VitaBar 2017
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berkeley, berkeley class, business model, business model canvas, customer development, engineering, lean launchpad, lean startup, startup, steve blank
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VitaBar 2017
- 1. VitaBar
- 2. We started with two partners and one product
- 3. We started with two partners and one product
- 4. We started with two partners and one product
- 5. A cohesive team passionate about health
- 6. We started with a great product and team
- 7. Our initial business model canvas
- 8. Exploring Weight Loss Product Market Fit
- 9. Tepid response from customers
- 10. Invalidated low-income weightloss segment Kara Early 40s Overweight Low-Income Oakland, CA Pain points Our Value Props Life stressors: can’t prioritize health Improves long-term health “I have to deal with practical stressors of getting by in life, so I backburner my health considerations.” Hard to lose weight Lose 2lbs/month without lifestyle changes
- 11. Invalidated low-income weightloss segment Kara Early 40s Overweight Low-Income Oakland, CA Pain points Product/Market fit?Our Value Props Life stressors: can’t prioritize health Improves long-term health No bandwidth to think about long-term health “I have to deal with practical stressors of getting by in life, so I backburner my health considerations.” Hard to lose weight Lose 2lbs/month without lifestyle changes Not enough loss and we cannot legally claim this in marketing
- 12. Found vague signal around affluent middle-age “I just want to make sure to get the requisite vitamins that my doctor tells me I need.” Don Wants a yummy catch-all health snack since no time to plan meals All-in-one, easy health snack Late 50s Overweight Mid-Upper Income New Jersey Pain points Our Value Props Health is complicated and wants Dr. recommendation Dr. Recommended
- 13. If they enjoy the taste, then could replace vitamins If we can get local doctors to recommend it, then will buy Found vague signal around affluent middle-age “I just want to make sure to get the requisite vitamins that my doctor tells me I need.” Don Wants a yummy catch-all health snack since no time to plan meals All-in-one, easy health snack Late 50s Overweight Mid-Upper Income New Jersey Pain points Product/Market fit?Our Value Props Health is complicated and wants Dr. recommendation Dr. Recommended
- 14. Our journey takes an upward swing Great product & team Can’t make weight loss claim Positive signal from market Customer’seyeslightup! Cholesterol value prop? Weaksignal 1 2 3 4 5
- 15. We found our archetype! “Of a certain age and certain cholesterol numbers, you’re trying to find something that doesn’t involve drugs.” John 50 yrs old Generally healthy High cholesterol Mid - high income Wants a more natural way to treat high cholesterol All-in-one, easy health snack Pain points Our Value Props Wants something he can integrate easily to routine All in one, portable Bar lowers bad cholesterol
- 16. We found our archetype! “Of a certain age and certain cholesterol numbers, you’re trying to find something that doesn’t involve drugs.” Product/Market fit? John 50 yrs old Generally healthy High cholesterol Mid - high income Wants a more natural way to treat high cholesterol All-in-one, easy health snack Pain points Our Value Props Wants something he can integrate easily to routine All in one, portable Bar lowers bad cholesterol
- 17. Pivot: we updated our business model canvas
- 18. Doctors’ feedback supported our new value props “No one wants to take medicine, and there’s side effects to statins [including] liver function, myalgia...I almost always recommend lifestyle changes first unless cholesterol is way out of control.” — Dr. Ian McDaniels, Primary Care Resident
- 19. Doctors’ feedback supported our new value props “I would guess 1 in 20 or 1 in 30 people make the lifestyle changes that they say they will make when they have high cholesterol” — Dr. Lara Bruneau, Primary Care Physician “No one wants to take medicine, and there’s side effects to statins [including] liver function, myalgia...I almost always recommend lifestyle changes first unless cholesterol is way out of control.” — Dr. Ian McDaniels, Primary Care Resident
- 20. We built a brand around our new value prop!
