Lean LaunchPad COLUMBIA BLOCK WEEK JANUARY 12-16, 2015

1. Lean LaunchPadCOLUMBIA BLOCK WEEKJANUARY 12-16, 2015 Turning Hackers, Hustlers and Designers into Entrepreneurs

2. Turning great ideas into great businesses A brief HISTORY lesson

3. You’re in good company • US National Science Foundation • National Institute of Health(last week) • Stanford, Berkeley, UCSF, Princeton • 350 Universities we’re aware of • Incubators, Accelerators Worldwide • Columbia Block Week and Full Term • Hundreds more educators per year

4. Steve Blank • More than a decade developing Customer Development • 8 startups in Silicon Valley • Semiconductors • Supercomputers • Consumer electronics • Video games • Enterprise software • Military intelligence • Teach: Stanford, Berkeley, Columbia, UCSF

5. Teaching team • FACULTY: • Bob Dorf, seven startups, CBS Adjunct, co-author Startup Owner’s Manual • AshaSaxena, Founder/CEO Future Tech, plus multiple other ventures • Alicia Syrett, Founder and CEO of PantegrionCapital • Adam Royalty, Designer in Residence, CU Entrepreneurship • TBD, Seasoned entrepreneur • TA/COACH TEAM: • Nathaniel Kelner, Columbia University Entrepreneurship Team • Meghan Cross, 2nd year MBA, Co-President of CEO Club

6. Course Info • Team: Application is by teams of 3-5 • (ideally include 1 ENGR or technical); • avoid “all MBA” teams where you can • Workload: half-day in classroom, half “out of the building • don’t plan much of a social agenda for the week • Credit: 3 credits based on team improvement Mon-Fri, plus your contribution and student evaluation of startup • Format: Flipped Classroom; watch lectures nightly with team • Every team presents progress, gets feedback every day • Teams split into cohorts Tues-Wed-Thurs

7. The basics • Join a team! • Business Model Canvas • Is it scalable…? • Who else is doing it?

8. I II III IV Cash Flow Time The Entrepreneurial VentureFOUR PERIODS of DEVELOPMENT

9. Customer Development is how you search for the model

10. I II III IV Cash Flow Time The Entrepreneurial VentureFOUR PERIODS of DEVELOPMENT

12. Business Models

14. Business Models

15. Business Models

16. 9 Guesses Guess Guess Guess Guess Guess Guess Guess Guess Guess

18. Implications of Search and ExecutionThe Customer Discovery Approach • Lower Initial Investment • Minimum Viable Product [MVP] tests only crucial features • Earlier testing and validation. Room to recover AND REVISE. • More capital preserved and higher valuation achieved before scaling • Scaling financing more available • Clarify the role of the entrepreneur • Able to retain entrepreneurs engaged in business senior leadership • Higher rate of return for all • Entrepreneurs • Investors • Employees

19. Example of a Team’s Final Presentation

20. As of: 8/31/12 “The Netflix of Licensed Sports Jerseys” JerseySquare Bryan Gitler Elmer Moore Jay Naik Michael Melmed JerseySquare is a rental service for professional sports jerseys Total Interviews: 169 Total Website Visits: 190 TOTAL SUBSCRIPTIONS SOLD: 2

21. Customer Discovery Yankee Stadium Customer Sales Nike, NBA, NHL Stores Cleaners, Shipping, Sports Bars Social Media, StarStreet, Sports Bars 1 1 • Over the course of the week, we spoke with 169 contacts during the customer discovery process

