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Steve Blank
www.steveblank.com
Twitter: @sgblank
How to Build a Startup
This Talk is Based On• Business Model Generation• Four Steps to the Epiphany• The Four Steps to Epiphany
This Talk is Based On• Business Model Generation• Four Steps to the Epiphany• The Startup Owners Manual
But First,…
WHAT’S A STARTUP?
Lesson 1
Startup
Lifestyle Startups Work to Live their Passion
• Serve known customer with known product
• Work for their passion
Small BusinessStartup
Small Business StartupsWork to Feed the Family
• Serve known customer with known product
• Feed the family
Small BusinessStartup
Exit Criteria- Business Model found- Profitable business- Existing team< $500K in revenue
Small Business StartupsWork to Feed the Family
• known customer known product
• Feed the family
Large Non-Profit
Social Startup
Social Entrepreneurship Startups
• Solve pressing social problems• Social Enterprise: Profitable• Social Innovation: New Strategies
ScalableStartup
Large Company
Scalable Startup
Goal is to solve for: unknown customer and
unknown features
Search Execute
ScalableStartup
Large Company
Scalable Startup
Goal is to solve for: unknown customer and
unknown features
Search Execute
Exit Criteria- Business model found- Total Available Market > $500m- Can grow to $100m/year
ScalableStartup
$2 to $50M Acquisition
Buyable StartupBorn to Be Big
Goal is to solve for: Internet, Mobile, Gaming Apps
Search Sell
Sell to larger company
THE DELUSIONS OF ENTREPRENEURSHIP
Lesson 2
I Have a Vision
I Have the “Right Stuff”
I Know What Needs to Be Done
Lets Start A Company!
#1 I Know Who The Customer Is
#2I Know Exactly the Product They Need
#3I Know the Problem They Have
#4All I Need to Do is Execute the Plan
#5Now Let’s Raise Money
#6Let’s Do It Like a Large Company
#7We Can Fix It After We Ship It All
HOW TO GET STARTUPS WRONG
Lesson 3
Large Company Product Introduction Model
Concept/Seed
Round
Product Dev.
Alpha/Beta Test
Launch/1st Ship
When Adopted by Startups =
Concept/Seed
Round
Product Dev.
Alpha/Beta Test
Launch/1st Ship
The Leading Cause of Startup Death
Product Introduction Model:Two Implicit Assumptions
Customer Problem: known
Product Features: known
Concept/Seed
Round
Product Dev.
Alpha/Beta Test
Launch/1st Ship
Execute the Business Plan
Large Company Method – Hire Marketing
Concept/Seed
Round
Product Dev.
Alpha/Beta Test
Launch/1st Ship
- Create Marcom Materials- Create Positioning
- Hire PR Agency- Early Buzz
- Create Demand- Launch Event- “Branding”
Marketing
Large Company Method – Hire Sales
Concept/Seed
Round
Product Dev.
Alpha/Beta Test
Launch/1st Ship
- Create Marcom Materials- Create Positioning
- Hire PR Agency- Early Buzz
- Create Demand- Launch Event- “Branding”
• Build Sales Organization
Marketing
Sales• Hire Sales VP• Hire 1st Sales
Staff
Large Company Method – Hire Business Development
Concept Product Dev.
Alpha/Beta Test
Launch/1st Ship
- Create Marcom Materials- Create Positioning
- Hire PR Agency- Early Buzz
- Create Demand- Launch Event- “Branding”
• Hire Sales VP• Pick distribution
Channel
• Build Sales Channel / Distribution
Marketing
Sales
• Hire First Bus Dev
• Do deals for FCS
Business Development
Large Company Method – Hire Engineering
Concept Product Dev.
Alpha/Beta Test
Launch/1st Ship
- Create Marcom Materials- Create Positioning
- Hire PR Agency- Early Buzz
- Create Demand- Launch Event- “Branding”
• Hire Sales VP• Pick distribution
Channel
• Build Sales Channel / Distribution
Marketing
Sales
• Hire First Bus Dev
• Do deals for FCS
Business Development
Engineering • Write MRD
• Waterfall
• Q/A • Tech Pubs
WHAT DO WE NEED TO GET STARTUPS RIGHT?
