NCIIA Steve Blank Keynote 032312

Crossing the Rubicon:

Entrepreneurial education at the crossroads

Steve Blank

www.steveblank.com

@sgblank

http://www.steveblank.com/

We’ve learned a lot about entrepreneurship

Perhaps our curriculums should reflect what we’ve learned?

Agenda

1. What we used to believe / What we now know

2. Business Models and Customer Development

3. Class Example

4. The Evolution of the Curriculum

Part 1

What We Used to Believe

What We Now Know


There is one type of startup and entrepreneur

What We Now Know

Startup

Lifestyle Startups Work to Live their Passion

• Serve known customer with known product

• Work for their passion

Small BusinessStartup

Small Business StartupsWork to Feed the Family

• Serve known customer with known product

• Feed the family

Small BusinessStartup

Exit Criteria- Business Model found- Profitable business- Existing team< $500K in revenue- Not venture-backable

Small Business StartupsWork to Feed the Family

• known customer known product

• Feed the family

Large Non-Profit

Social Startup

Social Entrepreneurship Startups

• Solve pressing social problems• Social Enterprise: Profitable• Social Innovation: New Strategies

• Not venture-backable

ScalableStartup

Large Company

Scalable StartupBorn to Be Big

Goal is to solve for: unknown customer and

unknown features

Search Execute

ScalableStartup

Large Company

Scalable Startup

Goal is to solve for: unknown customer and

unknown features

Search Execute

Exit Criteria- Business model found- Total Available Market > $500m- Can grow to >$100m/year- Can be Venture capital funded

ScalableStartup

$2 to $50M Acquisition

Buyable Startup

Goal is to solve for: Internet, Mobile, Gaming Apps

Search Sell

- Sell to larger company- Angel or early stage VC

Transition Large Company

ScalableStartup

Sustaining Innovation

• Existing Market / Known customer• Known product feature needs

Large Company Sustaining InnovationInnovate or Evaporate

Large Company Disruptive Innovation

New Division Transition Large

Company

Disruptive Innovation• New Market• New tech, customers, channels

Large Company Disruptive Innovation

New Division Transition Large Company

Disruptive Innovation• Build• Partner• Acquire - IP - Talent - Product - Customers - Business


Startups are About Vision & Ideas

What We Now Know

Most visions are hallucinations


Startups are a Smaller Version of a Large Company

What We Now Know

Startups Search Companies Execute


Strategy

Start With an Operating Plan and Financial Model

All I Need to Do is Execute the Plan

All I Need to Do is and Make the Forecast

All I Need to Do is Execute the Plan

What We Now Know

Strategy

No Business Plan survives first contact with customers

Planning comes before the plan

Business Models

Business Models

Business Model Hypotheses

Search

Strategy

Execution

Operating Plan +Financial Model


Process

We Built Startups by Managing Processes

Product Management

+

Waterfall Engineering

Product Introduction Model

Concept/Seed

Round

Product Dev.

Alpha/Beta Test

Launch/1st Ship

Tradition – Hire Marketing

Concept/Seed

Round

Product Dev.

Alpha/Beta Test

Launch/1st Ship

- Create Marcom Materials- Create Positioning

- Hire PR Agency- Early Buzz

- Create Demand- Launch Event- “Branding”

Marketing

Tradition – Hire Sales

Concept/Seed

Round

Product Dev.

Alpha/Beta Test

Launch/1st Ship




• Build Sales Organization

Marketing

Sales• Hire Sales VP• Hire 1st Sales Staff

Tradition – Hire Bus Development

Concept Product Dev.

Alpha/Beta Test

Launch/1st Ship




• Hire Sales VP• Pick distribution Channel

• Build Sales Channel / Distribution

Marketing

Sales

• Hire First Bus Dev

• Do deals for FCSBusiness Development

Tradition – Hire Engineering

Concept Product Dev.

