Korbo Zusammenfassung Flashcards
(78 cards)
1
Q
What is necessary for entrepreneurism
A
- For new markets do need radical new technologies: improved vs disrupted (schumpeter)
- Capital
- Policy (lower regulation)
- Support (cultural support in society, as well as support from certain people)
- Culture and community (Group of founders)
- Market characteristics(demand/supply —> new markets)
Talents
2
Q
Reasons for startup explosion:
A
Reasons for startup explosion:
- Speed of consumer adoption of new technology
- Building startups is cheaper (thousands, not millions of $ anymore)
- Higher resolution venture finance industry
- Entrepreneurship is developing its own management science
3
Q
Who is financing startups
A
- There are a lot of people helping startups with money, especially in Silicon Valley and in the Ivy League Universities.
- In Germany Business Angels fund more than venture-capital, but most of the time public money is invested
4
Q
Are entrepreneurs born or made?
A
- Children of entrepreneurs are 60% more likely to become entrepreneurs
- Importance of adoptive parents is twice as large as the influence of biological parents
- Parental role modeling based on an analysis of gender specific parent-child transmissions of entrepreneurship
5
Q
Types of innovation
A
- Technology Push innovation (New Problem with Old Solution): Looking for new applications
- Radical innovation (New Problem with New Solution): Looking for a new solution
- Incremental innovation (Old Problem with old solution): Optimizing
- Market Pull (Old Problem with new solution): Looking for new solutions
6
Q
Entrepreneurs versus Managers
A
- Entrepreneur are less loss averse then managers
- Same risk averse, but loss averse greater
- Entrepreneurs have a more intuitive decision making styles than managers
- Entrepreneurs are more optimistic than managers (NOT over confident)
7
Q
Name the 5 discovery skills of an entrepreneurs
A
- Associating (Steve Jobs typology): Combine different cultures, things, ideas —> new ideas get formed
The more you expose yourself to new ideas, the more you will have - Questioning (Question daily life; Why this way, why not in another way?)
- Observation (Look at people, how they behave and conclude on that
- Experimenting (Try something new and learn from failure. Take small steps —> POSITIVE THINKING: „I haven’t failed. I’ve just found 10000 ways that won’t work“ - Edison)
- Networking (Find people, who are better than you)
8
Q
Likelihood of opportunity recognition and financial success
A
- Data suggests correlation between discovery skills and financial success.
BUT: More factors: Personality traits/motivation, Execution skills, experience, Timing, Competition/Technology, Capital, Luck, organizational constraints.
9
Q
What is Effectuation?
A
Effectuation: how do entrepreneurs build their companies? And what can we learn from that?
10
Q
Causal rationality versus effectual reasoning
A
- Causal rationality begins with a predetermined goal and seeks to identify the optimal alternative
- Effectual reasoning begins with a given set of means and allows goals to emerge contingently overtime from varied ideas
11
Q
4 basic principles of effectuation:
A
- Bird in the hand principle — start with your means: start taking action, based on what you readily have available.
- Affordable loss principle — set affordable loss: evaluate opportunities based on whether the downside is acceptable.
- Lemonade principle — leverage contingencies: embrace surprises that arise from uncertain situations
- Crazy-Quilt-principle — form partnerships: look for people who are willing to commit for real
12
Q
Name Business Models examples
A
- Haloid: 1958 - First big printer ; Good a good product, but way to expensive. → Monthly fee + 2000 Pages for free; Then pay for additional pages
- 1998: Google designs new business model → Auction search words -→ It is very important to look at a business model
13
Q
Name the 9 building blocks of the business model canvas
A
Key Partners
Key Activities
Key Resources
Value Proposition
Customer Relationships
Customer Channels
Customers
Costs
Revenue
14
Q
Describe the McDonalds milkshake problem
A
- People hire products to do things for us
- For what kind of a job do people hire a milkshake? → Data analysis→ Last time you didn’t hire that product, what did you hire?
- If you understand the job you can improve the product
15
Q
Describe: Customers from the Business Model Canvas
A
- Which customers / users are you serving?
- Which job they want to get done?
–> Customer driven
16
Q
Describe: Value Propositions from the Business Model Canvas
A
- What are you offering them?
- What is getting that done for them?
- Do they care?
