Every startup co-founder should read this one

Every startup co-founder should read this one

February 21, 2019
February 21, 2019

Once we decide to immerse into some kind of business planning there are a few battle proven methodologies. As a quick spoiler thought I love the simplicity and collaborative attributes of the one-pager approach you end up missing a few essentials areas of planning.

The approach these method reflect can easily align with the CEO’s / organizational DNA, either measurable / lean / product oriented / customer oriented / mature..


I suggest starting with one of the one-pager methodologies according to the best fit, but continue to relate to the other crucial aspect related with the customer, product and revenue process.Business Plan (Classic)Classic business plans have the advantage of being thorough and long term, but here lays the challenge of applying that on a startup that suffers from uncertainty in a fast changing and competitive landscape.Startups requires an agile approach and continues reevaluation of the principals and assumptions. I’ve seen and used quite a few good templates for the classic business plan, somewhere very successful in illustrating the sales funnel and stressing the operational model connecting marketing, sales, BD, customer success and product.I’ve referred to a few principal in this article - Business Model Canvas (BMC) –In a nutshell this an extremely agile and customer facing method that allows alignment across the value proposition delivered to the customer.“A strategic management and lean startup template for developing new or documenting existing business models. It is a visual chart with elements describing a firm's or product's value proposition, infrastructure, customers, and finances. ” (Wikipedia)

BMC

The BMC Building blocks

Define our customer segments – who are our customers? You can combine a persona based approach and even evolve it into different stakeholders across different verticals.Value proposition – why will customer buy from us?Channel (internal / external) – how your product. Service is sold to customers (how do you reach your customers) Customer relationship how do you get, keep and grow your customers base. (Customer journey perspective)Revenue streams where does the money come from (optimize the value provided for your customers, pricing) Key resources: (physical / intellectual / human / financial) most important strategic assetsKey activities most important things we do to make the business model to workKey partners tasks and activities not done by yourselfCost structure Map key activities to costsLean CanvasAn adaptation of Business Model Canvas, Lean Canvas promises an actionable and entrepreneur-focused business plan. It focuses on problems, solutions, key metrics and competitive advantages. The lean Canvas approach added the following building blocks:Problem- a problem box was included because several businesses do fail applying a lot of effort, financial resources and time to build the wrong product. It is therefore vital to understand the problem first.

Lean

Solution- once a problem has been recognized the next thing is to find an amicable solution to it. As such, a solution box with the Minimum Viable Product “MVP” concept was included.Key Metrics- a startup business can better focus on one metric and build on it.  The metrics include the range of products or services you want to provide. It is therefore crucial that the right metric is identified because the wrong one could be catastrophic to the startup.Unfair Advantage- this is basically the competitive advantage. A startup should recognize whether or not it has an unfair advantage over others.

FTE canvas

The FTE canvas model places more focus on customers with additional information about the ones that should be paid users. The flow of canvas creation is defined strictly and starts from a “Paid Users” prospective.

The structure of the FTE canvas is practical and measurable. It allows easy and efficient verification of the business hypothesis. Whereas, in the preceding models, the last line included Cost Structure and Revenue Stream, while in the FTE canvas there are: Costs, Customer Acquisition Cost and Customer Lifetime Value (called also LTV or CLV).  Personally speaking I always prefer the customer centric approach, and once I gain clarity on the capabilities that would drive sales, I try to build the sales funnel income and cost models accordingly. One additional aspect I am missing across all of these methods is approaching the organizational structure that would support the plan, and role, accountabilities and personal goals derived from it.

Once we decide to immerse into some kind of business planning there are a few battle proven methodologies. As a quick spoiler thought I love the simplicity and collaborative attributes of the one-pager approach you end up missing a few essentials areas of planning.

The approach these method reflect can easily align with the CEO’s / organizational DNA, either measurable / lean / product oriented / customer oriented / mature..


I suggest starting with one of the one-pager methodologies according to the best fit, but continue to relate to the other crucial aspect related with the customer, product and revenue process.Business Plan (Classic)Classic business plans have the advantage of being thorough and long term, but here lays the challenge of applying that on a startup that suffers from uncertainty in a fast changing and competitive landscape.Startups requires an agile approach and continues reevaluation of the principals and assumptions. I’ve seen and used quite a few good templates for the classic business plan, somewhere very successful in illustrating the sales funnel and stressing the operational model connecting marketing, sales, BD, customer success and product.I’ve referred to a few principal in this article - Business Model Canvas (BMC) –In a nutshell this an extremely agile and customer facing method that allows alignment across the value proposition delivered to the customer.“A strategic management and lean startup template for developing new or documenting existing business models. It is a visual chart with elements describing a firm's or product's value proposition, infrastructure, customers, and finances. ” (Wikipedia)

BMC

The BMC Building blocks

Define our customer segments – who are our customers? You can combine a persona based approach and even evolve it into different stakeholders across different verticals.Value proposition – why will customer buy from us?Channel (internal / external) – how your product. Service is sold to customers (how do you reach your customers) Customer relationship how do you get, keep and grow your customers base. (Customer journey perspective)Revenue streams where does the money come from (optimize the value provided for your customers, pricing) Key resources: (physical / intellectual / human / financial) most important strategic assetsKey activities most important things we do to make the business model to workKey partners tasks and activities not done by yourselfCost structure Map key activities to costsLean CanvasAn adaptation of Business Model Canvas, Lean Canvas promises an actionable and entrepreneur-focused business plan. It focuses on problems, solutions, key metrics and competitive advantages. The lean Canvas approach added the following building blocks:Problem- a problem box was included because several businesses do fail applying a lot of effort, financial resources and time to build the wrong product. It is therefore vital to understand the problem first.

Lean

Solution- once a problem has been recognized the next thing is to find an amicable solution to it. As such, a solution box with the Minimum Viable Product “MVP” concept was included.Key Metrics- a startup business can better focus on one metric and build on it.  The metrics include the range of products or services you want to provide. It is therefore crucial that the right metric is identified because the wrong one could be catastrophic to the startup.Unfair Advantage- this is basically the competitive advantage. A startup should recognize whether or not it has an unfair advantage over others.

FTE canvas

The FTE canvas model places more focus on customers with additional information about the ones that should be paid users. The flow of canvas creation is defined strictly and starts from a “Paid Users” prospective.

The structure of the FTE canvas is practical and measurable. It allows easy and efficient verification of the business hypothesis. Whereas, in the preceding models, the last line included Cost Structure and Revenue Stream, while in the FTE canvas there are: Costs, Customer Acquisition Cost and Customer Lifetime Value (called also LTV or CLV).  Personally speaking I always prefer the customer centric approach, and once I gain clarity on the capabilities that would drive sales, I try to build the sales funnel income and cost models accordingly. One additional aspect I am missing across all of these methods is approaching the organizational structure that would support the plan, and role, accountabilities and personal goals derived from it.

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