Testing Solutions Validating Product-Market Fit - PowerPoint Presentation

Slide1

Testing SolutionsValidating Product-Market Fit

Edmund Pendleton

Lead Instructor,

NSF I-Corps & SBIR Bootcamp

Director,

DC I-Corps Node

Slide2

The Prequel

Slide3

My startup set out to change an

entire industry

Slide4

10 years

$20M later

Slide5

Slide6

The Sequel

Slide7

…

a

different

beach…

Slide8

Innovation and Startup Coach

Slide9

2,000+ Teams

Slide10

10,000+ Hours

Slide11

Science andTechnology Focus

Slide12

Long time to market and high risk

Slide13

Slide14

“Transforming the world’s largest seed fund into

…the world’s largest Accelerator.”

Slide15

Not just resources ($) but direction

Slide16

Slide17

Slide18

Our goal is toimprove your odds.

Slide19

Shift the Curve

Shift the Curve

Slide20

That is WHYwe are here.

Slide21

Slide22

ConceptReview

Slide23

Innovation about Customer Needs

Slide24

Two Extremesof Innovation

Slide25

Slide26

ConceptualInnovation

Slide27

Build, Show, & Hope

Product Strategy

Formulate Product Strategy

Formulate Market Strategy

What can we do “better”

Who else is doing what we are doing?

What are we good at doing?

Technical Brainstorm

Input from sales and marketing

“Guess” at potential market share

Pay for market forecasts

Google Market Trends

Slide28

ExperimentalInnovation

Slide29

“I haven’t failed.

Slide30

– Thomas Edison

“I haven’t failed.

I’ve just found 10,000 ways that won’t work.”

Slide31

You can learn

Experimental Innovation

Slide32

ExperimentalInnovation

Lean

Slide33

Use a systematic approach

…

Slide34

…to identify

unmet

needs.

Slide35

Scientific Method

Observe

phenomena

Formulate hypothesisTest hypothesis

via rigorous experiments

Establish theory

based on repeated validation of results

Modify

hypothesis

Slide36

Hypothesis Testing, Iteration, and Pivoting

Slide37

Essence of Lean Approach

Slide38

“Can you identify and validate a problem or need in the market that enough people care about?”

Slide39

Problem-Solution Fit

Product-Market Fit

Business-Model Fit

Slide40

“Can you build and deliver a product/service that satisfies the customer problem or need?”

Slide41

Problem-Solution Fit

Product-Market Fit

Business-Model Fit

Slide42

Is this a business worth doing…

Slide43

Problem-Solution Fit

Product-Market Fit

Business-Model Fit

Slide44

Needs FirstSolutions Second!

Slide45

Initial Focus

Slide46

Test the Need First

Slide47

Get out of the building!

Slide48

Talk (listen) to customers

…

Slide49

Customer Discovery

Slide50

What are youtrying to discover?

Slide51

Design Value Proposition

Segment

based on

Needs

Quantify Metrics for Success

Understand

“Jobs-to-be-Done”

Identify the Customer

Customer Discovery

Process Steps

Slide52

#1. Are you goingafter top-of-mind need?

Slide53

#2. Who is theperson(s) you intend to help?

Slide54

#3. What does that person

seek to do better?

Slide55

#4. How does that person

define better?

Slide56

Opportunities for innovation arise from better understanding the customer job.

Slide57

Identify Customer Segment and Value Proposition(s)

prior to building rest of Business Model

Slide58

Hypotheses

Hypotheses

Slide59

How do we turn theseinto facts

…

Slide60

Design Value Proposition

Segment

based on

Needs

Quantify Metrics for Success

Understand

“Jobs-to-be-Done”

Identify the Customer

Slide61

Slide62

Customer Discovery Methods

Slide63

Primary Research

(Continue)

Customer Interviews

(Continue)

Customer Observation

(Continue)

Problem MVP

(Continue)

Solution MVP

(Now)

Customer Surveys

(Later)

Focus Groups

(Later)

Slide64

Primary Research

(Continue)

Customer Interviews

(Continue)

Customer Observation

(Continue)

Problem MVP

(Continue)

Solution MVP

(Now)

Customer Surveys

(Later)

Focus Groups

(Later)

Slide65

Slide66

Test the Solution Second

Slide67

What in the world is an MVP?

Slide68

A minimum viable product (MVP)

is a development technique in which a new product or website is developed with sufficient features to satisfy early adopters. The final, complete set of features is only designed and developed after considering feedback from the product's initial users

Slide69

A minimum viable product (

MVP

) is a development technique in which a

new product or website is developed with sufficient features to satisfy early adopters. The final, complete set of features is only designed and developed after considering feedback from the product's initial users

Slide70

A minimum viable product (MVP)

is an artifact or representation of a value proposition. It is designed to test the validity of one or more critical assumptions or so called hypotheses surrounding a business model or value proposition. 