–> Offer driven
17
Q
Describe: Customer Channels from the Business Model Canvas
A
- How does the customer segment want to be reached?
- Interaction points
–> Customer driven
18
Q
Describe: Customer Relationships from the Business Model Canvas
A
- What kind of relationships do you develop?
- personal, retentive, automated?
–> Customer driven
19
Q
Describe: Revenue from the Business Model Canvas
A
- What are the customers willing to pay?
- How?
- Transactional or recurring revenues?
–> Finance driven
20
Q
Describe: Key Resources from the Business Model Canvas
A
- Essential assets/resources for your business?
–> Resource driven
21
Q
Describe: Key Activities from the Business Model Canvas
A
- What activities are crucial?
–> Resource driven
22
Q
Describe: Key Partners from the Business Model Canvas
A
- which partners/suppliers leverage your business?
- Do you need to rely on somebody?
–> Resource driven
23
Q
Describe: Costs from the Business Model Canvas
A
- What is the resulting cost structure?
- Which key elements could ruin your business?
–> Finance driven
24
Q
Business Model Innovators outperform traditional innovators – Name 4
A
Produce and sell
Freemium
License / Franchise
Multisided platforms (Google) / Long-Tail (Amazon)
25
Leap of faith
Commuters will stop and buy a refreshing drink --> They pay a premium for fresh lemonade
26
Hypothesis for business
At least 10 ppl per day will stop and buy lemonade --> Coke costs 1$ --> They could pay 1,5$ for lemonade
27
Success metric for your business
Number of glasses you sell and/or price at which customers most willingly buy
28
Actual results from testing your business
Sold only 2 glasses -- Several people stopped, but did not buy
29
Insights and course corrections of your business
Started placing signs for lemonade versus dropping the price
30
Different Approaches: cost vs. Value driven
- Finance driven: Minimizing costs (Low price value, maximum automation, outsourcing)
- Customer driven: Focus on value creation l Aim at creating and maintaining value and personalization)
- One-off consumption: single buy of a product
- Recurring consumption: Buy things multiple times (Nespresso coffee)
- Freemium: High conversion rate elasticity (profit extremily sensitive to conversion) - easily profitable , but need to be studied over timeto be studied over time
31
Challenges for start-ups regarding market entry
- Low awareness of company and product → Build a brand
- Limited resources: financial, personnel, time
- Existing market vs. New market: type of market changes everything: Varying parameters make it necessary to approach every market differently (Regarding sales, marketing, Business development strategies etc.)
32
Targeting & Positioning
- Product / Market fit;
- Packaging and pricing;
- Channels and Distribution;
- Messaging and communication ⇒ depend on targeting &
- Segmentation
- Starbucks (coffee → Lifestyle) ⇒ Pure perception by customers
33
Focus on the right customer:
Focus on the right customer:
Has a problem → Is aware of the problem → Has actively looked for a solution → Has put together a own, bad solution → Has a budget
34
Customer discovery:
Customer discovery:Find a problem, worth solving → Find a potential solution
35
Customer validation:
Validate, that solution works → Validate a business model
36
How do you find information about customers?
- Exploratory approach: Interview / Observation vs.
| - Assumption approach: Questionnaire
37
Product development
Concept/Bus. Plan --> Product Dev. --> Alpha/Beta --> Launch/1. Shipping
38
Customer development
Customer discovery --> Customer validation --> Customer creation --> Company building
customer validation --> Customer discovery
39
Main challenges for product development
- Customer often don't know themselves about their needs
- Misleading information due to personal influence
- "Sticky information"-Problem: Difficult to describe → Knowledge of customer often limited → less imagination
⇒ Important to understand whom to listen to and why
40
Explain the Customer Validation approach:
- Do they: Care, Need it, can afford it. Who are they for real?
- Does our solution solve the problem? Do they understand it? Would they pay?
41
Problem-Solution fit:
- 10-20 customers, telling them, they must have the solution to a problem you are trying to solve
- A high number should say that your solution solves their problem
- A handful of them is willing to help you to grow
- Some are paying for a prototype
42
The Mom-Test
The Mom-Test (Find out, what customers want)
- People are lying bastards! (They tell us what we want to hear, if he ask wrong)
- Mom tries not to hurt your feelings
43
What are Customer interviews for?
