Turn%your%idea% into%a% Business%Model% % %

(1)

Turn%your%idea%

into%a%

Business%Model%

%

Salvatore)Majorana

)

(2)

who am I, where do I come from, what do I do?

!

 

Trained as an Electronic Engineer

!

 

Some lab experience

!

 

Moved to large corporate (Telco)

!

 

Jumped on the

New Economy,

on the VC’s side

!

 

Management consultant

!

 

MBA

!

 

Started a niche PE firm

!

 

Credit crunch

!

 

Fix it… and move on!

(3)

TODAY’s TALK

IS ABOUT YOU!

(4)

• Are you an entrepreneurial spirit?

yes _______

no _______

• Are you constantly thinking about how to

create value and build new businesses,

or how to improve or transform your

organization?

yes _______

no _______

• Are you trying to find innovative ways of

doing business to replace old, outdated

ones?

(5)

What’s between your idea and your start-up?

Business Strategy

idea

Fund Raising

&

start up

Business Model

Business Plan

P&L SALES%OF%SE RVICES Num_ber'of'custo mers''[B] 0 '''''''''''''''''''' ' 2 '''''''''''''''''''''''' ' 4 '''''''''''''''''''''''' ' 6 '''''''''''''''''''''''' ' 8 '''''''''''''''''''''''' ' Num_ber'of' sales'[C] 0 '''''''''''''''''''' ' 2 '''''''''''''''''''''''' ' 4 '''''''''''''''''''''''' ' 6 '''''''''''''''''''''''' ' 8 '''''''''''''''''''''''' ' Unita_ry'pric e'(Euro) 350.000 ''''''''''' ' 350.000 '''''''''''' 350.000 ''''''''''' ' 350.000 '''''''''''' 350.000 ''''''''''' ' Total%Di rect%Revenues : %%%%%%%%%%%%%%%%%%%%% % 700.000 %%%%%%%%%%%% % 1.400. 000 %%%%%%%%%% 2.100. 000 %%%%%%%%%% 2.800. 000 %%%%%%%%%% Num_ber'of' test'&_'tunin g'Partners 1 '''''''''''''''''''''''' ' 1 '''''''''''''''''''''''' ' 0 '''''''''''''''''''' ' 0 '''''''''''''''''''' ' 0 '''''''''''''''''''' ' Unita ry'price'of'te_st'&'tu

ning's_ervice '(Euro) 100.000 ''''''''''' ' 100.000 '''''''''''' 100.000 ''''''''''' ' 100.000 '''''''''''' 100.000 ''''''''''' '

Total%test%&_%tunin g%service%Re_venues

100.000 %%%%%%%%%%%% % 100.000 %%%%%%%%%%%% % : %%%%%%%%%%%%%%%%%%%%% % : %%%%%%%%%%%%%%%%%%%%% % : %%%%%%%%%%%%%%%%%%%%% % TOTA L'REV_ENUES 100.000 800.000 1.400. 000 2.100. 000 2.800. 000 Delta'Stock < ''''''''''''''''''''' ' < ''''''''''''''''''''' ' < ''''''''''''''''''''' ' < ''''''''''''''''''''' ' < ''''''''''''''''''''' ' TOTA_L'VAL UE'O_F'PRO DUCTION 100.000 800.000 1.400. 000 2.100.000 2.800. 000 %'su'Vdp Perso_nnel (396.050) (480.585) (572.583) (601.213) (706.209) Real%E_state %rent (19.800) (20.790) (21.830) (38.202) (40.112) Cloud_%Comp uting%Service (100.000) (150.000) (200.000) (300.000) (400.000) Utenze (48.000) (50.400) (52.920) (55.566) (58.344) 50,0% Softw are%Licences (10.000) (10.000) (20.000) (25.000) (27.500) Car%Rental (13.500) (13.500) (13.500) (13.500) (13.500) Legal%and%fis_cal%ad

visors (8.000) (8.800) (9.680) (10.648) (11.713) Board_%Memb ers (10.000) (30.000) (50.000) (60.000) (70.000) 50,0% Comm unication%a_nd%Ad

vertising (5.000) (36.500) (47.750) (55.375) (58.263) Trave_l%and%o ther%e xpenses (24.000) (36.000) (36.000) (36.000) (36.000) TOTA L'IND_IRECT'COSTS (634.350) (836.575) (1.02_4.263) (1.19_5.503) (1.42 1.640) EBITDA (534.350) (36.5 75) 375.737 904.497 1.378. 360 %'su'Vdp 0534% 05% 27% 43% 49% Amort_ization (24.400) (39.033) (60.250) (77.758) (88.721) EBIT (558.750) (75.608) 315.487 826.738 1.289. 639 %'su'Vdp 0559% 09% 23% 39% 46% 9,00%

