LEAN
LAUNCHPAD
COLUMBIA BLOCK WEEK
JANUARY 12-16, 2015
Tur ning Hackers, Hustlers and Designers
into Entrepreneurs
TURNING GREAT IDEAS
INTO GREAT BUSINESSES
A brief HISTORY lesson
YOU’RE IN GOOD COMPANY
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US National Science Foundation
National Institute of Health(last week)
Stanford, Berkeley, UCSF, Princeton
350 Universities we’re aware of
Incubators, Accelerators Worldwide
Columbia Block Week and Full Term
Hundreds more educators per year
Steve Blank
More than a decade developing
Customer Development
8 startups in Silicon Valley
• Semiconductors
• Supercomputers
• Consumer electronics
• Video games
• Enterprise software
• Military intelligence
Teach: Stanford, Berkeley,
Columbia, UCSF
TEACHING TEAM
FACULTY:
Bob Dorf, seven startups, CBS Adjunct, co-author Startup Owner’s Manual
Asha Saxena, Founder/CEO Future Tech, plus multiple other ventures
Alicia Syrett, Founder and CEO of Pantegrion Capital
Adam Royalty, Designer in Residence, CU Entrepreneurship
TBD, Seasoned entrepreneur
TA/COACH TEAM:
Nathaniel Kelner, Columbia University Entrepreneurship Team
Meghan Cross, 2nd year MBA, Co-President of CEO Club
COURSE INFO
Team:
Application is by teams of 3-5
(ideally include 1 ENGR or technical);
avoid “all MBA” teams where you can
Workload:
half-day in classroom, half “out of the building
don’t plan much of a social agenda for the week
Credit:
3 credits based on team improvement Mon-Fri, plus
your contribution and student evaluation of startup
Format:
Flipped Classroom; watch lectures nightly with team
Every team presents progress, gets feedback every
day
Teams split into cohorts Tues-Wed-Thurs
THE BASICS
1. Join a team!
2. Business Model Canvas
TEAM NAME HERE
3. Is it scalable…?
FILL OUT ALL 9 BOXES OF THE CANVAS IN ORDER 1 THUR 9
What Key
Activities do our
Value Propositions
require?
Which one of our
customer’s
problems are we
helping to solve?
Who are our Key
Partners?
4. Who else is doing it?
Who are our key
suppliers?
What Key
Resources do our
Value Propositions
require?
What are the most important costs inherent
in our business model?
Which customer
needs are we
satisfying
What type of
relationship does
each of our
Customer
Segments expect
us to establish?
For whom are we
creating value?
Through which
Channels do our
Customer
Segments
want to be
reached?
Who are our most
important
customers
For what value are our customers really
willing to pay? How do we make money?
The Entrepreneurial Venture
FOUR PERIODS of DEVELOPMENT
I
II
III
Cash
Flow
Time
IV
Customer Development is
how you search for the model
The Entrepreneurial Venture
FOUR PERIODS of DEVELOPMENT
I
II
III
Cash
Flow
Time
IV
Business Models
Business Models
Business Models
9 Guesses
Guess
Guess
Guess
Guess
Guess
Guess
Guess
Guess
Guess
Implications of Search and Execution
The Customer Discovery Approach
• Lower Initial Investment
• Minimum Viable Product [MVP] tests only crucial features
• Earlier testing and validation. Room to recover AND REVISE.