Customer interviews:
| 1. Find out if they are the customer; 2. Explore their world view; 3. Get commitment
44
What are good questions for an interview guide?
- Tell me about X (Not: Do you have a problem with X / Do you think, it is a good idea ? / Would you buy a product which solves X?)
- How do you currently deal with this problem?
- Talk me through the last time you had this problem
- How much does that problem cost you? (Not: How much would you pay?)
- Is there a budget for it? who else should i talk to?
- Did or do ! ⇒ Never would! (Do not assume problems / Give hints)
- Let them speak about experiences/ examples (Do not ask for opinions)
- Opinions are worthless — Commitments & Think is. Do!
45
Focus on the customers in an interview
Know what you want to learn: 1. Find customers; 2. Validate Problem; 3.Validate solution; 4. Learn and Iterate
- We are looking for expert feedback; Ask open questions; Let them speak; Let them be the expert; In Person
- Don't delegate the interviews; Precisely table to people; Come back to the interviewees; Review the team
46
What are Major team challenges
Clear responsibilities - clear goals - making strategic decisions - personal conflicts - Equity splits
47
3 R´s
Relationships -- Roles -- Rewards
48
Roles in a startup
Roles: functional, skill related roles
- Consultant: analyzes situation & derives recommendation
Ability to learn, empathy, apprehension
- The boss: leads, gives orientation, keep's team together, supports, motivates
Initiative, risk-taking, ability to motivate, ability to make decisions
- Artist: nonconventional questions, different viewpoints, impulses
Creativity, communication skills, open, risk initiative, risk taking, the ability to motivate, and ability to make decisions
- Maker: execution, pushes others
Endurance, discipline, ability to motivate
- Enthusiast: brings fun and is able to inspire
Teamwork, optimist, ability to communicate, motivate
- The organizer: plans and controls, has overview
Flexibility, teamwork, structured, reliable
- Helper: always there
Initiative, open, empathy
49
The great team is characterized by?
- Equal distribution of talking and listening (focused and short)
- Team members look at each other during conversation
- They interact beyond daily work with each other
- Explore new information in their networks, then come back and share
- Who is on the team matters less than how the team members interact, structure their work, and view their contributions
- Heterogeneous in terms of competencies and roles
- Business acumen + technical expert
- Someone who executes + someone who looks at the details + someone who connects people
- Shared vision, working culture, ambitions
50
Rewards in a startup
Equal splits vs. the founders pie calculator
| ESOP = employee stock option plan (critical!)
51
Name Categories of investors:
- Family and friends: altruistic/idealistic (seed)
- Business Angels: monetary/ idea of being the mentor (seed/early stage)
- Incubators, accelerators: monetary (M&A advisory, Commission, stakes) (seed)
- Venture capital: monetary return on investments (seed, early & later stage)
- Corporate venture: strategic motivation (seed & early stage)
52
Major Terms for valuation
Money: valuation, pre-money, Post-money, milestones, Virtual stock options, Exit preference, down round protection
Control: Vesting of founders shares, transfer restrictions, drag-along/tag-along, supervisory board, veto rights, information rights
53
Stages of funding
Early stage: Seed stage --> Start-Up
Expansion stage: Expansion
Late stage: Bridge --> MBO
54
Valuation Variables
- Comparables: similar deals in history
- Key assets of the company: management (commitment, knowledge, experience), intellectual property, financials, Time to profit, milestones achieved, revenue, customers and feedback, barriers to entry
- Financing history: funding today, future funding, Post money valuations
- Size and growth of market: current size, targeted size
55
Problems with Net Present Value
Net present value: forecast of profit / discount rate —> (turnover - costs)/ discounted rate —> discounted rate = what is the risk, that my forecast is wrong
56
Problems with DCF
Discounted cash flow: there are no cash flows
57
Dave Berkus Method
Dave Berkus Method: Add 500k for every thing, that exists (sound idea + 500k, quality team + 500k etc. )
58
Scorecard method:
```
30% Management
25% Opportunity
15% Product
10% Sales
10% Competition
10% Other factors
```
59
Wisdom of the crowd:
Wisdom of the crowd: pre-money valuation of all business angels —> take mean and mode
60
Cost validation:
Cost validation: do salaries scale? above or below market rates? What are other cost drivers?