Interests%an_d%fina ncial%costs 0 (18.000) (9.000) 0 0 EBT (558.750) (93.6 08) 306.487 826.738 1.289. 639 %'su'Vdp 0559% 094% 306% 827% #DIV/0! 27,50% Ires%(27,5%) 0 0 (84.284) (227.353) (354.651) 3,90% Irap%(3,90%) 0 (15.794) (34.635) (55.690) (77.8 38) PROFIT'(LO SS) (558.750) (109.402) 187.568 543.695 857.150 %'su'Vdp 0559% 014% 13% 26% 31%

(6)

“Business models

enable (new) products and

technologies and help solve

(entirely new) customer

problems”

“A business model describes

the rationale of how an

organization creates,

delivers, and captures

value”

Alexander Osterwalder

(7)

(8)

www.BusinessModelGeneration.com

%

How do you search for the right

Business Model?

It is a

trial-and-error

process

(9)

(10)

(11)

Who do you want to reach and serve?

• mass / niche / multi-sided market

• segmentation strategy

(12)

How do you create value for your customers?

• do your product and/or services satisfy a new need?

• do they have better performances?

• do you offer personalization?

(13)

How do you want to deliver to your customers?

• direct vs. indirect channel

• own vs. Partners’ channel

(14)

How do you want to interact with your customers?

• personal relationship (CRM)

• automated relationship (IVR, self-service machines)

(15)

How do you earn money from your goods and/or services?

• Sell / Rent / Lease

• Subscription / License / Commission

(16)

What do you need?

• people

• space / natural resources / highways

• know-how

(17)

How does it work?

• production

• R&D / quality assurance

• customer care

(18)

Who are those who will help you make it work?

• strategic suppliers

• consortium

• franchisees

(19)

What is the relationship of costs with the whole?

• cost-driven vs. value-driven model

• fixed and variable costs

(20)

(21)

(22)

(23)

(24)

(25)

(26)

(27)

(28)

(29)

(30)

(31)

(32)

(33)

(34)

(35)

(36)

(37)

(38)

(39)

(40)

IF

you get it right....

(41)

Share ideas, ask others but...

(42)

(43)

SWITCHING COST

• how easy or difficult is it for customers to switch

to another company?

(44)

(45)

(46)

RECURRING REVENUES

• Is every sales a new effort or will it result in

follow-up revenues and purchases?

• How evenly distributed are your revenues

(47)

(48)

EARN BEFORE YOU PAY

• Are you earning money before you are

(49)

GAME CHANGING COST

STRUCTURE

• Is your cost structure substantially different and

better than those of competitors?

(50)

GETTING OTHERS

TO DO THE WORK

• How much does your business model get

(51)

(52)

(53)

(54)

(55)

SCALABILITY

• How rapidly and how easily can you grow your

business model without hi[ng roadblocks (e.g.

infrastructure, customer support, etc.)?

(56)

VIRALITY /

NETWORK EFFECT

• How viral is your business model?

• How substantial are the benefits to share with

(57)

PROTECTION FROM

COMPETITION

• How much is your business model protection you

(58)

(59)

Structure your

business model

Explore

alternatives

Evaluate your

business model

Face the

market and see

(60)

GOAL: test your market

• Customer Discovery: are they really interested in my product?

• Customer Validation: be sure you can sell in a repeatable way;

• Customer Creation: sustain your demand

• Company Building: give yourself structure…but only when the market

(61)

(62)

Things I did not tell you:

• Techniques for Market and customer behavior analysis (data

collection, customer segmentation, …)

• Competitors analysis (SWOT analysis, BCG matrix, …)

• Business plan financials: Profit & Loss / Balance Sheet / Cash Flow

• How to choose your shareholders, the statute and shareholder

agreements

• Compensation and incentives in a start-up environment

(63)

Remembering that I’ll be dead soon is the most important tool

I’ve ever encountered to help me make the big choices in life.

Because almost everything – all external expectations, all pride,

all fear of embarrassment or failure – these things just fall away

in the face of death, leaving only what is truly important.

(

Steve Jobs

)

Stay focused,

do your homework and …

GOOD LUCK!

(64)