Alpha/Beta Test

Launch/1st Ship




• Hire Sales VP• Pick distribution Channel

• Build Sales Channel / Distribution

Marketing

Sales

• Hire First Bus Dev

• Do deals for FCSBusiness Development

Engineering • Write MRD

• Waterfall • Q/A • Tech Pubs

Customer Problem: known

Product Features: known

Waterfall / Product ManagementExecution on Two “Knowns”

Requirements

Design

Implementation

Verification

Maintenance

Source: Eric Rieshttp://startuplessonslearned.blogspot.com

Customer Problem: known

Product Features: known

Waterfall / Product ManagementExecution on Two “Knowns”

Requirements

Design

Implementation

Verification

Maintenance

Source: Eric Rieshttp://startuplessonslearned.blogspot.com

What We Now Know

Strategy

More startups fail from a lack of customers than from a failure of product development

Startups go from failure to failure

Startups go from failure to failureThe ones that win are those that

learn from failure

Customer Development


Strategy

Process Customer &Agile Development


Product Management& Waterfall

Development

Search Execution


Organization

Hire and Build a Functional Organization

What We Now Know

Organization

Founders run a Customer Development Team

No sales, marketing and business development


OrganizationCustomer

Development Team, Founder-driven

Customer Development,Agile Development


Product ManagementAgile or Waterfall Development

Functional Organization by Department

Search Execution

Strategy

Process


Education

Entrepreneurial Education was about execution

Entrepreneurial Education was about execution

What We Now Know

Education

Entrepreneurial Education begins with the Search for a

business model


Strategy

Organization Customer DevelopmentTeam, Founder-driven

Process Customer Development,Agile Development

Education Creativity/Innovation, Business Model Design, Customer Development, Startup team building,

Entrepreneurial Finance, Agile Development, Customer Funnel:

Get/Keep/Grow Market




Organizational Behavior, HR Mgmt, Accounting,

Modeling, Strategy, Operations, Leadership,

Marketing, Manufacturing

Search Execution

Putting Search first is a radical change

It’s not just one more methodology


Instructional Strategies

Cases and a Business Plans were good entrepreneurial teaching tools

Cases and a Business Plan were good teaching tools

What We Now Know


~100 GOOTB connections

Experiential Immersion

Team-based Simulations

73

Business Model Patterns Replace Cases

Nespresso machines

retail mailorder

Nespresso.com

callcenter

Nespresso

stores

households

business

1 x machinesales

repetitive pod sales

distribution channels

coffeeproduction

facilites

production B2C distribution brand

marketing

brandpatents

machine

manufacturer

production

B2C

distributionbrand

marketing

Nespresso club

brandbrand

Nespresso pods

Business Model Competitions Replace Business Plan Competitions

Business Model Competitions Replace Business Plan Competitions

http://www.businessmodelcompetition.com/

Now imagine these classes virtual and networked independent of location


Strategy

OrganizationCustomer DevelopmentTeam, Founder-driven


Education Business Model Design, Customer Development, Startup team building,

Entrepreneurial Finance, Agile Development,

Marketing


Experiential, constructivist, learner-centered,

inquiry-based

Search







Case, Lecture, Small Group, Mentorship

Execution

Classes on Entrepreneurial Execution Follows Search


Strategy





Marketing


Experiential, constructivist, learner-centered, inquiry-

based

Search


StrategyOperating Plan +Financial Model







Marketing





Experiential, constructivist, learner-centered, inquiry-

based

Case, Lecture, Small Group, Mentorship

Search Execution

Part 2

Business Models and


What’s A Company?

What’s A Company?

A business organization which sells a product or service in exchange for revenue

and profit

What’s A Startup?

A temporary organization designed to search

for a repeatable and scalable business model









A Startup aims to become a company

How Are Companies Organized?

How Are Companies Organized?

Companies are organized around Business Models

What’s a Business Model?

What’s a Business Model?

Value Proposition

What Are You Building and For Who?

What About My Idea/Technology?

What About My Idea/Technology?

Your idea/ technology is one of the pieces necessary to build a company.

It is part of the “Value Proposition”

Customer Segments

Who Are They?

Why Would They Buy?

What Job are They Trying to Get Done?

Channels

How does your Product Get to Customers?

Customer Relationships

How do you Get, Keep and Grow Customers?