Lesson 4
Is It Big Enough?
Is It Big Enough?
How Do You Know?
Do You Have What it Takes?
Do You Have What it Takes?
ResilientRelentless
AgileCurious
PassionateDriven
Do You Know Why Startups Fail?
More startups fail from a lack of customers than from a failure of product development
Do You Know What a Startup Is?
A Startup is a temporary organization
A Startup is a temporary organization designed to search
A Startup is a temporary organization designed to search for a repeatable and
scalable business model
Startups Are Not Smaller Versions of Large Companies
Startups Are Not Smaller Versions of Large Companies
Startups Are Not Smaller Versions of Large Companies
Large Companies Execute Known Business Models
Startups Are Not Smaller Versions of Large Companies
Startups Search for Unknown Business Models
Startups Fail Because They Confuse Search with Execute
Startups need their own tools, different from those used
in existing companies
Startups need their own tools, different from those used
in existing companies
THE 3 TOOLS FOR STARTUPS
Lesson 5
Startup Tool #1: The Business Model
All I Need to Do is Execute the Plan
No Business Plan Survives First Contact With Customers
CUSTOMER SEGMENTS
which customers and users are you serving? which jobs do they really want to get done?
VALUE PROPOSITIONS
what are you offering them? what is that getting done for them? do they care?
CHANNELS
how does each customer segment want to be reached? through which interaction points?
CUSTOMER RELATIONSHIPS
what relationships are you establishing with each segment? personal? automated? acquisitive? retentive?
REVENUE STREAMS
what are customers really willing to pay for? how? are you generating transactional or recurring
revenues?
KEY RESOURCES
which resources underpin your business model? which assets are essential?
62
KEY ACTIVITIES
which activities do you need to perform well in your business model? what is crucial?
KEY PARTNERS
which partners and suppliers leverage your model?
who do you need to rely on?
COST STRUCTURE
what is the resulting cost structure? which key elements drive your costs?
65images by JAM
customer segments
key partners
cost structure
revenue streams
channels
customer relationships
key activities
key resources
value proposition
sketch out your business model
(c)2010 K+S Ranch Consulting Inc. www.steveblank.com
67
KEYPARTNERS
OFFER
CHANNELS
CUSTOMER RELATIONSHIPS
CUSTOMERSEGMENTS
REVENUE STREAMSCOST STRUCTURE
KEYACTIVITIES
KEYRESOURCES
67
buildingblock
buildingblock
buildingblock
buildingblock
building
block
buildingblock
buildingblock
building
block
buildingblock
buildingblock
buildingblock
Business Model Canvas – Any Business
building
block
9 Guesses
Guess Guess
Guess
Guess
GuessGuess
Guess
GuessGuess
Startup Tool #2: The Agile Development
Agile Development is How We Build Startups
Startup Tool #3: Customer Development
Customer Development is How We Search for the Business Model
CUSTOMER DEVELOPMENT
Lesson 5
Customer Development
There are no facts inside your building
So get the heck out
Customer Development is how you search for the model
CompanyBuilding
Customer Creation
Execution
Customer
Discovery
Customer
Validation
Pivot
Search
Customer Development
Customer
Discovery
Customer
Validation
Pivot
Search
The Search For the Business Model
Customer Development
CompanyBuilding
Customer
Discovery
Customer
Validation
Customer Creation
Pivot
Execution
• Articulate and Test your hypotheses• Design experiments, start listening• Continuous Discovery• Done by founders
Customer Discovery
CustomerDiscovery
CustomerValidation
CompanyBuilding
CustomerCreation
Execution
Search
Pivot
Discovery
• How big is the market?• Who’s the customer?
– What’s their problem/need
• What’s the product/service/need?– Does it solve the customers problem?
• How do you create demand?• How do you deliver the product?• How do you make money?
Customer Development =process to search
Business Model Canvas =the Scorecard
Agile Engineering is How We Build Startups
• Research Labs
• Equipment Manufacturers
• Distribution Network
• Service Providers
• Technology Design
• Marketing
• Demo and customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents
• Video Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Organic Farmers
• Weeding Service Providers
• Conventional Farmers
• Dealers• Direct
Service• Indirect
Service• … then
Dealers
• Asset Sale• Direct Service with
equipment rental• … then Asset Sale
Value-Driven
Customer Validation
Customer
Discovery
CustomerValidatio
n
Customer Creation
CompanyBuilding
• Repeatable and scalable business model?
