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Customer Development Methodology

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The Customer Development Methodology Steve Blank [email_address]
Goals of This Presentation ,[object Object],[object Object],[object Object]
Product Development Model Concept/ Seed Round Product Dev. Alpha/Beta Test Launch/ 1 st Ship
What’s Wrong With This? Concept/ Seed Round Product Dev. Alpha/Beta Test Launch/ 1 st Ship Product Development ,[object Object],[object Object],[object Object],- Hire PR Agency - Early Buzz - Create Demand - Launch Event - “Branding” Marketing
What’s Wrong With This? Concept/ Seed Round Product Dev. Alpha/Beta Test Launch/ 1 st Ship Product Development ,[object Object],[object Object],[object Object],- Hire PR Agency - Early Buzz - Create Demand - Launch Event - “Branding” ,[object Object],Marketing Sales ,[object Object],[object Object]
What’s Wrong With This? Concept/ Seed Round Product Dev. Alpha/Beta Test Launch/ 1 st Ship Product Development ,[object Object],[object Object],[object Object],- Hire PR Agency - Early Buzz - Create Demand - Launch Event - “Branding” ,[object Object],[object Object],[object Object],Marketing Sales ,[object Object],[object Object],Business Development
Build It And They Will Come ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Chasing The FCS Date ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
If Startups Fail from a Lack of customers not Product Development Failure ,[object Object],[object Object],[object Object]
An Inexpensive Fix ,[object Object],[object Object]
Build a Customer Development Process Customer Development ? ? ? ? Concept/ Seed Round Product Dev. Alpha/Beta Test Launch/ 1 st Ship Product Development
Customer Development is as important as Product Development Company Building Customer Development Customer Discovery Product Development Customer Validation Customer Creation Concept/ Bus. Plan Product Dev. Alpha/Beta Test Launch/ 1 st Ship
Customer Development: Big Ideas ,[object Object],[object Object],[object Object],[object Object],[object Object]
Customer Development Heuristics ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
[object Object],[object Object],[object Object],[object Object],Customer Discovery: Step 1 Customer Discovery Customer Validation Company Building Customer Creation
Customer Discovery: Exit Criteria ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Sidebar How to Think About Opportunities
“Venture-Scale” Businesses ,[object Object],[object Object],[object Object],[object Object],[object Object]
Ideas ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Facts Vs. Hypothesis ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Fact or Hypothesis?
End of Sidebar
Customer Validation: Step 2 Customer Discovery Customer Validation Customer Creation Company Building ,[object Object],[object Object]
Customer Validation: Exit Criteria ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Sidebar Customer Development Engineering And Agile Development Methodologies
Traditional Agile (XP) Tactics ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Problem: known Waterfall Unit of progress: Advance to Next Stage
Problem: known Waterfall Unit of progress: Advance to Next Stage Solution: known
Problem: known Solution: known Waterfall Unit of progress: Advance to Next Stage
Agile Development ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Problem: known Agile (XP) “ Product Owner” or in-house customer Unit of progress: Working Software, Features
Problem: known Solution: unknown Agile (XP) “ Product Owner” or in-house customer Unit of progress: Working Software, Features
Problem: known Solution: unknown Agile (XP) “ Product Owner” or in-house customer Unit of progress: Working Software, Features
Problem: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights
Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights
Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights
Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights Data, feedback, insights
Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights Data, feedback, insights Incremental, quick, minimum features, revenue/customer validation
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Customer Development Engineering Tactics
Five Why's ,[object Object],[object Object],[object Object],[object Object]
Five Why's Example ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Customer Development Engineering ,[object Object],[object Object],[object Object]
End of Sidebar
Customer Creation Step 3 Customer Discovery Customer Validation Customer Creation Company Building ,[object Object],[object Object],[object Object]
Customer Creation Big Ideas ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
New Product Conundrum ,[object Object],[object Object],[object Object],[object Object],[object Object]
Three Types of Markets New Market Resegmented Market Existing Market
Three Types of Markets ,[object Object],[object Object],[object Object],[object Object],New Market Resegmented Market Existing Market
Type of Market Changes Everything ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],New Market Resegmented Market Existing Market
Definitions: Three Types of Markets ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],New Market Resegmented Market Existing Market
Existing Market Definition ,[object Object],[object Object],[object Object],[object Object],[object Object]
Resegmented Market Definition (1) Low End ,[object Object],[object Object],[object Object],[object Object],[object Object]
Resegmented Market Definition (2) Niche ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
New Market Definition ,[object Object],[object Object],[object Object],[object Object]
Hy br id Markets ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Company Building: Step 4 Customer Discovery Customer Validation Customer Creation Company Building ,[object Object],[object Object]
Company Building : Big Ideas ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Company Building: Exit Criteria ,[object Object],[object Object],[object Object],[object Object],[object Object]
New Product Conundrum ,[object Object],[object Object],[object Object],[object Object],[object Object]
A Plethora of Opportunities
Startup Checklist – 1 What Vertical Market am I In? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Market Risk vs. Invention Risk
Startup Checklist - 2 ,[object Object],[object Object],[object Object]
Execution: Lots to Worry About
Startup Checklist - 3 ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Execution: Very Different by Vertical
Market Risk Reduction Strategy
Customer Development and the Business Plan
The Traditional Plan & Pitch ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Since You Can’t Answer my real questions here’s the checklist Better
Business Plan Becomes the Funding Slides Fire Founders Concept Business Plan Seed or Series A Execute
Why Don’t VC’s Believe a Word You Say? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
What Are Early Stage Investors Really Asking? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
“Lessons Learned” Drives Funding Concept Business Plan Lessons Learned Series A Do this first instead of fund raising Test Hypotheses
Credibility Increases Valuation ,[object Object],[object Object],[object Object],[object Object],[object Object]
The Customer Development Presentation ,[object Object],[object Object],[object Object],[object Object]
Customer Development: Summary ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Further Reading Course Text at: www.cafepress.com/kandsranch or www.amazon.com

