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Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
Building a Compelling Value Proposition
startupsecrets.com
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
Workshops
Full descriptions of each at
startupsecrets.com
1. What’s Your Roadmap to Success?
2. Building a Compelling Value Proposition
3. Turning Products into Companies
4. Culture, Mission, and Vision
5. Hiring A+ Talent
6. Game-Changing Business Models
7. Go to Market Strategies
8. Getting Behind the Perfect Investor Pitch
9. Funding Strategies to go the Distance
10. Have You Got What It Takes?
11. Mastering Mutual Mentorship
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Agenda
3
Evaluate Build
Gain Pain
Value
Prop
Define
Ideas
Problem
Solution
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 For (target customers)
 Who are dissatisfied with (the current alternative)
 Our product is a (new product)
 That provides (key problem-solving capability)
 Unlike (the product alternative)
4
Value Proposition
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 For Mobile Enterprises
 Who are unable to deliver Apps to users bringing their own devices to work
 Our product is an Enterprise App Services Environment (EASE)
 That provides for users to securely access Apps and Information
 Unlike (MDM), our patented Cloud based (MAM) solution is instantly turned
on and scales to tens of thousands of users
5
Example – Apperian (simplified)
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Where Might You Start?
6
Evaluate Build
Gain Pain
Value
Prop
Define
Ideas
Problem
Solution
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Ideas: Free Floating?
7
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Evaluate Build
Gain Pain
Value
Prop
Define
Agenda - Problem
8
Ideas
Problem
Solution
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Unworkable
 Unavoidable
 Urgent
 Underserved
9
Problems worth solving
are usually the 4 U’s…
Problem
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Broken business process
 Consequences?
10
If the consequences are costly or painful,
so much the better.
e.g., Who gets fired if this doesn’t work?
Unworkable
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Accounting
 Regulation
11
Is the problem so fundamental
you can’t avoid it and just have to comply?
Unavoidable
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Relative to other needs …
 Priority
• Determines resources allocated
12
If you’re not at the top of the list,
are you at least in the top 3?
If not, will you get moved up or down over time
and why?
Urgent
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 You will compete in a zero-sum game
 Finite:
• Money
• Time
• People
• Attention
13
Underserved: Business
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Social
• Find
• Connect
• Communicate
• Meet
• Share
• Entertain
• Date
14
Examples:Needs:
• Social
• Security
• Physical
• Economic
• Recognition
• Responsibility
• Achievement
• Growth
Underserved: Consumers
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Qualify the Need
15
Is it “BLAC” & white?
- (B)latant
- (L)atent
- (A)spirational
- (C)ritical
Blatant
Latent
Aspirational Critical
White
Space
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Is it addressing a “white space” in the market?
• an open area of opportunity
• which you can capture
• Uniquely well
• AND defend with a moat
 NOT just technology, business model too
16
moat
Startup Secret!
Create a Moat
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Is it 4 U?
• Unworkable
• Unavoidable
• Urgent
• Underserved
 Is it BLAC and white?
17
Problem - Summary
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Ideas Can Now Be Applied!
18
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Blatant
Critical
Ideas: Fit to Problem
19
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Agenda - Solution
20
Evaluate Build
Gain Pain
Value
Prop
Define
Ideas
Problem
Solution
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Solution
21
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Faster
• Cheaper
• Better
Startup
Opportunity?
22
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
What is your compelling
breakthrough?
3D
Break Something!
23
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Discontinuous innovation
• Defensible technology +
• Disruptive business model
A breakthrough that
COMPELS people to
ACT !
24
Breakthrough Opportunities
3D
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 It’s often as much work going after a small fight…
 Big problems often = big opportunities
25
Startup Secret!
Pick a BIG Fight
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 It’s often as much work going after a small fight…
 Big problems often = big opportunities
 Start small (Execution), think BIG (Vision), develop a ROADMAP
• See Roadmap to Success on startupsecrets.com
• e.g., Uber
 An app with the potential to disrupt an industry
26
Startup Secret!
