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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
5/2/14
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
5/2/14
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
5/2/14
+ 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: [email protected]
LinkedIn: hu.linkedin.com/in/hildimre/
This presentation available at:
http://www.slideshare.net/hildimre