How to start_a_startup_for_abc

Starting a Startup

Hild Imre

STARTUP PIRATES

20 years

5/2/14

1990-1993 Hungary - Tourism

1998-2003 Lehman Brothers, New York, NY (Conduit Hotel Securitization)

1993-1998 Ithaca, NY - Cornell University (B.S. & MBA)

2003-2004 Hild’s, owner (Securitization Advisory)

2005-2009 OTP Life Annuity, founder, CEO

2004-2005 Hild Life Annuity, co-founder, owner

2012- iCatapult

2009-2012 Primus Capital

What is a startup?

A Human institution operating under extreme uncertainties

An organization searching for a solution

A group of people conquering the unknown

What is a startup?

Define by non-quantifiable qualities

WHY DO YOU START A STARTUP?

- for good cause- for money- for fame- for fun- for being cool- for independence- or to simply to be:

Startup Pirates

Startup Operations – Running a gig

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Idea FundingProduct

development

Sales

WHAT ARE YOU AT WORK?

A. Fast

B. Precise

C. Both

D. …what do you mean by work?

THE STARTUP PROCESS

• Let’s do startup• …I have an idea!• Idea = guess• Guess = hypothesis• Guess about the product, market etc.• Test, test, test a.k.a. ask questions• Your offer (a.k.a. value proposition) is…

• vitamin (nice to have)• medicine (MUST have)

• If at least 70% significance = MUST have

• Hypothesis• Get out of the building• Test and measure responses• Learn facts• Build MVP• Test (measure) traction• Learn until you have a repeatable model• ….. Build - Measure - Learn cycle

THE PROPER PROCESS OF STARTING UP

FOCUS ON PRODUCT OR SERVICE

BUILD A FOUNDING TEAM AROUND IT BUILD STARTUP AROUND THE TEAM

…IF NEEDED, FORM A COMPANY

Who do you have to fight?

Startup Pirates

Startup Operations – Running a gig – for success

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Identify need or problem

Prototype a solution

Test and iterate

Fund Scaling

VALUE PROPOSITION

Value is material, emotional or abstract benefit to user or client

VALUE PROPOSITION

Value is material, emotional or abstract benefit to user or client

VALUE PROPOSITION

Value is material, emotional or abstract benefit to user or client

STARTUP ZONES

KNOWN UNKNOWN

INCOME

GROWTH

RISK

RETURN

STARTUP ZONES

KNOWN UNKNOWN

INCOME

GROWTH

BARBERSHOP

AMAZON

RISK

RETURN

SNAPCHAT

PREZI

STARTUP ZONES

KNOWN UNKNOWN

INCOME

GROWTH

BARBERSHOP

AMAZON

RISK

RETURN

SNAPCHAT

PREZI

STARTUP ZONES

KNOWN UNKNOWN

INCOME

GROWTH

BARBERSHOP

AMAZON

RISK

RETURN

SNAPCHAT

PREZI

STARTUP ZONES

KNOWN UNKNOWN

INCOME

GROWTH

BARBERSHOP

AMAZON

RISK

RETURN

SNAPCHAT PREZI

STARTUP ZONES

KNOWN UNKNOWN

INCOME

GROWTH

BARBERSHOP

AMAZON

RISK

RETURN

SNAPCHAT

PREZI

Startup Pirates

Startup Operations

5/2/14

Product Team (founders) Startup Company

LEARNING IS EVERYTHING

If you're not willing to learn, no one can help you. If you're determined to learn, no one can stop you.

THE SINGLE THING THAT HOLDS YOU BACK FROM SUCCESS

Lack of funding

Not good enough idea

Mixing Assumptions with Facts

Few Sales people

Not enough customers

Too much competition

Slow patent registration

Customers do not understand

YOUR No.1. TASK AS AN ENTREPRENEUR

REPLACE ASSUMPTIONS WITH FACTS

A STORY

A father and his son are mountain climbing.Both of them fall down and are injured.