Revenue Streams

How do you Make Money?

Key Resources

What are your most important Assets?

Key Partners

Who are your Partners and Suppliers?

Key Activities

What’s Most Important for the Business?

Cost Structure

What are the Costs and Expenses

images by JAM

CANVAS OVERLAYOFFER

CHANNELS

CUSTOMER RELATIONSHIPS

CUSTOMERSEGMENTS

REVENUE STREAMSCOST STRUCTURE

KEYACTIVITIES

KEYPARTNERS

KEYRESOURCES

But,Realize They’re Hypotheses

9 Guesses

Guess Guess

Guess

Guess

GuessGuess

Guess

GuessGuess

building block

building block

building block

building block

building block buildin

g block

building block

building block

building block

building block

building blockbuildin

g block

building block

building block

Business Model Canvas



The Process for Turning Hypotheses Into Facts

The Four Steps – The Startup Path



Test the Problem, Then the Solution

Hypotheses Testing and Insight


The Pivot

Customer Development is how you search for the model

CompanyBuilding

Customer Creation

Execution

Customer

Discovery

Customer

Validation

Pivot

Search

Customer Discovery

Web/Mobile Versus Physical

• Web/Mobile startups run faster

• Different process steps for web vs. physical

• Customer Relationships are radically different

Customer

Discovery

Customer

Validation

Pivot

Customer Discovery

Customer Validation

Customer Validation

Part 3

How Does this Really Work?

How Does This Really Work?

Lean LaunchPad Class

8 Weeks From an Idea to a Business


Strategy

Organization Customer DevelopmentTeam, Founder-driven



Entrepreneurial Finance, Agile Development, Marketing


Experiential, constructivist, learner-centered,

inquiry-based

Search

This Class

dentalOptics

Amit Desai, Aaswath Raman, Ashwin Madgavkar, Alok Vasudev

Interviewed: 72 people

Final Presentation

Revolutionizing dental diagnostics through non-invasive imaging

dentalOptics

The A-Team

Ashwin Madgavkar

MBA/M.S.

BCG, UT Austin

Amit Desai

Ph.D., Mat. Sci

Cambridge, NC State

Aaswath Raman

Ph.D., App. Physics

Microsoft, Harvard

Alok Vasudev

Ph.D., EE

UT Austin

Mentor: Ethan Bloch

dentalOptics

Dental lighting is ripe for innovation

dentalOptics

Original Idea : Inside-Out Dental Lighting

Bring the light-source inside the mouth

Provide better, more consistent illumination

dentalOptics

Overview

I. Understanding our Customers

II. Finding Customer & Value Proposition Fit

III. Building the Business: Channels, Partners & Regulators

IV. Introducing.. periOptics

dentalOptics

Overview





dentalOptics

Version 0 The A-Team

• Dentists• Hygienist

s• Specialist

s

• Chains• Dental

schools• Hospitals

• Improved diagnostics

• Better customization

• Superior patient experience

• Lower price

• Personal service

• Training & demos

• Direct sales

• Trade shows

• Dental schools

• Product sales• Licensing (physical &

IP)• Accessory sales

• Manufacturers

• Resellers

• Distributors

• Marketers

• Trade organizations

• Prototyping• Design• Manufacturin

g• Marketing• Sales• Service

• Stanford• IP• Human• Our

network

• Human resources• Manufacturing• Marketing• Sales

• Compliance• Warranties

& support• Legal

dentalOptics

Getting out of the building

dentalOptics

Three major dentist archetypes

Care providers

“Bentley” dentists

“Chain” dentists

Most typical dentist• Primarily concerned with patient care• Worried about costs• Optimizes lifestyle and income

Uses technology to up-sell additional procedures• Typically in high-income areas• State-of-the-art facilities and technologies• Early adopter of dental devices

Equipment handled by purchasing department• Uses financial metrics to make decisions• Technologies standardized across all offices

dentalOptics



s• Specialist

s






• Lower price



• Direct sales

• Trade shows

• Dental schools



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

Hypotheses Tested:

