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EP245 Notes for Instructors

Contents

First Steps

So this lecture is for facilitators and coaches, sometimes called the instructors or mentors. Why you're here is I'm just going to go through a brief explanation of what it is you're doing while the students are watching the lectures and working on their presentations and getting out of the building and presenting. What do you do? My suggestion is to get us all aligned, rather than me have to repeat all of the lectures we're giving the students, is you need to go watch Lecture 0, Lecture 1, Lecture 1.5 and find your copy of the Lean LaunchPad Educators Guide. That's kind of your prep work for the rest of this conversation. This might take an hour or 2 to watch all these lectures and kind of get up to speed on the material, but it's well worth your time. Also, if you don't have a copy, please get a copy of Alexander Osterwalder's Business Model Generation book and a copy of The Startup Owner's Manual.

Educators Training

So if you're a facilitator or a teacher, what is it you're doing? You should understand this is an adapted version of the Lean LaunchPad curriculum that is actually for post-Startup Weekend events. That is, it comes after students actually sit through a Startup Weekend and kind of raise their hands and say, "Hey, we'd actually like to learn more." "We'd actually like to take this team we've built "and actually figure out whether we could put together a startup." This is not a full semester class and not the full version of the Lean LaunchPad, but these teams will learn a tremendous amount in the weeks that they will be spending with you. This helps fill a gap between the Startup Weekend and the next step that most entrepreneurs think they should take, which is commonly seen as an accelerator. So the goal of the class is twofold. Number 1 is we're going to teach customer development. We're going to give the attendees an immersive and experiential course and a methodology that they will remember for the rest of their lives. It's a big idea. We're going to teach them customer development and give them a methodology for the rest of their lives. Remember kind of graduating from the Startup Weekend to the startup next phase, this is still a dating phase. We're going to give them an incredible experience for their team, but we're also going to stress test them. This is not just sitting in a class and doing presentations. Our opinion is if we could blow them up now, if the teams will fail under pressure, it's better to have them fail now, and it's even better that they learn it's not an optimal team and what the dysfunctions were now before they take any money versus when they've spent a million dollars and they're 2 years into it. So those are the 2 goals: Teach customer development with an immersive and experiential course and enhance and expand on team development skills.

Guidelines

If you're a coach or a mentor, what you're responsible for is spending 1 to 3 hours per week for every team. And you're going to be working with 1 to 4 teams for up to 3 weeks. We encourage you to meet up once a week in person and/or once a week online per team with Skype or Google Hangout. But what we're really looking for is you to offer your critiques and your expertise in their LaunchPad Central narratives. As they start talking about the customers they're actually interacting with, we want you to offer comments. Was this the right interaction? What should they have learned? Should they have done something different? You need to actually be giving them feedback, you need to be giving them contacts, people to talk to, and sharing all your domain expertise. This is not just kind of, "I showed up as a mentor." This is a full-time engagement with these teams. So think of yourself as almost their venture investor. Assume you just put a substantial fraction of your net worth into these teams. Care like that. Let me be clear, though. We don't want you to do their work for them. But we want you to guide them to the right places to talk to, to see the right patterns in the data, and to understand what you understand.

Weekly Business Model Canvas

Just as a reminder, what the teams will be starting with in Week 1 is filling out the business model canvas and getting out of the building and testing their hypotheses about the value proposition, customer segments, and channel. In the next week they'll be testing customer relationships, revenue streams, and partners. And then in Week 3 they'll be looking at key resources, key activities, and cost structure. The thing to remember: that the goal is not to draw on the canvas. The goal is to get out of the building and use the canvas as a scorecard for the customer development activities that are going on in the Z axis and depth between each one of those canvas scorecards. You need to make sure your team is learning about who are those right customers, what are the right value propositions, what is the right revenue model. And it's the activity that they're doing outside the classroom. Now, the real winners in this program are not just the teams who get out and talk to lots of customers but those who actually turn the data into insight-- that is, who see patterns, who realize, "Oh, it's not that 43 people liked it, "it's the 4 people who threw us out but said they would have paid a lot of money." "Maybe the business is over there." That's what you as mentors and you as facilitators are actually helping these teams see.

Student Presentations

So what are the students going to be doing when they meet up once a week? They're going to be presenting their lessons learned, and they're going to be presenting in front of their entire peers. Now, you'll be sitting in the back of the room, both the facilitators and the mentors, and critiquing what they've learned. And as they present, remember, you've been reading their LaunchPad Central blog posts, so you kind of know who they've been talking to. So this is almost a summary, but you will be giving them comments. In the meantime, the students, instead of just sitting there and doing their email, who are not presenting, actually have a shared Google Doc and they're doing peer grading of their peers, of their presentations, and giving them feedback as well. And what the students are doing outside the classroom are 10 to 15 hours of customer discovery, and they're spending at least an hour a week blogging what they've learned, and they're using the LaunchPad Central tool to do that. And they're watching the lectures online on the Udacity site. What you're doing as facilitators and coaches is you're answering questions about the lectures, and you're critiquing team presentations. And what the teaching team is using is, you're using a shared Google Doc, sitting in the back of the room, grading, while the students are using their peer grading doc, which is very separate from yours. So they don't get to see your grades, and you get to see theirs later. But now the teaching team is actually writing down what you think of each one of the teams. And again, in between the weeks your job is to review and comment on the team's customer discovery narrative using the LaunchPad Central tool.