Alex Osterwalder

Slide71

A minimum viable product

 (MVP)

is an artifact or representation of a value proposition. It is designed to test the validity of one or more critical assumptions or so called hypotheses surrounding a business model or value proposition. 

Alex Osterwalder

Slide72

A minimum viable product (MVP)

is a concise summary of the smallest possible group of features that will work as a stand-alone product while still solving at least the “core” problem and demonstrating the product’s value.

Steve

Blank

Slide73

A minimum viable product (MVP)

is the simplest thing that you can show to customers to get the most learning at that point in time. Early on in a startup, an MVP could simply be a PowerPoint slide, wireframe, clay model, sample data set, etc. Each time you build an MVP you also define what you are trying to test or measure. Later, as more is learned, the MVP’s go from low-fidelity to higher fidelity, but the goal continues to be to maximize learning not to build a beta/fully featured prototype of the product.

Steve

Blank

Slide74

A minimum viable product (MVP)

 

is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.

Eric

Ries

Slide75

A minimum viable product

 (MVP)

 

is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.

Eric

Ries

Slide76

A minimum viable product (MVP)

 

is the smallest thing you can build that delivers customer value (and as a bonus captures some of that value back).

Ash

Maurya

Slide77

A minimum viable product

 (MVP)

 

is the smallest thing you can build that delivers customer value (and as a bonus captures some of that value back).

Ash

Maurya

Slide78

A minimum viable product (MVP)

We define MVP as that unique product that maximizes return on risk for both the vendor and the customer… is a mindset of the management and development-team. It says, think big for the long term but small for the short term. Think big enough that the first product is a sound launching pad for it and its next generation and the roadmap that follows, but not so small that you leave room for a competitor to get the jump on you. Too large or too small a product are big problems. The MVP is the difficult-to-determine sweet spot between them. Teams flounder tactically in trying to determine the MVP.

Frank

Robinson

Slide79

A minimum viable product (MVP)

We define MVP as that unique product that maximizes return on risk for both the vendor and the customer…

Clayton

Christensen

Slide80

A minimum viable product (MVP)

We define MVP as that

unique product

that maximizes return on risk for both the vendor and the customer…

Clayton

Christensen

Slide81

A minimum viable product (MVP)

is the most pared down version of a product that can still be released and has three key characteristics:

enough value that people are willing to use it or buy it initially

enough future benefit to retain early adoptersa feedback loop to guide future development.

Slide82

A minimum viable product (MVP)

 is that version of a new product a team uses to collect the maximum amount of validated learning about customers with the least effort." The definition's use of the words maximum and minimum means it is decidedly not formulaic.

Slide83

“The power of the MVP approach is matched only by the amount of confusion it causes…”

Slide84

WTH MVP OMG

Slide85

Slide86

Slide87

Slide88

Problem / NeedMVPs

Slide89

Good Starting Point

Slide90

What is current process (solution)?

Slide91

Where are current challenges?

Slide92

Slide93

WORK FLOW (UPW example)

Primary Loop

Secondary Loop

Pre-treatment

Slide94

Slide95

Observe Current Process

Slide96

Slide97

Understand Competition

Slide98

Both competitors already have apps out. Is Bay Alarm competitive in today's market…

or do users even care about apps?

Slide99

Existing Process vs Desired Job

Slide100

Understand the difference between what customers want to do (the job)...

versus what they are

currently

doing (existing solution)

Slide101

Pre Execute

Post Execute

What is the customer

trying

to accomplish?

Job Map

Slide102

Job Steps

Step

1

Step 2

Step 3

…

Step

1

Step 2

Step 3

…

Step

1

Step 2

Step 3

…

Step

1

Step 2

Step 3

…

Step

1

Step 2

Step 3

…

Step

1

Step 2

Step 3

…

Step

1

Step 2

Step 3

…

Step

1

Step 2

Step 3

…

What is the customer

trying

to accomplish?

Slide103

Success Metrics

How does the customer

measure

success?

*Outcome 1

*Outcome 2

*Outcome 3

…

*Outcome 1

*Outcome 2

*Outcome 3

…

*Outcome 1

*Outcome 2

*Outcome 3

…

*Outcome 1

*Outcome 2

*Outcome 3

…

*Outcome 1

*Outcome 2

*Outcome 3

…

*Outcome 1

*Outcome 2

*Outcome 3

…

*Outcome 1

*Outcome 2

*Outcome 3

…

*Outcome 1

*Outcome 2

*Outcome 3

…

Slide104

What If…

Conversations

Slide105

How would process change?

Slide106

Slide107

Slide108

After validating a true unmet need…

Slide109

You will start testing the product*

Slide110

Can you build and deliver a product/service that satisfies the customer problem or need…in a form the customer wants to consume it?

Slide111

Can you build and deliver a product/service that satisfies the customer problem or need…

in a form the customer

wants to consume it?

