Startup pitch (educational material)

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<h2>Take the first step into validation of your startup idea using this Lean Canvas template</h2>

A Lean Canvas Template is a tool designed to help entrepreneurs and startups create a lean business plan that outlines the key elements of their business idea.

The Lean Canvas Template is based on the Lean Startup methodology, which emphasizes creating a flexible and adaptable business plan that can evolve over time based on customer feedback and market changes.

The Lean Canvas Template typically includes sections for defining the company&#39;s value proposition, target customer segments, key metrics, and channels for reaching customers.

It also includes sections for identifying key partners, resources, and activities needed to deliver the product or service, as well as potential revenue streams and cost structure.

Our template has also an educational purpose which is why we included many section fields to explain the process and give examples of successful businesses.&nbsp;

<h3>Who is it for?</h3>

- Startups 
- Entrepreneurs 
- Business students 
- Incubators and accelerators

Starting with this template, you can change it to suit your requirements. To make it more interactive, include more sections that are pertinent to your audience and develop quick tests and surveys. You can also include <a href="https://www.formaloo.com/en/blog/how-to-use-formaloo-logic/">conditional logic</a> and calculate the users&#39; scores after submitting the quizzes.&nbsp;

To guarantee that the app is consistent with your corporate identity, you can brand it with your company&#39;s <a href="https://www.formaloo.com/en/blog/custom-domain/">domain</a>, logo, colors, and fonts.

<h3>Features used in this template</h3>

- Multi-step form 
- Section fields 
- Long text fields&nbsp; 
- CSAT 
- upload file field

You can turn this template into an educational app and add more courses to it. You can also share <a href="https://www.formaloo.com/en/blog/how-to-create-an-online-quiz-with-auto-grading-and-answer-sheets/">quizzes</a> and <a href="https://www.formaloo.com/en/blog/online-survey-maker/">surveys</a> with your users to gather feedback or to check their progress.&nbsp;

All Formaloo templates

Most startups start with an exciting idea, but the problem is we don't know that our idea works or not. The Lean Canvas job is to show you if your idea and business make sense or not (at least on paper). This is the first step of idea validation.
The Lean Canvas tool asks you vital questions to help you form a real business case for your grand vision. This guide will lead you through these sections as you launch your startup.
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Price

Score

This is in summary: Your most important KPIs.

What activities drive your product usage and help you build strong customer relationships? Which statistics indicate how well your company is doing? What numbers best underline opportunity for development?

This should outline how you will measure success. Key Metrics allow you to track and evaluate the success of a specific business process.&nbsp;
A Key Metric could be daily visitors to your site, the number of company emails opened by consumers per hour or the monthly sales of a specific feature. Every sector of a business has specific metrics that should be monitored. Fill in this section of your lean canvas with the metrics that are most critical to the problems you’re trying to solve.
The most useful metrics provide a great deal of insight and spur short-term, low-cost action.

6. Key Metrics

Examples: - YouTube: “Flickr for video” - "Uber for X“ - "Whatsapp for Y" or "X for accountants" - "Github Meet Slack"

Do you have any high-concept pitch?

What is the name of your startup?

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Few Examples

Start with a single pricing plan Starting with multiple plans that cover everyone under the sun is a form of waste. I’ve seen startups launch with plan options targeting 1 person startups to 1000+ person enterprises.
 Not only does supporting multiple plans require you to write more code to support plan/feature segmentation, but the return on learning is diluted when you attempt to target multiple customer segments all at once. In the example above, the business models and tactics vary greatly when selling to startups than to enterprises.
 The bigger point here though is that when you’re starting out, you don’t yet have enough information to know how to correctly price or segment the feature set into multiple plans.
 Use a “Free Trial” plan Time-based trials help time-box your pricing experiments so you can force a conversion decision which allows you to learn and iterate faster.
 Pick a price to test Existing alternatives create “reference points” in the minds of customers that they will use to rank your solution so it’s important to understand and position your price against them.
In the rare cases, you are actually solving a brand new problem or don’t have clear reference points (more common in Enterprise-based products), you might have to pick a starting price out of thin air and refine from there. “
Pricing is all about setting the right perception.” - Neil Davidson, Don’t Just Roll the Dice
Take your costs into account The ultimate goal is finding a scalable business model so it should go without saying that you also need to keep an eye on what it would cost you to deliver your solution and ensure you have a healthy margin built-in.
 One rule of thumb for building a successful business is ensuring the lifetime value of your customers exceeds the cost of customer acquisition by at least a factor of three.
 It’s hard to accurately calculate these at this stage so instead do a back-of-the-envelope calculation based on your people/hardware costs and subscription revenue to find your break-even point.