Develop a Roadmap
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Evaluate Build
Gain Pain
Value
Prop
Define
Agenda - Evaluate
27
Ideas
Problem
Solution
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Before After
Acute Pain  Absolute Joy 
Qualitative Evaluation
28
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Before After
Acute Pain  Absolute Joy 
Vitamin vs. Morphine
Qualitative Evaluation
29
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
UTEST* EXAMPLE
(*Later renamed APPLAUSE)
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 For companies with web or mobile apps
 Who are dissatisfied with apps that work as expected in the
QA lab, but not in the hands of end users
 Our in-the-wild testing
 Enables them to test their apps under real-world conditions
 Unlike outsourced testing, which merely moves the QA lab to
a cheaper part of the world, but doesn’t actually improve app
quality
31
uTestBefore & AfteruTest
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Before: Test In The Lab & Hope
32
Testing inside the lab is vital. But today’s web & mobile apps require a new approach to
augment lab testing: in-the-wild testing
After: Test Where Your Users Are
Before & AfterBefore & After
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Introducing the gain / pain ratio
33
Quantitative Evaluation
Gain Pain
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 The gain delivered to the customer
vs.
 The pain and cost for the customer to adopt
Gain / Pain Ratio
Gain Pain
34
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Revenue
• Cost savings
• Time
• People
• Competitive
advantage
• Reputation
• Etc.
Gain
Gain
35
Pain
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Find (See)
• Try
• Buy
• Implement
• Deploy
• Own – e.g., TCO
Pain
Gain
36
Pain
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Gain from uTest:
• Scale infinitely and immediately
 From 3 testers, to 30, to 300, and back to 0
• Lower total cost of testing
 EG: SMBs - unlimited testing for ½ the cost of one FTE
• Test under real-world conditions
 Live testers, real devices, imperfect conditions… in-the-wild
 Pain from uTest:
• More testing reports, creating more work
 Takes time to re-produce, vet and rate 50+ bugs
• More collaboration, creating more oversight
 Coordination between in-house & crowd testers
 Goal:
• Maximize in-the-wild testing, while minimizing overhead
uTest: Gain vs Pain
37
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Switching
costs?
• Default = do
nothing
• Alternatives?
• Good enough =
good enough!
• RISK on a
startup
Inertia
38
Gain Pain
Inertia,
RISK
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
What’s the Right Ratio?
39
Gain Pain
Inertia,
RISK
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 > 10 to overcome
• Inertia
• RISK
40
Gain / Pain Ratio
Inertia,
RISK
Gain >10
Pain
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
ACTIFIO EXAMPLE
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Gain / Pain Ratio
 Average of 30:1 benefit
• $34m vs $1.2m
• Recovery used to take 8 1/2 hours v 2
minutes
42
Inertia,
RISK
Gain >10
Pain
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Customer View: Gain / Pain
43
• Revenue
• Cost savings
• Time
• People
• Competitive
advantage
• Reputation
• Etc.
• Inertia
• Switching costs?
• Default = do
nothing
• Alternatives?
• Good enough =
good enough!
• RISK on a startup
• Find (See)
• Try
• Buy
• Implement
• Deploy
• Own – e.g., TCO
Inertia,
RISKGain
Pain
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
“An order of
magnitude”
Customer view: Gain / Pain
44
• Revenue
• Cost savings
• Time
• People
• Competitive
advantage
• Reputation
• Etc.
• Inertia
• Switching costs?
• Default = do
nothing
• Alternatives?
• Good enough =
good enough!
• RISK on a startup
• Find (See)
• Try
• Buy
• Implement
• Deploy
• Own – e.g., TCO
Inertia,
RISK
Gain
Pain
>10
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
UTEST* EXAMPLE
(*Later renamed APPLAUSE)
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Tough to quantify precisely, but here’s what we’ve learned
46
Gain vs. Pain Ratio
Gain Pain
Cost Savings: 10X
Lower Escape Rate by
75%
Make Testing Mirror
User Base
Launch Confidence
Higher Quality Apps
vs.
Increased Overhead
5:1
on cost basis
20:1
on cost + value basis
Customer Gain / Pain Ratio
46
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
• Test latest version of Google Chrome across 300 highest trafficked URLs
on the web
Traditional Outsourcing vs. uTest
Testers 8 Testers 30
Hours / Tester 40 Hours / Tester 10
# of Days 5 # of Days 2
# of URLs Tested 300 # of URLs Tested 300
# of Discovered Issues 19 # of Discovered Issues 129
Price $15,000 Price $10,000
Price-per-Issue $789 Price-per-Issue $78
Sample Customer ROIGain vs. Pain Ratio
Sample Customer ROI
47
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
APPERIAN EXAMPLE
Mobile Application Management
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 Increase revenue by 40% at counters
 Roll out 17,000 iPads
 Deliver worldwide no IT touch required
 Saved $2.5M+ in direct IT costs
Example - Apperian
49
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Disruptive innovation
Yet…
NON-disruptive adoption
50
Startup Secret!