• Intra-oral lighting provides value for all dental professionals

• Channels

dentalOptics

Immediate changes• Current lighting was satisfactory for most uses

• However dentists expressed interest in better lighting for particular sets of procedures

dentalOptics

Immediate changes• Current lighting was satisfactory for most uses

• However dentists expressed interest in better lighting for particular sets of procedures

• Redid customer segmentation:

Segment by Procedure Length

dentalOptics



s• Specialist

s






• Lower price



• Direct sales

• Trade shows

• Dental schools



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

dentalOptics

Version 0+ The A-Team




• Lower price

• Reduced time

• Product sales• Licensing (physical & IP)• Accessory sales

• Manufacturers

• Resellers

• Distributors

• Marketers


• Prototyping• Design• Manufacturing• Marketing• Sales• Service

• Stanford• IP• Human• Our network


• Compliance• Warranties &

support• Legal

• Procedure length

- Short- Medium- Long

• Direct sales

• Trade shows

• Distributor



• Continuing education

dentalOptics





• Lower price

• Reduced time



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal



• Direct sales

• Trade shows

• Distributor




Hypothesis Tested:

• Lighting needs differ based on procedure length

dentalOptics

Procedure length learnings

Procedure length

Long (> 2 hrs)

Moderate (1-2 hrs)

Short (< 1 hr)

dentalOptics


Procedure length

Long (> 2 hrs)

Moderate (1-2 hrs)

Short (< 1 hr)

Anesthesia

Patient comfort / movement no longer an

issue

Surgical microscope Loupe light Clamps

Existing lighting solutions

dentalOptics


Procedure length

Long (> 2 hrs)

Moderate (1-2 hrs)

Short (< 1 hr) Root canals Crack detection Color matching

Identified key procedures:

Done by all dentists

Lighting critical

Segment by Procedure Type

dentalOptics





• Lower price

• Reduced time



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal



• Direct sales

• Trade shows

• Distributor




dentalOptics




• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor






• Reduced procedure time

• Procedure type

- Root canal- Crack detection- Color matching

dentalOptics

$200 MM/yr US market size

• 180,000 dentists • 2300 visits per year

average• Consumable for each

patient• ~$5 cost per consumable• 10% of visits• $0-100 cost per tool• 20% of dentists

$25 B dental equipment industry

Source: US BLS, ADA, dentist interviews, industry research

$200 M serviceablediagnostic tool

market

TAM: $2B

dentalOptics

$200 MM/yr US market size

• 180,000 dentists • 2300 visits per year

average• Consumable for each

patient• ~$5 cost per consumable• 10% of visits• $0-100 cost per tool• 20% of dentists

$25 B dental equipment industry

Source: US BLS, ADA, dentist interviews, industry research

$200 M serviceablediagnostic tool

market

TAM: $2B

Consumables are key

dentalOptics


• Product sales• Licensing (physical & IP)• Accessory sales• Consumable sales

• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor







• Procedure type


Key Learning:

• Consumable component drastically improves revenue potential

dentalOptics

Overview





dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor







• Procedure type


Hypothesis Tested:

• Lighting needs differ based on procedure type

dentalOptics

Segmenting by Procedure Types

Color matching

Crack detection

Root canal

More natural light

Multiple teeth at once

Increased visibility in tight spaces

Dentists

Reduce procedure time

ProcedureIntra-oral light

benefit

Improve Diagnostic Capability

dentalOptics

Best response: Transillumination

Color matching

Transillumination for Cracks

Root canal

Proactive detection vs. waiting for patient pain

Multiple teeth at once

Track crack/defect progress

Dentists

Reduce procedure time

ProcedureIntra-oral light

+ imaging benefit

Improve Preventative Diagnostic Capability

Drive patient loyalty and return visits

dentalOptics

Prototyping

Transilluminated tooth using fiber or LED source

dentalOptics

Prototypes

dentalOptics

Form & Function

formfunction

dentalOptics

Physical prototypes help!• Handing dentists a crude clay mockup got us better, more

actionable feedback

• A great way of gauging whether new functionality satisfies a need

dentalOptics

Interest, but not excitement

Dentists generally liked the prototype Key Takeaways

1

2

3

4

5

Imaging back teeth is essential

Market would be somewhat limited / niche

Dentist #

Interest in prototype

None Very PositiveNeutral

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor







• Procedure type


Hypothesis Tested:

• Lighting needs differ based on procedure type

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor




• Crack detection


• Improve preventative diagnostics

• Increase # of procedures

• Provide a patient record

dentalOptics

We were tipped off to a potentially larger diagnostic market:

Keeping our ear to the ground..

dentalOptics

“This would be a game changer!”