• More capital preserved and higher valuation achieved before
scaling
• Scaling financing more available
• Clarify the role of the entrepreneur
• Able to retain entrepreneurs engaged in business senior
leadership
• Higher rate of return for all
• Entrepreneurs
• Investors
• Employees
Example of a Team’s Final
Presentation
JerseySquare
As of: 8/31/12
“The Netflix of Licensed Sports Jerseys”
Bryan Gitler
Elmer Moore
Jay Naik
Michael Melmed
JerseySquare is a rental service for
professional sports jerseys
Total Interviews:
169
Total Website Visits: 190
Customer Discovery
80
70
Customer Sales
Key Partners
2
60
Cost Resources
50
Potential Customers
40
30
66
55
15
1
20
10
20
4
7
1
Wednesday
Thursday
Friday
0
Monday
Tuesday
Over the course of the week, we spoke with 169 contacts
during the customer discovery process
Day 1 Canvas
As of: 8/27/12
Key Partners (7)
Key Activities (5)
Value Proposition (1)
Customer Relationships (4)
Customer Segments (2)
Who are our key partners/ suppliers
Which key activities does the biz model
require
What value do we deliver to the
customer
What type of relationship does each
segment require of us
For whom are we creating value
Professional Sports
Leagues
- Rental Tracking
Search ads
Professional Sports
Game Attendees
Jersey Suppliers
- Dry cleaning
A cheaper way to
wear Officially
Licensed sports
jerseys to a game
Dry Cleaners
- Marketing
Stadium
Shop/Vendors
- Customer Service
Pre-paid Envelope
Suppliers
USPS/Fedex/UPS
- Shipping
Key Resources (6)
Which key resources does the biz model
require
Jersey Inventory
Warehouse
Eliminate risk of
owning a player
jersey who is
traded
Social Media
At Stadium
Promotions
- Male
- Adult
- <$100k income
- Attend 10+
games per yr
Channels (3)
Provide alternative
to purchasing
counterfeit jerseys
Logistics system
Through which channel does each
segment want to be reached
Website
Stadium
Shops/Vendors
Ticket Websites
Direct Mail
Cost Structure (9)
Revenue Streams (8)
What are our cost drivers
How much is each segment willing to pay and how would they like to pay us this amount
Warehouse, shipping, cleaning, logistics tracking,
website development/maintenance
Annual Subscription Model
Day 1 - Yankee Stadium
Customer Discovery
Day 2 Canvas
As of: 8/28/12
Current Canvas
Key Partners (7)
Key Activities (5)
Value Proposition (1)
Customer Relationships (4)
Customer Segments (2)
Who are our key partners/ suppliers
Which key activities does the biz model
require
What value do we deliver to the
customer
What type of relationship does each
segment require of us
For whom are we creating value
Professional Sports
Leagues
- Rental Tracking
GET - Search Ads,
Partnerships, At
stadium promotion
Professional Sports
Game Attendees
Jersey Suppliers
- Dry cleaning
A cheaper way to
wear Officially
Licensed sports
jerseys to a game
Dry Cleaners
- Marketing
Stadium
Shop/Vendors
- Customer Service
Pre-paid Envelope
Suppliers
USPS/Fedex/UPS
- Shipping
Key Resources (6)
Which key resources does the biz model
require
Jersey Inventory
Warehouse
Eliminate risk of
owning a player
jersey who is
traded
Provide alternative
to purchasing
counterfeit jerseys
Logistics system
KEEP - Customer
Service
- Male and Female
- Young Adult 1830
GROW - Referral
Program
- <$100k income
Channels (3)
- Attend >10% of
home games per
yr
Through which channel does each
segment want to be reached
Website
Stadium
Shops/Vendors
- Casual sports
fans
Ticket Websites
Direct Mail
Cost Structure (9)
Revenue Streams (8)
What are our cost drivers
