1. UMSI 363 Nancy A. Benovich Gilby
Busting Myths and Pursuing Information Innovations with Mobile Apps in SWIFT
Week 9
Nancy A. Benovich Gilby
Ehrenberg Director of Entrepreneurship
Clinical Associate Professor 
University of Michigan School of Information

2. Today Changes MVP 1/Final pitch demo Chasm 2 with Elevator Pitch
Your pitch vs. Sequoia 10/Art of the Start 10
Your Project has gone through 6 weeks:
You should have 18 interviews, KJ affinity diagram, competition matrix, wireframe, a start on your project app code, feedback on these from your target users
Share out: Present KJ Question, Present Average from Scores.
MVP 1 prototype
Pitch Deck

3. Team Project Overview
Form your team, establish ground rules, Interviews round 1, build app scaffolding, interview 6 target users
Review Customer Development Round 1 and Potentially Pivot, Competition, sketch/wireframe, interview 6 target users complete a full SWIFT/PARSE scaffolding to use in developing your apps MVP1
Review Customer Development Round 2, Pivot, Competition 2, sketch/wireframe,, interview final 6 target users (18 total)
Review Customer Development Round 3, Build and test KJ Affinity Diagram, wireframe, competition matrix test with users, for feedback
Draft pitch, MVP prototype 1, Top Line Revenue Model
All teams pitch and review, MVP prototype 2, Business Model Canvas,
Pitch and demo to VCs, Executives, Entrepreneurs

4. KJ of Note:
The main difference is that Affinity Diagram focus on ideas whereas KJ Analysis is focusing on “facts”.
MIT Rule of “7”
If you have a crisp target user definition, you only need to interview 7 people and you will start hearing the same things.
Set out to interview 15 or 20 with the end goal you will cull down to 7

5. Prepare for Share Out: KJ and Code
Remind everyone”
State your target user,
top 3 problems,
value hypothesis
Each team will huddle for 15 minutes to review their score sheets and prepare to present the KJ and SUMMARY scores.
STANDUP: Tell me, show your scrum board
What do you propose for your demo MVP and your code MVP?
What you did the week before to get the interviews, competition, wireframe done (if you weren’t in class last Friday)
What you will do this week,
What obstacles you have

6. Share Out target user description what is their urgent top 3 problems?
What is your value hypothesis?
Present your KJ:
Problem
Solution
KJ Flow
Top 3 items
Repeat Solution
Present your average scores
Group discussion

7. Chasm 2

8. Chasm Model: The People
The market waiting and watching…FUD!!

9. Hockey Stick
The VC Revenue Curve Expectation: What is Success?? Big Enough Idea That It’s not Just Another Mouse Trap
Users/ Revenue
Go public, everyone makes millions
$100M
In the Tornado, can barely keep up with customer growth
Everything
is going according to plan
First batch of users 1 3 5
Time (years)

10. Point of Peril Users/ Revenue Time Oh no, What’s wrong, I’m scared
First batch of users
Time

11. Marketing?

12. Marketing
Taking actions to create, grow, maintain, or defend markets … Shape something that is REAL.
Market
A set of actual or potential customers
For a given set of products or services
Who have a common set of needs or wants, and
Who REFERENCE each other when making a buying decision.
Aggregate sales, both past and present

13. Why: Pragmatists Don’t Trust Visionaries as References!!!
Order of Magnitude ROI MUST HAVE AN APPLICATION
Measurable, Predictable Progress
SERVICE!!
Leading Bleeding Edge Technology
New & revolutionary
Unique functionality
Horizontal references
Willing to take risk
Want rich tech-support
Revolutionary processes
Tolerate bugs
Standard
Third party supporters
Vertical references
Little risk
Great quality of support
Enhance established processes
Bug free

14. How Do You Cross the Chasm?
Early Market
Chasm
Bowling Alley
Tornado
Main Street
Total
Assimilation
Go Bowling!!

15. "BUILD SOMETHING FOR SOMEBODY INSTEAD OF EVERYTHING FOR NOBODY" - Geoffrey Moore in Crossing the Chasm

16. How? Niche Territory
Cross the chasm by targeting a very specific niche market
where you can dominate from the outset,
Create competition then dominate your competitors, and then
use it as a base for broader operations.
Concentrate an overwhelmingly superior force on a highly focused area

17. Facebook Bowling Alley Example
Adoption happens by groups who reference each other
Company
Aunts and Uncles
Grand
Mas and Pas
Middle
School Students
Middle Age
Workers
Mom’s and Dads
High
School
Students
First Time Workers
Twenty Some
things
College Students
How hard did Facebook need to work to get the Early Majority?
Where does the Early Majority begin here?