Slide112

Get out of the building!

Slide113

We will use MVP as shorthand for any prototype!

Slide114

Using Prototypes

Slide115

Using MVPsto test Solutions

Slide116

Build, Show, and Hope!

Slide117

Build, Show, and Hope!

Slide118

Don’t just build and show…be deliberate!

Slide119

Use a systematic approach

…

Slide120

…to validate that you solution addresses

unmet needs.

Slide121

Scientific Method

Observe

phenomena

Formulate hypothesisTest hypothesis

via rigorous experiments

Establish theory

based on repeated validation of results

Modify

hypothesis

Slide122

The ultimate ”test”…

will people buy it.

Slide123

But a “sellable” product…

is often the most expensive test.

Slide124

MVPs

MVPs

Slide125

MVPs

MVPs

Slide126

MVPs Not For Sale

Slide127

Low Fidelity

MVP

Slide128

Used to test early concepts before building a “working solution”…

Slide129

The purpose – to test whether you are headed in the right direction?

Slide130

Slide131

Slide132

Slide133

Slide134

“Higher” Fidelity

MVP

Slide135

The purpose – to test whether basic functionality addresses a problem or need?

Slide136

Slide137

Slide138

Slide139

Pilot Site MVP

Slide140

For some complex system solutions, pilot sites are required to prove value to customers.

Slide141

Purpose of MVPs…move abstract to specific!

Slide142

Slide143

Example MVPs

Slide144

Slide145

Slide146

Slide147

Slide148

Slide149

Slide150

Slide151

Slide152

Slide153

Slide154

Slide155

Slide156

Slide157

Why is thisso challenging?

Slide158

“The first principle is that you must not fool yourself, and you are the easiest person to fool.”

– Richard Feynman

Slide159

“The first principle is that you must not fool yourself, and you are the

easiest person to fool.”

– Richard Feynman

Slide160

People areNot Rational

Slide161

Slide162

Even scientistsstruggle designing experiments

Slide163

Slide164

“I have approximate answers and possible beliefs and different degrees of certainty about different things

, but I’m not absolutely sure about anything.”

–

Richard Feynman

Slide165

“I have approximate answers and possible beliefs and different degrees of certainty about different things,

but I’m not absolutely sure about anything.”

–

Richard Feynman

Slide166

“People don’t know what they want

until I show it to them!”

Slide167

“People don’t know

what

they want

until I show it to them!”

Slide168

You are trying to discover the ”why”

Slide169

Slide170

Question Answer

Slide171

Slide172

Intellectual Propertyand the MVP

Slide173

Intellectual Property:any product of the human intellect that the law protects from unauthorized use by others

Slide174

Slide175

Why should you protect IP?

Slide176

80%+ of a company’s value

can reside in IP

Slide177

Increase Value by…

excluding competition

leveraging license deals

avoiding trade secrets loss

Slide178

1. The idea becomes part of the public domain

through a public disclosure.

2. The invention is appropriated through a

prior filing by another.

MVP Testing

Risks

Slide179

The invention is described without the benefit of confidentiality

Results in the loss of exclusivity through the inability to enforce an exclusive statutory right (patent)

Public Disclosure

1. The idea becomes part of the public domain

through a public disclosure.

Slide180

The invention is patented by another’s prior filing

Results in the inability to practice ones own invention

March 16, 2013 – USA switched from

“first-to-invent” to “first-inventor-to-file”

First to File

2. The invention is appropriated through a

prior filing by another.

Slide181

Non Disclosure Agreements (CDA) and Patent Filings

Mitigate IP Risks Differently

Non Disclosure agreements (CDA)

Mitigate the risk of a disclosure invalidating a later filed patent

Mitigate the risk that the receiving party will claim a patent based on the information

BUT: scope of the agreement governs what’s protected, and resulting claim is in Contract. Claims of Inventor-ship /derivation require substantial documentation.

Patent Filing (Including Provisional Patent Filings)

Eliminate the risk of appropriation based on the disclosure to another

Mitigate the risk of the disclosure to another invalidating the patent

But: Ability to exclude is limited to the description provided in the patent (a significant pivot or hasty drafting increases risk of BOTH public disclosure and appropriation)

Slide182

Customer Discovery: Test the Problem

Can we test the problem without disclosing potential solutions?

Common mistakes

Disclosure without protectionDisclosing potential solutions as a part of testing the problem (IP loss)Filing provisional patents that don’t cover the real problem or the later discovered solutionProvide technology insight that enables others to file patents

Slide183

Intellectual Property Plan Executed

Common mistakes

Assume provisional is a good replacement for CDA

Not enabled/or support (EU/China)Not entitled to datePivot takes you outside patent scopeLosing patent rights due to filing delays/invention disclosuresDisclosure in a printed publicationOffer for sale in the US if pivot on feedback makes new product not entitled to provisional date

Slide184