Research from Harvard Business School’s Shikhar Ghosh shows that 75% of all startup enterprises fail. What causes these failures and what can entrepreneurs do to mitigate the risk? Enter “Entrepreneurial Management.” In Session 4 of Entrepreneurship 101, we discuss the research from Startup Genome’s report, define the 5-Dimensions of success and introduce entrepreneurial management practices that startups can use to reduce the risk of failure. Startups are not just small versions of big companies – they need special tools and methodology to manage uncertainty and find their place in the market. We aim to equip attendees with the tools to mitigate risk and enjoy the journey of building a great company.

1. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
16
October
2014
marsdd.com
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us
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2. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
ENTREPRENEURIAL
MANAGEMENT
N AT H A N M O N K ,
@ CO W B OY T W E E T S
I C T V E N T U R E S E R V I C E S
1 5 O C T 2 0 1 4
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us
at
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3. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
“ A legendary hero is usually the founder of something
– the founder of a new age, the founder of a new
religion, the founder of a new city, the founder of a
new way of life. In order to found something new,
one has to leave the old and go on a quest of the
seed idea, germinal idea that will have the potenYal
of bringing forth that new thing.
Our Future MaFers
Joseph Campbell, The Hero with a Thousand Faces
15 October
Entrepreneurial Management2014

4. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT
Our Future MaFers
You do not need to just solve a ‘pain’ or
‘problem’ to be an entrepreneur.
-­‐
2014

5. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT
2014
Our Future MaFers

6. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT
2014
Our Future MaFers
Ask yourself:
What can I do well that I would love to do for
an extended period of Yme?
-­‐

7. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
ENTREPRENEURIAL MANAGEMENT
1. Knowledge: what was the focus of your educaYon or career?
2. Capability: what are you most proficient at / strengths?
3. ConnecYons: who do you know and in what industries?
4. Financial: do you have significant financial capital, or meager
savings account to start? What is your ‘Ramon Noodle’ diet?
5. Name recogniYon: what are you or your partners well-­‐known
for?
6. In previous jobs you’ve held, what inefficiencies or pain points
existed?
7. Passion for a parYcular market?
8. Commitment: do you have the Yme and effort to devote?
-­‐
Our Future MaFers
15 October
2014
Where do I start ‘digging’?

8. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
ENTREPRENEURIAL MANAGEMENT
Our Future MaFers
“Olen you will find an idea or technology
that improves something for you
personally, then realize that idea or
technology has the potenYal to help many
others.’”
-­‐ Bill Aulet, Sr. Lecturer, MIT Entrepreneurship,
Sloan School of Management
15 October
2014

9. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT2014
Our Future MaFers
E N T R E P R E N E U R I A L M A N A G E M E N T
DEFINING
ENTREPRENEURIAL
MANAGEMENT

10. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT
2014
Our Future MaFers
A set of principles and frameworks that are
aligned with your passion and help you
idenYfy a sustainable and repeatable
business model, while managing the chaos
of scaling through 5 phases of business
growth.

11. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
The Emergence of New PracYces
Our Future MaFers
2001
Agile
Develop-­‐
ment
2005
Customer
Development
1911
Scien6fic
Mgmt
2009
Lean
Startup
Mvmt
2003
Lean
Thinking
1948
Toyota
Produc6on
System
2014

12. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT
Our Future MaFers
Are you ready to jump?
Really?
Are you sure?
Seriously?
2014

13. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
“ 30-­‐40% of all U.S. startups fail
(liquidaYng all assets) and 95%
fail to deliver projected return on
investment or breakeven by a
defined Yme period.
Our Future MaFers
Shikhar Ghosh, Sr. Lecturer, Harvard Business School
Entrepreneurial Management
15 October
2014

14. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT
Our Future MaFers
Are you sure you want to jump?
2014

15. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
ENTREPRENEURIAL MANAGEMENT
Our Future MaFers
Why do startups fail?
Customer
Product
Team
No
segmenta6on
Acquisi6on
b4
PMF
Vanity
metrics
trap
Wrong
target
Wrong
archetype
Invalidated
PSF
Inves6ng
scale
before
PMF
3.4x
more
lines
of
code
Execute
on
irrelevant
Poor
MVP
/
conversion
Outsourced
development
Hiring
too
much
too
early
Adop6ng
mul6-­‐levels
Not
hiring
doers
No
accountability
Lack
of
Customer
Dvp.
Focus
on
features
No
‘search
&
learn’
Business
Model
Financials
Profit
max.
too
early
Over
planning
Not
adap6ng
to
market
Costs
>
revenue
Pivot
with
no
valida6on
No
learning
capture
Undisciplined
Raising
too
much
No
innova6on
accoun6ng
Picking
wrong
investors
Deploying
capital
wrong
No
KPI
or
understanding
Misnomer Attributes
• Emphasis on market size
• Product release cycles
• Education levels
• Gender
• Cofounder history
• Entrepreneurial experience
• Age
• Number of products
• Type of tools to track metrics
15 October
2014

16. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT
Our Future MaFers
If your answer is sYll
YES.
2014

17. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
16 October
ENTREPRENEURIAL MANAGEMENT
2014
Our Future MaFers

18. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
The art of ‘high growth’ entrepreneurship is to master the chaos of getting each of
Entrepreneurial Management
2014
Our Future MaFers
these 5 dimensions to move in time and concert with one another. (SGR)

19. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
ENTREPRENEURIAL MANAGEMENT
1. Startups with helpful mentors, track performance metrics effecYvely & learn from thought leaders
raise 7x more money & have 3.5x beFer user growth.
2. PivoYng startups raise 2.5x more money, 3.6x beFer user growth, & are 52% less likely to scale
prematurely. Startups that haven’t raised money overesYmate their market size by 100%.
3. Premature scaling is common reason startups perform worse: scale team, customer acquisiYon
strategies, or over build the product.
4. Solo founders take 3.6x longer to reach scale stage.
5. Business-­‐heavy founding teams are 3.3x more likely to successfully scale with sales-­‐driven startups
6. Tech-­‐heavy founding teams are 3.3x more likely to scale with a product-­‐centric startup
7. Balanced teams with one technical founder and one business founder raise 30% more money, have
2.9x more user growth and are 19% less likely to scale prematurely than technical or business-­‐heavy
founding teams
8. Founders that don’t work full-­‐Yme have 4x less user growth and end up raising 24x less
money from investors
9. Most successful founders are driven by impact rather than experience or money.
10. Startups need 2-­‐3 Ymes longer to validate their market than most founders expect. The
underesYmaYon creates the pressure to scale prematurely. B2B and B2C isn’t a meaningful segmentaYon
because of the way the internet has changed customer dynamics.
Our Future MaFers
We
now
know.
15 October
2014

20. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
6-­‐ Stage Life Cycle of a Startup
• Learning
• Valley
of
death
Our Future MaFers
15 October
Entrepreneurial Management 2014
ESTG
PMF
LSTG
BMC
Extreme uncertainty Search 4 repetable & scalable business model
DISCOVERY
• PMF
• PSF
VALIDATION
EFFICIENCY
SCALE
SUSTAIN
CONSERVATI
ON
i: $100k / month threshold /
scaling, BMC ops. 60%
Search for problem space & fit
(PSF-PMF)
Valley of Death
PSF
“Scaling
successfully
is
what
separates
eventual
industry
leaders
from
long-­‐forgoden
startups
in
the
deadpool.”
–
Michael
A.
Jackson

21. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
failure to failure without
loss of enthusiasm.
Our Future MaFers
“ Success is going from
Winston Churchill
15 October
2014
Entrepreneurial Management

22. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
The Entrepreneurial API
Entrepreneurial Management
2014
Our Future MaFers
Business
Model
Stages
Lean
Itera6on

23. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
ENTREPRENEURIAL MANAGEMENT2014
Our Future MaFers
E N T R E P R E N E U R I A L M A N A G E M E N T
FRAMEWORKS AND
METHODOLOGIES

24. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Who do we
follow?
Our Future MaFers
The Founders of lean,
disrupYon, crossing
the chasm, business
model innovaYon,
startup markeYng and
the discipline of
entrepreneurship:
Blank, Aulet, Christensen,
Ellis, Mauyra, Ries, Moore
Osterwalder, Chen
2014

25. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
1. Business Model GeneraYon
2014
Our Future MaFers

26. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Business Model
2014
Our Future MaFers

27. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
4. Customer SegmentaYon
2014
Our Future MaFers

28. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
4. Customer SegmentaYon
15 October
2014
PresentaYon Title Goes Here
Our Future MaFers

29. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Big idea…
Our Future MaFers
We no longer compete on a product or
service, but rather, a compeYYve,
repeatable and scalable business model.
2014

30. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
7 key quesYons
2014
Our Future MaFers

31. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Source:
Osterwalder
Masterclass,
2012
2014
Our Future MaFers

32. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Source:
Osterwalder
Masterclass,
2012
2014
Our Future MaFers

33. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Source:
Osterwalder
Masterclass,
2012
2014
Our Future MaFers

34. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Source:
Osterwalder
Masterclass,
2012
2014
Our Future MaFers

35. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Source:
Osterwalder
Masterclass,
2012
2014
Our Future MaFers

36. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Source:
Osterwalder
Masterclass,
2012
2014
Our Future MaFers

37. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Source:
Osterwalder
Masterclass,
2012
2014
Our Future MaFers

38. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Environment
2014
Our Future MaFers

39. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
2. Customer Development (new IP)
2014
Our Future MaFers

40. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
What we used to think…
2014
Our Future MaFers

41. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
What happens today…
2014
Our Future MaFers

42. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
2014
Our Future MaFers

43. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
• Translate business
model hypotheses to
test with customers
• Develop an MVP of
the solution to test
with customers
Our Future MaFers
• Continuous testing
of hypothesis.
• Careful analysis of
customer
interactions
• Pivot or proceed
• Product is refined
enough to sell
• Build demand
through marketing
& sales
• Business
transitions for
startup mode to
departments
operating in
functions
Customer Development Cycle
15 October
2014

44. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
3. Lean
2014
Our Future MaFers

45. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
‘Lean’ methodology favours
experimentaYon over elaborate
planning, customer feedback over
intuiYon, and iteraYve design over
tradiYonal up-­‐front development.
2014
Our Future MaFers

46. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
3. Lean
2014
Our Future MaFers

47. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Process
Our Future MaFers
Assump6ons
Test
problem
Assump6ons
Measure
Evaluate
2014

48. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Lean vs. TradiYonal
2014
Our Future MaFers

49. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Why is this important?
2014
Our Future MaFers

50. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
2014
Our Future MaFers

51. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
2014
Our Future MaFers

52. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
4. Customer SegmentaYon
2014
Our Future MaFers

53. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
2014
Our Future MaFers

54. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
A target customer is a group of potenYal
customers who share many characterisYcs
and who would all have similar reasons to buy
Our Future MaFers
a parYcular product.
2014

55. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Milkshake
2014
Our Future MaFers

56. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
By choosing a single market to excel in, your
startup can more easily establish a strong
market posiYon, and hopefully a state of
posiYve cash flow, before it runs out of
Our Future MaFers
resources.
2014

57. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
5. Growth Hacking
Entrepreneurial Management 2014
Our Future MaFers

58. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Growth Hacking Funnel
2014
Our Future MaFers

59. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Growth Hacking Funnel
2014
Our Future MaFers

60. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Growth Hacking Funnel
2014
Our Future MaFers

61. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
ENTREPRENEURIAL MANAGEMENT
Our Future MaFers
E N T R E P R E N E U R I A L M A N A G E M E N T
CONCLUSION

62. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
Our Future MaFers
Summary
• ‘Dig for your idea’ and be ready for Everest
• Understand why we fail so you can succeed
• Hypothesize, test & validate your assumpYons
• Search, don’t execute for your business model
• Talk to customers (get out of the building)
• Minimize waste, deploy resources efficiently
• Build a diversified dream team
• Growth Hack when ready and opYmize funnel
• Have fun, it’s an amazing journey
• Put MaRS to work. We are here to support you.
15 October
2014

63. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
What do I do next?
2014
Our Future MaFers

64. D E V E L O P I N G T A L E N T • G R O W I N G V E N T U R E S • O P E N I N G M A R K E T S
15 October
Thank you. "
Our Future MaFers
Visit my post-mortem blog on marsdd.com"
"
"
"
"
Nathan Monk"
nmonk@marsdd.com"
@Cowboytweets"
2014