How much is each segment willing to pay and how would they like to pay us this amount
Jerseys, warehouse, shipping, cleaning, logistics
tracking, website development/maintenance,
customer service employees
Annual Subscription Model
Pay per Rental
Day 2- Customer Discovery
Nike Town
NBA Store
NHL Store
Day 3 Canvas
As of: 8/29/12
Current Canvas
Key Partners (7)
Key Activities (5)
Value Proposition (1)
Customer Relationships (4)
Customer Segments (2)
Who are our key partners/ suppliers
Which key activities does the biz model
require
What value do we deliver to the
customer
What type of relationship does each
segment require of us
For whom are we creating value
Jersey Suppliers
- Rental
Rental Tracking
Tracking
Dry Cleaners
- Shipping
Shipping
Professional Sports
Fans
Pre-paid Envelope
Suppliers
- Dry
Dry cleaning
cleaning
USPS/Fedex/UPS
- Customer Service
Customer Service
GET
Ads,
GET- Search
- Search
Partnerships,
At
Ads,
stadium
promotion
Partnerships,
At
stadium
KEEP - Customer
promotion
Service
KEEP - Customer
GROW - Referral
Service
Program
GROW –
Channels
(3) Reward
Referral/
Through which channel does each
segment
want to be reached
Program
Website
Website
- Marketing
Marketing
SPORTS JERSEY
OWNERS
- Flexibility to
change jersey
- Eliminate risk of
owning jersey
who is traded
Key Resources (6)
Which key resources does the biz model
require
Jersey Inventory
Jersey Inventory
Warehouse
Warehouse
Logistics system
Logistics system
SINGLE GAME
ATTENDEES
- Cheaper way to
wear jersey to a
game
Stadium
Stadium
Shops/Vendors
Shops/Vendors
Ticket Websites
Websites
Ticket
SPORTS JERSEY
OWNERS
- Male
- Kid to Young
Adult 13-35
SINGLE GAME
ATTENDEES
- Male and
Female
- Young Adult 1830
- Casual fan
Direct Mail
Mail
Direct
Cost Structure (9)
Revenue Streams (8)
What are our cost drivers
How much is each segment willing to pay and how would they like to pay us this amount
Jerseys,
Jerseys,warehouse,
warehouse,shipping,
shipping,cleaning,
cleaning,logistics
tracking,
website development/maintenance,
logistics tracking,
website
customer
service employees customer service
development/maintenance,
employees
SINGLE GAME ATTENDEES
- Pay per Rental
SPORTS JERSEY OWNERS
- Annual Subscription
Day 3 - Customer Discovery
Left Side of Canvas
Commercial Dry Cleaners
Right Side of Canvas
USPS & FedEx
Sports Bars
Jersey Suppliers
Social Media
Day 4 Canvas
As of: 8/30/12
Current Canvas
Key Partners (7)
Key Activities (5)
Value Proposition (1)
Customer Relationships (4)
Customer Segments (2)
Who are our key partners/ suppliers
Which key activities does the biz model
require
What value do we deliver to the
customer
What type of relationship does each
segment require of us
For whom are we creating value
Jersey Suppliers
- Rental
Rental Tracking
Tracking
Dry Cleaners
- Shipping
Shipping
Professional Sports
Fans
Pre-paid Envelope
Suppliers
- Dry
Dry cleaning
cleaning
USPS/Fedex/UPS
- Customer Service
Customer Service
GET
Ads,
GET- Search
- Search
Partnerships,
At
Ads,
stadium
promotion
Partnerships,
Social Media, At
KEEP - Customer
stadium
Service
promotion
GROW - Referral
KEEP - Customer
Program
Service
- Marketing
Marketing
SPORTS JERSEY
OWNERS
- Flexibility to
change jersey
- Eliminate risk of
owning jersey
who is traded
Key Resources (6)
Which key resources does the biz model
require
Jersey Inventory
Jersey Inventory
Warehouse
Warehouse
Logistics system
Logistics system
SINGLE GAME
ATTENDEES
- Cheaper way to
wear jersey to a
game
SPORTS JERSEY
OWNERS
- Male
- Kids to Young
Adult 13-35
Channels
GROW(3)–
