Tag Archives: value proposition

The Power of Story: 3 Key Steps to Connecting Your Vision with Commercial Success

By:  Andrew Johnson, Ph.D.

open book with watch on it

Take the time to craft the ‘story’ of how your offering will impact your customers to provide a focus and direction to your commercialization efforts

There are a million things to do to get your new ideas and discoveries into a finished product that will delight your customers.  This can be a very overwhelming experience as you are not only trying to determine what your product will be like when you launch but also how to talk about it to your investors, your prospects, partners and your team.  One unifying principal that can help here is to use the power of story to guide you through this process.  Think of the story you would like people to tell about your company and its product(s) years after its success.  When you take the time to do this, the path to success will seem a bit less treacherous.

Easier said than done
The key here is to focus on the interests of your target audience and realize that the narrative will be different for each of your stakeholders.  This is kind of like trying to come up with a story that will appeal to both children and adults (perhaps using a comic book version for kids and a novel for adults).  However, as challenging as this might seem to be, the process that you will follow to create the story of your company will ultimately provide you with the insights and focus you will need to move your company forward.

Step 1:  Start with Your Future Customers
Your new product will provide some new outcomes for your future customers.  This could be a new diagnostic test to guide medical treatment, a new tool or kit that will allow researches access to new information or perhaps even a significantly improved version of an existing product or service.  In each case, you need to find out how badly your customers would wish to overcome a particular issue and ultimately if they can envision your solution to it to be compelling.  From this effort you will know what your product or service needs to do for your customers (not just what it can do but what it must do).  This is the most critical story to get right.  You will be basically retelling this story of how your product or service impacts customers to your other stakeholders in the following steps.

Step 2:  Delight your Board and Investors
Use the insights that you gained from the previous step to build enthusiasm on your Board of Directors.  Being able to share testimonials from future customers, and statistics like, “90 percent of the people we targeted in our initial outreach said that they would pay $$$ today for our offering to fulfill this critical unmet need.”  Testimonials like this go a lot further than statistics from market reports that have been shoehorned to fit your business case with these stakeholders.  Remember your ‘audience’ prefers non-fiction over fiction here.

Step 3: Putting It All Together with Your Team
The feedback from your future customers in Step 1 will become the minimal set of performance and pricing characteristics for your first product(s).    Your development team can use this to produce the first prototype for alpha evaluations.  Your commercial team will have key insight into what will be a compelling value proposition to use to reach and win new customers.  If your board and investors liked your ‘story’ so far, they will have validated it with their approval and perhaps even some additional funding.

In Summary:

  • As early as possible, find out who will buy your products and for how much and why (what impact will your offering have on your customers).  – The Customer Needs and Solution Story.
  • Use real prospective customer feedback to further convince your stakeholders (Board of Directors and investors) to support your team.  – The Rags to Riches Story –non-fiction version
  • Provide your team with real outside feedback to guide your development efforts towards making the right product for the right customer at the right price at the right time.  – The Life Science Idea to Successful Biotechnology Company Story

Picture Credit:  © Tomloel | Stock Free Images & Dreamstime Stock Photos

The 10 Essential Elements of Every Successful Life Science Startup

By:  Andrew Johnson, Ph.D.

keys with a success key fob

Paying attention to these 10 essential elements for a successful startup will greatly increase the prospect that you will get your hands on these keys!

Transforming breakthroughs from the lab into successful companies is a daunting but ultimately rewarding task.  For some, there is no better validation of the quality and value of their scientific discoveries than the kind you get when it generates demand from paying customers.  However, according to Shikhar Ghosh, senior lecturer at the Entrepreneurial Management Unit at Harvard University, 75% of startups fail largely because they have neglected one or more of the 10 essential elements of successful startups.1

 

The 10 Essential Elements of a Successful Startup Are:

  1. Compelling Value Proposition: Having a great idea or discovery does not always mean that you have a product or service that will generate the customer demand required to sustain a business.  Having an experienced Board of Advisors can help you figure this puzzle out and will also provide you with the introductions to the industry experts and Key Opinion Leaders you need to feel confident that you have a viable business hypothesis.
  2. Capital:  How much money will you need to keep your operation running until you start to generate revues?  How will you fund the company?  Grants, Foundation money, investments and bootstrapping are just some of the ways that entrepreneurs get the funding they need to get their product or service to market.
  3. Key Resources:  You need key people on your founding team with the technical know-how and business sophistication to shepherd you company from the early days to a real going concern.  In addition to the people, you need to make sure they have access to the resources they require to succeed like adequate lab space, access to equipment, reagents, regulatory guidance etc.
  4. Key Activities:  Seems like an obvious one.  It is critical to develop a detailed roadmap that describes all of the strategies, tactics and activities that need to be successfully completed to reach your ultimate goal for the company.  This plan will include critical milestones along the way so that the team can monitor progress and make course corrections as needed.  Also, this plan will allow you to develop a realistic budget which will help you to mitigate the risk of running out of capital before you have achieved a successful launch.  The best roadmaps break this down to enough detail to guide not only month to month activity but day to day efforts as well.
  5. Cost Structure:  After you have launched your product or service, your focus now shifts towards expanding profitability.  Your Operations team will be looking to reducing the costs of providing your product while your Sales & Marketing team will be executing on tactics that will bring in significantly more leads, and more sales.
  6. Key Partners:  You don’t need to go it alone.  Establishing strategic partnerships can help you expand your market reach when you set up co-marketing agreements and save capital when you share the cost of space, equipment and other resources that you can both profitably share.  Your team will also benefit from the experience and perspective of your partner as your relationship grows stronger.
  7. Customer Segmentation:  This is something that needs to be started way before you are even ready to sell.  It is important to know both who will want to buy your product as well as who will not.  This will not only help you with your marketing efforts but will also insure that you build the right offering.
  8. Demand Creation:  Once you have a good idea who your customers will be, figuring out how to reach them and what message they will find most compelling becomes a lot easier.  Running an effective beta-evaluation with perspective customers will provide you with key insights that will go a long way to insuring that you have a strong product launch and have a Sales & Marketing plan that will quickly scale up to meet the business growth goals you have set for the company.
  9. Sales Channels:  Having a well thought out Channel Management plan will greatly increase the chances that you will have a strong launch.  It is important to know how you will sell to your customers and then develop the resources and team that will allow you to execute this well.  Different channels have different demands and processes.  Be sure to consider whether you will be using a direct sales force, distributors, a combination of the two and how that would work etc.  Don’t’ forget to consider e-commerce!
  10. Revenue Streams:  Another seemingly obvious ‘element’.  Don’t’ forget that you can get revenue for intellectual property that you can monetize through licensing fees if you don’t commercialize it.  Be sure to consider other ‘products’ like extended warranties, service agreements and advanced training offerings for example.   There are many ways to generate revenue besides what you get from sales of your core product or service.
Chart from UpStart presentation

Making sure your Founding Team has the expertise to manage the “10 Essential Elements” is the best way to improve the odds of success for your startup.2

The Secret to Getting this Right
The secret to keeping on top of all these ‘elements of success’ is having a founding team with the depth and breadth of experience and know-how to cover all of these areas.  Each ‘element’ can require very specific skills and tactics.  Furthermore, it is critical that these are customized to fit the particular needs of your company.  The other thing to keep in mind here is that these ‘elements’ are not static in their timing and demands for resources.  Having at least a few team members that have done this before will insure that you get all of this right.  Founders should look to establish a Board of Advisors very early on to help manage all of this and or help you to find these key people for your founding team.

Notes: 

  1. Venture Capital Secret: 3 of 4 Start-Ups Fail
  2. The Life Science Startup: Bringing Innovative Science to Market with the Right Team 

Picture Credit:  © Suravid | Dreamstime Stock Photos & Stock Free Images