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Customer Development Methodology

  • 1. The Customer Development Methodology Steve Blank [email_address]
  • 2.
  • 3. Product Development Model Concept/ Seed Round Product Dev. Alpha/Beta Test Launch/ 1 st Ship
  • 4.
  • 5.
  • 6.
  • 7.
  • 8.
  • 9.
  • 10.
  • 11. Build a Customer Development Process Customer Development ? ? ? ? Concept/ Seed Round Product Dev. Alpha/Beta Test Launch/ 1 st Ship Product Development
  • 12. Customer Development is as important as Product Development Company Building Customer Development Customer Discovery Product Development Customer Validation Customer Creation Concept/ Bus. Plan Product Dev. Alpha/Beta Test Launch/ 1 st Ship
  • 13.
  • 14.
  • 15.
  • 16.
  • 17. Sidebar How to Think About Opportunities
  • 18.
  • 19.
  • 20.
  • 22.
  • 23.
  • 24. Sidebar Customer Development Engineering And Agile Development Methodologies
  • 25.
  • 26. Problem: known Waterfall Unit of progress: Advance to Next Stage
  • 27. Problem: known Waterfall Unit of progress: Advance to Next Stage Solution: known
  • 28. Problem: known Solution: known Waterfall Unit of progress: Advance to Next Stage
  • 29.
  • 30. Problem: known Agile (XP) “ Product Owner” or in-house customer Unit of progress: Working Software, Features
  • 31. Problem: known Solution: unknown Agile (XP) “ Product Owner” or in-house customer Unit of progress: Working Software, Features
  • 32. Problem: known Solution: unknown Agile (XP) “ Product Owner” or in-house customer Unit of progress: Working Software, Features
  • 33. Problem: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights
  • 34. Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights
  • 35. Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights
  • 36. Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights Data, feedback, insights
  • 37. Problem: unknown Solution: unknown Customer Development Engineering Unit of progress: Learning about Customers Hypotheses, experiments, insights Data, feedback, insights Incremental, quick, minimum features, revenue/customer validation
  • 38.
  • 39.
  • 40.
  • 41.
  • 43.
  • 44.
  • 45.
  • 46. Three Types of Markets New Market Resegmented Market Existing Market
  • 47.
  • 48.
  • 49.
  • 50.
  • 51.
  • 52.
  • 53.
  • 54.
  • 55.
  • 56.
  • 57.
  • 58.
  • 59. A Plethora of Opportunities
  • 60.
  • 61. Market Risk vs. Invention Risk
  • 62.
  • 63. Execution: Lots to Worry About
  • 64.
  • 65. Execution: Very Different by Vertical
  • 66. Market Risk Reduction Strategy
  • 67. Customer Development and the Business Plan
  • 68.
  • 69. Business Plan Becomes the Funding Slides Fire Founders Concept Business Plan Seed or Series A Execute
  • 70.
  • 71.
  • 72. “Lessons Learned” Drives Funding Concept Business Plan Lessons Learned Series A Do this first instead of fund raising Test Hypotheses
  • 73.
  • 74.
  • 75.
  • 76. Further Reading Course Text at: www.cafepress.com/kandsranch or www.amazon.com