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Evaluate Build
Gain Pain
Value
Prop
Define
Agenda - Build
51
Ideas
Problem
Solution
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 For (target customers)
 Who are dissatisfied with (the current alternative)
 Our product is a (new product)
 That provides (key problem-solving capability)
 Unlike (the product alternative)
52
Value Proposition
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 What problems do you understand uniquely well?
 What solution can you deliver uniquely well?
 What kind of disruptive business model can you bring?
53
Build Around YOU
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
1. Define
• 4U Need (Unworkable, Unavoidable, Urgent, Underserved)
• 3D Solution (Discontinuous, Defensible, Disruptive)
2. Evaluate
• Gain / Pain >10
3. Build
• Around YOU!
54
Summary
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
info@startupsecrets.com
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential
Building a Compelling Value Proposition
startupsecrets.com
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
1 2 3
HOW DISQUS WORKS
Easy install for all platforms
Sites are part of the Disqus network
Sites integrate Disqus Users engage with Disqus
Users discover new content &
sites across Disqus
Sites see tangible benefits, including
increased traffic on their pages
Audience development made easy.
Millions of users use Disqus to participate online and we make
that valuable for publishers in a way that they can measure.
57
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
THE DISQUS
ECOSYSTEM
A COMMUNITY
ECOSYSTEM is the
foundation of our business.
USERS
GOALS
Discovery
Community
ADVERTISERS
GOALS
Acquisition
Retention
PUBLISHERS
GOALS
Engagement
Growth
Revenue
58
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comCulture, Mission, and Vision
DISQUS – Value Prop for Publishers
FOR
· Publishers, like online media or bloggers
WHO CARE ABOUT
· Building more engaged, loyal audiences directly on their sites
OUR PRODUCT IS
· The most widely used discussion platform online
THAT PROVIDES
· An “engagement management platform” for publishers, and
· direct reach into millions of engaged community participants online
UNLIKE
· Social networks, which don’t properly serve the needs of publishers
· Or white-label software, which doesn’t provide the wide network reach of users
59
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 For those in the developing world
 Who are dissatisfied with limited access to diagnosis
 Our product is a patterned paper-based diagnostic technology
 That provides low-cost, easy-to-use, point-of-care diagnostics
 Unlike no diagnosis
60
Diagnostics For All - Alok
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
Before
Need
After
Solution
53%
of Rwandan women
cannot afford healthcare
26%
of Rwandan women
live too far from a hospital
[1] National Institute of Statistics of Rwanda (NISR) [Rwanda], Ministry of Health
(MOH) [Rwanda] http://www.measuredhs.com/publications/publication-fr259-
dhs-final-reports.cfm
Point-of-care
Minimal training required
Cost = 1¢
Diagnosis by telemedicine
Image: http://www.trust.org/alertnet/news/alertnets-top-20-big-ideas-that-dont-
cost-the-earth/
DFA
61
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
 NO current solution => huge
 NO infrastructure required
 NO training required
 NO time required
 Customers’ Gain / Pain ratio = ∞
62
DFA Gain / Pain
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
At-risk pregnancy
Liver function
• 8 million affected globally
• Conducting ~700 person trial in Vietnam
• Test for ALT/AST enzymes
• Cost: $14 v. 1¢ (DFA)
Child nutrition
Small farmer support
Customer ‘pain’ is real pain
DFA Example
63
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
How Thoroughly Should You Define?
A little and then iterate?
or
A LOT and then execute?
64
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
“A problem well stated is a
problem half solved.”
-Charles Kettering
65
How Thoroughly Should You Define?
A little and then iterate?
or
A LOT and then execute?
Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition
CASE STUDIES
Actifio
Apperian
Disqus
DFA
uTest
Thank you…
66

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Building a Compelling Value Proposition

  • 1. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential Building a Compelling Value Proposition startupsecrets.com
  • 2. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential Workshops Full descriptions of each at startupsecrets.com 1. What’s Your Roadmap to Success? 2. Building a Compelling Value Proposition 3. Turning Products into Companies 4. Culture, Mission, and Vision 5. Hiring A+ Talent 6. Game-Changing Business Models 7. Go to Market Strategies 8. Getting Behind the Perfect Investor Pitch 9. Funding Strategies to go the Distance 10. Have You Got What It Takes? 11. Mastering Mutual Mentorship
  • 3. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Agenda 3 Evaluate Build Gain Pain Value Prop Define Ideas Problem Solution
  • 4. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  For (target customers)  Who are dissatisfied with (the current alternative)  Our product is a (new product)  That provides (key problem-solving capability)  Unlike (the product alternative) 4 Value Proposition
  • 5. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  For Mobile Enterprises  Who are unable to deliver Apps to users bringing their own devices to work  Our product is an Enterprise App Services Environment (EASE)  That provides for users to securely access Apps and Information  Unlike (MDM), our patented Cloud based (MAM) solution is instantly turned on and scales to tens of thousands of users 5 Example – Apperian (simplified)
  • 6. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Where Might You Start? 6 Evaluate Build Gain Pain Value Prop Define Ideas Problem Solution
  • 7. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Ideas: Free Floating? 7
  • 8. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Evaluate Build Gain Pain Value Prop Define Agenda - Problem 8 Ideas Problem Solution
  • 9. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Unworkable  Unavoidable  Urgent  Underserved 9 Problems worth solving are usually the 4 U’s… Problem
  • 10. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Broken business process  Consequences? 10 If the consequences are costly or painful, so much the better. e.g., Who gets fired if this doesn’t work? Unworkable
  • 11. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Accounting  Regulation 11 Is the problem so fundamental you can’t avoid it and just have to comply? Unavoidable
  • 12. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Relative to other needs …  Priority • Determines resources allocated 12 If you’re not at the top of the list, are you at least in the top 3? If not, will you get moved up or down over time and why? Urgent
  • 13. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  You will compete in a zero-sum game  Finite: • Money • Time • People • Attention 13 Underserved: Business
  • 14. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Social • Find • Connect • Communicate • Meet • Share • Entertain • Date 14 Examples:Needs: • Social • Security • Physical • Economic • Recognition • Responsibility • Achievement • Growth Underserved: Consumers
  • 15. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Qualify the Need 15 Is it “BLAC” & white? - (B)latant - (L)atent - (A)spirational - (C)ritical Blatant Latent Aspirational Critical White Space
  • 16. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Is it addressing a “white space” in the market? • an open area of opportunity • which you can capture • Uniquely well • AND defend with a moat  NOT just technology, business model too 16 moat Startup Secret! Create a Moat
  • 17. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Is it 4 U? • Unworkable • Unavoidable • Urgent • Underserved  Is it BLAC and white? 17 Problem - Summary
  • 18. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Ideas Can Now Be Applied! 18
  • 19. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Blatant Critical Ideas: Fit to Problem 19
  • 20. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Agenda - Solution 20 Evaluate Build Gain Pain Value Prop Define Ideas Problem Solution
  • 21. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Solution 21
  • 22. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Faster • Cheaper • Better Startup Opportunity? 22
  • 23. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition What is your compelling breakthrough? 3D Break Something! 23
  • 24. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Discontinuous innovation • Defensible technology + • Disruptive business model A breakthrough that COMPELS people to ACT ! 24 Breakthrough Opportunities 3D
  • 25. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  It’s often as much work going after a small fight…  Big problems often = big opportunities 25 Startup Secret! Pick a BIG Fight
  • 26. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  It’s often as much work going after a small fight…  Big problems often = big opportunities  Start small (Execution), think BIG (Vision), develop a ROADMAP • See Roadmap to Success on startupsecrets.com • e.g., Uber  An app with the potential to disrupt an industry 26 Startup Secret! Develop a Roadmap