Through which channel does each
segment want to be reached
Referral/ Reward
Program
Website
Website
Stadium
Ticket Websites
Shops/Vendors
Ticket Websites
SINGLE GAME
ATTENDEES
- Male and
Female
- Young Adult 1830
- Casual fan
Cost Structure (9)
Revenue Streams (8)
What are our cost drivers
How much is each segment willing to pay and how would they like to pay us this amount
Jerseys,
Jerseys,warehouse,
warehouse,shipping,
shipping,cleaning,
cleaning,logistics
tracking,
website development/maintenance,
logistics tracking,
website
customer
service employees customer service
development/maintenance,
employees
SINGLE GAME ATTENDEES
- Pay per Rental
SPORTS JERSEY OWNERS
- Annual Subscription
$200
Launched JerseySquare.com
81 Visitors
In 1st 9 hours
With 30-Second Demo Video
www.jerseysquare.com
Our First Customer
Our Email Blasts
Day 5 Canvas
As of: 8/31/12
Current Canvas
Key Partners (7)
Key Activities (5)
Value Proposition (1)
Customer Relationships (4)
Customer Segments (2)
Who are our key partners/ suppliers
Which key activities does the biz model
require
What value do we deliver to the
customer
What type of relationship does each
segment require of us
For whom are we creating value
Jersey Suppliers
- Rental
Rental Tracking
Tracking
Dry Cleaners
- Shipping
Shipping
Professional Sports
Fans
Pre-paid Envelope
Suppliers
- Dry
Dry cleaning
cleaning
USPS/Fedex/UPS
USPS
- Customer Service
Customer Service
GET
Ads,
GET- Search
- Search
Partnerships,
At
Ads,
stadium
promotion
Partnerships,
Social Media, At
KEEP - Customer
stadium
Service
promotion
GROW - Referral
KEEP – Seniority,
Program
loyalty program
- Marketing
Marketing
SPORTS JERSEY
OWNERS
- Flexibility to
change jersey
- Eliminate risk of
owning jersey
who is traded
Key Resources (6)
Which key resources does the biz model
require
Jersey Inventory
Jersey Inventory
Warehouse
Warehouse
Logistics system
Logistics system
SINGLE GAME
ATTENDEES
- Cheaper way to
wear jersey to a
game
GROW –
Premium subs,
Channels (3)
Through
which channel
Family
plandoes each
segment want to be reached
Website
Website
Stadium Shops/Vendors
Ticket Websites
SPORTS JERSEY
OWNERS
- Male
- Kids to Young
Adult 13-35
SINGLE GAME
ATTENDEES
- Male and
Female
- Young Adult 1830
- Casual fan
Direct Mail
Cost Structure (9)
Revenue Streams (8)
What are our cost drivers
How much is each segment willing to pay and how would they like to pay us this amount
Jerseys,
Jerseys,warehouse,
warehouse,shipping,
shipping,cleaning,
cleaning,logistics
tracking,
website development/maintenance,
logistics tracking,
website
customer
service employees customer service
development/maintenance,
employees
SINGLE GAME ATTENDEES
- Pay per Rental
SPORTS JERSEY OWNERS
- Annual Subscription,
Monthly Subscription,
One-Time
Biggest Learning Moments
What We Thought
Customer segment is adult males
who attend lots of games each year
Customers will use JerseySquare
because we are cheaper
Customers will not be willing to
spend as much on rental jerseys
There is a market for renting
professional jerseys!
Results What We Found
X
There are two customer segments:
• SPORTS JERSEY OWNERS
o Male, Kids to Young Adult 13-35
• SINGLE GAME ATTENDEES
o Male and Female, Young Adult 18-30,
Casual fan
X
Customers like our company because we provide
both:
• the ability to wear different jerseys throughout
the season
• a hedge against players being traded, getting
hurt, retiring, etc.
X
Customers are actually willing to spend as much (if
not more) on a subscription for jersey rentals as
they do on buying a jersey!
