innovation colonies:incubating the future of your business

INNOVATION COLONIES: INCUBATING THE FUTURE OF YOUR BUSINESS

LIVE WEBINAR

WHO AM I?

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Jeff Steinberg - SolutionsIQ Lean Innovation & Agile Transformation Coach

• 15 years’ experience in product and service development

• Builds cultures of innovation and organizational effectiveness

• Director of Lean-Agile at 3 startups • Has helped transform dozens of large orgs

and hundreds of teams • Coaching combines Lean Startup, Design

Thinking and Agile Delivery

S&P 500 COMPANIES HAVE SHORTEST LIFE SPAN EVER

www.Inosights.com, Corporate Longevity, May 2016

CB Insights, www.cbinsights.com, Aug 2016

THE UNICORN CLUB

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PRINCIPLE #1: WE DON’T KNOW WHAT WE DON’T KNOW

FORESIGHT IS VANISHING

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PRINCIPLE #2: PERSPECTIVE

“Get out of the building. There are no facts in here." - Steve Blank

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PRINCIPLE #3: APPLY THE SCIENTIFIC METHOD

Requirements = Hypothesis

As a <user>I want <this capability/feature>

so that <business reason>.

Requirements

We believe < this target market>,will <do this action/use this

solution>,for <this reason>,

as measured by <this signal>.

Hypothesis

BUILD-MEASURE-LEARN CYCLE

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DATA CODE

IDEAS

LEARN BUILD

MEASURE

Build-Measure-Learn Cycle

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DATA CODE

IDEAS

LEARN BUILD

MEASURE

start here (mostly)

MINIMUM

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“The MVP is that version of the product that enables a full turn of the Build-Measure-Learn loop with a minimum amount of effort and the least amount of development time.”

VIABLE

M i n i m u m V i a b l e P r o d u c t

PRINCIPLE #4: MINIMUM VIABLE PRODUCT

TACTIC: EXPLAINER VIDEO

TACTIC: WIZARD OF OZ TEST

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PRINCIPLE # 5 - PIVOT

PIVOT

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“A pivot is a structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth.” - Eric Ries

AT LEAST TWO TYPES OF INNOVATION

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Sustaining Innovation Disruptive Innovation

Existing market New or previously ignored market

Improves performance & lowers cost Innovation is game changing

Incremental change Dramatic change

Market is predictable Market is unpredictable

Traditional business model Is sufficient Traditional business models fail

Doing the same thing better

Doing something new that may make the old thing obsolete

DISRUPTION

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X

DISRUPTION

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X

DISRUPTION

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X

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HACKATHON’S

SAFE’S INNOVATION AND PLANNING ITERATION

INNOVATION LABS

CORPORATE ANTIBODIES

INNOVATION COLONIES

WHAT IS AN INNOVATION COLONY?

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Def: A dedicated department of small entrepreneurial teams focused on cultivating disruptive innovation for the benefit of the enterprise.

INNOVATION COLONY ARE MULTI-FUNCTIONAL

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Design Studio

Startup Incubator

Investment Fund

Corporate Development

INNOVATION COLONY PERFORM THREE JOBS

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1. Conceiving New Disruptive Products

2. Validating Markets For Them

3. Shepherding to Product-Market Fit

They are SEPARATE… Legal Entities Budget Brand Location

which ENABLES… Experiment Pivot Allocate Resources

INNOVATION COLONIES HAVE RADICAL AUTONOMY

INNOVATION COLONY HAVE THEIR OWN LEADERSHIP

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Innovation Officer • Reports Directly to CEO or Board • Acts as Internal Venture Capitalists • Previous Entrepreneurial Experience

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2 - 3 Managing Directors $1 - $50M Fund

2 - 5 Years

INNOVATION COLONY HAVE THEIR OWN STRUCTURE

Success requires a large sample size of ideas to choose from

Idea Sources

Ideation Workshops

Idea Boxes

Hackathons

Intraprenuership Programs

Startup Community

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1. Incubate Internal Startups

2. Acquire Early Stage Startups

3. Invest in Outside Startups

INNOVATION COLONY HAVE THREE INVESTMENT TYPES

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“Ownership is why you stay up all night. It’s why you think about this all day, every day.”

Chris Dixon, Venture Capitalist Andreessen Horowitz

True entrepreneurs give up salary for equity, so too should intraprenuers.

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500 Teams Apply 10 Selected into Colony

25k - 250k in Initial Funding 3 Months to Get to Market

INNOVATION COLONY: EXAMPLE SCENARIO

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Financial Accounting

Revenue, Margin, Profit

Innovation Accounting

Customer Behavior & Growth

INNOVATION COLONY HANDLE ACCOUNTABILITY DIFFERENTLY

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Once they get customers and prove the product…

…when most of the uncertainty is gone…

The enterprise has 3 options: 1. integrate into enterprise 2. grow as independent entity 3. pass and sell to outside buyer

Fact 1: 1 out of 10 Venture Capital investments pays for the other 9

Fact 2: 1 in 1000 YCombinator investments are worth more than the rest of their entire portfolio combined.

INNOVATION COLONY ARE A CURRENT STRATEGY

CULTIVATE THE FUTURE OF YOUR BUSINESS WITH

INNOVAT ION COLON IES

WHERE CAN I LEARN MORE ABOUT LEAN INNOVATION?

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Q&A

THANK YOU!

@SolutionsIQ @JRSBerg - Jeff Steinberg

Contact us! info@solutionsiq.com 1.800.235.4091