Weekly Accelerator Updates

Week 3: Venture Creation Deep Dive

Week 3 Recap

This week we took a deep dive into venture creation, where teams explored or revisited the following topics:

  • Market segmentation and selection, reprise
  • Stakeholder Mapping
  • No code prototyping for mobile / web apps
  • Board Governance 101
  • The “Entrepreneur” in “Entrepreneurship”

Market Segmentation and Selection, Reprise

This week, several teams are revisiting their market segmentation and selection after taking into consideration early data from the field. Some teams are serving the same end users but are realizing that the economic buyers have to change. This means they have to redo their segmentation, starting with the economic buyer – especially with B2B offerings, because who the economic buyer is changes who the end user is and what their needs, wants and expectations are.

While this can feel like taking a step back, it is absolutely the right thing to do. Consider using MIT Professor Bill Aulet’s Segmentation Worksheet to help you create your first segmentation matrix. Once you are happy with how you segment your market, take a moment to review the selection criteria for your beachhead market, taking into account all the new data you have collected since you started your business.  See if you have any new data that may change how you choose your target market.

Having finished your market segmentation and selection process, your next task is to estimate the size of your opportunity. Hubspot has a great article that explains the TAM, SAM, SOM alphabet soup. Browse the Market Sizing and Analysis section of our knowledgebase for pointers on how to do this quickly and without spending any money on buying analyst reports.

Stakeholder mapping

None of this can be done without doing primary market research, which starts with recruiting people to interview. But who do you need to talk to? Here is a list of common stakeholders you will need to identify.

  • Economic Buyer: The person who will make the “buy” decision (not the person who does the transaction, but the person who approves it – so it is almost never the purchasing department).
  • End User(s): The people who will use your solution (there are sometimes multiple types of end users, and the end users are sometimes not the same as the economic buyers)
  • Champion: The person(s) who strongly advocates for your solution to be adopted by the Economic Buyer and/or the End Users
  • Influencers: The people, media outlets and more, who the Economic Buyer and/or End User pay attention to when making an adoption or buying decision
  • Veto Powers: The people who can make the whole deal go away. For instance, the Chief Financial Officer could stop the VP Engineering from buying new computers to make the engineers more productive by refusing to release the budget.

Start by interviewing potential end users and / or paying customers. Shoot for having at least 50 more people interviewed by the midpoint of this program.

No code prototyping for Minimum Viable Products (MVPs)

At this point many teams are anxious to get started building their solutions. You can do a lot of testing with clickable prototypes developed on platforms such as Figma. However, at some point, you need to go into the field and deliver real value using a working Minimum Viable Product (MVP).

Many teams make the assumption that the working prototype involves hiring a technical team and spending 3-6 months developing an MVP. That may have been true 5 or 10 years ago – but today there is another way. There are a lot of low code / no code solutions you can deploy that can help you string together a working “Frankenstein model” so you can test the actual offering and test purchase intent before investing in building the code for real. What you are optimizing is time to market – build the least amount of infrastructure possible to allow you to have a minimally working pipeline to deliver the value to your end customers, then go into the field and test it with real people.

Here are the steps to building a fully working web platform that can enable you to deliver value and charge money for it. Let’s use an online coaching platform as an example.

  • Based on the best data possible from primary market research, identify 1-3 jobs-to-be-done for the end user that delivers real value. For the coaching platform example, it would be a way to sign up for the service, a way to view a list of potential coaches, a way to connect with one of them, and a way to have a video call with them. The coach needs a way to record the fact that a conversation happened. There needs to be a way for the consumer to pay the coach.
  • For each of these jobs to be done, find a no-code solution. For example: The sign up could be via a Google Form; viewing coaches could be done with a GSheet or an Airtable; you can manually connect them or you can build an automation using Zapier to facilitate the email connection; and in the email, you can provide a Zoom link. Once the call has happened, the coach can send an email or update a GSheet, and you can build another automation to automate an email sending the Venmo information of the coach to the customer for payment. Once the payment has occured the coach can note this in a spreadsheet or Airtable form.
  • Test out the whole process and tweak until it works.
  • Make a minimalistic website on a WYSIWYG platform such as Wix with a responsive theme, create 1 page for the consumer and 1 page for the coach, and add language and buttons that make the above process crystal clear. This can be used on a mobile phone as if it is an app.

This type of approach can cut the time to market by weeks if not months. We strongly recommend any teams who have offerings they are ready to test to try this approach before building a real app.

Board Governance 101

One of the things founders don’t spend enough time on is to understand boards – what they need, how to build one, and how to best utilize their board to help them build their business. Boards for emerging new ventures are quite different from public boards. This week during our Board governance workshop, we explored how boards work and how our entrepreneurs might build the right type of boards. Topics we explored included:

  • Why do we build boards (Governance, Connections, Coaching the leadership team)
  • The difference between board of directors (for corporate governance) and board of advisors (for advice and support)
  • Typical composition of a startup board of directors at the Series A / B level – and how to ensure the company’s interests and the investors’ interests are well represented
  • Typical composition of a non profit board of directors – and why those tend to be larger and more diverse in skillset and domain expertise
  • When and why to create a board of advisors, and what they can do for a new venture
  • Compensation (or not) for board members
  • Building relationships with the board 1 person at a time
  • Keeping the board appraised and managing board meetings

Details may be found in this presentation. Many thanks to Jim Baum who delivered a talk on the same topic in 2021 for the MIT Delta V Summer Accelerator.

The “Entrepreneur” in “Entrepreneurship”

During the intense weeks of a summer accelerator, there is so much to learn, create, and put into action for your venture. This focus on the business itself can leave a gaping hole in building the foundation of your entity, namely, how YOU, the founder, are connected with what you are creating.

Here are questions for you to consider, as you continue to grow your business:

1. Am I in the *right* seat in my organization? *Right* is determined by your skills, talents, abilities AND interests. If the answer is yes, keep going! If the answer is no, how can you course correct? Is there someone else on your team who can fulfill aspects of the role with which you do not align well, or is there someone not on your team whom you need to bring in to support you and the business?
 
2. Am I an effective leader? Do I inspire others to act on behalf of our venture? Do they have a clear sense – from me – of the direction in which we are headed? Do I engender confidence in our future?
 
3. Where am I, “faking it until I make it?” Meaning, where are my skills gaps and what do I need to learn/do/embody to feel like I can step into my power in authentic ways?
 
The answers to these questions are critical to your success as a founder, and the viability of your business. Take the time to answer them honestly, and record your answers in a digital document that you can alter and amend.
 
In her book, “Freedom Is An Inside Job,” Zainab Salbi speaks about how she founded an incredibly successful international organization (Women for Women International ), and yet, ultimately felt like she was, “wearing a crown on my head and shackles around my feet.” Self-reflection questions like the ones listed above are meant to help you avoid a similar fate.