“A new standard of care”

Non-invasive gum disease detection

We were tipped off to a potentially larger diagnostic market:

Keeping our ear to the ground..

dentalOptics

This should get poked into your gums 192 times during a dental visit

…there must be a better way

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor




• Crack detection





Customer Insight:

• Periodontal imaging could be a larger market

• Periodontal imaging

dentalOptics

Periodontal care right nowConsiderable undertreatment

70% of offices don’t regularly do a full probe test of all teeth! Time & effort

50% of US population has mild-severe periodontitis, only 5-10% of are treated

“The number-one reason dentists are sued is failure to diagnose periodontal disease”*

30% of patients don’t feel the need for the recommended treatment*

Increases with aging population

*K. Esler, Sidekick (2009)

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor




• Crack detection






Hypothesis Tested:

• Periodontal imaging is of greater interest to dentists

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor




• Crack detection

• Accuracy

• Reduced time

• Patient comfort


• Improve records

• Patient education

• Reduced malpractice

• Periodontal imaging✔

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows

• Distributor





• Manufacturers

• Resellers

• Distributors

• Marketers


• Insurance companies

• Accuracy

• Reduced time

• Patient comfort


• Improve records



New hypothesis:

• Insurance companies could be strategic partners

dentalOptics

Overview





dentalOptics






network



& support• Legal

• Direct sales

• Trade shows

• Distributor





• Manufacturers

• Resellers

• Distributors

• Marketers



• Accuracy

• Reduced time

• Patient comfort


• Improve records



Hypotheses Tested:

• Insurance companies would embrace this technology

• FDA compliance is not prohibitive

dentalOptics

Key Partner: Insurance

“Periodontal probing is the single most inaccurate piece of data we get from dentists. Fraud and abuse are common”

Largest dental insurance provider in California

dentalOptics

Key Partner: Insurance

“Periodontal probing is the single most inaccurate piece of data we get from dentists. Fraud and abuse are common”

Dental Policy Committee • Meets regularly to evaluate new technologies• Determines which technologies will be added to annual

contracts based on efficacy and cost savings to insurance company

Willing to recommend use of new technologyNeed more clinical data, but are enthusiastic about the idea!

Largest dental insurance provider in California

dentalOptics

What we make

DentistDentalOptics

~$2000

Device cost (one time)

~$2.50 per patient

Disposables

dentalOptics

What the dentist normally makes

Dentist Patient

Insurance

Co-pay

Membership

$250

$250

Equipment / Variable Costs

Note: Assumes 50/50 copay-insurance split

dentalOptics

What we’d add for the dentist

Dentist PatientDentalOptics

Insurance

Co-pay

Membership

~$2000

$250

Device cost (one time)

$250

~$2.50 per patient

Disposables

Equipment / Variable Costs

Device creates

additional periodontal procedures

Note: Assumes 50/50 copay-insurance split

dentalOptics

Three classes of FDA Devices

Class I(eg, dental pick,

gloves, toothbrush)

Class II(eg, dental fillings,

ceramics, drills)

Class III(eg, stent,

implantable pacemaker)

Criteria FDA Requirements

Minimal health and safety risks, established precedent

Need to register with FDA but not get approval before putting it on the market

Presents safety and health risks that aren't completely controlled by GMP (good manufacturing processes)

Submit 510-K application to FDA, include detail about device, marketing materials, device safety features, and other paperwork

Invasive, inflammable, or presents other significant significant safety risks. Often times a new type of device