Tips

So, a couple of tips. Number 1: The Business Model Canvas is a scorecard; it's not the class. The lectures are not the class. We're not asking you, as facilitators or mentors, to lecture in the class but to do short summaries just to make sure everybody's up to speed and ask probing questions to spur conversation. But the class itself is about critiques about each team's findings, from their original hypotheses to what did they actually learn. One of the things we do to make the teams feel great is when someone actually gets physically thrown out of a customer, just remind students that some of the most aggressive teams seem to be actually spending their time trying to get customer data sometimes have been known to get thrown out of buildings because they've been so aggressive or threatened with arrest because they shouldn't be where they are. We're not asking you to break any laws or do anything illegal. But you know you're pushing hard when somebody physically grabs you by the arm and escorts you out of a place. Then you get in--then you get to show up at the class, tell us that story, and the teaching team needs to stand up and applaud that activity. That just means there was an aggressive team. And just remind them that we do not provide bail or political asylum, depending on your country. But being passive is not the way to actually proceed with this class.

JerseySquare

So rather than just talk about this to death, let me use the example that we use throughout the lectures and this is just the team that actually did this in five days not three weeks. There was a team at Columbia University called Jersey Square, and they were a rental service for professional sports jerseys and in five days they did 169 interviews and had 190 people share their website and they actually sold 2 of their products five days from a raw idea into a business. So on day one, these were their initial hypotheses coming into the class. They thought that their customer segments was going to be professional sports game attendees. Notice they were beginning with a series of hypotheses about their customer archetype. And they thought their value proposition was going to provide a cheaper way to officially license sports jerseys to a game, eliminate the risk of owning a player whose jersey is traded, and to provide alternatives to purchasing counterfeit jerseys. And their sales channel were going to be websites or stadium shops or ticket websites or direct mail. And how they were going to create demand was through search ads, social media, and stadium promotions. And their revenue stream was going to be through an annual subscription model. So when they took a look at this day one canvas, the teaching team first said "We don't even believe that there's market here. What's the total available market then? Is this like a hobby or a business? And how do you know and did you do any real customer discovery? And our skepticism really in fact infuriated these guys who they thought they were the main experts because they were wearing a lot of jerseys. And teaching team, this is your job. You want to irritate them into action. We did this on purpose. Not by accident. We wanted these people to come back on the first day with enormous proof that this was even worth spending their time, and they did it. They went out to Yankee Stadium in New York and found the most people in the densest area they could who actually were potential customers and they spoke to 60-somewhat customers just to prove to us what idiots the teaching team was by design. They didn't understand that that was part of our game. It's to get them to raise theirs. Now when they came back again, they showed us. Hey, look! There might be a real business here and it's even bigger than we thought because it includes females and so one of the things we pointed out to them is it looked like they had multiple customer segments. And this is just a teaching team tactic but when you have multiple customer segments you have to have multiple value props and you probably have multiple revenue models if not multiple other things. Just for logistics and just for you to be able to teach, we beat them up and said you need to put these in multiple colors because it will force you to actually start thinking about how each segment relates to each other. And so they got out of the building and again talked to different users or potential users in different locations and now you could see they actually took our advice and segmented the canvas into two separate colors because they thought there were two unique customer segments. And now you could see the customer segment sports jersey owners match the value prop for sports jersey owners and match the revenue model and it's fairly easy to track their thinking. Now the thinking by now in this third-day duration it's a big idea for facilitators and coaches. It's no longer their opinion. They now have 100-plus customers telling them this. And life is getting kind of interesting because they now know more collectively than you do. It's actually no longer your opinion versus theirs which it was on day one. It's actually they're now bringing new data. Now it can be that they're just misinterpreting the data or they might be calling on the wrong people in the wrong places. That's your job as the facilitator and coach. It's to say, Well, wait a minute. That's the wrong segment. Or gee, have you looked at your activities or your resources because you might have a great theory on the right hand side but this thing won't pencil out if you just do the numbers. And so we push them a bit on day three and they actually went out and started looking at the left hand side of the canvas because we'd beat their stuffing out of them saying yeah, yeah, yeah this might be nice but there's no way. You know you're going to end up spending more doing this than you could bring in. And so they went out and actually talked to the left side of the canvas and they actually found out that, oh yeah, you were right. It's not FedEx we want to use because that's too expensive. But we also found out how much we could actually charge. We had people raise their hands and say we could do that. And the other thing we push is that by the second or third day or second or third week we want them to have launched their website or have their app up and running. And these guys did exactly that. Literally on the third day, they had a working website. And within nine hours, they had 81 visitors. Even though it was all their relatives and friends, it didn't matter. They now have traffic to a site and they actually received an order from the first customer who wasn't even a relative, which was actually again another sign of a teaching team standing up and cheering. So we literally all stood up and applauded and then we reminded them that the record inside of a class was a purchase order for half a million dollars so they still had $499,000 to go but it was a good start and of course it makes the other teams who were barely able to get talking to customers understand what the scale of the game is and that you really need to be playing this seriously here. And again, for facilitators and coaches, your goal is to keep the pressure on. You've got to keep it on. Be polite. Be respectful. But just remind them that the pressure you're putting on them is about 1/100 of what it's really going to be like in a real start up. And just understand, you're not trying to be mean. But part of your activity, if you remember, is to figure out how these teams operate in pressure and it might just be that a good number of them aren't suited for this stage of the company. What a cheap way to find out. This is a simulation of a startup. And your job is to make sure they understand that this is just a fraction of the 24/7 sleepless nights that they're going to be spending for the next couple of years. So you could see after five days, just five days, after talking to 160 customers you could see how the business model evolved dramatically from something that looked like this on day one to something that looked like this on day five. On day one, a series of untested hypothesis, a faith-based enterprise. On day five, the faith has turned into facts and this startup is on the road to actually building something that customers might want.