One ambulance helicopter takes the father to a hospital in Györ, the other takes the son to a Budapest hospital.The son is rolled into the operating room in Budapest

immediately. The surgeon steps into the operating room, looks at him

and says: I can not operate on him, he is my son.- - ?? - -

WHAT ASSUMPTIONS DO TO US

Clouds one’s vision of known and unknown factsMake one think of complicated solutions

Keeps one guessingMakes one come up with additional assumptions

CHECKLIST - BEFORE THE TEAM STARTS PRODUCT DEVELOPMENT…

Turn assumptions into facts by:

Testing the hypothesesAsking questions - develop answers

Learning your market’s driversBeing objective

Daring to change frequentlyBeing objective with your team’s strengths

Only do what you love (the FREE test)

KEY ELEMENTS OF A GOOD STARTUP

BIG MARKETEVEN BIGGER MARKET

DEEP UNDERSTANDING OF THAT MARKET (Extensive googling does not count)

REPEATABLE BUSINESS MODELTEAM THAT FITS THE ABOVE

ASKING QUESTIONS FROM EACH OTHERDONE BETTER THAN PERFECT

WWYCD

Richest people on Earth

1. Bill Gates, Net Worth: $76 BSource of wealth: Microsoft

2. Carlos Slim Helu & family, Net Worth: $72 BSource of wealth: telecom

3. Amancio Ortega, Net Worth: $64 BSource of wealth: retail

4. Warren Buffett, Net Worth: $58.2 BSource of wealth: Berkshire Hathaway

5. Larry Ellison, Net Worth: $48 BSource of wealth: Oracle

6. Charles Koch, Net Worth: $40 BSource of wealth: diversified

6. David Koch, Net Worth: $40 BSource of wealth: diversified

8. Sheldon Adelson, Net Worth: $38 BSource of wealth: casinos

9. Christy Walton & family, Net Worth: $36.7 BSource of wealth: Wal-Mart

10. Jim Walton, Net Worth: $34.7 BSource of wealth: Wal-Mart

11. Liliane Bettencourt, Net Worth: $34.5 BSource of wealth: L’Oreal

12. Stefan Persson, Net Worth: $34.4 BSource of wealth: H&M

13. Alice Walton, Net Worth: $34.3 BSource of wealth: Wal-Mart

14. S. Robson Walton, Net Worth: $34.2 BSource of wealth: Wal-Mart

15. Bernard Arnault & family, Net Worth: $33.5 BSource of wealth: LVMH

Day 1

Startup development – a word about the co-founder

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+ Dissolving dilemmas, doubts

+ Reality check

+ Minimum 1 maximum 2

+ Reasoning practices

+ Do more if you work together

STARTUP PIRATES

Startup Pirates

Chances of success – lets do the math

The Forward labs experiment

20% Great, 35% Zombie, 45% dead

18 months, 14 projects

After pivot and optimization?

= ± 0

Even good team’s good ideas do not guarantee success

Startup Pirates

How to avoid this trap..?

Don’t believe the ‘Devizahitel’ hype – it is not in your favor

BE sure you need the money - VC money is only for growth

Do not focus on a market that limits your ‘good team and good idea’

Create value and everything will follow

Energy Challenge – E-OFF

Cliffnotes

Study markets Lose

assumptions, build upon facts

Don’t wait, act fast

Break some rules

Be critical of your

environmentSpeed is key Have fun

5/2/14

Recommended reading

- Lean Startup by Eric Reis- Early Exit by Basil Peters- Startup Nation by Saul Singer and Dan Señor- Venture Deals by Brad Feld

Blogs:- feld.com- avc.com- Open View Ventures blog- Hacker News (YCombinator)

Contact and more info

E-mail: imre@icatapult.co

LinkedIn: hu.linkedin.com/in/hildimre/

This presentation available at:

http://www.slideshare.net/hildimre