• Passionate earlyvangelists?
• Pivot back to Discovery if no customers
Pivot Execution
Search
The Minimum Viable Product (MVP)
• Smallest feature set that gets you the most …
- orders, learning, feedback, failure…
- incremental and iterative
Hypotheses Testing and Insight
The Pivot
• The heart of Customer Development
• Iteration without crisis
• Fast, agile and opportunistic
Customer
Discovery
Customer
Validation
Pivot
Search
Pivot Cycle Time Matters
• Speed of cycle minimizes cash needs
• Minimum feature set speeds up cycle time
• Near instantaneous customer feedback drives feature set
CustomerDiscovery
CustomerValidation
CompanyBuilding
CustomerCreation
ExecutionSearch
Pivot
Web/Mobile Versus Physical
• Web/Mobile startups run faster
• Different process steps for web vs. physical
• Customer Relationships are radically different
Customer
Discovery
Customer
Validation
Pivot
Customer Discovery Phase 1 & 2
Customer Relationships
Customer Relationships Physical Products – Get Customers
Customer Relationships Physical Products – Keep Customers
Customer Relationships Physical Products – Grow Customers
Customer Relationships Physical Products – Get/Keep/Grow
Customer Relationships Web/Mobile Products– Get Customers
Customer Relationships Web/Mobile Products– Keep Customers
Customer Relationships Web/Mobile Products– Grow Customers
Customer Relationships Web/Mobile Products Get/Keep/Grow
Customer Relationships Physical & Web Mobile Are Different
HOW DOES THIS REALLY WORK?
LEAN LAUNCHPAD CLASS
Lesson 6
How Does This Really Work?
Lean LaunchPad Class
National Science Foundation
Pivot ExampleRobotic Weeding
Talked 75 Customers in 8 Weeks
Our initial plan
Confidential
20 interviews, 6 site visits…We got OUR Boots dirty
WeedingVisited two farms in Salinas Valley to better understand problem
Interviewed:• Bolthouse Farms, Large Agri-Industry in Bakersfield• White Farms, Large Peanut farmer in Georgia• REFCO Farms, large grower in Salinas Valley• Rincon Farms, large grower in Salinas Valley• Small Organic Corn/Soy grower in Nebraska• Heirloom Organics, small owner/operator, Santa Cruz Mts• Two small organic farmers at farmers market• Ag Services of Salinas, Fertilizer applicator
MowingInterviewed:• Golf: Stanford Golf course • Parks: Stanford Grounds Supervisor, head of maintenance and
lead operator (has crew of 6)• Toro dealer (large mower manufacturer) • User of back-yard mowing system• Maintenance Services for City of Los Altos• Colony Landscaping (Mowing service for stadiums)
Business Plan Autonomous Vehicles for Mowing & Weeding
We reduce operating cost- Labor reduction- Better utilization of assets (eg mow or weed at nights)- Improved performance (less rework, food safety)
Mowing- Owners of public or commercially used green spaces (e.g. golf courses)- Landscaping service provider
Weeding- Farmers with manual weeding operations
Dealers sell, installs and supports customer
Co. trains dealers, supports dealers
- Mowing Dealers- Ag Dealers
- Innovation- Customer Education- Dealer training
Dealer discount COGS seek a 50-60% Gross MarginHeavy R&D investment
- Dealers (Mowing and Ag)- Vehicle OEMs (John Deere, Toro, Jacobsen, etc)
- Research labs
Asset saleOur revenue stream derives from selling the equipment
Engineers on Autonomous vehicles, GPS, path-planning
Found weeding in organic crops is HUGE problem; 50 - 75% of costs
Crews of 100s-1000
Back-breaking task
(Ilegal) labor harder to get
1-5 weedings per year/field
$250-3,500 per acre and increasing
Food contamination risk
Decision to make – mowing vs weeding
Application If ROI is < 1 yr they will
buy
Labor costs significant?