"Nobody will choose you over your competitor just because you're cheaper."
- Farokh Shahabi, idearun Startup Studio Playbook

The Pricing

This is usually the hardest section to fill which is why I leave it for last. Most founders list things as competitive advantages that really aren’t.&nbsp;
"Anything worth copying will be copied."
- Jason Cohen
So imagine your co-founder steals your source code, sets up shop in Costa Rica, and slashes prices. Do you still have a business?
 You have to be able to build a successful business in spite of that which leads to the following definition:
 “A real unfair advantage is something that cannot be easily copied or bought.” - Jason Cohen, A Smart Bear

7. Unfair Advantage

How mush did you find this presentation useful?

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Amazon, early days:

Upload your filled canvas here if you want:

The good news is that following a “Customer Discovery/Interview” process forces you to build a path to customers early. Unfortunately, unless you are in a direct sales business, that path may not scale beyond Problem/Solution Fit.
 In addition to defining the right product to build, it’s just as critical to start finding, building and testing a significant path to your customers from day one.
 While there are a plethora of channel options available, some channels may be outright inapplicable to your startup, while others may be more viable during later stages of your startup.
 I typically look for the following characteristics in my early channels:

4. Channels

What are the top problems?

A lot of startups choose to defer the “pricing question” because they don’t think their product is ready. Something I hear a lot is that a minimum viable product is by definition embarrassingly minimal. How can you possibly charge for it?
 First, a minimum viable product is not synonymous with a half-baked or buggy product. Your MVP should address the top problems customers have identified as important to them. By that definition, it should deliver enough value to justify charging.
 But, there is another line of reasoning frequently cited for deferring pricing: to accelerate initial learning. The argument goes that pricing creates unnecessary friction that should be avoided early on.
 While this strategy may work (especially if you are already funded), I find that it delays testing one of the riskier and critical parts of your business model.
&nbsp;Furthermore, I have found that you don’t need a lot of users to support learning. You need just a few good customers.
 I believe that if you intend to charge for your product, it’s better to be upfront about it. It sets the right expectations, raises customer commitment, starts generating cash flow, and lets you start tackling one of the riskier parts of your business model early.
What you charge for your product is simultaneously one of the most complicated and most important things to get right. Not only does your pricing model keep you in business, but it also signals your branding and positioning. It determines your customers.
 Your price is part of your product.
 Although there is a lot of science around pricing, pricing is more art than science. Pricing is not unlike any other business model hypothesis and should be tested using the same criteria we covered earlier when building validated learning loops - create a testable hypothesis, time-box the experiment, and validate qualitatively, then verify quantitatively.

