Download - Course 2 - 1st session: Failure
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With the Support of:
www.de-‐pe.com @depeteam
Antofagasta, Chile, May 2011
1
FAILURE DAY Class 2
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INDEX • Intro • Failure in Chile • What is a Startup? • Why Most Startups Fail? • What is a Pivot? • Failure, Pivot & Success Stories • Summing Up • Teams
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FAILURE IN CHILE Effects on Entrepreneurship
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Failure • The Punishment Culture
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Failure • Jesse’s blog: “He explained to me that the biggest impediment for entrepreneurs in Chile is the fact that Chilean culture harshly punishes failure in general. All the other Chileans in the room concurred…”
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Failure • “…As I spoke more with this Chilean businessman, it became truly apparent how debilitaSng it would be for entrepreneurs to grow up in a society that punishes failure”.
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Effects on Entrepreneurship • In Chile, what happens if we punish failure?
– We don’t share (fear) – Country in status quo -‐> zero innovaSon – We don’t learn – Cancer for Entrepreneurship
• AccepSng failure is an important characterisSc of any entrepreneur.
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The Truth • Most successful startups and successful people were failures at one Sme. Failure is important learning process. The ability to accept failure is an important characterisSc of entrepreneurs.
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WHAT IS A STARTUP? What kind of Startup are we?
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Human institution designed to deliver a new product or service under conditions of extreme uncertainty.��� Eric Ries, Lean Startup (www.startuplessonslearned.com)
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Why to build a startup? • Our goal is create an InsStuSon not just a product.
• TradiSonal Management tacScs fail. • Environment of extreme uncertainty. • Not just 2 people in a garage.
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Different Types of Companies
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Different Types of Companies
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Different Types of Companies
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SO, WHY STARTUPS FAIL?
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More startups fail from a lack of customers than from a failure of product development. Steve Blank, Four Steps to the Epiphany (www.steveblank.com)
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Different Types of Market
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Why we fail? • Nobody knows what the market really needs.(we cant predict the future)
• Entrepreneurs usually build before test their Product/Business Model hypothesis. • Startups can fail from unproven assumpAons.
– We believe that advancing the plan is progress.
• You have to push your product out in order to be`er listen and learn from the market.
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The class focuses on using Customer Discovery process to create products that fit with the market. DePe Team
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Why we fail? • Mike Maples: “You Have to Be Willing to Throw it all away”. – InvesSng a months of Sme in an idea, it’s hard to let it go and move on to the next one.
– Be`er to push a minimal viable product out and validate your idea quickly – we’ll show you how to do this.
• Most successful startups and successful people were failures at one Sme. Failure is important learning process. -‐> Adapt and move forward (PIVOT)
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THE PIVOT Build, Ship, Pivot, Repeat
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The Pivot • Pivot is changing your business model (not just iteraSng on your product) – It’s the equivalent of taking a hit (no product
traction) and spinning (product pivot) to find another path to the goal (product market fit).
Defense Dribbling Score
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The Pivot • Change of direcSons but stay grounded in what we have learned.
• If we speed up the Sme between iteraSons, we increase the chances of success.
Build
Measure Learn
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What can we Pivot?
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Some Pivot Examples • Product Pivot
DaSng Site
”Who is ho`er” site
Group SMS
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Some Pivot Examples • Fuzhou HC Imp. & Exp.
1. Impo. Company based in Chile. a. High CompeSSon, No Partners, worthless revenue
model-‐> FIRST PIVOT / Product (Service).
2. Sourcing and Procurement Outsourcing Company based in Chile. a. No experSse, No partners, No Customer relaSonship,
No Channels -‐> SECOND PIVOT / Customer Segment.
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Some Pivot Examples 3 Sales (Foreign Markets)
Outsourcing Company based in China. a. New target market, new
revenue model. b. Buyers and Sellers became
our customers.
4 Today’s PIVOT-‐> Sourcing and Procurement Outsourcing Company based in Chile. (yeah, same as I started)
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GRACIAS! Preguntas?