Description
most of the new business ideas are Enhancement, Extensions and Specializations rather than totally innovative ideas. And how to turn these ideas into opportunities, questions to be asked while screening opportunities
Ideas & Value Creation
Street Vendor
Coffee Shop
Cycle-rikshaw
Aeroplane
Viable Business Proposition
?
Some product or service that delivers 'Value' to a set of customers 'Value' is a customer-centric perspective Think like a customer – put yourself in the “customer’s shoes”
?
?
4
Categories of 'value' by analyzing existing entrepreneurs
5
Analysis of Existing Entrepreneurs
?
Truly new, novel and innovative ideas
3-4%
6
Analysis of Existing Entrepreneurs
?
Enhancement
improvement/refinement of features
cheaper, better, faster, more user-friendly
96%
?
Extension Specialization
addition to features niche creation
?
7
Analysis of Existing Entrepreneurs
?
Truly new, novel and innovative ideas Enhancement improvement/refinement of features
cheaper, better, faster, more user-friendly
3-4%
?
96%
?
Extension
addition to features
?
Specialization niche creation
8
Enhancement, Extensions and Specializations
Enhancements
Extensions
Specialization
9
Examples of Enhancement
?
DOS to Windows Mechanical watch to quartz watch Ordinary TV to a flat screen TV
?
?
?
Desktop PC to a laptop PC to a tablet PC
Propeller engine to a jet engine
?
Most industrial innovations
10
Examples of Enhancement
?
DOS to Windows Mechanical watch to quartz watch Ordinary TV to a flat screen TV
?
?
?
Desktop PC to a laptop PC to a tablet PC
Propeller engine to a jet engine
?
Most industrial innovations
Give us a couple of others!
11
Examples of Extensions
?
Toothbrush with built in toothpaste
Pen with a torchlight Mobile handset with camera, FM radio, MP3 player ….. Wristwatch with a calculator Cinema multiplexes
?
?
?
?
?
Day care centers (crèche) with tuitions
12
Examples of Extensions
?
Toothbrush with built in toothpaste
Pen with a torchlight Mobile handset with camera, FM radio, MP3 player ….. Wristwatch with a calculator Cinema multiplexes
?
?
?
?
?
Day care centers (crèche) with tuitions
Give us a couple of others!
13
Examples of Specialization
?
Low cost airlines (Air Deccan) Super-speciality hospitals
?
?
Finishing schools
Executive search firms [CxOs only (CEO, CFO, COO, CTO), finance professionals only]
?
14
Examples of Specialization
?
Low cost airlines (Air Deccan) Super-speciality hospitals
?
?
Finishing schools
Executive search firms [CxOs only (CEO, CFO, COO, CTO), finance professionals only]
?
Give us a couple of others!
15
Turning Ideas Into Opportunities
Product OR Service
Market
Opportunity Recognition
Opportunity Recognition Pursuit of Opportunity
People & Organizat ion
Resources & Capital
Product OR Service
Market
Opportunity Recognition Pursuit of Opportunity
People & Organizat ion
Resources & Capital
A new company
A Word of Caution
?
If you are fundamentally in a lousy business, you will not get very far irrespective of the efforts and the talent. No matter how talented you are and how much capital you have, if you have not given your idea a rigourous, critical examination before starting out, you could be heading for a disaster. When you buy a car, you take it for a test ride. Why not do the same for your idea?
?
?
Some Interesting Statistics
?
Most businesses fail in less than two years
?
Fewer than one percent of the business plans submitted to VCs get funded
Business failures lead to huge “collateral damages” Failures are planned by lack of planning
?
?
Important Insights…
?
Markets and industries are not the same things A Market consists of a group of current and/or potential customers having a willingness and ability to buy products (goods and services) to satisfy a particular class of wants and needs
?
?
A market is a set of buyers (individuals, firms) and their needs. Not to be confused with products
Example: Businesspeople who get hungry between meals during the workday – market for workplace snacks
?
Important Insights…
?
