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smart city expo 2014 Valto Loikkanen
Grow VC Group ++ www.growvc.com ++
@growvc ++
Copyrights © Grow VC Group 2014
As an Entrepreneur● 20 years as international Serial Entrepreneur (US, EU, Asia) &
Portfolio Entrepreneur, with personal hard earn success & failures● 17 years experience in developing web based tools for various
business processes● 6 Years of developing equity crowdfunding model globally via Grow
VC Group (scaling access & availability of risk funding)● 5 years for Startup Ecosystem online support tools, platforms &
metrics● Past year, being part of three Horizon 2020 Groups: Access to Risk
Finance, Widening participation and International Cooperation
As a Business Advisor● 10 years of startup mentoring with over 2000 one to one mentoring
sessions and workshops with 1000+ entrepreneurs and hundreds of startups around the world at various development stages and industries
● 10 years developing Startup Support services, with entrepreneurial mind and lean methodology (fast ideation, implement and measure cycle)
● 5 years of “living lab” development for Startup Ecosystem in Finland with City of Helsinki
About Grow VC Group"The global pioneer of securities crowdfunding, peer to peer marketplaces and new investment models."
Other Business VerticalsReal estate, P2P loans etc.
Consulting & knowledge Services
Local Investors
Startups
Startup Ecosystem
Global Investors
Enable online investment platforms and marketplaces
Online infrastructure to manage and measure startup ecosystems
Other Business VerticalsReal estate, P2P loans etc.
Consulting & knowledge Services
Local Investors
Startups
Startup Ecosystem
Global Investors
Enable online investment platforms and marketplaces
Online infrastructure to manage and measure startup ecosystems
Research IPR
Innovation via Big Companies & Public
Sector.
Closed process & Internal resources
Innovation by Startups
FundingSources
Innovation Ecosystem
Customers
Innovation process is moving away from “closed structures” and big companies to more open and
collaborative startup ecosystem.
Megatrend
Research IPR
Innovation via Big Companies &
Public Sector.
Closed process & Internal resources
Innovation by
Startups
Research IPR
Innovation via Big
Companies & Public Sector.
Innovation by Startups
Open, collaborative &
external resourcesFundingSources
Service Providers
SupportOrganizations
FundingSources
New Funding Solutions
Innovation Ecosystem
Startup Ecosystem
Customers
Customers
Research IPR
Innovation via Big Companies & Public Sector.
Innovation by Startups
Open, collaborative & external resources
FundingSources
Service Providers
SupportOrganizations
New Funding Solutions
Startup Ecosystem
Customers
Why this megatrend?● The megatrends of innovation is focusing more and more around startups ● The old world is about ideas, research and big companies creating the
innovation (products and services from these).● The old models is already working at it’s best and is difficult to improve - as
such, little growth can be achieved in that area ● The new world is about making the innovation happen via Startups, where
innovation is also more openly and independently exposed to markets● Startups are “outsourced innovation” for big companies and biggest group
generating new jobs● Startups are fast, flexible, highly motivated, cost effective and supported by
private and public parties● The big companies themselves are moving away from traditional innovation
models towards more open innovation and working with and buying most promising startups after they have validated scalable innovation.
● To new growth ambition startup creation ● Pre-startup and early stage startup support
services● get more research, inventions, ideas and
other IPR to be utilized by startups
Focus
“Over the last twenty five years, almost all of the private sector jobs have been created by businesses
less than five years old.”
“Between 1988 and 2011, companies more than five years old destroyed more jobs than they created in all
but eight of those years.”
Startup“A startup company or startup is a company or
temporary organization designed to search for a repeatable and scalable business model”
http://en.wikipedia.org/wiki/Startup_company
Startup“The only essential thing is growth. Everything else we associate with startups follows from
growth.”
http://en.wikipedia.org/wiki/Startup_company
A B
C D
High Growth Ambition and very scalable business model
Low Growth Ambition and/or Non Scalable business
Market validated business
model
Unvalidated business model
"a kiosk"
"new startup"
“New Startup”
http://en.wikipedia.org/wiki/Startup_company
Startup Development?
