This blog is a platform that I use to share ideas and catalogue my thoughts. My main interests are in Entrepreneurship, Venture Investing, Hospitality and Economics.
Showing posts with label Business as a Hypothesis. Show all posts
Showing posts with label Business as a Hypothesis. Show all posts
We had our 6th Meetup @Cafe Solon last evening. We once again had a very good turn up, around 30 people. The topic of the discussion was Strategies to Test Business Hypothesis, which was a follow up from last week's meet topic "Business as a Hypothesis", here are the Notes to that meetup and follow up write up. Björn Brynjar Jónsson, give a 5 minute brief talk about a topic of interest that he wanted to share with the group. The topic that he talked about was from the book "Start with Why" by Simon Sinek. It was very interesting and inspiring. Björn talked about the Golden Circle from the book. The premise is that we tend to focus our effort our vision etc on the "What", whereas great leaders who inspire us usually start with the "Why", which refers to the Purpose of why we do the things we do. When we understand the purpose and communicate the purpose we can inspire people to action. He gave the example of Apple. Here is the Video of Simon talking in Tedx.
We talked about Strategies that were used in Clara to test their business model through the product Vaktarinn. Originally, Clara had not created the software that automatically sources all the digital content and provides the visualization that they do on Textual information. Gunnar explained how they got 10 of their friends to manually enter all the text from different sources into Excel Spreadsheets and then manually created the visualization look and feel on the data to validate if anyone would be interested to buy the product. Their first revenue was in selling that manual work, once they validated that idea they went on to build all the software that powers Clara Insight and Vaktarinn now. This was a quick and dirty way to see if there is a market for what you want to build.
The second example was from the company Buuteeq, how the team there validated their hypothesis that Independent Hotel Owners are willing to share their contact details and everything about their hotels to a third party and host their solution on a third party platform. They validated that by creating a Hotel Directory Service for Independent Hotel Owners called Wandari.com. Not only were they able to validate that business hypothesis they also created their customer funnel which they could target and convert into actual paying customers.
There was a discussion on a new business hypothesis that Safe Drivers would be willing to save money on their car insurance by allowing a tracking device to be installed in the car. We talked about how this hypothesis can be validated by just creating a web page with a simple button that says "Are you a Safe Driver? If you answered Yes, You can save 30% on your Car Insurance!" Sign up to be the First of the Safe Drivers to take advantage of the offer." Ok, I made the actual sentences up but that is where the discussion was going!
The 4th business hypothesis was about non-availability of Icelandic Candy on Souvenir shops. One of the participants wanted to create a business on creating an attractive wrapper around the traditional Icelandic Candy and sell it to the Souvenir shops. The group guided her to actually pre-sell the candy to the stores with just using Digital images and depending on the demand she could build up her business. I was so happy to see how excited she was about being able to launch her business by this weekend! Entrepreneurs find the way!
Kristján Freyr Kristjánsson shared the story of how they created a business to sell the Eyafjalljokul's volcanic ash. They sold this idea while they were stranded in the airport in London, they just used digital images to create a visualization of a fancy bottle with the Ash in it and they sold it even before the product was ready. Overall a fantastic meetup and the next meetup is going to be on Pivot Stories.
We had a very good turn out for the 5th meetup to discuss the book the Lean Startup. We had a new interesting idea that was tried out, where one of the participant takes 5 minutes to talk about something that he/she found interesting and wanted to share with the group. Sverrir took the first stab at it and outlined a check list for making a business case for your product or service. His posting is here on Facebook, for those who don't want to go there and find the post I have reproduced it:
22 Power techniques to show that your product or service has characteristics and benefits to secure a unique position for your product and sell it (From Formula Five)
The core things need to be present (all products and services have these), how can you show that you have strength in each of these attributes?
Find and show the financial value of the element that will positively effect the buyer. - Calculate and show the better value. - If you are giving bonuses, say what they are worth.
Free focus factor, if the product has lower cost, calculate when the lower cost has added up so that the product is really free after that point. Tell it. Show it. „Pays itself up/free in ten months.“
Instead of value, when pays itself up, show how much extra profit customer will make. Do the math for customers (most won‘t do it themselves).
If not cost and money, show how things are quicker, easier, simpler, better environmentally.
The discussion centered around the notes that I had shared from the previous blog post. There was a number of discussion around how validating and hypothesis testing is critical to learn whether what we are trying sell has a customer. There was also a lot of discussion around why traditional businesses do not try this method with their current customers. Overall fun evening and I learnt a lot listening to the group.