An Industry consists of sellers – typically organizations – that offer a product or a class of products that are similar and close substitutes Example for workplace snack industry – producer level (salty snacks such as chips, candy, fresh fruits) or distribution level (coin vending machine, coffee bars, take-away joints)
?
Important Insights
?
“Space” or “Sector” are dubious words – they confuse market and industry (Internet space, biotech space) Judgments about attractiveness of the market one proposes to serve are very different from attractiveness of the industry in which one plans to compete
?
?
Both micro and macro level considerations are important – markets and industries must be examined at both levels
Keys to evaluating entrepreneurs or entrepreneurial teams are not simply found in their resumes or in their entrepreneurial character
?
What are these Seven Domains ?
?
Market domain – macro level
?
Market domain – micro level
Industry domain – macro level Industry domain – micro level Team domain – aspirations Team domain – execution capability
?
?
?
?
?
Team domain – connections or networks
Screening an Opportunity: 5 Questions
1.
What important customer problem can you solve?
How valuable? How painful? Remember, you need to change somebody’s behavior to buy your product.
Screening an Opportunity: 5 Questions
2.
How are you going to do it?
Business model:
Product Distribution Location Technology/Innovation Service Brand
Screening an Opportunity: 5 Questions
3.
How many customers are there that are willing to buy from you?
How many customers are there? (Market size)
How many will buy from you? (Market share)
Who will be your first customer (besides your Mom)?
Who will be your 100th?
Screening an Opportunity: 5 Questions
4.
Why can only you provide the solution?
How are you unique? What do you provide that nobody else can?
Screening an Opportunity: 5 Questions
5.
How can you defend against others?
Location, brand, patent (or other IP), great service, great taste, great fashion sense….
Screening Ideas: Are they Opportunities? 5 Questions
1. 2. 3.
What important customer problem can you solve?
How are you going to do it? How many customers are there that are willing to buy from you? Why can only you provide the solution?
4. 5.
How can you defend against others?
Ask these questions BEFORE somebody else does!
doc_432479886.pptx
most of the new business ideas are Enhancement, Extensions and Specializations rather than totally innovative ideas. And how to turn these ideas into opportunities, questions to be asked while screening opportunities
Ideas & Value Creation
Street Vendor
Coffee Shop
Cycle-rikshaw
Aeroplane
Viable Business Proposition
?
Some product or service that delivers 'Value' to a set of customers 'Value' is a customer-centric perspective Think like a customer – put yourself in the “customer’s shoes”
?
?
4
Categories of 'value' by analyzing existing entrepreneurs
5
Analysis of Existing Entrepreneurs
?
Truly new, novel and innovative ideas
3-4%
6
Analysis of Existing Entrepreneurs
?
Enhancement
improvement/refinement of features
cheaper, better, faster, more user-friendly
96%
?
Extension Specialization
addition to features niche creation
?
7
Analysis of Existing Entrepreneurs
?
Truly new, novel and innovative ideas Enhancement improvement/refinement of features
cheaper, better, faster, more user-friendly
3-4%
?
96%
?
Extension
addition to features
?
Specialization niche creation
8
Enhancement, Extensions and Specializations
Enhancements
Extensions
Specialization
9
Examples of Enhancement
?
DOS to Windows Mechanical watch to quartz watch Ordinary TV to a flat screen TV
?
?
?
Desktop PC to a laptop PC to a tablet PC
Propeller engine to a jet engine
?
Most industrial innovations
10
Examples of Enhancement
?
DOS to Windows Mechanical watch to quartz watch Ordinary TV to a flat screen TV
?
?
?
Desktop PC to a laptop PC to a tablet PC
Propeller engine to a jet engine
?
Most industrial innovations
Give us a couple of others!
11
Examples of Extensions
?
Toothbrush with built in toothpaste
Pen with a torchlight Mobile handset with camera, FM radio, MP3 player ….. Wristwatch with a calculator Cinema multiplexes
?
?
?
?
?
Day care centers (crèche) with tuitions
12
Examples of Extensions
?