ScaleProduct Market Fit
Gro
wth
Time
Ideation
Scalable product or service idea for a big enough target market. Some initial business models for how it would make money. One person or only a vague team; no confirmed commitment or no right balance of skills in the team structure yet.
Concepting
Clear and meaningful target with direction for at least 3 years with milestones how to get there, -> 3, 6, 12, 24, 36 months… Team of two or three core founding partners with balanced ownership. Can also already have some extended team with lighter commitment (stock options and or cash compensation)
Commitment
Committed and balanced founding team. Able to develop the product or service (Minimum Viable Product) without dependency of uncommitted external resources, or already an initial product or service in place. Existing signed shareholder agreement between founders, with milestones, committed time and money use, for at least 2+ years with vesting.
Validation
Can demonstrate some user growth and or revenue (initial traction). Continue to attract additional resources (money or sweat equity) for equity or future revenue. Looking for clear market validation (Product Market Fit), to move into scaling.
Scaling
Showing a clear, growing and measurable user and or market traction in a big or rapidly growing target market. Can and wants to scale fast. May have attracted significant funding.
Establishing
Achieved great growth, that can expected to continue. No longer needs to struggle to get resources and can acquire those easily. Continues to grow and often wants to culturally continue behaving like a "startup" for as long as possible. Founders exit or continue business as usual.
Minimum Viable Product (MVP)
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License.To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/
or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
Startup Key StagesBy www.startupcommons.org
Vision & Mission
-2 -1 0 21 3
Target
Startup EcosystemA startup ecosystem is formed by people, startups in their various stages and various types of organizations in a location (physical and/or virtual), interacting as an organic system to create new
companies.
Different organizations typically focus on specific parts of the ecosystem function and/or startups at their specific development
stage(s).
Learn more: http://www.startupcommons.org/understanding-startup-ecosystems1.html
Startups & Ecosystems
Startups develop in startup ecosystems through the development phases in constant interaction with
various organizations, services & people.
The more dynamic, transparent and balanced the ecosystem is the more successful startups ecosystem
can create.
Challenge was● Not enough (high) growth companies in Finland● Growth services were a total mess● Growth potential or stage was not systematically
identified● Angel investing was not systematically organized● Poor investment readiness● Ecosystem concept and understanding as a whole was
missing● ROI at single service and ecosystem level is unclear
Level 1: Identify problem● Growth potential and development phases should be
systematically identified● Need more high growth companies to Helsinki● Clear guidance to right growth paths● Matching growth potential with most fitting services,
people and accelerators should be systematically coordinated
● Improved investment readiness● Ecosystem should be visualized to be understood
Level 2: Take action ● Make Startup development phases more broadly used
as "canvas" for ecosystem service design● Get common terminology more broadly to be used● Identify service gaps and development new services to
fix them● Improve ecosystem level understanding and
communications among the ecosystem parties● Define handovers between services and iteratively
improve● Implement online ecosystem infrastructure to BETA use
Level 3: Finalize and start iterating● Common metrics identified● Ecosystem IT infrastructure in use● Metrics implementation ● Metrics in use and shared with the ecosystem● Iterative ecosystem development and validation by
metrics
Midterm results● Less unknown● Silos are braking● ROI becomes more measurable and understandable
target● Growing supply of “investment ready” startups● more new companies creating jobs and attracting
international investments into region
Three steps of ecosystem development
1. map out starting position 2. Identify and fix gaps and bottlenecks 3. implement measurements
Iteratively improve; measure and learn
With help of key stages tool
● Map out ecosystem services○ Public & Private
● Describe ecosystem target● Label items;
○ startups, services, events, funding instruments, blog posts, tools, ideas, suggestions, etc.
ScaleProduct Market Fit
Gro
wth
Time
Ideation
Scalable product or service idea for a big enough target market. Some initial business models for how it would make money. One person or only a vague team; no confirmed commitment or no right balance of skills in the team structure yet.