- 21. Our digital MVP : Website & Adwords www.vita.bar
- 22. Our physical MVP : The VitaBar
- 23. We saw positive results in our customer funnel KEEPGET GROW Tested online get strategies: - Adwords: saw higher than industry average CTRs - 3.88% conversion rates while on site Learned from other bar companies, customers and industry experts: - GET: Sampling is crucial - KEEP: Education and Community Building - GROW: Referral programs, Product extensions
- 24. 78.1 American Adults with high cholesterol Million Million 31.3 Haven’t changed lifestyle to lower cholesterol Our market size was still very large Source: CDC, American Council on Science and Health, customer interviews Not using statins34.8 Million 145 Overweight Americans Age 20+ 70 Americans trying to lose weight Million Million 35.7 Million Americans snacking 2x day Original Market Size (Obesity) New Market Size (Cholesterol) TAM SAM Target Market
- 25. We ran into roadblocks Great product & team Can’t make weight loss claim Positive signal from market Left side of canvas: negative signals Invalidated major partnership Customer’seyeslightup! Cholesterol value prop? Weaksignal 1 2 3 4 5 6 7
- 26. High costs made our product too expensive Channel Cost - $2.03 COGS- $1.14 ($0.20 higher than industry averages) Royalty - $0.02 (25% of Pre-Tax Profits, will grow as company scales) Gross Profit - $0.31 $3.50 VitaBar Retail Price $2.26 Avg. Competitor Price > VitaBar Unit Economics $2.00 Stated Customer WTP
- 27. Drs. won’t recommend -> hard to reach customers Physicians acknowledged our value prop of reducing cholesterol through natural means However, they did not see it as their role to recommend specific food products This meant that we would have to go through traditional retail channels - a daunting prospect with the 1,100 bars in the market
- 28. Customers’ sensory feedback was mixed “I enjoyed it. I liked but didn’t love the flavor. [It’s] far too dense to consume all in one sitting and I eat a lot.” — Tyler Fisher-Colbrie (ate the bar for one week) “I tried it and didn’t find it tasty. I would want a doctor’s recommendation to replace my current, tastier bars.” — Salim Saglam (sampled the bar once) “This tastes like crap.” — Jim Hornthal (sampled the bar once)
- 29. Our final pivot Taste is king What we learned from interviews Price must be below $3 Dr/nutritionist channel is not viable Can’t make marketing claims
- 30. Our final pivot Taste is king 25% royalty fee & expensive ingredients What we learned from interviews The bar doesn’t taste good enough Research doesn’t meet rigorous standards Price must be below $3 What we learned about our partnership Dr/nutritionist channel is not viable Can’t make marketing claims The bar is high in sat fat + fiber isn’t oat-based
- 31. Our final pivot Taste is king 25% royalty fee & expensive ingredients What we learned from interviews What that means for VitaBar Need to reformulate the bar, but our partner was inflexible regarding bar formulation. Economics are currently unattractive The bar doesn’t taste good enough Research doesn’t meet rigorous standards Invalidate partner Price must be below $3 What we learned about our partnership Dr/nutritionist channel is not viable Can’t make marketing claims The bar is high in sat fat + fiber isn’t oat-based
- 32. Is this a viable business? People clicking “buy” on website! Positive signal from potential customer interviews → pain is evident No relevant expertise (medical or recipe dev) Crowded bar market Exit strategy is difficult for products tied to health claims
- 33. Our journey ends Great product & team Can’t make weight loss claim Positive signal from market Left side of canvas: negative signals Invalidated major partnership Not pursuing VitaBar but we’re better prepared for the future! Customer’seyeslightup! Cholesterol value prop? Weaksignal Reflection 1 2 3 4 5 6 7 8
- 34. Looking to the future
- 35. Appendix: All our BMCs
- 36. Business Model Canvas: Week 1
- 37. Business Model Canvas: Week 2
- 38. Business Model Canvas: Week 3
- 39. Business Model Canvas: Week 4
- 40. Business Model Canvas: Week 5
- 41. Business Model Canvas: Week 6
- 42. Business Model Canvas: Week 7
- 43. Business Model Canvas: Week 8
- 44. Business Model Canvas: Week 9
- 45. Business Model Canvas: Week 10