  • 27. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Evaluate Build Gain Pain Value Prop Define Agenda - Evaluate 27 Ideas Problem Solution
  • 28. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Before After Acute Pain  Absolute Joy  Qualitative Evaluation 28
  • 29. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Before After Acute Pain  Absolute Joy  Vitamin vs. Morphine Qualitative Evaluation 29
  • 30. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential UTEST* EXAMPLE (*Later renamed APPLAUSE)
  • 31. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  For companies with web or mobile apps  Who are dissatisfied with apps that work as expected in the QA lab, but not in the hands of end users  Our in-the-wild testing  Enables them to test their apps under real-world conditions  Unlike outsourced testing, which merely moves the QA lab to a cheaper part of the world, but doesn’t actually improve app quality 31 uTestBefore & AfteruTest
  • 32. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Before: Test In The Lab & Hope 32 Testing inside the lab is vital. But today’s web & mobile apps require a new approach to augment lab testing: in-the-wild testing After: Test Where Your Users Are Before & AfterBefore & After
  • 33. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Introducing the gain / pain ratio 33 Quantitative Evaluation Gain Pain
  • 34. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  The gain delivered to the customer vs.  The pain and cost for the customer to adopt Gain / Pain Ratio Gain Pain 34
  • 35. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Revenue • Cost savings • Time • People • Competitive advantage • Reputation • Etc. Gain Gain 35 Pain
  • 36. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Find (See) • Try • Buy • Implement • Deploy • Own – e.g., TCO Pain Gain 36 Pain
  • 37. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Gain from uTest: • Scale infinitely and immediately  From 3 testers, to 30, to 300, and back to 0 • Lower total cost of testing  EG: SMBs - unlimited testing for ½ the cost of one FTE • Test under real-world conditions  Live testers, real devices, imperfect conditions… in-the-wild  Pain from uTest: • More testing reports, creating more work  Takes time to re-produce, vet and rate 50+ bugs • More collaboration, creating more oversight  Coordination between in-house & crowd testers  Goal: • Maximize in-the-wild testing, while minimizing overhead uTest: Gain vs Pain 37
  • 38. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Switching costs? • Default = do nothing • Alternatives? • Good enough = good enough! • RISK on a startup Inertia 38 Gain Pain Inertia, RISK
  • 39. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition What’s the Right Ratio? 39 Gain Pain Inertia, RISK
  • 40. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  > 10 to overcome • Inertia • RISK 40 Gain / Pain Ratio Inertia, RISK Gain >10 Pain
  • 41. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential ACTIFIO EXAMPLE
  • 42. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Gain / Pain Ratio  Average of 30:1 benefit • $34m vs $1.2m • Recovery used to take 8 1/2 hours v 2 minutes 42 Inertia, RISK Gain >10 Pain
  • 43. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Customer View: Gain / Pain 43 • Revenue • Cost savings • Time • People • Competitive advantage • Reputation • Etc. • Inertia • Switching costs? • Default = do nothing • Alternatives? • Good enough = good enough! • RISK on a startup • Find (See) • Try • Buy • Implement • Deploy • Own – e.g., TCO Inertia, RISKGain Pain
  • 44. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition “An order of magnitude” Customer view: Gain / Pain 44 • Revenue • Cost savings • Time • People • Competitive advantage • Reputation • Etc. • Inertia • Switching costs? • Default = do nothing • Alternatives? • Good enough = good enough! • RISK on a startup • Find (See) • Try • Buy • Implement • Deploy • Own – e.g., TCO Inertia, RISK Gain Pain >10
  • 45. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential UTEST* EXAMPLE (*Later renamed APPLAUSE)
  • 46. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Tough to quantify precisely, but here’s what we’ve learned 46 Gain vs. Pain Ratio Gain Pain Cost Savings: 10X Lower Escape Rate by 75% Make Testing Mirror User Base Launch Confidence Higher Quality Apps vs. Increased Overhead 5:1 on cost basis 20:1 on cost + value basis Customer Gain / Pain Ratio 46
  • 47. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition • Test latest version of Google Chrome across 300 highest trafficked URLs on the web Traditional Outsourcing vs. uTest Testers 8 Testers 30 Hours / Tester 40 Hours / Tester 10 # of Days 5 # of Days 2 # of URLs Tested 300 # of URLs Tested 300 # of Discovered Issues 19 # of Discovered Issues 129 Price $15,000 Price $10,000 Price-per-Issue $789 Price-per-Issue $78 Sample Customer ROIGain vs. Pain Ratio Sample Customer ROI 47
  • 48. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential APPERIAN EXAMPLE Mobile Application Management
  • 49. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  Increase revenue by 40% at counters  Roll out 17,000 iPads  Deliver worldwide no IT touch required  Saved $2.5M+ in direct IT costs Example - Apperian 49
  • 50. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Disruptive innovation Yet… NON-disruptive adoption 50 Startup Secret!