Concepting
Clear and meaningful target with direction for at least 3 years with milestones how to get there, -> 3, 6, 12, 24, 36 months… Team of two or three core founding partners with balanced ownership. Can also already have some extended team with lighter commitment (stock options and or cash compensation)
Commitment
Committed and balanced founding team. Able to develop the product or service (Minimum Viable Product) without dependency of uncommitted external resources, or already an initial product or service in place. Existing signed shareholder agreement between founders, with milestones, committed time and money use, for at least 2+ years with vesting.
Validation
Can demonstrate some user growth and or revenue (initial traction). Continue to attract additional resources (money or sweat equity) for equity or future revenue. Looking for clear market validation (Product Market Fit), to move into scaling.
Scaling
Showing a clear, growing and measurable user and or market traction in a big or rapidly growing target market. Can and wants to scale fast. May have attracted significant funding.
Establishing
Achieved great growth, that can expected to continue. No longer needs to struggle to get resources and can acquire those easily. Continues to grow and often wants to culturally continue behaving like a "startup" for as long as possible. Founders exit or continue business as usual.
Minimum Viable Product (MVP)
This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License.To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/
or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.
Startup Key StagesBy www.startupcommons.org
Vision & Mission
-2 -1 0 21 3
Target
-2 -1 30 21
Public services & funding
Private service providers & investors
Supporting Startup Development
Startup Knowledge - Money & Connections
-2 -1 30 21
Business idea
Team
Online Communities and tools on connected platform (Startup Commons)
Business
Com
pany
-2 -1 30 21
Business idea
Team
Private Advisory: Multiple advisors
In search of co-founders
SHA Workshop
Group Advisory
Private Advisory: One advisor
Pitch Training & feedback
General networking
In search of team members
Startup Info (stages & service matching)
Company registration, VAT etc. basics advisory
Co-working space and pop up advisory
Pitching events: for advisors, funding, sweat equity & visibility
Recruiting support & advisory
Biz Model Canvas
MVP & metrics workshop
Customer Development
Online Communities and tools on connected platform (Startup Commons)
Business
Com
pany
Random events, meetups & presentations in the ecosystem
Media as a Service
Marketing ServicesMarketing Workshop
Subsidised specialist grants (UX, design etc. etc.)
Sales as a Service
Subsidised specialist grants (accounting, legal etc.)
Startup Weekend etc.
Accelerator Bootcamps
Public sector as a customer
Business Idea Potential
More PotentialBig MarketMarket growingMarket pullScalable
Less PotentialSmall market
Market shrinkingMarket PushNot scalable
Team Validation
More PotentialGood TeamBalanced SkillsCommittedDoer AttitudeRight Culture
Less PotentialSolo Entrepreneur
Uneven SkillsNot committedTalker AttitudeWrong Culture
A B
C D
High Growth Ambition and very scalable business model
Low Growth Ambition and/or Non Scalable business
Market validated business model
Unvalidated business model
"a kiosk"
New Startup at Stage 0
Startup
Early Startup at Stage 2
A B
C D
High Job Creation Potential (need of people)
Low Job Creation Potential
Low Demand PotentialVery few and/or low paying
limited region customers
High Demand Potentiala lot of potential well paying international customers
No Value Idea
High Value Idea
Idea evaluation NOTE: as a public sector!
Medium Value Idea
Low Value Idea
About Metrics● Ecosystem as a funnel ● Input and output volumes of each service● Compare each service ROI separately
Other tools● Ecosystem development workshop● Development support● Mapping and agreement templates● Ecosystem IT infrastructure● Knowledge on demand (for all levels)● Library of best practices service models
● Develop startup ecosystem as a whole● Measure “everything” to learn and improve● Improve iteratively
Recap
Single most valuable tool to improve your ROI
Free to use under creative commons licence
Original www.startupcommons.org
Licence termshttp://creativecommons.org/licenses/
“When more people and organizations are developing things together, there needs to be a common language and
understanding about what is being developed.”
Valto [email protected]
+358 400 421 551 (FIN)+1 415 854-0546 (US)
Grow VC Group ++www.growvc.com ++
@growvc ++
@valto
#startupecosystem