22. Day 1 Canvas As of: 8/27/12 Key Partners (7) Who are our key partners/ suppliers Key Activities (5) Which key activities does the biz model require Value Proposition (1) What value do we deliver to the customer Customer Relationships (4) What type of relationship does each segment require of us Customer Segments (2) For whom are we creating value Professional Sports Leagues Jersey Suppliers Dry Cleaners Stadium Shop/Vendors Pre-paid Envelope Suppliers USPS/Fedex/UPS - Rental Tracking - Shipping - Dry cleaning - Marketing - Customer Service A cheaper way to wear Officially Licensed sports jerseys to a game Eliminate risk of owning a player jersey who is traded Provide alternative to purchasing counterfeit jerseys Search ads Social Media At Stadium Promotions • Professional Sports Game Attendees • Male • Adult • <$100k income • Attend 10+ games per yr Key Resources (6) Which key resources does the biz model require Channels (3) Through which channel does each segment want to be reached Jersey Inventory Warehouse Logistics system Website Stadium Shops/Vendors Ticket Websites Direct Mail Revenue Streams (8) How much is each segment willing to pay and how would they like to pay us this amount Cost Structure (9) What are our cost drivers Warehouse, shipping, cleaning, logistics tracking, website development/maintenance Annual Subscription Model

23. Day 1 - Yankee Stadium Customer Discovery

24. Day 2 Canvas As of: 8/28/12 Current Canvas Key Partners (7) Who are our key partners/ suppliers Key Activities (5) Which key activities does the biz model require Value Proposition (1) What value do we deliver to the customer Customer Relationships (4) What type of relationship does each segment require of us Customer Segments (2) For whom are we creating value - Rental Tracking - Shipping - Dry cleaning - Marketing - Customer Service GET - Search Ads, Partnerships, At stadium promotion KEEP - Customer Service GROW - Referral Program Professional Sports Leagues Jersey Suppliers Dry Cleaners Stadium Shop/Vendors Pre-paid Envelope Suppliers USPS/Fedex/UPS A cheaper way to wear Officially Licensed sports jerseys to a game Eliminate risk of owning a player jersey who is traded Provide alternative to purchasing counterfeit jerseys • Professional Sports Game Attendees • Male and Female • Young Adult 18-30 • <$100k income • Attend >10% of home games per yr • Casual sports fans Key Resources (6) Which key resources does the biz model require Channels (3) Through which channel does each segment want to be reached Jersey Inventory Warehouse Logistics system Website Stadium Shops/Vendors Ticket Websites Direct Mail Revenue Streams (8) How much is each segment willing to pay and how would they like to pay us this amount Cost Structure (9) What are our cost drivers Jerseys, warehouse, shipping, cleaning, logistics tracking, website development/maintenance, customer service employees Annual Subscription Model Pay per Rental

25. Day 2- Customer Discovery Nike Town NBA Store NHL Store

26. Day 3 Canvas As of: 8/29/12 Current Canvas Rental Tracking Shipping Dry cleaning Marketing Customer Service Key Partners (7) Who are our key partners/ suppliers Key Activities (5) Which key activities does the biz model require Value Proposition (1) What value do we deliver to the customer Customer Relationships (4) What type of relationship does each segment require of us Customer Segments (2) For whom are we creating value Jersey Suppliers Dry Cleaners Pre-paid Envelope Suppliers USPS/Fedex/UPS GET - Search Ads, Partnerships, At stadium promotion KEEP - Customer Service GROW – Referral/ Reward Program SPORTS JERSEY OWNERS - Flexibility to change jersey - Eliminate risk of owning jersey who is traded Jersey Suppliers Dry Cleaners Pre-paid Envelope Suppliers USPS/Fedex/UPS - Rental Tracking - Shipping - Dry cleaning - Marketing - Customer Service GET - Search Ads, Partnerships, At stadium promotion KEEP - Customer Service GROW - Referral Program Professional Sports Fans SPORTS JERSEY OWNERS - Male - Kid to Young Adult 13-35 Key Resources (6) Which key resources does the biz model require Channels (3) Through which channel does each segment want to be reached Jersey Inventory Warehouse Logistics system SINGLE GAME ATTENDEES - Cheaper way to wear jersey to a game SINGLE GAME ATTENDEES - Male and Female - Young Adult 18-30 - Casual fan Website Stadium Shops/Vendors Ticket Websites Direct Mail Jersey Inventory Warehouse Logistics system Website Stadium Shops/Vendors Ticket Websites Direct Mail Revenue Streams (8) How much is each segment willing to pay and how would they like to pay us this amount Cost Structure (9) What are our cost drivers Jerseys, warehouse, shipping, cleaning, logistics tracking, website development/maintenance, customer service employees Jerseys, warehouse, shipping, cleaning, logistics tracking, website development/maintenance, customer service employees SPORTS JERSEY OWNERS - Annual Subscription SINGLE GAME ATTENDEES - Pay per Rental