61
Profit validation:
Profit validation: Enough demand? Deal closure rate? Sales team internal/external/size?
62
B2B vs. B2C
- B2C Startups: Traction, Vanity metrics vs. real key metrics, e-commerce: cac vs. lcv, scalabe?
- B2B startups: Scalable, technology, team, network, comp.?
63
Unicorns:
Unicorns: Venture backed, private, < 10 years, > $1 billion
64
Customer Lifecycle
- Visitor: Everyone, who gets in touch with the product —> If they sign up for beta or so, they become prospect —> Action to move to next stage: Conversion
- Prospect: potential customer who has expressed interest —> Conversion rate
- Activated user: delivering the core value unit for the first time —> activation rate
- Customer: as soon as he/she pays —> daily/weakly active user rate
- Active customer: regulary uses your products —> renewal rate
- Loyal customer: customer renews or signs up for additional features —> net promoter score/referrals
65
Sales Funnel
- Leads: can enter the sales funnel from outbound or inbound channels —> action required —> filtering bad data
- Marketing qualified lead (MQL): scoring system that correlates with the historic probability of closing the deal —> action required
- Sale qualified lead (SQL): sales development team conducts lead qualification —> provide sales team with information about customer —> SDR qualifies prospect using BANT approach
- Opportunity: When a lead passes all the necessary qualification parameters, it becomes an opportunity —> SDR schedules a demo
- Proof of concept (PoC): negotiate, if your product needs access to other platforms/products from other companies
- Closed: customer send in the signed proposal and pays for the first invoice —> customer success team
- Onboarding: customer success team (CST) trains the customer on how to use the solution
- Renew/upsell: effectiveness of your customer success team is measured by renewal, upselling and churn metrics
66
Customer Awareness
Marketing: Enlighten customers about industry trends
67
Customer Education
Marketing/Sales/Customer Success: Educate customers on more effective and efficient ways
68
Customer Selection
Marketing/Sales/Customer Success: Tell customers about other products
69
Customer Training
Sales/Customer Success/ Support: Train customer to use product
70
Entrepreneurial ecosystem
- Old top-down strategy: Government —> Incubators & Venture funds —> EPs
- New Entrepreneur-centered approach: network
Needed: policy, finance, culture, supports, human capital, markets
71
Founders pie
- Idea: Company wouldn't exist without an idea
Business plan preparation: the plan is a necessary element of starting a business — but it all comes down to execution
- Domain expertise: where does someone have meaningful expertise?
- Commitment and risk: full-time workers (opportunity costs) / investments
- Responsibilities: who is going to do what and who is responsible for failure
Relative importance of elements:
- The elements above create weights on a scale from 0 to 10, showing their importance to the business
Relative importance of founders:
- Founders get points on a scale from 0 to 10, based on how they are involved in an element.
In the end the weights get multiplied with the founders points of every founder and get summed up into total points per founder
Then you can derive the percentage of total pie everyone gets
72
Validated UX Concept
Validated concept — solution that communicates the value proposition — in the form that works for the user
Makes the users life easier — goal focused — forgiving — consistent — creates meaningful delight
73
How do you know when the UX is bad?
Low conversion, high drop-off rates, angry users and a lot of questions/ Assistance needed
74
Causes of bad UX?
Not fully developed/bad ideas, too many features, ambiguous timelines, Poor planning, no research/testing
75
How to plan for UX Design?
Observation —> ideation —> prototyping —> testing
76
What is the relevant IP?
- Copyright (design and software)
- Know-how (business processes and data)
- Trademarks and designs(company name)
- (Utility) patents
- Business ideas and concepts, web developments, customer data/business contacts
77
Hotspots of IP
- Does the company hold all the relevant IP rights — proper transition of rights
- Who owns employee/freelancer developments — proper transfer of rights
- Do you have all licenses you need to run your business — license status
- Do you have a reliable relationship with your supplier — check Agreements
- Proper know-how protection
- Can you ensure proper use of your IP — audit rights and defined sanctions
- IT security
78
Sales channels for a startup
- Direct to customer channel — indirect channel — Direct channel
- Load touch channel ($) — High touch channel ($$$$)
Internet – Telesales – volume distributors – value-added partners – field sales