Very thorough process similar to drug approval. Requires clinical trails and mountains of paperwork

dentalOptics

Some regulatory riskDevice key risk:

misdiagnosisProxy suggests our

device will be class II

Intra-oral, non-invasive laser light caries (tooth decay) detector

Approved as class II medical device. Clinical tests conducted to prove accuracy

Device carries little direct risk• Intra-oral, non-invasive

probe • Uses non-harmful

wavelengths of radiationKey risk: misdiagnosis• Clinical evidence required to

establish efficacy

Source: Iowa Dental Supply

dentalOptics

Class II FDA approval process

• Construct device prototype

• Determine device diagnostic capabilities

• Begin FDA 510(k) documentation

• Enroll 1-2 periodontists in preliminary efficacy study

Feasibility study

0 18

93 6 12

15

Month

Class II device FDA trials and approval

• Determine predicate device(s)

• Enroll 4-7 sites and 10+ periodontists in study

• Fix critical end-points based on device capability (eg, 1 mm measurement error)

• Submit 510(k) to FDA and obtain approval

$200 K

30 patients

$200 - 400 K

200-400 patients

$1,000 – 2,000 K

1000-2000 patients

Without a predicate

Costs

Trial Size

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal





• Manufacturers

• Resellers

• Distributors

• Marketers



✔✔

• Direct sales

• Trade shows

• Distributor

• Accuracy

• Reduced time

• Patient comfort


• Improve records



Hypotheses Tested:

• Insurance companies would embrace this technology

• FDA compliance is not prohibitive

dentalOptics






network



& support• Legal

• Direct sales

• Trade shows

• Distributor





• Manufacturers

• Resellers

• Distributors

• Marketers



• Accuracy

• Reduced time

• Patient comfort


• Improve records



Question asked:

• How do we sell our product?

dentalOptics

Private PracticeDentist

PurchasingDepartment

Big Distributors

InstitutionalDentist

Direct Sales

Channels

dentalOptics



Big Distributors


Direct Sales

Channels

80% Market Share30% Margin

dentalOptics



Big Distributors


Direct Sales

Channels

80% Market Share30% Margin

ContinuingEducationCourses

Magazines& Email

TradeShows

dentalOptics






network



& support• Legal

• Direct sales

• Trade shows

• Patterson/Schein





• Manufacturers

• Resellers

• Schein/Patt.

• Marketers



• Accuracy

• Reduced time

• Patient comfort


• Improve records



dentalOptics






network



& support• Legal

• Direct sales

• Trade shows






• Manufacturers

• Resellers

• Distributors

• Marketers



Hypothesis Tested:

• Value Propositions are strong enough to sell products

• Accuracy

• Reduced time

• Patient comfort


• Improve records



dentalOptics

Our Sales Pitch

dentalOptics

Patient experience is key

• Accuracy• Reduced time• Patient comfort• Patient education• Reduced malpractice exposure• Up-sell procedures• Improved record keeping

☐

Value Props

Cost Props$1000 $2000 $8000

“I’d write you a check today!”

“This seems reasonable”“We would have the discussion”

“It would be cost prohibitive”

Per patient consumable cost < $5

dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows






• Manufacturers

• Resellers

• Distributors

• Marketers



• Accuracy

• Reduced time

• Patient comfort


• Improve records



dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows






• Manufacturers

• Resellers

• Distributors

• Marketers



• Accuracy

• Reduced time

• Patient comfort

• Improved records


dentalOptics



• Manufacturers

• Resellers

• Distributors

• Marketers





network



& support• Legal

• Direct sales

• Trade shows






• Manufacturers

• Resellers

• Distributors

• Marketers



• Accuracy

• Reduced time

• Patient comfort

• Improved records


dentalOptics

dentalOptics

dentalOptics

dentalOptics

periOptics

dentalOptics

Our Product: periOptics

dentalOptics

Our Product: periOptics

$2000 per unit$2.50 per silicone sleeve

Distributed through:Patterson Dental & Direct

Imaging Resolution:< 1mm

dentalOptics

$400 MM annual total addressable market for Periodontal Diagnostic Device

Device sales Consumables Total0

50

100

150

200

250

300

350

400

450$400 MM

$320 MM

$75 MM

• Device cost - $2000• Amortized over 4 years

• $2.5 consumables per patient

• 128 MM patients per year

Total addressable market ($MM)

Source: Department of Health and Human Services

dentalOptics

Growth Plan

Feasibility study

Month


$300 K $1.5-2 MCosts

Regulatory

ProductDevelopmentScale-up Preparation

Early Prototype Dev.

