THE SILICON VALLEY WAY

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THE SILICON VALLEY WAY
- BOOK REVIEW

• Mikko Jokela
• Jarkko Kosonen
• Jussi Pihlainen
• Janne Tikkanen

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The Silicon Valley way- Author Book
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Main Reasons for the Success of Silicon Valley

• Stanford University and the University of
  California
• Venture Capital
• The Concentration of High-Tech Companies
• The Weather

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Some Other Reasons for the Success of Silicon
Valley

• Workforce Diversity
• Two-Income Families
• Labor Laws
• Government and Industry Cooperation
• Californias Culture
• Employee Ownership and Stock Options
• Californias Public Colleges
• Californias Pioneer Mentality

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Seven questions executives ask

• The 45-second business plan
• What is your product?
• should contain measurable objective
• Who is the customer?
• be specific
• Who will sell it?
• This helps determine product elements.

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Seven questions executives ask

• How many people will buy it?
• How much will it cost to design and build?
• What is the sales price?
• Remember that prices come down over time.
• When will you break even?
• forecast and calculate

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Market research

• What does neighbors and media think?
• Ask neighbors opinions and listen them carefully.
• Go to library!
• What's on the web?
• Web is a powerful market research tool.
• What do the numbers/experts say?
• Save all the number data.
• Keep your open mind when listening experts.
• Can you predict the future?

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The Competition

• Who are your competitors?
• List toughest and most potential competitors.
• What are they doing?
• Organize your thoughts.
• What is their value proposition?
• Define your competitors value proposition.
• What are their secrets?
• Trade shows, job postings on the web...

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The Product

• Why would anyone buy your product?
• List your products values and benefits.
• What will it look like?
• Use drawings to create a shared vision.
• When it will be available for shipping?
• Product should have 3 to 10 milestones.
• How different are you from the competition?
• Price, reliability, ease of use etc.

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The Product

• Should you do product simulations?
• Some ways to simulate could be
• paper and ink
• PC simulations
• phone simulations
• What is your products name?
• Use brainstorming.
• Name associates with Quality assurance, Product
  vs. company name, Geography and history,
  uniqueness

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The Customer

• It is so easy to get wrapped up in your product
  and forget all about he customer
• Dale L. Fuller, Whowhere? Inc.
• Do the customers think it is a good idea?
• Ask about it from your potential customers.
• Who is the real customer
• Specific buying habits?, Prerequisites?, Etc.

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The Customer

• What are your customers secrets?
• Age demographics, Income level, Method of
  payment
• Should you do focus groups?
• Focus group Group of 6 to 10 people, who are
  representing potential customers.
• Focus group interviews should be done by some
  professional.
• How much will the customer pay?

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The Marketing Strategy

• What are your objectives?
• Strategic and marketing objectives
• How will you sell and support the product?
• Make buying process more simple.
• Who will generate demand?

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The Marketing Strategy

• Will you need marketing or sales?
• Sales representatives etc.
• What is the marketing plan?
• History teaches that the only thing that works
  in marketing is the single bold stroke
• Al Ries and Jack Trout, 22 immutable laws of
  marketing.
• How do you become front page news?
• Imagine what kind of strengths will be mentioned
  in your future front page success story.

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Confront the Truth

• "The best way to make a lot of money in a new
  venture...is to be honest about the real risks in
  the business.
• John Doerr, Partner, Kleiner Perkins Caufield
  Byers, from Going Global by William C. Taylor and
  Alan M. Webber
• Disasters do have warning signals --gt trust your
  instincts.

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Confront the Truth

• Is this the right project for you?
• Why are you doing this?
• Consider it before making big decisions.
• What is your motivation?
• What is your core competency?

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Confront the Truth

• Will the business work?
• A new business succeeds by focusing.
• What skills are critical to your success?
• What will make your business or product unique?
• What do you enjoy doing?
• Identify your competitive advantage and
  concentrate on it.

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Confront the Truth

• Are you telling yourself the truth?
• Be truthful
• How much will it cost to build it?
• How much will customers pay?
• Can you deliver what you promised?
• Is there really need for the product?
• If your employees don't want the product, it will
  not succeed.
• One of the biggest faults is not being truthful
  to yourself.

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Raising Money

• Should you invest your own money?
• There's something wrong if no one wants to
  invest.
• Never
• mortgage your house
• use your kids college funds
• don't take the risks you can't live with!

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The Business strategy presentation

• 1. Project Name
• 2. Agenda
• 3. Executive Summary
• 4. Business Objective
• 5. The Opportunity
• 6. Demographics
• 7. Target Market
• 8. The Product

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The Business strategy presentation

• 9. Product Schematic
• 10. Product's Benefits
• 11. The Competition
• 12. Competitor's Products
• 13. Competitive Feature Matrix
• 14. Marketing Plan
• 15. Channel Strategy

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The Business strategy presentation

• 16. Development Schedule
• 17. Cost of Goods
• 18. Pricing
• 19. Demonstrations
• 20. Financials
• 21. Next Steps
• 22. Summary

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The Business strategy presentation

• Common Pitfalls
• 1. Presenting with Your Back to The Audience
• 2. Avoiding Eye Contact with The Decision Maker
• 3. Running Out of Time
• 4. Decision Maker "No-Shows"
• 5. Unknown Audience

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The Product Development Scorecard

• Predicts the likehood that you will produce a
  great product
• About ten questions which project manager has to
  answer and give points
• Drawing and Pictures
• Target User
• Competitive knowledge

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The Marketing, Sales and Distribution Scorecard

• This scorecard enables you to track activities
  outside of R D.
• Predicts future success or failures.
• Each business area should have their own card (or
  report).
• 13 Questions.

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Closing Arguments

• Surround yourself with people who tell the truth.
• ask people's opinions
• don't mind if your idea is getting ridiculed
• criticism gives new ideas
• be careful who you talk to, tough (inside/outside
  your company)
• sometimes best ideas come from unlikely sources

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Closing Arguments

• Set the right questions
• answer truthfully
• analyze your answers
• "Back-of-a-Napkin
• A Plan doesn't need to be fancy to work
• Planning is important - not the plan itself

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Closing Arguments Strengths Weaknesses

• Strengths
• Cases - some good/interesting examples
• List of questions needed to be answered
• Offers a "toolbox" for unexperienced

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Closing Arguments Strengths Weaknesses

• Weaknesses
• Quite subjective view
• No scientific argumentation
• Very American - for Americans
• Tries to cover all possible situations