Download - THE SILICON VALLEY WAY - BOOK REVIEW Mikko Jokela Jarkko Kosonen Jussi Pihlainen Janne Tikkanen
Main Reasons for the Success of Silicon Valley
Stanford University and the University of California
Venture Capital The Concentration of High-Tech Companies The Weather
Some Other Reasons for the Success of Silicon Valley
Workforce Diversity Two-Income Families Labor Laws Government and Industry Cooperation California´s Culture Employee Ownership and Stock Options California´s Public Colleges California´s Pioneer Mentality
Seven questions executives ask
The 45-second business plan What is your product?
– should contain measurable objective
Who is the customer?– be specific
Who will sell it?– This helps determine product elements.
Seven questions executives ask
How many people will buy it? How much will it cost to design and build? What is the sales price?
– Remember that prices come down over time.
When will you break even?– forecast and calculate
Market research
What does neighbors’ and media think?– Ask neighbors opinions and listen them carefully.– Go to library!
What's on the web?– Web is a powerful market research tool.
What do the numbers/experts say?– Save all the number data.– Keep your open mind when listening experts.
Can you predict the future?
The Competition
Who are your competitors?– List toughest and most potential competitors.
What are they doing?– Organize your thoughts.
What is their value proposition?– Define your competitors value proposition.
What are their secrets?– Trade shows, job postings on the web...
The Product
Why would anyone buy your product?– List your products values and benefits.
What will it look like?– Use drawings to create a shared vision.
When it will be available for shipping?– Product should have 3 to 10 milestones.
How different are you from the competition?– Price, reliability, ease of use etc.
The Product
Should you do product simulations?– Some ways to simulate could be:
paper and ink PC simulations phone simulations
What is your products name?– Use brainstorming.– Name associates with: Quality assurance, Product vs.
company name, Geography and history, uniqueness
The Customer
”It is so easy to get wrapped up in your product and forget all about he customer”
– Dale L. Fuller, Whowhere? Inc.
Do the customers think it is a good idea?– Ask about it from your potential customers.
Who is the real customer– Specific buying habits?, Prerequisites?, Etc.
The Customer
What are your customer’s secrets?– Age demographics, Income level, Method of
payment… Should you do focus groups?
– Focus group = Group of 6 to 10 people, who are representing potential customers.
– Focus group interviews should be done by some professional.
How much will the customer pay?
The Marketing Strategy
What are your objectives?– Strategic and marketing objectives
How will you sell and support the product?– Make buying process more simple.
Who will generate demand?
The Marketing Strategy
Will you need marketing or sales?– Sales representatives etc.
What is the marketing plan?– “History teaches that the only thing that works in
marketing is the single bold stroke…”Al Ries and Jack Trout, 22 immutable laws of marketing.
How do you become front page news?– Imagine what kind of strengths will be mentioned in
your future front page success story.
Confront the Truth
"The best way to make a lot of money in a new venture...is to be honest about the real risks in the business.”
John Doerr, Partner, Kleiner Perkins Caufield & Byers, from Going Global by William C. Taylor and Alan M. Webber
Disasters do have warning signals --> trust your instincts.
Confront the Truth
Is this the right project for you?– Why are you doing this?
Consider it before making big decisions. What is your motivation?
What is your core competency?
Confront the Truth
Will the business work?– A new business succeeds by focusing.– What skills are critical to your success?– What will make your business or product unique?– What do you enjoy doing?
Identify your competitive advantage and concentrate on it.
Confront the Truth
Are you telling yourself the truth?– Be truthful
How much will it cost to build it? How much will customers pay? Can you deliver what you promised? Is there really need for the product? If your employees don't want the product, it will not
succeed.
– One of the biggest faults is not being truthful to yourself.
Raising Money
Should you invest your own money?– There's something wrong if no one wants to invest.
Never:– mortgage your house– use your kids college funds– don't take the risks you can't live with!
The Business strategy presentation
1. Project Name
2. Agenda
3. Executive Summary
4. Business Objective
5. The Opportunity
6. Demographics
7. Target Market
8. The Product
The Business strategy presentation
9. Product Schematic
10. Product's Benefits
11. The Competition
12. Competitor's Products
13. Competitive Feature Matrix
14. Marketing Plan
15. Channel Strategy
The Business strategy presentation
16. Development Schedule
17. Cost of Goods
18. Pricing
19. Demonstrations
20. Financials
21. Next Steps
22. Summary
The Business strategy presentation
Common Pitfalls
1. Presenting with Your Back to The Audience
2. Avoiding Eye Contact with The Decision Maker
3. Running Out of Time
4. Decision Maker "No-Shows"
5. Unknown Audience
The Product Development Scorecard
Predicts the likehood that you will produce a great product
About ten questions which project manager has to answer and give points– Drawing and Pictures– Target User– Competitive knowledge– …
The Marketing, Sales and Distribution Scorecard
This scorecard enables you to track activities outside of R & D.
Predicts future success or failures. Each business area should have their own
card (or report). 13 Questions.
Closing Arguments
Surround yourself with people who tell the truth.– ask people's opinions– don't mind if your idea is getting ridiculed– criticism gives new ideas– be careful who you talk to, tough (inside/outside
your company)– sometimes best ideas come from unlikely sources
Closing Arguments
Set the right questions– answer truthfully– analyze your answers
"Back-of-a-Napkin”– A Plan doesn't need to be fancy to work– Planning is important - not the plan itself
Closing Arguments: Strengths & Weaknesses
Strengths– Cases - some good/interesting examples– List of questions needed to be answered– Offers a "toolbox" for unexperienced