New 5 bets and test - plan a to n
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Transcript of New 5 bets and test - plan a to n
On Bets and Tests: Entering an Existing Industry
Ziya G. Boyacigiller
This presentation was created and given by Ziya Boyacigiller who was leading Angel Investor and a loved mentor to many young entrepreneurs in Turkey. We have shared it on the web for everyone’s benefit. It is free to use but please cite Ziya Boyacigiller as the source when you use any part of this presentation. For more about Ziya Boyacigiller’s contributions to the start-up Ecosystem of Turkey, please go to www.ziyaboyacigiller.com
BETS AND TEST – MOVING FROM PLAN A TO N...
Entering an Existing Industry
Ref: Getting to Plan B, J. Mullins / R. Komisar
Figuring out what customers will buy is a process – not a guess.
FIGURING OUT WHAT CUSTOMERS WANT AND WILL BUY SOUNDS EASY – BUT IS NOT !
Running out of cash isn’t a cause – it’s a symptom. It’s a symptom or signal that the company’s business model didn’t
work.
“WE RAN OUT OF CASH.”
GOAL : CREATING A BUSINESS MODEL THAT WORKS
Business Model is the pattern of economic
activity – cash flowing into and out of your
business for various purposes and the
timing thereof – that dictates whether or not
you run out of cash and whether or not you
deliver attractive returns to your investors.
THE QUESTIONS YOU CANNOT ANSWER BY LOOKING AT THE ANALOGS AND ANTILOGS LEAD YOU TO YOUR LEAPS OF FAITH – BETS…
To address your leaps of
faith, you’ll have to
leap… that is,
experiment.
IDENTIFYING YOUR BETS AND
TESTING THEM WILL PROVE OR
REFUTE THEM, SO YOU LEARN IF
YOUR PLAN A WILL WORK BEFORE
YOU WASTE TOO MUCH OF YOUR
TIME AND YOUR MONEY.
GUIDE & TRACK YOUR JOURNEY:
DASHBOARD
A dashboard is a tool that drives an evidence-based process to plan, guide, and track the results of what you learn from your hypothesis testing.
DASHBOARD FOR PLAN A :
Leap of Faith Question
Hypothesis Metrics/Test
Findings/Results
Insight/Response
1. Commuters will stop and buy a refreshing drink made with fresh lemons.
1. At least 10 customers per day will buy
2. At least 20 people will stop and ask for price.
Customers/day
Set up on a chair with lemons/sugar borrowed from Mom…
1. Mon/2, Tue/0 (rained), Wed/8
2. Mon/8, Tue/0, Wed/24
High pricing deters sales, people look but don’t buy; no point setting up if it rains; seems like demand is less than Johnny thought.
2. People will pay a premium price over Coke selling at $1/glass.
$1.50 per drink will be acceptable
Total customers/ people asking for price
Mon/25%, Tue/-, Wed/33%
$1.50 looks too high.
We need a Plan B.