Startup Weekend Next

So, how does it work for startup weekend next. Well, after the weekend, it seems that you're told that you're going to be presenting your results tomorrow and the types of things we want to see is how big is this idea. So, you have to understand that this is a note for the facilitators and coaches Is while the business model canvass talks a lot about the business the big idea and you need to note this. The big idea is that there's thing external to the canvass that are important for a start-up. It doesn't talk about competition. It doesn't talk about market size. All of these external forces you need to be asking the team to present as well and be constantly thinking about it. Market size, we'll what kind of interest is this. Is this is a large scalable opportunity or is it a hobby? Or is it like a lifestyle business? Now, those teams might decide that making 300 grand a year is just fine, thank you very much but they ought to understand that they can never raise venture capital or even investment and that it's a nice lifestyle business. There's nothing wrong with that once you understand that that's the game you're in, but you need to teach them the distinction between a scalable business and one that's a small business Same for competition. Competition is not on the canvass. They need to understand the external environment and they need to come in. Understanding the proposed experiments to test each one of the segments for customer segments, value proposition channel, and revenue model and they want to know what the past fail signal is for each test and more importantly you want these teams to hit the ground running and so they need to come in with a 100 plus contacts they're going to be calling on in the three weeks that they're in the class. Where do they get the contact? Welcome to social media. Friends, family, LinkedIn, Facebook, etc. And since it's a team, there are multiple members of the team so a 100 contacts really isn't that much spread among three or four or five people. So you need to be able to contact them and they need to be roughly pre-qualified So, each week the team will have homework. You know, watch part of the Udacity lectures. Fill out the business model canvass. Talk to 10-15 customers and then talk to your mentor via Skype or Google hangout and fill out the Launchpad Central software.

Why

Why should you be a facilitator or a teacher? Why should you give your time to Startup Weekend and these entrepreneurs? Number 1, we think you'll learn a tremendous amount yourself just watching a variety of teams start with an idea and watch their process. And you as a facilitator will actually watch your skills rise as you're able to see patterns you've never seen before. You will gain a deep understanding of the Lean LaunchPad curriculum. That is, you'll understand business model design, you'll understand all the components of the business model canvas and understand the startup is not just a bunch of teams who have free food and you bring your dogs to work and work incredibly hard. You'll understand that there's actually a pattern here, and the pattern is not only the strategy, the canvas, but the process of getting out of the building, talking to customers, and understanding iterations and pivots and know when to do that. You will get fingertip skills that will be immensely valuable in your own career. And then we think that being part of an organization, bringing the democratization of entrepreneurship to a thousand cities worldwide means you're part of something bigger. You're becoming part of a community and a leader and a role model for the startup community in your city and your country. You have an incredibly important role. And I think you understand that the Startup Weekend program is an important part of the ecosystem in your city and, potentially, your country. It is the catalyst in bringing entrepreneurs together and giving them a set of skills they could never acquire elsewhere. And you are that leader. So I want to personally thank you for dedicating your time to something we all believe is so incredibly important. This entrepreneurship, this education, this Lean LaunchPad, this Startup Weekend and Udacity is all part of a global movement that's truly impacting the world. I'm really, really impressed that all of you have decided to participate and give all you have. So thank you from the bottom of my heart.