An exercise for teams or founders to lay out their business model, key assumptions, and key risks.

1. Assumptions & Risks Exercise
Last updated Oct 2013

2. Introduction
The purpose of this exercise is to help you think through
your belief system for your big idea. By understanding your
assumptions and identifying the risky ones, you will know
what you need to go learn and test.
The answers to the questions should be very concise and
as specific as possible. Don’t list all the possible answers,
but rather share what you currently believe is the most
likely answer. Remember: it is ok to be wrong if you find out
the truth quickly.

3. My target customer will be:
____________________________________
Customer Assumption
Tip: How would you describe your primary target customer?

4. The problem my customer wants to
solve is:
____________________________________
Problem Assumption
Tip: What does your customer struggle with or what need do they want to fulfill?

5. My customer’s need can be solved
with:
____________________________________
Solution Assumption
Tip: Provide a very concise description (elevator pitch) of your product

6. The measurable outcome my customer
wants to achieve is:
____________________________________
Customer Outcome Assumption
Tip: What measurable change happens in your customer’s life that makes them love your
product?

7. The measurable outcome my business
wants to achieve by creating this
product is:
____________________________________
Business Outcome Assumption
Tip: Is there a particular outcome that your business is seeking?

8. My primary customer acquisition tactic
will be:
____________________________________
Customer Acquisition Assumption
Tip: You will have multiple marketing channels, but there is often one, at most two, that
dominates your customer acquisition. What is your current guess?

9. My earliest adopter will be:
____________________________________
Early Adopter Assumption
Tip: You cannot get to your mainstream customer without getting early adopters first! Who are they?

10. I will make money (revenue) by:
____________________________________
Monetization Assumption
Tip: Does revenue come from subscriptions? advertising? Don’t list all the ideas for making
money. Pick your primary one and share it here.

11. My primary competition will be:
____________________________________
Competition Assumption
Tip: This is one topic where it is ok to list more than one or two. Who is your direct competition?
indirect competition?

12. I will beat my competitors primarily
because of:
____________________________________
Differentiation Assumption
Tip: What will truly differentiate you from competitors?

13. My biggest risk to financial viability is:
____________________________________
Financial Assumption
Tip: what could prevent you from getting to breakeven? is there something baked into your
revenue or cost model that you can de-risk?

14. My biggest technical or engineering
risk is:
____________________________________
Engineering Assumption
Tip: Is there a major technical challenge that could get in the way of actually building your
product?

15. What assumptions do we have that, if
proven wrong, would cause this to fail?
Risks to failure
1.
2.
3.
4.
5.
6.
7.

16. Of everything you just filled out, what
are your biggest concerns?
Risks to failure
1.
2.
3.
4.
5.
Tip: Think about the beliefs that, if you really are honest, have a lot of uncertainty baked into
them and could seriously impact your business.

17. Next Steps: Experiments
Given your big concerns, how can you gather evidence that
you are on the right path in the next 2 days? The next week
or two?
What experiment can you run?
Who can you interview?
Don’t lose sight of your vision, but focus on speed of
learning and pay that risk down!

18. About Us
Headquartered in San Francisco, Neo Innovation, Inc. (www.neo.com) is a global
product innovation company. We partner with our clients to make digital
products that people need, want and love. Like a startup, we understand that a
digital product is a continuous process that requires ongoing iterations to meet
evolving goals. Like a global company, we understand that products must
ultimately deliver business value. Neo’s clients cover the spectrum from startups
to large enterprises and governments and include world-recognized
organizations like Time, American Express, PayPal, Sunlight Foundation, GE,
AT&T, ICANN and Turnstone.
contact@neo.com Credits
Exercise: @giffco
Slide 15: @clevergirl