISK, TECHNOLOGY RISK, MANUFACTURING RISK, SALES RISK, ETC)

TARGET POPULATION ________________________________________________________________________________________________________

SUB-SEGMENT POPULATIONS & COMORBIDITIES ____________________________________________________________

IS THERE A CONTROL GROUP?____________________________________________________________________________

SELECTION BIASES?_____________________________________________________________________________________

EXPERIMENT SAFETY ISSUES ________________________________________________________________________________________________________

HOW DOES THIS MAXIMIZE LEARNING? ________________________________________________________________________________________________________

WHAT CAN YOU TEST FAST + CHEAP? ________________________________________________________________________________________________________

ExperimentsStart here. Brainstorm with stickies, pull it over to the right to start your experiment.

Customer

Problem

Solution

Result &Decision

Learning

RiskiestAssumption

Method & SuccessCriterion

1 2 3 4 5

To form a Customer/Problem Hypothesis:I believe my customer has a problem achieving this goal.

To form your Assumptions:In order for hypothesis to be true, assumption needs to be true. Determine how you will test it:The least expensive way to test my assumption is...

Who is your customer? Be as specific as possible. Time Limit: 5 Min

What is the problem? Phrase it from your customer’s perspective. Time Limit: 5 Min

Define the solution only after you have validated a problem worth solving. Time Limit: 5 Min

List the assumptions that must hold true, for your hypothesis to be true. Time Limit: 10 Min

Need help? Use these sentences to help construct your experiment.

To form a Problem/Solution Hypothesis:I believe this solution will resultin quantifiable outcome.

To identify your Riskiest Assumption:The assumption with the leastamount of data, and core to the viability of my hypothesis is...

Determine what success looks like:I will run experiment with # of customers and expect a strong signal from # of customers.

Project Name: Team Leader Name:

GET OUT OF THE BUILDING!

© 2014 Javelin. You are free to use it and earn money with it as an entrepreneur, consultant, or executive, as long as you are not a software company (the latter need to license it from us).Download Experiment Board and watch case studies at www.javelin.com

DELIBERATE EXPERIMENTS

FIND ONE METRIC THAT MATTERS DIGITAL BUSINESS METRICS WHICH DRIVE GROWTH

LEANANALYTICSBOOK.COM

HOW HIGH IS THE TIGHTROPE FOR YOU?

ENTREPRENEUR MINDSET

MATCH VENTURE + LIFE RISK DELIBERATE PRACTICE IMPROVESMVP HELPS FOCUS + LIFE BALANCE

THANK YOU!

ZEN CHUZENVEN@MIT.EDU

@ACCELMED

BACKUP

HOW FUND NEW VENTURES?

SEED$2-5

MISSION SER A$5-15 EXIT/RETURN

FUNDING $M

GRANTSBOOTSTRAP

SER B$10+

VENTURE PHILANTHROPY

PHILANTHROPY

GRANTS

CUSTOMER REVENUESCROWDFUNDING

STRATEGIC INVESTORS

ACCELERATORS

MATCH MILESTONES, RISK, SOURCE

HOW FUND NEW VENTURES?

SEED$2-5

MISSION SER A$5-15 EXIT/RETURN

FUNDING $M

GRANTSBOOTSTRAP

SER B$10+

VENTURE PHILANTHROPY

FRIENDS/FAMILY

PHILANTHROPY

GRANTS

ANGEL FUNDING

CUSTOMER REVENUESCROWDFUNDING

STRATEGIC INVESTORS

ACCELERATORS

* NOT OTHER PEOPLE’S MONEYSO THEY REALLY CARE!

@MITHACKMED

MATCH STAGE TO SOURCE

ALL YOU NEED IS ONE TO SAY YES @ EACH STAGE

SEED$2-5

MISSION SER A$5-15 EXIT/RETURN

FUNDING $M

GRANTSBOOTSTRAP

SER B$10+

VENTURE PHILANTHROPY

FRIENDS/FAMILY

PHILANTHROPY

GRANTS

ANGEL FUNDING

STRATEGIC INVESTORS

ACCELERATORS

EARLY STAGE VC

VENTURE CAPITAL

PRIVATE EQUITY

* NOT OTHER PEOPLE’S MONEY

HIGH COST PROFESSIONAL

JET FUEL

CUSTOMER REVENUESCROWDFUNDING