Autonomous would solve
problem?
TAM
Mowing of large fields
Yes.Professionally
run organizations
Yes Yes Adjusted up toxxx
Weeding in Agriculture
Agri Industry: YES!
Large Growers: Yes
Small Growers: No
YES! for organic crops
They are spending $500/ac!
Not necessarily
Key need is weed vs. crop differentiation
TAM increased to $2.6 B (Total
organic)
Target Market (organic
specialty) 162 M/yr
18%/yr growth
Autonomous vehicles WEEDING
We reduce operating cost- Labor reduction (100 to 1)- Reduced risk of contamination- Mitigate labor availability concerns
- Low density vegetable growers- High density vegetable growers- Thinning operations- Conventional vegetables
Dealers sell, installs and supports customer
Co. trains dealers, supports dealers
- Ag Dealers- Ag Service providers
- Innovation- Customer Education- Dealer training
Dealer discount COGS seek a 50-60% Gross MarginHeavy R&D investment
- Ag Dealers- Ag Service providers
- Research labs
Asset saleOur revenue stream derives from selling the equipment
Engineers on Machine VisionTwo problems:- Identification- Elimination
1 Week – 1 CarrotBot
Confidential
CarrotBot
• Machine Vision data collection platform– Monochrome & Color
Cameras– Laser-line sweep (depth
measurement)– Encoders
(position/velocity)– Onboard data acquisition
& power
CarrotBot 1.0
The Business Plan Canvas Updated
• Research Labs
• Equipment Manufacturers
• Distribution Network
• Service Providers
• Technology Design
• Marketing• Demo and
customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents• Video
Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Organic Farmers
• Weeding Service Providers
• Conventional Farmers
• Dealers• Direct Service• Indirect
Service• … then
Dealers• Asset Sale• Direct Service
with equipment rental
• … then Asset Sale
Value-Driven
Visit Highlights
Carrot vs. WeedsDue to small root systems, carrots have no chance against weeds
Visit Highlights
Organic Broccoli, closely cultivated. Weeds close to plants are hand-picked
Visit Highlights
State of the Art in Weeding Technology for Organic Crops
Customer Hypothesis
Hypothesis Confirmed• Growers interested in own
equipment • Industrial (10,000s of acres) • Large (1,000s of acres)• Willing to pay $100k for one unit
• Smaller growers (100s of acres) usually subcontract the labor services or rent equipment
• All purchases through local dealers• Customer service is essential
Pre-Test
Post-Test
Customer Map #1 – Industrial Growers
Example: Bolthouse Farms – Large Industrial Carrot Producer – 8K acres/yr
• Equipment Operator
• Director, Ag Technology
• Justin Grove, interviewed
• VP, Growing Operations
• CFO, CEO (Jeff Dunn)
• Local Farm Mgr• Cliff Kirkpatrick, visited
Equipment Operator
Cliff, Farm Mgr
Customer Map #2 – Service Providers
Example: Ag Services – Service Provider, Salinas Valley
• Equipment Operator
• Service Mgr
• ?? (service mgr’s boss)
Me (left), Marty (middle, Service Mgr), Doug (right, Grower)
• Grower
The Business Plan Canvas Updated
• Research Labs
• Equipment Manufacturers
• Distribution Network
• Service Providers
• Technology Design
• Marketing• Demo and
customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents• Video
Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Mid/Large Organic Farmers
• Agricultural corporations
• Weeding Service Providers
• Mid/Large Conventional Farmers
• Direct Service• Indirect
Service• … then
Dealers
• Direct Service with equipment rental
• ($1,500/d; 120d/yr )• Low density:
$1,500/d• High density:
$6,000/d
Value-Driven
World Ag Expo interviews:the need is real and wide spread
• 10+ interviews at show– Everyone confirmed the need– Robocrop, UK based, crude
competitor sells for $171 K