5. Revenue Streams and Cost Structure:

Costs: Problem/Solution Fit: 2 interviewers * (50 interviews * 30 min per interview) = 50 hours Effort to get ready for interviews (mockups, scripts, etc.) = 40 hours Build MVP: 2 developers * 2 weeks * 20 hours per week = 80 hours Cost to launch = 170 hours * $65/hr = $11K Ongoing People costs = 4 ppl * 10 hours per week * $65/hr = $10,400/mo Hosting costs currently $50/m
&nbsp; Revenue: Break-even point @$14/mo = $10,400K / $14/mo = 743 paying customers Break-even point @$24/mo = $10,400K / $24/mo = 434 paying customers

Example: Revenues & Costs

You most likely already have an inkling of the problem, solution, and customer in mind. Start by brainstorming the list of possible customers you envision using your product.
1. Distinguish between customers and users If you have multiple user roles in your product, identify customers. A customer is someone that pays for your product.
2. Split broad customer segments into smaller ones I&rsquo;ve worked with startups that felt the problems they are solving are so universal, they apply to everyone. You can&rsquo;t effectively build, design, and position a product for everyone. While you might be aiming to build a mainstream product, you need to start with a specific customer in mind. Even Facebook, with its now 500 million+ users started with a specific user in mind - Harvard college students.
3. Fill a Lean Canvas for each customer segment As you&rsquo;ll find shortly, the elements of your business model can and will vary greatly by customer segment. I recommend starting with the top 2-3 customer segments you feel you understand the best or find most promising.
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<h3 style="text-align: start;">Fill Multiple Lean Canvases</h3>
 In this section, I&rsquo;ll outline the process for sketching a Lean Canvas:
1. Complete a canvas in one sitting While a business plan can take weeks or months to write, your initial canvas should be sketched quickly.
2. It&rsquo;s okay to leave sections blank Rather than trying to research or debate the &ldquo;right&rdquo; answers, put something down quickly or leave it blank and come back to it later. Some elements like &ldquo;Unfair Advantage&rdquo; take time to figure out. The canvas is meant to be an organic document that evolves over time and it&rsquo;s okay to say &ldquo;I don&rsquo;t know&rdquo;.
3. Think in the present Business plans try too hard to predict the future which is impossible. Instead, write your canvas with a &ldquo;getting things done&rdquo; attitude. Based on your current stage and what you know right now, what are the next set of hypotheses you need to test to move your product forward?
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How to create your lean canvas?

Be different, but make sure your difference matters The key to unlocking what’s different about your product is deriving your UVP directly from the #1 problem you are solving. If that problem is indeed worth solving, you’re more than halfway there already.
 Target early adopters Too many marketers try to target the “middle” in the hopes of reaching mainstream customers and in the process water down their message.&nbsp;
Your product is not ready for mainstream customers yet. Your sole job should be finding and targeting early adopters who require bold, clear, and specific messaging.
 Focus on finished story benefits You’ve probably heard about the importance of highlighting benefits over features. But benefits still require your customers to translate them to their worldview. A good UVP gets inside the head of your customers and focuses on the benefits your customers derive after using your product.

So for instance, if you are building a résumé-building service:
 - a feature might be “professionally designed templates” - the benefit would be an “eye-catching résumé that stands out” - but the finished story benefit would be “landing your dream job”. 
Pick your words carefully and own them Words are key to any great marketing and branding campaign. Look at how the top luxury car brands have used a single word to define themselves:
 Performance: BMW Design: Audi Prestige: Mercedes
 Picking a few “key” words that you consistently use also drives your SEO ranking.

Answer: What, Who, and Why A good UVP needs to clearly answer the first 2 questions - what is your product and who is the customer.&nbsp;
The “Why” is sometimes hard to fit in the same statement and I’ll frequently use a sub-heading for that.
 Here are example UVPs I have used in products:
 CloudFire - Photo and Video Sharing for Busy Parents. Get back to the more important things in your life.
 USERcycle - Lifecycle Marketing Software. Turn your users into passionate customers.
 Study other good UVPs The best way to craft a good UVP is to study the UVPs of the brands you admire. Visit their landing pages and deconstruct how and why their messaging works.

Create a high-concept pitch: Most Advanced, Yet Acceptable A high-concept pitch usually builds on other familiar concepts to quickly get an idea across and make it easily spreadable. Unlike a UVP, a high-concept pitch is best used in conjunction with something else that sets the right context such as an elevator pitch.
 Examples: - YouTube: “Flickr for video” - Aliens (movie): “Jaws in space” - Dogster: “Friendster for dogs”

How to Craft a Unique Value Proposition?

