commercializing your idea getting heard & funded

Getting Heard + Funded

Sean Ammirati @SeanAmmirati

Partner, Birchmere Ventures

Adjunct Professor, Carnegie Mellon University

May 21, 2013

COMMERCIALIZING YOUR IDEA

Most Startups FAILThe Reason

NO ONE WANTSwhat they’ve built.

IS BECAUSE...

WHY IS THIS IMPORTANT?

Dec 2006

Conviction to build FeedHub

Aug 2007

Private Beta of FeedHub

Launch FeedHub @ Demo 2007

Sept 2007

10 MONTHS “STEALTH MODE”

Dec 2006

Conviction to build FeedHub

Aug 2007

Private Beta of FeedHub

Launch FeedHub @ Demo 2007

Sept 2007

10 MONTHS “STEALTH MODE”

Wasted Time

“Launch early enough to be embarrassed by your product’s first version”

~ Reid HoffmanCo-Founder & Chairman LinkedIn

“I should let you know, we're not done. It's early days and some things could change to the API before we release it.”

~ Timothy JordanGoogle

#ifihadglass

Known Problem

Known Solution

WaterfallDevelopment

Requirements

Design

Implementation

Verification

Maintenance

Known Problem

Unknown Solution

AgileDevelopment

Requirements

Design

Implementation

Product BacklogSprint Backlog

ReleasedCode

Unknown Problem

Unknown Solution

LeanStartup

CustomerDiscovery

CustomerValidation

Product BacklogSprint Backlog

ReleasedCode

CustomerCreation

Company Building

Known Solution

Lean Startup

AgileDevelopment

Waterfall Development

Kanban

Unknown SolutionKn

own

Prob

lem

Unkn

own

Prob

lem

1. Customer Discovery

A product solves a problem for an identifiable group of users

2. Customer Validation

The market is saleable & large enough that a viable

business might be built

3. Customer Creation

The business is scalable through a repeatable sales and

marketing roadmap

4. Company Building

Company departmentaland operational processes

are created to scale

THE CUSTOMER DEVELOPMENT MODEL

BUILD

MEASURE

LEARN

IDEAS

CODE DATA

Minimally Viable

Product

BUILD

MEASURE

LEARN

IDEAS

CODE DATA

Minimally Viable

Awesome Product

Adapted From : The Entrepreneur's Guide to Customer Development

MAP #1PPC CampaignLanding Page

MAP #2Product Drawings

Detailed Spec

MAP #3Prototype

Functional Output

Features / Benefitsdescription‘More info’

Call to Action

Face-to-facetechnology demo Field Pilot

Market insightFind early adopters

Locate Strategicpartners

Seed FundingPaid-beta customers

RevenueCustomer Validation

Capital Investment

Customer Interaction

Objective

MAP #1 > Concept MAP #2 > P-M Eval MAP #3 > P-M Fit

Investment $ $$ $$$

~ $35k

~ $100k

~ $200k

concepts

scale

spin out

~$100k - $150k target first investment

~ $275k average total investment

All Community Driven Commerce Focused & Shared Overhead

STUDIO SEED

+

CONCEPTS ~ $1k

“NON-SOFTWARE”EXAMPLE

Innovation Happens

GOALS FOR INNOVATION HAPPENS

1. Provide networking events connecting entrepreneurs & large corporations

2. Encourage entrepreneurs to focus more on getting customers

3. Create a culture of “buying local” in Pittsburgh

APPLICATIONEXERCISEWhat is your MAP?

• Minimally Awesome Product

• Customer Interaction

• Objective

COMMUNICATION IS KEY

FOR FUNDING

2004

2006

2010450+

Key Partnerships

Cost Structure

RevenueStreams

Key Activities

Key Resources

ValueProposition

CustomerRelationships

Channels

CustomerSegments

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???

???

??????

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VALIDATE HYPOTHESIS ...

Key Partnerships

Niche Content

Cost Structure

RevenueStreams

Key Activities

Key Resources

ValueProposition

CustomerRelationships

CustomerSegments

Niche Customers

Channels

Key Partnerships

Cost Structure

Revenue FreeStreams Paid

Key Activities

Key Resources

ValueProposition

Basic Usage

Premium Usage

CustomerRelationships

CustomerSegments

Casual

High Volume

Channels

THANK YOU @SEANAMMIRATI

PHOTO CREDITSSlide 6: http://www.flickr.com/photos/nasa_goddard/8434074140/

Slide 8: http://www.flickr.com/photos/data70/4748860721/

Slide10: http://www.flickr.com/photos/joi/1431818434/

Slide 30: http://www.flickr.com/photos/yodelanecdotal/3329778720/