• Revenue Stream– Mid to small growers prefer a
service– Large growers prefer to buy, but
OK with service until technology is proven
– Charging for labor cost saved is OK, as we provide other benefits (food safety, labor availability)
Confidential
The Business Plan Canvas Updated
• Research Labs
• Equipment Manufacturer
• Distribution Network
• Service Providers
• 2 or 3 Key Farms
• Technology Design
• Marketing• Demo and
customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents• Video
Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Mid/Large Organic Farmers
• Agricultural corporations
• Weeding Service Providers
• Mid/Large Conventional Farmers
• Direct Service• Indirect
Service• … then
Dealers
• Direct Service with equipment rental
• Low density: $1,500/d
• High density: $6,000/d
Value-Driven• R&D• Bill of Materials• Training &
Service• Sales
Autonomous weeding - Final
We reduce operating cost- Labor reduction (100 to 1)- Reduced risk of contamination- Mitigate labor availability concerns
- Low density vegetable growers- High density vegetable growers- Thinning operations- Conventional vegetables
Direct- Provide high quality service at competitive price
Direct - Alliance with service providers- Eventually sell through dealers
- Innovation- Customer Education- Dealer training
Costs for service provisionCOGS seek a 50-60% Gross MarginHeavy R&D investment
- Ag Service providers
- Research Institutes (eg UC Davis, Laser Zentrum Hannover)
- 3-4 key farms
Service provision- Charge by the acre with modifier according to weed density - Eventually move to asset sale
Engineers on Machine VisionTwo problems:- Identification- Elimination
Pivot ExampleAutonomous Robot
Talked 75 Customers in 8 Weeks
Our initial plan
Business Plan Autonomous Vehicles for Mowing
We reduce operating cost- Labor reduction- Better utilization of assets (eg mow or weed at nights)- Improved performance (less rework, food safety)
Mowing- Owners of public or commercially used green spaces (e.g. golf courses)- Landscaping service provider
Weeding- Farmers with manual weeding operations
Dealers sell, installs and supports customer
Co. trains dealers, supports dealers
- Mowing Dealers- Ag Dealers
- Innovation- Customer Education- Dealer training
Dealer discount COGS seek a 50-60% Gross MarginHeavy R&D investment
- Dealers (Mowing and Ag)- Vehicle OEMs (John Deere, Toro, Jacobsen, etc)
- Research labs
Asset saleOur revenue stream derives from selling the equipment
Engineers on Autonomous vehicles, GPS, path-planning
20 interviews, 6 site visits…We got OUR Boots dirty
WeedingVisited two farms in Salinas Valley to better understand problem
Interviewed:• Bolthouse Farms, Large Agri-Industry in Bakersfield• White Farms, Large Peanut farmer in Georgia• REFCO Farms, large grower in Salinas Valley• Rincon Farms, large grower in Salinas Valley• Small Organic Corn/Soy grower in Nebraska• Heirloom Organics, small owner/operator, Santa Cruz Mts• Two small organic farmers at farmers market• Ag Services of Salinas, Fertilizer applicator
MowingInterviewed:• Golf: Stanford Golf course • Parks: Stanford Grounds Supervisor, head of maintenance and
lead operator (has crew of 6)• Toro dealer (large mower manufacturer) • User of back-yard mowing system• Maintenance Services for City of Los Altos• Colony Landscaping (Mowing service for stadiums)
Decision to make – mowing vs weeding
Application If ROI is < 1 yr they will
buy
Labor costs significant?
Autonomous would solve
problem?
TAM
Mowing of large fields
Yes.Professionally
run organizations
Yes Yes Adjusted up toxxx
Weeding in Agriculture
Agri Industry: YES!
Large Growers: Yes
Small Growers: No
YES! for organic crops
They are spending $500/ac!
