1. Chapter 5 Developing and Testing the Business Concept

2. Copyright © Houghton Mifflin Company5-2 Overview Idea to opportunity to business concept The relevance of personal goals Development of the business concept Overview of testing the concept through feasibility Why you should start a business today

3. Copyright © Houghton Mifflin Company5-3 Opportunity Idea Business Concept

4. Copyright © Houghton Mifflin Company5-4 ENTREPRENEUR Distribution Product/ServiceCustomer Benefit or Value Proposition Entrepreneurial Concept Model

5. Copyright © Houghton Mifflin Company5-5 Business Concept What is the product or service being offered? Who is the customer? What is the benefit? How do you get the product or service to the customer?

6. Copyright © Houghton Mifflin Company5-6 Why Do Concepts Fail? Not understanding the customer No compelling story

7. Copyright © Houghton Mifflin Company5-7 What’s the Compelling Story? Why you? Why now? How do you plan to change the world? AKA: How do you heal the pain?

8. Copyright © Houghton Mifflin Company5-8 How Do We Avoid Concept Failure? We test it

9. Copyright © Houghton Mifflin Company5-9 Feasibility Analysis: What Does the Market Say?

10. Copyright © Houghton Mifflin Company5-10 INDUSTRY ASSESSMENT Market/Customer Assessment Product/Service Assessment Team Assessment FinancialAssessment Industry Test Patterns of change Demographics Major players Status of technology

11. Copyright © Houghton Mifflin Company5-11 Industry Assessment MARKET/CUSTOMER ASSESSMENT Product/Service Assessment Team Assessment FinancialAssessment Market/Customer Assessment Target market demographics Customer grid Competitor analysis and grid Competitive advantage Demand Customer profile

12. Copyright © Houghton Mifflin Company5-12 Customer Grid Initial Customer Grid for Rhino Records

13. Copyright © Houghton Mifflin Company5-13 Industry Assessment Market/Customer Assessment PRODUCT/SERVICE ASSESSMENT Team Assessment FinancialAssessment Product/Service Test Benefits and features Current status Intellectual property acquisition Plan for prototyping and testing Tasks and timeline to completion

14. Copyright © Houghton Mifflin Company5-14 Industry Assessment Market/Customer Assessment Product/Service Assessment Team Assessment FinancialAssessment Current expertise, skill sets, and experience Gap analysis Strategic partners

15. Copyright © Houghton Mifflin Company5-15 Industry Assessment Market/Customer Assessment Product/Service Assessment Team Assessment FINANCIAL ASSESSMENT Financial Assessment Forecasting Financial premises Sensitivity analysis Cash needs assessment Price/margin schedule

16. Copyright © Houghton Mifflin Company5-16 Industry Assessment Market/Customer Assessment Product/Service Assessment Team Assessment FinancialAssessment The New Venture Timeline to Start-up Is it feasible? –Conditions to go forward Timeline of activities from today to launch

17. Copyright © Houghton Mifflin Company5-17 Take-Aways List what your students took away from the discussion here in real time