27. Day 3 - Customer Discovery Left Side of Canvas Right Side of Canvas USPS & FedEx Commercial Dry Cleaners Sports Bars Jersey Suppliers Social Media

28. Day 4 Canvas As of: 8/30/12 Current Canvas Rental Tracking Shipping Dry cleaning Marketing Customer Service GET - Search Ads, Partnerships, Social Media, At stadium promotion KEEP - Customer Service GROW – Referral/ Reward Program Key Partners (7) Who are our key partners/ suppliers Key Activities (5) Which key activities does the biz model require Value Proposition (1) What value do we deliver to the customer Customer Relationships (4) What type of relationship does each segment require of us Customer Segments (2) For whom are we creating value Jersey Suppliers Dry Cleaners Pre-paid Envelope Suppliers USPS/Fedex/UPS SPORTS JERSEY OWNERS - Flexibility to change jersey - Eliminate risk of owning jersey who is traded Jersey Suppliers Dry Cleaners Pre-paid Envelope Suppliers USPS/Fedex/UPS - Rental Tracking - Shipping - Dry cleaning - Marketing - Customer Service GET - Search Ads, Partnerships, At stadium promotion KEEP - Customer Service GROW - Referral Program Professional Sports Fans SPORTS JERSEY OWNERS - Male - Kids to Young Adult 13-35 Key Resources (6) Which key resources does the biz model require Channels (3) Through which channel does each segment want to be reached Jersey Inventory Warehouse Logistics system SINGLE GAME ATTENDEES - Cheaper way to wear jersey to a game SINGLE GAME ATTENDEES - Male and Female - Young Adult 18-30 - Casual fan Website Stadium Shops/Vendors Ticket Websites Jersey Inventory Warehouse Logistics system Website Ticket Websites Revenue Streams (8) How much is each segment willing to pay and how would they like to pay us this amount Cost Structure (9) What are our cost drivers Jerseys, warehouse, shipping, cleaning, logistics tracking, website development/maintenance, customer service employees Jerseys, warehouse, shipping, cleaning, logistics tracking, website development/maintenance, customer service employees SPORTS JERSEY OWNERS - Annual Subscription $200 SINGLE GAME ATTENDEES - Pay per Rental

