- The following are some of the resources and "tools" we find useful for companies in addressing inflection point strategies and action plans.
- While we have identified certain tools as useful at certain company stages, many crossover stages of a company's evolution. For example "Lean Launch" is just as applicable to new product development groups within large firms as it is in the early phase of start-ups.
New Business & Product Planning
- Lean Launch has become an engrained model for start-ups to use in planning and communicating with prospective investors and partners such as SBIR sources. NSF I-Corps has made it the defecto required tool of choice for university and government lab spin-offs. The concepts and tools are also highly applicable to new product launches in large firms.
- Customer Discovery is a subset of Lean Launch with a specific focus on determining customer needs by actively engaging in systematic dialogs as opposed to the often taken route of engineering driven firms that pursue "build it and they all come".
- Business Model Canvas is a summary framework to organize the lean launch information and typical business topics framework elements that all firms should gather and organize.
- Porter's 5 Forces Competitive Analysis - HBS has become a staple of business planning for firms, including non-profits, of all sizes and stages. Either explicitly or indirectly, all sophisticated angel groups and institutional investors and most large corporations use this framework in evaluating market and investment choices.
Marketing & Operational Topics
- Survey tools for customers, vendors, partners are readily available and highly useful in various analysis ranging from customer satisfaction, customer needs analysis and "customer discovery", market and competitive intelligence. Among the more popular to use are SurveyMonkey and among useful specific techniques are Net Promoter Scores . We've used these and more specific custom surveys on behalf of clients to understand competitive position, product acceptance and pricing capacity, as well as internal vs. external discontinuities about strategic and tactical directions for products and strategies.
- Accurate product development projections of timing and associated costing and supply chain resources are a critical elements for success of all companies. For early stage and "inflection point" firms, this is often a major challenge and one that we frequently help firms understand and address.
- In many technology driven markets there is a substantial market share and firm valuation penalty for being a late to market entrant . However, in many markets and product competitive spaces, the first-mover can be overtaken over time.
- Disruptive innovation is increasingly playing a role in many sectors, and at an accelerating pace from the past. As a result better understanding forward periods of time of expected prices and associated costing of products and services is critical. The use of Porter's 5-Forces combined with proper application of "Experience Curves" and analysis of how-when can a disruptive innovation model work. Mapping BOM, direct & indirect costs, and TCO from the current environment into future market timeframes is a task that often trips up early stage and fast growing firms. Collecting such data and building relevant models with the Company team is a frequent task we undertake.
Financial Topics - Building & Attaining Value
- A substantial portion of our work is involved in some form in company "value" -- either working with the team to improve it or in working on an exit or harvest plan. The timeframe may be near-term or with an outlook for several years. The big, frequent question is what is the "Value" is not an easy one to answer and that is often a frustration for highly technical C-Level executives.
- There is a “SCIENCE” to valuation techniques, but it requires a substantial amount of “ART” -- really informed judgments applied under various conditions. For example: Is a valuation being generated for a minority private investment vs. buyout vs. public market vs. employee options (409A)? What are the structure and terms? They matter greatly. Is an earn-out involved, are there restrictions on security sales-liquidity, and what are the components of future employee compensation?
- For a given situation what are the relevant tools & techniques?
- What are the relevant “comparables”: public, private actual deals? Are there changing market conditions: Buy/Sell Demand Imbalances; “Corner cases”: Scarcity of capital/buyers or scarcity of firms/deals? Size and liquidity risk discounts? What are the buyer’s decision factors: DCF, discount rates, earnings accretion, portfolio balancing, strategic synergy impact, IP, acquiring the management team?
- In reaching conclusions there is a wealth of data to use filtered by: (a) Dynamics of Market Conditions, (b) Dynamics of Competitive Conditions, (c) Dynamics of Company Specific Conditions
- For a given situation what are the relevant tools & techniques?
- Among the resources available and useful for various situations:
- SEC documents of public comparable firms, current stock market pricing and published investment reports by analysts
- Past private transaction data published by industry analysts, banks and investment banks
- Start-up financing comparables published by various sources such as Angelist and others
- Growth financing metrics gathered and published by firms such as PWC Moneytree, law firms , and others.
Incubators & Spin-offs
Universities, government and corporate laboratories have created hundreds of innovation hubs around the world. These can have several roles: to foster start-ups, to create spin-offs from existing groups including a larger entity and to encourage start-up and large company collaborations. Our team has helped on successful new business launches out of several such organizations, among them : Fraunhofer, Plug & Play, Digital Garage, Yale University, University College London, IBM, United Technologies, and Ericsson.