Key metrics are like KPIs or Key Results in OKR. They MUST be number-based & time-bound (daily, monthly, etc.) to indicate the measurement for growth as well.

What are your most important key metrics?

Also mention if you have multiple revenue streams.

Explain the breakdown of you Revenues:

Examples: 1. In a blogging platform, the customer is the blog author while the user is a reader. 2. In a photo-sharing service, the customer is the sharer, while users are viewers (family and friends).

What User Roles will use your solution?

You may initially have to leave this box blank but it’s here to have you really think about how you can make yourself different and make your difference matter.   Some examples of unfair advantages - insider information, the right “expert” endorsements, personal authority.

What is your unfair advantage?

Inbound channels use “pull messaging” to let customers find you organically while outbound channels rely on “push messaging” for reaching customers.
 Example inbound channels: Blogs, SEO, E-books, white papers, webinars.
 Example outbound channels: SEM, print/TV ads, trade shows, cold calling.
 When you don’t yet have a tested value proposition, it’s hard to justify spending marketing dollars or effort on outbound messaging.&nbsp;
Getting “techcrunched” or seeking other forms of PR before then is a form of waste. Now might be the time to start building inroads to influencers but you are not ready to “get covered”.

Inbound versus Outbound:

First of all, there is no such thing as a free channel. Channels we normally associate as being free like SEO, social media, and blogging, have a nonzero human capital cost associated with them. Calculating their ROI is complicated because, unlike a paid channel which is used up after you pay for it, these channels keep working for you over time.
 A commonly cited paid channel is search engine marketing. Eric Ries has written about how he tested his early product on $5 a day using Google Adwords - driving 100 clicks at a CPC of 5 cents.&nbsp;
If you can pull this off today, by all means, use it, but unfortunately, those days are long gone for most products. Keyword competition is so fierce now that you need to either out-spend or out-wit your competition. Both of these activities are better suited after product/market fit when your focus shifts to optimization versus learning.

FREE’er versus PAID Channels:

Explain the breakdown of you costs:

Your resources are not infinite, only mention your top prirorities.Explain why you chose these over others.

What are you channels?

No problem is new, your customers are dealing with this problem, today. What do they use? What do they do? Don't think just competitors, even a notebook can be an alternative solution.

What are the current alternatives to your solution?

I find that the “Problem-Customer” pair usually drives the rest of the canvas which is why I tackle them together:
 1. List top 3 problems For the customer segment, you are working with, describe the top 1-3 problems they need to be solved.
 2. List existing alternatives Then document how you think your early adopters address these problems today. Unless you are solving a brand new problem (unlikely), most problems have existing solutions. Many times these may not be readily obvious competitors. As an example, the biggest alternative to most online collaboration tools is not another collaboration tool, but email. Doing nothing could also be a viable alternative for a customer if the pain is not acute enough.
3. Identify other user roles Next, identify any other user roles that will interact with this customer.
4. Hone in on possible early adopters With these problems in mind, get more specific on the customer segment. Narrow down the distinguishing characteristics of your prototypical customer. Your objective is to define an early adopter - not a mainstream customer.

1. The Problem & Customers

<h3>Direct versus Automated:</h3>
As a scalable channel, direct sales only make sense in businesses where the aggregate lifetime value of the customers exceeds the total compensation of your direct salespeople - such as in certain B2B and Enterprise products.
 But as a learning channel, direct sales is one of the most effective since you interact face-to-face with the customer. The Customer Discovery process we’ll cover in a little bit is direct selling repurposed for accelerating learning from customers.
<h3>Direct versus Indirect</h3>
Another area where startups waste energy is prematurely trying to establish strategic partnerships. The idea is to partner with a larger company to leverage its channels and credibility.&nbsp;
The problem is that until you have a proven product, you won’t get the right level of attention from the bigger company’s sales reps to make this work. Given the choice of selling what you know or an unproven product to make your quota, which would you choose?
 First, sell yourself, then let others do it.
 The same principle allows applies to hiring external salespeople. While a salesperson can probably outsell you on the execution of a sales plan, they can’t create that plan.
<h3>Retention before Referral</h3>
Many startups are obsessed with building virality and referral/affiliate programs into their product from day 1. While referral programs can be very effective in spreading the word about your product, you need to have a product worth spreading first.
“Build a remark-able product.” - Seth Godin, Purple Cow