Not necessarily
Key need is weed vs. crop differentiation
TAM increased to $2.6 B (Total
organic)
Target Market (organic
specialty) 162 M/yr
18%/yr growth
Autonomous vehicles WEEDING
We reduce operating cost- Labor reduction (100 to 1)- Reduced risk of contamination- Mitigate labor availability concerns
- Low density vegetable growers- High density vegetable growers- Thinning operations- Conventional vegetables
Dealers sell, installs and supports customer
Co. trains dealers, supports dealers
- Ag Dealers- Ag Service providers
- Innovation- Customer Education- Dealer training
Dealer discount COGS seek a 50-60% Gross MarginHeavy R&D investment
- Ag Dealers- Ag Service providers
- Research labs
Asset saleOur revenue stream derives from selling the equipment
Engineers on Machine VisionTwo problems:- Identification- Elimination
1 Week – 1 CarrotBot
Confidential
CarrotBot
• Machine Vision data collection platform– Monochrome & Color
Cameras– Laser-line sweep (depth
measurement)– Encoders
(position/velocity)– Onboard data acquisition
& power
CarrotBot 1.0
Visit Highlights
Carrot vs. WeedsDue to small root systems, carrots have no chance against weeds
Visit Highlights
Organic Broccoli, closely cultivated. Weeds close to plants are hand-picked
The Business Plan Canvas Updated
• Research Labs
• Equipment Manufacturers
• Distribution Network
• Service Providers
• Technology Design
• Marketing• Demo and
customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents• Video
Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Organic Farmers
• Weeding Service Providers
• Conventional Farmers
• Dealers• Direct Service• Indirect
Service• … then
Dealers• Asset Sale• Direct Service
with equipment rental
• … then Asset Sale
Value-Driven
Customer Hypothesis
Hypothesis Confirmed• Growers interested in own
equipment • Industrial (10,000s of acres) • Large (1,000s of acres)• Willing to pay $100k for one unit
• Smaller growers (100s of acres) usually subcontract the labor services or rent equipment
• All purchases through local dealers• Customer service is essential
Pre-Test
Post-Test
Customer Map #1 – Industrial Growers
Example: Bolthouse Farms – Large Industrial Carrot Producer – 8K acres/yr
• Equipment Operator
• Director, Ag Technology
• Justin Grove, interviewed
• VP, Growing Operations
• CFO, CEO (Jeff Dunn)
• Local Farm Mgr• Cliff Kirkpatrick, visited
Equipment Operator
Cliff, Farm Mgr
Customer Map #2 – Service Providers
Example: Ag Services – Service Provider, Salinas Valley
• Equipment Operator
• Service Mgr
• ?? (service mgr’s boss)
Me (left), Marty (middle, Service Mgr), Doug (right, Grower)
• Grower
The Business Plan Canvas Updated
• Research Labs
• Equipment Manufacturers
• Distribution Network
• Service Providers
• Technology Design
• Marketing• Demo and
customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents• Video
Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Mid/Large Organic Farmers
• Agricultural corporations
• Weeding Service Providers
• Mid/Large Conventional Farmers
• Direct Service• Indirect
Service• … then
Dealers
• Direct Service with equipment rental
• ($1,500/d; 120d/yr )• Low density:
$1,500/d• High density:
$6,000/d
Value-Driven
World Ag Expo interviews:the need is real and wide spread
• 10+ interviews at show– Everyone confirmed the need– Robocrop, UK based, crude
competitor sells for $171 K
• Revenue Stream– Mid to small growers prefer a
service– Large growers prefer to buy, but
OK with service until technology is proven
– Charging for labor cost saved is OK, as we provide other benefits (food safety, labor availability)
The Business Plan Canvas Updated
• Research Labs
• Equipment Manufacturer
• Distribution Network
• Service Providers
• 2 or 3 Key Farms
• Technology Design
• Marketing• Demo and
customer feedback
• Cost Reduction
• Remove labor force pains
• Eliminate bio-waste hazards
• IP – Patents• Video
Classifier Files
• Robust Technology
• Farming conventions.
• Demo, demo, and demo!!
• Proximity is paramount
• Mid/Large Organic Farmers
• Agricultural corporations
• Weeding Service Providers
• Mid/Large Conventional Farmers
• Direct Service• Indirect
Service• … then
Dealers
• Direct Service with equipment rental
• Low density: $1,500/d
• High density: $6,000/d
Value-Driven• R&D• Bill of Materials• Training &
Service• Sales
Autonomous weeding - Final
We reduce operating cost- Labor reduction (100 to 1)- Reduced risk of contamination- Mitigate labor availability concerns
- Low density vegetable growers- High density vegetable growers- Thinning operations- Conventional vegetables
Direct- Provide high quality service at competitive price
Direct - Alliance with service providers- Eventually sell through dealers
- Innovation- Customer Education- Dealer training
Costs for service provisionCOGS seek a 50-60% Gross MarginHeavy R&D investment
- Ag Service providers
- Research Institutes (eg UC Davis, Laser Zentrum Hannover)
- 3-4 key farms
Service provision- Charge by the acre with modifier according to weed density - Eventually move to asset sale
Engineers on Machine VisionTwo problems:- Identification- Elimination
Genesis of the Idea
Business Model Canvas
Assumption of Customer PainPeople were even more
frustrated with parking at big
events.
