I’m the Server man11 July 2013
Proud of being an IE Business School student. Executive MBA ranked N° 2 worldwide by The Economist20 July 2013
Last saturday I had my first 5 minutes startup pitch in front of 4 investors at IE Business School. As final project of my MBA course of Entrepreneurial Management, our professor Paris De L’Etraz asked each team of the class to develop a business idea in 4 weeks and to present it in front of real venture capitalists. In a few days we had to identify a need and and build around it the concept of a successful company.Unfortunately I cannot tell you what was the concept about because we’re still thinking whether to bring the project at the next stage 😉
It was an amazing and engaging adventure that deeply enriched me, even though I lost some additional hours of sleep per day. This MBA is killing my body and vitalizing my soul 🙂
These are the main learnings that I will take home and I want to share with you. Let’s see them by going through the 8 steps structure of the presentation.
- Do not get stressed by looking for a wonderful idea, but rather focus on a need an find a way to satisfy it
- During the presentation describe the need in an emotional way by possibly using a personal anecdote. It will engage your audience, capture their attention and convey your motivation in starting up your company
- Study your competitors. Understand what they do, what are their weaknesses and how you can improve them
- Figure out their business model
- Describe how your competitors are addressing the need you have identified and how you can do it better
- Describe your solution and how you can make the life of your customers better
- Be sure it is scalable and describe how (geographical scalability, new products with same infrastructure, etc)
- Present your Minimum Viable Product. The MVP should have the minimum number of features that make it marketable, however in most of the case (immagine you want to build a new type of car) it is just a mockup or a digital drawn project
- In a first stage, I recommend to design just a graphical prototype without building the whole product. The reason is that you will be testing your assumptions day by day by adopting a “lean startup” methodology, therefore you will need several reiteractions before you will come out with a well shaped product. Probably you will have to test your idea and collect feedbacks from the field more than once before you get to the final version (see next step)
- Validating your assumptions about the need and the fetures is crucial, define them properly and send them to a sample
- Keep the survey simple and short by focusing just on a few questions. I would say around 10 or 20 multiple choice questions. Likert scale base are useful as well
- Geographical scalability is one of the most important aspect to run a successful startup, therefore take advantage of the survey to test at the same time more than one country. If you can, try to avoid language biases by creating your surveys in different languages according to the country you want to enter.
- Send the survey to trusted people if possible, they will be those who most likely will answer to your questions
- There are plenty of useful tools to test your market like Qualtrics, Monkey Survey or Google Form
- Collect all the information and be ready to review your assumptions and MVP in case the results refute some of your hypothesis
- BUSINESS MODEL
- Define the business model as soon as you can. In other words you have to be able easily answer to the following questions: how your company is making money? Who are your customers? How do you collect money from them?
- Keep your business model simple. Do not show to the investors that you can make money in several different ways. The more business models you have, the less flexible you will be to adapt your startup to possibile changes
- Describe it graphically without lots of numbers and text
- MARKET SIZING
- Provide an idea of the market size in volumes and revenues
- Avoid unconvincing forecast even though they are conservative (like saying that you are reaching the 0.01% of Facebook Users). Investors are interested in your business model and in your motivation. That’s what will make them to understand how much you will be able to make your company successful.
- Taking in consideration the previous point, just provide a reasonable target that you would like to reach in the first or second year (eg. 50 thousand customers) and then keep in back up an easy esplanation of the reason why you defined that target
- As I said, the motivation is key for the investors, so be convincing by explaining why you want to run your business idea. If you have any personal reason, don’t be reserved or shy and tell the thems what deeply motivates you. You will get points!
- The team has to be aligned on every aspect (business model, market, etc). Do not ever contradict among you
- Experiences related to the industry or business or market you want to enter are relevant. Show them
In addition to these suggestion, take in consideration the following tips:
- The idea is important, but you would not probably ever come up with a sensational and unique concept. What really makes the difference is the execution! Facebook was not the first social network in the world..
- Focus your presentation on the essential
- Rehearse the presentation in order to be ready to perform in the given time. One day you could be asked to face what is called the elevator pitch!
- Communicate in a easy and structured way and be sure that people are following you
- Prepare some Q&S in order to be ready to answer to the most common questions
- If you feel you’re making a mess, have a look to the image below and you will understand that in a lean startup approach it is normal. Things will get better soon (hopefully)
…and once you will launch your company, play hard, scale fast and let me know if this post has been useful 🙂
Lean startup. Ttypical setup trend