29. Launched JerseySquare.com 81 Visitors In 1st 9 hours

30. With 30-Second Demo Video www.jerseysquare.com

31. Our First Customer

32. Our Email Blasts

33. Day 5 Canvas As of: 8/31/12 Current Canvas Rental Tracking Shipping Dry cleaning Marketing Customer Service Key Partners (7) Who are our key partners/ suppliers Key Activities (5) Which key activities does the biz model require Value Proposition (1) What value do we deliver to the customer Customer Relationships (4) What type of relationship does each segment require of us Customer Segments (2) For whom are we creating value GET - Search Ads, Partnerships, Social Media, At stadium promotion KEEP – Seniority, loyalty program GROW – Premium subs, Family plan Jersey Suppliers Dry Cleaners Pre-paid Envelope Suppliers USPS SPORTS JERSEY OWNERS - Flexibility to change jersey - Eliminate risk of owning jersey who is traded Jersey Suppliers Dry Cleaners Pre-paid Envelope Suppliers USPS/Fedex/UPS - Rental Tracking - Shipping - Dry cleaning - Marketing - Customer Service GET - Search Ads, Partnerships, At stadium promotion KEEP - Customer Service GROW - Referral Program Professional Sports Fans SPORTS JERSEY OWNERS - Male - Kids to Young Adult 13-35 Key Resources (6) Which key resources does the biz model require Jersey Inventory Warehouse Logistics system Channels (3) Through which channel does each segment want to be reached SINGLE GAME ATTENDEES - Cheaper way to wear jersey to a game SINGLE GAME ATTENDEES - Male and Female - Young Adult 18-30 - Casual fan Jersey Inventory Warehouse Logistics system Website Stadium Shops/Vendors Ticket Websites Direct Mail Website Revenue Streams (8) How much is each segment willing to pay and how would they like to pay us this amount Cost Structure (9) What are our cost drivers Jerseys, warehouse, shipping, cleaning, logistics tracking, website development/maintenance, customer service employees Jerseys, warehouse, shipping, cleaning, logistics tracking, website development/maintenance, customer service employees SPORTS JERSEY OWNERS - Annual Subscription, Monthly Subscription, One-Time SINGLE GAME ATTENDEES - Pay per Rental

34. Biggest Learning Moments

35. Archetypes PAY PER RENTAL RENTAL TYPE SUBSCRIPTION SUBSCRIPTION

36. Unit Economics (For One Person) Year 1 Year 2 Jersey Cost (w/ 25% off) $ 150 Revenue $ 199 Revenue $ 199 Turns Turns Shipping $ 9 Shipping $ 9 X 5 X 5 Unit Costs - $ 230 Unit Costs - $ 55 Cleaning $ 1 X 5 Cleaning $ 1 X 5 Net - $ 31 Retention 60 % x Processing $ 1 X 5 Processing $ 1 X 5 Net $ 86 Customer Acquisition $ 25

37. Current Pricing Plans (But A/B Testing for Price Elasticity)

38. Customer Relationships GROW KEEP • Sale of customer data • Family plan • Premium subscriptions • Additional products • Customer Loyalty program with bonus rentals and discount purchases • Seniority credits • Partnership rewards and discounts • Free jersey giveaways GET • Google AdWords • Guerilla style marketing on FB, YouTube, and Twitter • Customer referral bonuses • Targeted promotions Results Pending…

39. Market Size

40. Next Steps • Teenager Customer Discovery • Customer Acquisition • More Google Adwords Testing • More Website Conversion Testing • LISTEN TO/OBSERVE OUR CUSTOMERS

41. Who Is the Team?

42. What’s the Competitive Landscape? Corporate Higher Education Startup Ecosystem Adult Learning/Skills Institutions

43. What’s Your Business Model?

44. What happens next? • Applications will be reviewed and accepted on a rolling basis - first come-first served. Finalists will be notified by email. • Step 1: Review Course Website • http://www8.gsb.columbia.edu/entrepreneurship/leanlaunchpad/ • Step 2: Form a Team (Use above website to form or join a team) • Step 3: Submit Application (Team submission, not Individual) • Step 4: Each Team Member must Acknowledge and Accept Class Requirements by Email (Sent by Jay Mehta) • Step 5: Application is Reviewed for completeness and Individual Eligibility is Verified • Step 6: Notification of Acceptance, Registration and Bid Point Reduction (MBA/EMBA only) • January 12 INITIAL CANVAS DUE by 6pm ET • January 13 Class starts 8:30am ET

45. Turning great ideas into great businesses Syllabus and more course info: http://www8.gsb.columbia.edu/entrepreneurship/leanlaunchpad/ General Lean LaunchPad background: http://steveblank.com/category/lean-launchpad/ Startup Tools: http://steveblank.com/tools-and-blogs-for-entrepreneurs/

46. In Conclusion… • Questions about the course or process? • Looking for Team Members? • Looking for a Team to Join? First look here: http://www8.gsb.columbia.edu/entrepreneurship/leanlaunchpad/ Still need help? • Also: Ashley Zwick… az2335@columbia.edu • OR if needed… bobdorf@gmail.com