Parking is a pain! People want a
guaranteed parking spot.
People DO want a guaranteed spot & would
reserve online.
200+ customers Bigger Pain
PIVOT!
80% positive response
Business Model Canvas
Assumption of Customer PainPeople were even more
frustrated with parking at big
events.
Parking is a pain! People want a
guaranteed parking spot.
People DO want a guaranteed spot & would
reserve online.
200+ customers Bigger Pain
People will pay extra to have a
great, guaranteed parking spot.
People will not only pay more,
they will pay a lot more! ($9+)
Validated!
Surveyed 75+ Customers
PIVOT!
Business Model Canvas
145
Customer Survey/Validation
• How much more would you be willing to pay to have a guaranteed close parking spot in the arena's lot or near the arena?– On average- $9.33– Max of $27.00
Assumption of PainPeople were even more
frustrated with parking at big
events.
Parking is a pain! People want a
guaranteed parking spot.
People DO want a guaranteed spot & would
reserve online.
200+ customers Bigger Pain
People will pay extra to have a
great, guaranteed parking spot.
People will not only pay more,
they will pay a lot more! ($9+)
Validated!
Surveyed 75+ Customers
People who have extra spaces will post spots and make money.
It is difficult to get a mass number of
people to post enough parking
spots.
We needed to find a new solution.
30+ People
PIVOT!
PIVOT!
Expert Validation
• Tom Lombardi and Greg Bessoni– Online parking reservation experts
Partnered with me and
put up capital.
Business Model Canvas
New AssumptionsParking lots will
post spots online so that people
can reserve them.
Yes! Lots have been looking for ways to increase revenue and fill
up lots.
30+ Parking Lots Bigger Pain
Electronic payments in
advance through an online
reservation system.
Validated!
30+ Parking Lots
20% of cash goes missing.
Loved it! Would pay about 15% of
posted price.
75% positive response
Industry Validation
Business Model Canvas
Business Model Canvas
MVP ValidationEasier ways to post parking &
track reservations.
Started with a very basic
reservation system.
All Pro Parking (30 lots)
30+ person focus group Search process
was too hard. Wanted mobile
site as well.
Fixed search, cleaned up site,
mobile site in the works.
Made it even easier to post
and track parking.
All Pro Parking’s
Customers
With no marketing-
50 reservations in just a few
months.
Business Model Canvas
Business Model Canvas
Our Model
$5 Reservation Fee
15% of Price Paid
XoomPark
We estimate being able to collect about $8 per reservation
Go to Market Strategy & ValidationTalked to Tom
Lombardi, industry expert.
Lots located throughout Florida and in Dallas,TX
Lots located all over West Coast and Texas
Parking lots in all 50 states
Over 250 lots throughout Eastern US.
25+ years experience
Go to Market Strategy & Validation
Tom and Greg’s Affilate Networks
3,000 Affiliates
Go to Market Strategy & Validation
Customer’s recommendations
for the future
Focus group of
30+ people
Market Size
$8.2 Billion USA Parking Industry
$4.5 Billion Parking Facility/Management
$1.4 Billion Event Parking
$240,000 Buffalo and Atlanta
TAMSAMTarget
Market
Apex
Competitors
Usability
Reliability
Low High
High
Low
Parkwhiz
ParkingCarma
GottaPark
ClickandPark
Revenue Projections
Year 1 Year 2 Year 3 Year 4$0$2$4$6$8
$10$12$14$16$18$20
Revenue
Revenue in Mil-lions
70% Gross Profit Margin
• 2 Partners• 30+ Parking lots• 50+ Reservations• Working Website
• Validated Revenue Model
How Does This Really Work?
The National Science Foundation
8 Weeks From an Idea to a Business
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