Design your channels right:

You are now ready to tackle solution possibilities. As all you have are untested hypotheses, I don’t recommend getting carried away with fully defining a solution just yet.&nbsp;
Rather simply sketch out the top features or capabilities next to each problem.&nbsp;
Bind a solution to your problem as late as possible!

3. The Solution

This should be maximum 2 sentences. Explain the perspective and the approach as well.

Explain your solution:

Unique is the key and don't forget the MAYA Principal: Be Most Advanced, Yet Acceptable

What is your - Unique Value Proposition?

Dead-center in the Lean Canvas is a box for your Unique Value Proposition (UVP). This is one of the most important boxes on the canvas and also the hardest to get right.
&ldquo;Unique Value Proposition: A single, clear compelling message that states why you are different and worth buying.&rdquo; - Steve Blank
<h3> The Four Steps to the Epiphany</h3>
 The UVP is hard to get right because you have to distill the essence of your product in a few words that can fit in the headline of your landing page.
 Additionally, your UVP also needs to be different and that difference needs to matter.
 First-time visitors spend 8 seconds on average on a landing page. Your UVP is their first interaction with your product - craft a good UVP and they might stay and view the rest of your site. Otherwise, they&rsquo;ll simply leave.
 The good news is you don&rsquo;t have to get this perfect right away. Like everything on the canvas, you start with the best guess and then iterate from there.

2. Unique Value Proposition

Who are your first 100 customers? As an example, CloudFire, was a photo and video sharing service targeted at parents. Further refinement got me to define my early adopters as “first-time moms with kids under the age of three”.

Who are your early adapters?

Once you have your Lean Canvases sketched for each customer segment, lay them side by side and select the best business model to start with.
 Your objective is to find a big enough market you can reach with customers who need your product that will pay a price you can build a business around.
Here is the weighting order I use (ranked from highest to lowest):
 1. Customer pain level Pick customer segments that need your product the most. The goal is to have one or more of your top three problems as must-haves for them.
 2. Ease of reach Building a path to customers is one of the harder aspects of building a successful product. If you have an easier path to one segment of customers over others, take that into consideration. It doesn’t guarantee you’ll find a problem worth solving or a viable business model, but it will get you out of building faster and speed up your learning.
 3. Price What you can charge for your product is largely driven by the customer segment. Pick a customer segment that allows you to maximize price.
 The more you can charge, the fewer customers you need to reach breakeven (assuming your gross margins don’t change).
4. Market Size Lastly, you need to pick customers that represent a big enough market, or are a stepping stone to a big enough market, that you can build a business around.

Sources: Running Lean (Main Source), The Lean Canvas, Lean Stack

Conclusion: Prioritize Where to Start

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Deliveroo

An early channel I recommend building that delivers on all the points above is Content Marketing.
 Content Marketing uses a combination of Content, Search Engine Optimization (SEO), and Social Media to work. Rather than crafting the “perfect outbound message”, you instead incrementally test various aspects of your Problem/Solution using inbound channels like blogs, white papers, and webinars. SEO and Social Media serve to further enhance the reach of your content.
 Content Marketing isn’t free, takes time to build, and does cost time. But when it starts to work, “Content Marketing” turns from an expense into an asset. It could even become your “Unfair Advantage”!

Building the ideal early channel

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Startup pitch (educational material)

Take the first step into validation of your startup idea using this Lean Canvas template

Who is it for?

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