These are my key takeaways from the NASSCOM Product Conclave & Expo, held in Bangalore from 27-28 Oct 2009.
Keynote: Entrepreneurship 2.0 by Guy Kawasaki
1. Build what you want to use
2. Pay Rs. 0 for Tools - use free tools/ software like PHP, MySQL, Drupple to build your app.
3. Pay Rs. 0 for Marketing - use Facebook, Twitter & MySpace
4. Suck down/ across not up - impress users with a solution thats of value to them and they'll spread the word about your product.
5. Use Twitter & Tweetmeme for marketing & selling your product/ service
6. Pay Rs. 0 for people - employ interns.
7. Put everything on the cloud - use the inexpensive infrastructure available for a subscription fee
8. Ship then test.
9. Forget venture capital - first build a prototype and build a customer base and then go to VCs for funds to scale your business.
10. Niche Thyself - offer something unique and of value to users.
11. Beware of the Bozos.
Workshop: The Art of Writing a Business Plan by Naeem Zafar
(Note: this was the best session)
Steps to start a business with higher probability of success:
1. Find unmet need
2. Validate need
3. Market Research
- Who needs it
- How many people are out there - sizing
- How will I make money - business model
- How will I uniquely position myself - unique sustainable positioning
4. Create investor material
- profound understanding of market dynamics
5. Find a team
6. Write a business plan
Why write a Business Plan?
- Business Plan is for YOU
- To organize, debate and validate reasons to start the business.
- To convince yourself and others that it'll make money, so it's worth the investment.
Business Plan answers three questions for a Investor:
1. Is there money to be made?
2. How much money?
3. Are these the people who can make money?
Business Plan Anatomy:
1. Exec Summary: 2-3 Pgs
2. The unmet need: 2-3 Pgs
3. Market size: 1-2 Pgs
4. Competitive Landscape: 1-2 Pgs
5. Your idea: 2-5 Pgs
6. Positioning: 1-4 Pgs
7. Business Model: 1-3 Pgs
8. Your Team: 2-4 Pgs
9. GTM Strategy: 3-6 Pgs
10. Financial Assumptions: 1-1 Pgs
11. Key Financial Projections OR KPIs: 2-3 Pgs
12. Use of Funds: 1-2 Pgs
13. Status Timeline & Traction: 1-4 Pgs
14. Supporting data, research, resume, proxies: 5-15 Pgs
- Advisory Board MEmbers
- Strategy Consultants
- Professionals - law firm, accounting firms etc.,
What's the diff b/w Co-founder & Early Employees?
The difference is in the,
- Mindset: co-founder has owner mindset
- Expected contribution/ remuneration
- "Halo Factor"
- Shared vision
Team Equity Divide:
20% Early Employees (hired in first 18 mos)
Ideal ADvisory Board:
- Market Guru - domain expert
- Technical Guru
- Personal Coach
- The connector
- The celebrity
Strategic Advisors & Experts
- Financial models
- Market research
- IP experts
- Off shore
Business Plan sections elaborated...
Do a survey to identify unmet need. 28 key questions to ask are published in his book. E.g.,
- What issues & problems they foresee?
- Why have they not fulfuilled their need?
- How have they tried to look for a solution?
- What should an ideal solution look like?
- How will they buy it?
Then validate the need thru'
- Google Adwords
- Online survey (site.google.com)
- Personal interviews - atleast 10 conversations per founder. preferably 20+ conv'
- Look for publicly available data
- Estimate # of users & your revenue per user
** then estimate how many you can get to realistically each year for the next 5 yrs
** proxies? e.g., who did it before?
- VCs don't typically invest in small markets
- Pretend to be a user of YOUR product
- Do mystery shopping - order products, sugn up for info
- Put yourself in your customer's shoes
Differentiate between customer (payer) and user of your product. E.g., Pre-teen products, Medical & hospital products
- How will you make money?
- Who pays who? What is the relationship between all characters in this play?
Positioning is "what you do" etched in customers', investors & employees mind.
- we are like ------- & unlike --------
- we are like ------- except this -------
"Be memorable thru' association"
"Help your audience place you in the right compartment"
- Channel Selection
- How to lock in your first "n" customers
- Support strategy
- Customer acquisition cost
- Where do you fit in the solution stack?
- Thru' which channel do people like to buy this product?
- Distribution channel doesn't do any selling. They only sell products that sell by themselves.
** Distribution channel comes into the picture only after the product is established
** You need to do the selling & evangelizing as a startup
Assumptions & KPIs:
- Identify success metrics & watch them
- Take corrective action if assumptions fail
- Make reasonable assumptions & have proxies
- Be conservative in 1st & 2nd year because people will be watching you. Get bold in yr 4 & 5
- Give 5 yr projections of
** Gross Profit
** Expenses by Dept.
** Special Expenses
** Net Profit
Timeline & Profit:
- Past 6 mos & future 18 mos
- Show actual survey questions, interview transcripts etc.,
- Same as topics 10-12 as paragraphs.
Other tips/ words of wisdom:
- Develop your personal filter to screen ideas.
- All ideas have to be chiseled away to be funded.
- People don't leave companies, people leave managers.
- You have to be stubborn in your conviction & flexible in your execution.
- You need a team to start a scalable business. You are not going to find anyone between your couch & TV. You need to go out to find a team.
- A Players attract A Players. B Players attract C Players.
- In battle the plans are useless... But the planning was indispensable.
There are only two possible exits - IPO or Get Acquired. Build a company for value. Exit will come to you.
Twitter as a marketing tool by Guy Kawasaki
Direct Selling e.g.,
** Street food vendor
** Location bound business
** Look for problems that comcast customers are having and address them.
** PRovides info about the company & engage with customers
** online movie ticket booking.
Tip to grow your followers
- find interesting info & tweet it.
Tools Guy Uses
** site to find interesting site & info for tweeting
** shorten URLs & post tweet
** site to find interesting site & info for tweeting
** manual editors find interesting articles on a topic & publish it in the form of a newsletter, which you can receive via email too.
** shortens links
** schedule tweets
** analiyze link clicks
** twitter client
** react to people who mention you or send direct message to you
** twitter app store
** tweetie iphone app is great
** a tool for managing twitter followers, direct messages, spam etc.,
** put on blog page so people can spread link to that page.
** helps grow your followers community
** automatically tweet RSS feeds from AllTop or other such sites
** objectivemarketer can do it too
** paid mass tweeting service service. 5 cents/ tweet
** auto respond to tweets to promote your product/ service
** has effective spam filters.
GTM Strategies: Top Tools in your GTM Strategy by Digit River (??)
- Affiliate MArketing - 15-30% incremental revenue
** affiliates are "sales people" you do not have to pay until they sell something for you.
** best way to drive traffic to your online store
- Paid Search - 7-10% incremental revenue
- Organic search
** optiimize your site for SEO
- Free trial - 2-5% incremental revenue
** helps generate word-of-mouth marketing
- Traditional Advertising - 3-15%
** established brand is a pre-req
- Email/ maintain ongoing communication with customers - 8-12%
- A/B testing - 5-10% incremental revenue
** continuously test your site, cart offers and optimize
Difference between Affiliate & Reseller
** requires knowledge
- ongoing training aboud your pdt/ servcie
- you pay commission for the sales they make
- you need to be more hands on
** more remote control
** they just drive traffic to your site for a commission