Toothbrush with built in toothpaste
Pen with a torchlight Mobile handset with camera, FM radio, MP3 player ….. Wristwatch with a calculator Cinema multiplexes
?
?
?
?
?
Day care centers (crèche) with tuitions
Give us a couple of others!
13
Examples of Specialization
?
Low cost airlines (Air Deccan) Super-speciality hospitals
?
?
Finishing schools
Executive search firms [CxOs only (CEO, CFO, COO, CTO), finance professionals only]
?
14
Examples of Specialization
?
Low cost airlines (Air Deccan) Super-speciality hospitals
?
?
Finishing schools
Executive search firms [CxOs only (CEO, CFO, COO, CTO), finance professionals only]
?
Give us a couple of others!
15
Turning Ideas Into Opportunities
Product OR Service
Market
Opportunity Recognition
Opportunity Recognition Pursuit of Opportunity
People & Organizat ion
Resources & Capital
Product OR Service
Market
Opportunity Recognition Pursuit of Opportunity
People & Organizat ion
Resources & Capital
A new company
A Word of Caution
?
If you are fundamentally in a lousy business, you will not get very far irrespective of the efforts and the talent. No matter how talented you are and how much capital you have, if you have not given your idea a rigourous, critical examination before starting out, you could be heading for a disaster. When you buy a car, you take it for a test ride. Why not do the same for your idea?
?
?
Some Interesting Statistics
?
Most businesses fail in less than two years
?
Fewer than one percent of the business plans submitted to VCs get funded
Business failures lead to huge “collateral damages” Failures are planned by lack of planning
?
?
Important Insights…
?
Markets and industries are not the same things A Market consists of a group of current and/or potential customers having a willingness and ability to buy products (goods and services) to satisfy a particular class of wants and needs
?
?
A market is a set of buyers (individuals, firms) and their needs. Not to be confused with products
Example: Businesspeople who get hungry between meals during the workday – market for workplace snacks
?
Important Insights…
?
An Industry consists of sellers – typically organizations – that offer a product or a class of products that are similar and close substitutes Example for workplace snack industry – producer level (salty snacks such as chips, candy, fresh fruits) or distribution level (coin vending machine, coffee bars, take-away joints)
?
Important Insights
?
“Space” or “Sector” are dubious words – they confuse market and industry (Internet space, biotech space) Judgments about attractiveness of the market one proposes to serve are very different from attractiveness of the industry in which one plans to compete
?
?
Both micro and macro level considerations are important – markets and industries must be examined at both levels
Keys to evaluating entrepreneurs or entrepreneurial teams are not simply found in their resumes or in their entrepreneurial character
?
What are these Seven Domains ?
?
Market domain – macro level
?
Market domain – micro level
Industry domain – macro level Industry domain – micro level Team domain – aspirations Team domain – execution capability
?
?
?
?
?
Team domain – connections or networks
Screening an Opportunity: 5 Questions
1.
What important customer problem can you solve?
How valuable? How painful? Remember, you need to change somebody’s behavior to buy your product.
Screening an Opportunity: 5 Questions
2.
How are you going to do it?
Business model:
Product Distribution Location Technology/Innovation Service Brand
Screening an Opportunity: 5 Questions
3.
How many customers are there that are willing to buy from you?
How many customers are there? (Market size)
How many will buy from you? (Market share)
Who will be your first customer (besides your Mom)?
Who will be your 100th?
Screening an Opportunity: 5 Questions
4.
Why can only you provide the solution?
How are you unique? What do you provide that nobody else can?
Screening an Opportunity: 5 Questions
5.
How can you defend against others?
Location, brand, patent (or other IP), great service, great taste, great fashion sense….
Screening Ideas: Are they Opportunities? 5 Questions
1. 2. 3.
What important customer problem can you solve?
How are you going to do it? How many customers are there that are willing to buy from you? Why can only you provide the solution?
4. 5.
How can you defend against others?
Ask these questions BEFORE somebody else does!
doc_432479886.pptx