  • 51. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Evaluate Build Gain Pain Value Prop Define Agenda - Build 51 Ideas Problem Solution
  • 52. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  For (target customers)  Who are dissatisfied with (the current alternative)  Our product is a (new product)  That provides (key problem-solving capability)  Unlike (the product alternative) 52 Value Proposition
  • 53. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  What problems do you understand uniquely well?  What solution can you deliver uniquely well?  What kind of disruptive business model can you bring? 53 Build Around YOU
  • 54. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition 1. Define • 4U Need (Unworkable, Unavoidable, Urgent, Underserved) • 3D Solution (Discontinuous, Defensible, Disruptive) 2. Evaluate • Gain / Pain >10 3. Build • Around YOU! 54 Summary
  • 55. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential info@startupsecrets.com
  • 56. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidential Building a Compelling Value Proposition startupsecrets.com
  • 57. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition 1 2 3 HOW DISQUS WORKS Easy install for all platforms Sites are part of the Disqus network Sites integrate Disqus Users engage with Disqus Users discover new content & sites across Disqus Sites see tangible benefits, including increased traffic on their pages Audience development made easy. Millions of users use Disqus to participate online and we make that valuable for publishers in a way that they can measure. 57
  • 58. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition THE DISQUS ECOSYSTEM A COMMUNITY ECOSYSTEM is the foundation of our business. USERS GOALS Discovery Community ADVERTISERS GOALS Acquisition Retention PUBLISHERS GOALS Engagement Growth Revenue 58
  • 59. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comCulture, Mission, and Vision DISQUS – Value Prop for Publishers FOR · Publishers, like online media or bloggers WHO CARE ABOUT · Building more engaged, loyal audiences directly on their sites OUR PRODUCT IS · The most widely used discussion platform online THAT PROVIDES · An “engagement management platform” for publishers, and · direct reach into millions of engaged community participants online UNLIKE · Social networks, which don’t properly serve the needs of publishers · Or white-label software, which doesn’t provide the wide network reach of users 59
  • 60. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  For those in the developing world  Who are dissatisfied with limited access to diagnosis  Our product is a patterned paper-based diagnostic technology  That provides low-cost, easy-to-use, point-of-care diagnostics  Unlike no diagnosis 60 Diagnostics For All - Alok
  • 61. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition Before Need After Solution 53% of Rwandan women cannot afford healthcare 26% of Rwandan women live too far from a hospital [1] National Institute of Statistics of Rwanda (NISR) [Rwanda], Ministry of Health (MOH) [Rwanda] http://www.measuredhs.com/publications/publication-fr259- dhs-final-reports.cfm Point-of-care Minimal training required Cost = 1¢ Diagnosis by telemedicine Image: http://www.trust.org/alertnet/news/alertnets-top-20-big-ideas-that-dont- cost-the-earth/ DFA 61
  • 62. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition  NO current solution => huge  NO infrastructure required  NO training required  NO time required  Customers’ Gain / Pain ratio = ∞ 62 DFA Gain / Pain
  • 63. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition At-risk pregnancy Liver function • 8 million affected globally • Conducting ~700 person trial in Vietnam • Test for ALT/AST enzymes • Cost: $14 v. 1¢ (DFA) Child nutrition Small farmer support Customer ‘pain’ is real pain DFA Example 63
  • 64. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition How Thoroughly Should You Define? A little and then iterate? or A LOT and then execute? 64
  • 65. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition “A problem well stated is a problem half solved.” -Charles Kettering 65 How Thoroughly Should You Define? A little and then iterate? or A LOT and then execute?
  • 66. Proprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and ConfidentialProprietary and Confidentialstartupsecrets.comBuilding a Compelling Value Proposition CASE STUDIES Actifio Apperian Disqus DFA uTest Thank you… 66