P
We received payment from our first customer on
Thursday, 8/30/2012
Archetypes
Attribute
Gasol
Junior
Becky
Age
32
15
24
Income
$65K
N/A
$40K
Demographics
White
White
White
Type
Jersey Buyer
Social Statement
Social Sports Viewer
Fan Type
Avid
In-Season
Casual
Class
Middle
Middle
Middle
Facebook Status
Single/It’s Complicated
Single
In Relationship
RENTAL TYPE
SUBSCRIPTION
Unit Economics
Year 1
(For One Person)
Year 2
Jersey Cost
(w/ 25% off)
$ 150
Revenue
$ 199
Turns
Turns
Shipping
$9
X5
Cleaning
$1
X5
Processing
$1
X5
Customer
Acquisition
$ 25
Unit Costs
- $ 230
Net
- $ 31
Revenue
$ 199
Shipping
$9
X5
Cleaning
$1
X5
Processing
$1
X5
Unit Costs
- $ 55
x
Retention
60 %
Net
$ 86
Current Pricing Plans
(But A/B Testing for Price Elasticity)
Annual Subscription
$199 /year
Monthly Subscription
$29.99 /month
1 Time, 1 Week Rental
$24.99
• Authentic Top of Line Jerseys
• Free Shipping
• Send back a jersey in exchange for another
• Authentic Top of Line Jerseys
• Free Shipping
• Send back a jersey in exchange for another
• Authentic Top of Line Jerseys
• Free Shipping
• Send back jersey within 1 week
Customer Relationships
GROW
KEEP
• Customer Loyalty program
with bonus rentals and
discount purchases
GET
• Google AdWords
• Guerilla style marketing on
FB, YouTube, and Twitter
• Seniority credits
• Partnership rewards and
discounts
• Sale of customer data
• Family plan
• Premium
subscriptions
• Additional products
• Free jersey giveaways
• Customer referral bonuses
• Targeted promotions
Results Pending…
Market Size
Total
Addressable
Market
(how big is
universe)
150 Million Americans watch the 5 major
team sports (in some capacity)
Served
Available
Market
(how many can I
reach with my
sales channel)
11 Million NY Metro Area watch the 5
major team sports (in some capacity)
Target Market
(who will be most
likely buyers)
Based only Yankee Stadium Research:
11.7% of SAM showed strong interest
1.3 Million People
- Half subscription / Half Pay Per Rental
Next Steps
• Teenager Customer Discovery
• Customer Acquisition
o More Google Adwords Testing
o More Website Conversion Testing
• LISTEN TO/OBSERVE OUR CUSTOMERS
Who Is the Team?
500 CUSTOMERS
TEAM MEMBERS
Degree program and
Department/Major
Provide your LinkedIn
public profile URL
Are you the subject
matter expert (SME) for
this team?
Pick a role you think you
most likely will play on
this team (Hustler,
Hacker, Designer or
Product Picker)
Anything interesting we
should know about you
(be brief)
What’s the
Competitive
Landscape?
What’s Your Business Model?
What happens next?
Applications will be reviewed and accepted on a rolling basis first come-first served. Finalists will be notified by email.
Step 1: Review Course Website
http://www8.gsb.columbia.edu/entrepreneurship/leanlaunchpad/
Step 2: Form a Team (Use above website to form or join a team)
Step 3: Submit Application (Team submission, not Individual)
Step 4: Each Team Member must Acknowledge and Accept
Class Requirements by Email (Sent by Jay Mehta)
Step 5: Application is Reviewed for completeness and
Individual Eligibility is Verified
Step 6: Notification of Acceptance, Registration and Bid
Point Reduction (MBA/EMBA only)
• January 12
INITIAL CANVAS DUE by 6pm ET
• January 13
Class starts 8:30am ET
Turning great ideas into great
businesses
Syllabus and more course info:
http://www8.gsb.columbia.edu/entrepreneurship
/leanlaunchpad/
General Lean LaunchPad background:
http://steveblank.com/category/lean-launchpad/
Startup Tools:
http://steveblank.com/tools-and-blogs-forentrepreneurs/
In Conclusion…
• Questions about the course or process?
• Looking for Team Members?
• Looking for a Team to Join?
First look here:
http://www8.gsb.columbia.edu/entrepreneurship/lean
launchpad/
Still need help?
• Also: Ashley Zwick… az2335@columbia.edu
• OR if needed… bobdorf@gmail.com