18. To WIN the Niche Market Pick on someone your own size, pick carefully
What “features” do we need to build?
Product Development’s role is to help determine and execute the whole product
For a TARGET CUSTOMER
MUST HAVE, COMPELLING
Reason to Buy

19. Where does the MVP fit in?

20. GET 3 Referenceable Customers
If I could leave you with the most important things I’ve learned over 20+ years:
GET 3 Referenceable Customers
Strategy & plan must be based on the REALITIES of where you are in the adoption cycle of your product in the market
Development’s role is to help determine and execute the whole product (Development = Product Management + Engineering)
Engineering is responsible to find a solution, within a given time window, determine how much the solution costs
Once a plan is agreed, engineering must ship on time, every time.

21. Who is Adding How Much Value?
How much value do engineers add with just developing the core product in the early market? Compensating Developers :the pioneer technologist
These divide into two camps—
true company founders - bet their lives on the equity gamble -hope that in reading this book they learn to conserve a large portion of that equity to fund crossing the chasm
very early employees - pose a real problem. They can point with accuracy to the notion that they created a large part of the core product. Thus, should that product become a mainstream market hit, they feel they should get a major share of the gains .
The fact is, they don’t, and the truth is, bluntly, they don’t deserve it either. Mainstream success, as we have argued at length, is a function of the whole product, not the core product, and that is a very large team effort indeed.
What the pioneer technologist does have a right to is a large share of the early market returns, because here it truly is the core product that drives success 1% Equity post Series A (institutional round)

22. Try the Elevator Pitch (Positioning: Create and Occupy a Space in the Target Customer’s Head)
Format
Example Intuit Bill Pay
For (target customers— beachhead segment only)
Who are dissatisfied with (the current market alternative)
Our product is a (new product category)
That provides (key problem-solving capability).
Unlike (the product alternative),
We have assembled (key whole product features for your specific application).
For For the bill-paying member of the family who also uses a home PC
Who are dissatisfied with Who is tired of filling out the same old checks month after month
Our product is a Quicken is a PC home finance program That automatically creates and tracks all your check-writing
Unlike Unlike Managing Your Money, a financial analysis package
We have assembled Our system is optimized specifically for home bill-paying.

23. "BUILD SOMETHING FOR SOMEBODY INSTEAD OF EVERYTHING FOR NOBODY" - Geoffrey Moore in Crossing the Chasm

24. Pitch

25. How: Positioning Your Product
Seize the high ground
Make it personal
Niche thyself – “Chasm”!!!!

26. How: Explain in the first minute Answer the little “man”
Follow 10/20/30 rule
10 slides
20 minutes
30 point font

27. WHAT: Sequoia 10/Art of the Start 10
10 slides for a VC Pitch:
Title
Problem
Solution
Business model
Underlying magic
Marketing and sales
Competition
Team
Projections
Status and timeline

28. Ideation Pitch Outline
Problem
Context scenario, URGENT PROBLEM for who, why bother?
Solution
Position product
Underlying magic
Why can’t other people do this?
Competition
Why is this unique?
Team
Why are you so special to be doing this…why will it be you that succeeds?
Revenue Model/Projections
How will you monetize
What would you charge?
(PLACE HOLDER for Projections)
Status and timeline
What have you done so far to prove you can set milestones and exceed them
What will you do next

29. MYTH: Of course my idea is unique

30. MYTH: Innovators never run out of time, they just run out of money.

32. Sample Wildfire KJ Diagram

33. Sample Wildfire KJ Diagram: top 1 sections

34. Sample Wildfire KJ Diagram: top 3rd

35. KJ How To 1: Have one quote per black level post-it
written in black, all caps, initals of speaker right hand corner JL-1 (for Joyce Lee quote #1)
Red level post-its should
be just a small step up in abstraction but should not be blackpostit1 AND blackpostit2 AND blackpostit3.
Red, blue and green only have at most 3 post-it/post-it groups of (Red or blue)
All teams must get to blue level
Extra credit for a team if they get one section to Green level
When you’ve abstracted your post-it’s as far as you can go, you finish putting putting the diagram on the paper MINUS the final ANSWER to the what question and the top 3 votes (see next slide)

36. KJ How To 2:
Make the diagram like the coloring on the example Wildfire diagram.
Add the FLOW arrows from your top most sections
-> this leads to this
<-> these both affect each other
|-| these are counter to each other
Each person gets 3 votes of 3,2,1 point. You vote on the read level of what most strongly answers your KJ WHAT question.
Color (like the wildfire example) your top mosts points ( 1. RED X marks, 2. Blue \ marks, 3 green dots)
Abstracting from your Red, Blue, Green red-level labels, write your final statement in RED in the upper right of the KJ diagram in all caps (yes the wildfire one is wrong)
When the diagram is done, date and each of you sign the diagram in black at the bottom right THEN your teams all swing their arms in a circle while saying Yooooo then both clap and say ONE (yes goofy but it’s part of the ritual so give it a try).

37. KJ Diagram

38. Assignments Reading Good To Great Chpt2-3 Built to Last Chpt 2-3
#25 Work on your prototype, pull together an MVP #1 of your app
#26 Team: Draft first pass of Ideation Pitch which includes prototype demo
#27 Team: Test Pitch and Prototype with 3 users, revise, score