The fourth presentation of the Lean AKademy held in Agro-Know to support business development. The presentation was based on the book "The Lean Startup" by Eric Ries and "Running Lean" by Ash Maurya as well as the course on business development from Steve Blank.

1. Breaking Even or…
Breaking Bad?
Nikos Palavitsinis, Agro-Know
400. Costs & Revenues

2. Lean AKademy, Mar-Apr, 2014
401. Report of Interview Results
• We put the LC on the wall again
• Practical problems? How were your
interviewees? Document their characteristics
• Product Risk
– What are you solving?
• Market Risk
– Existing Alternatives
• Customer Risk
– Is this a viable customer segment?

3. Lean AKademy, Mar-Apr, 2014
402. How Interviews Affect our LC
• This is the time to put the new input on the
canvas
• Any other insights?
– Channels?
– Pricing?
– Other details we need to put up there?

4. Lean AKademy, Mar-Apr, 2014
403. Cost Structure Deconstructed!
• What is your cost structure?
• What does it cost for you to build and launch
your product?
• Cost < Expenses

5. Lean AKademy, Mar-Apr, 2014
403. Cost Structure Deconstructed!
• Two types of cost
• Fixed costs
– Building, employees, etc.
• Variable costs
– Resources, other activities, channels
• Still a set of hypotheses

6. Lean AKademy, Mar-Apr, 2014
404. Identify your Cost Structure
• What is the cost for one person?
• Development costs?
• Time for interviews? Developing your customer…
• Landing page? Time needed to create a
collection?

7. Lean AKademy, Mar-Apr, 2014
405. Revenue Streams Deconstructed
• How do you make money? From each
customer segment…
• Revenue Model = Revenue Streams (strategy)
+ Pricing (tactics)
– You don’t set the prices based on the cost of
making
– You don’t set the price less than the competition
– Revenue stream is NOT the price…

8. Lean AKademy, Mar-Apr, 2014
406. Identify your Revenue Streams
• Revenue Stream
– The strategy that the company uses to generate
cash from each customer segment
• May have multiple revenue streams for
different customer segments

9. Lean AKademy, Mar-Apr, 2014
Questions
• What value are customers willing to pay for?
• How do customers pay for products today?
• How much do they pay?

10. Lean AKademy, Mar-Apr, 2014
406. Identify your Revenue Streams
• Asset Sale
– Sale of ownership right to a physical product
• Usage Fee
– Fee is proportional to the usage of service
• Subscription Fee
– Fee for continuous access to a service
• Renting
– Fee for temporary access to a good or service

11. Lean AKademy, Mar-Apr, 2014
406. Identify your Revenue Streams
• Licensing
– Fee for use of some IP (software)
• Intermediation Fee
– A fee of bringing two parties together involved in
a transaction
• Advertising
– Fee paid by brands and companies to get in front
of potential customers

12. Lean AKademy, Mar-Apr, 2014
407. Identify your Revenue Streams
• Pricing Model
– The tactics you use to set the price in each
customer segment
• Each Revenue Stream may have different
pricing tactics
– Fixed pricing
– Dynamic pricing
– Based on the customer input

13. Lean AKademy, Mar-Apr, 2014
Pricing
• Fixed Pricing
– Cost + Markup
– Value based (price on specific customer segments
or features)
– Volume based (Intel)
• Dynamic Pricing
– Negotiation
– Yield Management (airlines)
– Real-time markets (stocks)
– Auctions

14. Lean AKademy, Mar-Apr, 2014
407. Takeaways & Assignments
• Let’s spend some time to reflect on our work
today
• How did our LCs change?
• Do we have a different outlook on our initial
hypotheses?

15. Lean AKademy, Mar-Apr, 2014
407. Takeaways & Assignments
• Refine your canvas some more… Look at the
costs, pricing & revenue streams
• Prepare new interview forms and reach out to
new interviewees!
• Conduct new interviews and prepare your
input for the next time…

16. Lean AKademy, Mar-Apr, 2014
Questions?