Difference between revisions of "M3-S3 - Session notes"
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| − | M3-S3 - | + | Ideas are not the same as opportunities: |
| + | * Opportunities are presishable | ||
| + | ** Ideas last forever | ||
| + | * Window of opportunity depends on: | ||
| + | ** Technology, Demographics, Competitors, Consumers | ||
| + | * Ideas are free | ||
| + | ** Opportinities require work | ||
| + | |||
| + | The opportunity | ||
| + | Step 1: | ||
| + | * Large and growing market | ||
| + | * Structurally attractive industry | ||
| + | Step 2: Show how the venture can launch the opportunities: see the nine questions: | ||
| + | # Who is the new ventures customer? | ||
| + | # How does the customer make decissions about buying this product or service? | ||
| + | # '''To what degree is the product a compelling purchase for the customer?''' | ||
| + | ** A 'prototype' or 'vision' of a product may result to a favorable response but this quit different than paying for the real thing. | ||
| + | ** Do not really 'trust' a favorable response. Ask questions like: | ||
| + | *** What money will you save using our product? | ||
| + | *** Where would you go without our product | ||
| + | *** Also see: [[M3-S3 - Reading - Coyne, K.P. Sustainable Competitive Advantage|M3-S3 - Reading - Coyne, K.P. Sustainable Competitive Advantage]] | ||
| + | *** A [[Sustainable Competitive Advantage|Sustainable Competitive Advantage]] is the best predictor for business success | ||
| + | # How will the product be priced? | ||
| + | # How will the venture reach all customer segments? | ||
| + | # How much does it cost (in time and resources) to acquire a customer? | ||
| + | # How much does it cost to produce and deliver the product or service? | ||
| + | # How much does it cost to support a customer? | ||
| + | # How easy is it to retain a customer? | ||
| + | Step 3: Cash flow implications of pursuing the opportunities | ||
| + | Step 4: Map business beyond initial opportunity / product | ||
| + | Step 5: Competition | ||
| + | Step 6: Explain how the above will be influenced by changes in the context & how the business will mitigat, exploit those | ||
| + | Step 7: Convince sceptical audiance of the above | ||
| + | |||
| + | '''Hazards of opportunity exploitation''' | ||
| + | # Accepting "yes" at face value | ||
| + | # Financial projections which are not adequately built upon [[Bottom up forecast|Bottom up forecast]] evidence | ||
| + | |||
| + | Risk and reward: | ||
| + | * "True entreprenuers want to capture all the reward and give all the risk to others" | ||
| + | * "The best business is a post office to which people send casier checks" | ||
| + | |||
| + | Questions: | ||
| + | # Is there anything i can do to move my business closer to Sahlman's best business | ||
| + | # Are we taking ANY avoidable risks and if so why? | ||
| + | # Where do the owners endgames come in my priority list? | ||
| + | |||
| + | Visualizing the risk: | ||
| + | * Plot probability on y-axs | ||
| + | * Plot gain on x-axis | ||
| + | ** -100% (loose everything) | ||
| + | ** -50% | ||
| + | ** +0% | ||
| + | ** +10% | ||
| + | ** +50% | ||
| + | ** +100% | ||
| + | ** +200% | ||
| + | |||
| + | '''People''' | ||
| + | * Which personal question really count: | ||
| + | ** What are the motivations | ||
| + | ** How committed in this venture? | ||
| + | ** Are they prepared to hire high quality people? | ||
| + | |||
| + | Both expierence and skills are necessary: | ||
| + | * Genuine intrensic interest is critical | ||
| + | * Interest is the oxygen of comittment: sustaining you through thick and thin | ||
| + | * Being interested in money making potential of the opportunity is not the same thing as finding the business exiting | ||
| + | |||
| + | People conundrum: | ||
| + | * Past track record isn't a guarantee of future sucess or failure | ||
| + | * Every great entrepeneurs first success had no precendent | ||
| + | * Experience shapes the perception of opportunities removing some blind spots and introducing others | ||
| + | * Who are these people anyway vs "forget the proven team" | ||
| + | * Timing, time, test, terms | ||
[[Category:mbi]] | [[Category:mbi]] | ||
Latest revision as of 19:58, 27 August 2020
Ideas are not the same as opportunities:
- Opportunities are presishable
- Ideas last forever
- Window of opportunity depends on:
- Technology, Demographics, Competitors, Consumers
- Ideas are free
- Opportinities require work
The opportunity Step 1:
- Large and growing market
- Structurally attractive industry
Step 2: Show how the venture can launch the opportunities: see the nine questions:
- Who is the new ventures customer?
- How does the customer make decissions about buying this product or service?
- To what degree is the product a compelling purchase for the customer?
- A 'prototype' or 'vision' of a product may result to a favorable response but this quit different than paying for the real thing.
- Do not really 'trust' a favorable response. Ask questions like:
- What money will you save using our product?
- Where would you go without our product
- Also see: M3-S3 - Reading - Coyne, K.P. Sustainable Competitive Advantage
- A Sustainable Competitive Advantage is the best predictor for business success
- How will the product be priced?
- How will the venture reach all customer segments?
- How much does it cost (in time and resources) to acquire a customer?
- How much does it cost to produce and deliver the product or service?
- How much does it cost to support a customer?
- How easy is it to retain a customer?
Step 3: Cash flow implications of pursuing the opportunities Step 4: Map business beyond initial opportunity / product Step 5: Competition Step 6: Explain how the above will be influenced by changes in the context & how the business will mitigat, exploit those Step 7: Convince sceptical audiance of the above
Hazards of opportunity exploitation
- Accepting "yes" at face value
- Financial projections which are not adequately built upon Bottom up forecast evidence
Risk and reward:
- "True entreprenuers want to capture all the reward and give all the risk to others"
- "The best business is a post office to which people send casier checks"
Questions:
- Is there anything i can do to move my business closer to Sahlman's best business
- Are we taking ANY avoidable risks and if so why?
- Where do the owners endgames come in my priority list?
Visualizing the risk:
- Plot probability on y-axs
- Plot gain on x-axis
- -100% (loose everything)
- -50%
- +0%
- +10%
- +50%
- +100%
- +200%
People
- Which personal question really count:
- What are the motivations
- How committed in this venture?
- Are they prepared to hire high quality people?
Both expierence and skills are necessary:
- Genuine intrensic interest is critical
- Interest is the oxygen of comittment: sustaining you through thick and thin
- Being interested in money making potential of the opportunity is not the same thing as finding the business exiting
People conundrum:
- Past track record isn't a guarantee of future sucess or failure
- Every great entrepeneurs first success had no precendent
- Experience shapes the perception of opportunities removing some blind spots and introducing others
- Who are these people anyway vs "forget the proven team"
- Timing, time, test, terms