Planning with Manufacturers

Product Cycle I Product Cycle II

0 24

6 12

18

dentalOptics

Growth Plan

Feasibility study

Month


$300 K $1.5-2 MCosts

Regulatory

ProductDevelopmentScale-up Preparation

Early Prototype Dev.

Planning with Manufacturers

Product Cycle I Product Cycle II

$500*

Unit Economics

Cost of Goods

Margin

$900 $600

Distributor

Revenue

Cost to Dentist:$2000

*At scale: 10K units

0 24

6 12

18

dentalOptics

Next Step: Evaluate Technical Options

Optical Acoustic

function

dentalOptics

Lessons Learned

Physical prototypes engage potential customers

Consumables are key to revenue models in dental devices

Listen to your customers for new directions

Caregivers don’t think exclusively like businesspeople: the patient experience is paramount

“Hi, I’m a Stanford student…” gets you a conversation with pretty much anyone

Lean LaunchPad – Student Selection• Students apply as a team

– Their application is their business model canvas– Interdisciplinary business and engineering teams

• We select for teams, not ideas

Lean LaunchPad - Class Organization• Teams present every week

– Teaching team critiques

• Teams spend tens of hours outside the classroom– They keep a blog of their customer discovery

• Lectures are minimalist• Syllabus and slides on-line

Example of a Lean LaunchPad Team Blog


National Science Foundation


National Science Foundation

We’ll Teach ~175 Teams in 2012

Part 4

The New Entrepreneurship Curriculum

This is Not about One Class

It Changes Everything

It Changes Everything

Undergraduate/GraduateTechnology Startups, Small Business Startups,

Corporate Entrepreneurship

How?

Building the New Curriculum

Step 1:Decide what type of Entrepreneurship

you’re teaching

Step 1:Decide what type of Entrepreneurship

you’re teaching

Small business? Social? Scalable? Buyable? Corporate?

Step 2:Embrace Search Versus Execute

Step 2:Embrace Search Versus Execute

It drives the new curriculum

Step 3:Start By Teaching the

Business Model Canvas

Step 3:Start Teaching the Canvas

It’s the basics for “hypotheses”

Step 3:Start Teaching the Canvas

Undergrads to graduates

Step 4:Start Teaching Customer Development


It’s the basics for “search”


Level of intensity can vary – but getting out of the classroom is the key

Step 5:Move Teaching the Plan


Operating Plans come after the search


Business Plan competitions do not teach real-world skills

Step 6:Teams are more important then the

idea

Step 6:Teams are more important then the

idea

Teach Teamwork via immersion and simulation

Step 7:Get Your Classes On-line

Step 7:Get Your Classes On-Line

This is the year this stuff works

Step 8:Once On-line – Network the Students

We’re Building an E-School

We’re Building an E-School

Our Own Entrepreneurship Curriculum, not a derivative

ScalableStartup

Large CompanyTransition

Business School

Business School Versus Entrepreneurship School

Courses- Managerial Finance/Accounting- Managing Groups and Teams- Financial Accounting- Operations- Modeling for Optimization- Global Value Chain Strategies

ScalableStartup

Large CompanyTransition

Business School Versus Entrepreneurship School

Entrepreneurship School

- Creativity and Innovation- Business Model testing- Customer Development- Agile Development- Startup Metrics- Operating plans & Financial Models

Business School

-Managerial Finance/Accounting- Managing Groups and Teams- Financial Accounting- Operations- Modeling for Optimization- Global Value Chain Strategies

Why Do We Do This?

Make Your Lives Extraordinary