A spectacular finish to the World Founder Forum 2015 last night at KTH. Thank you to everyone at the university for hosting us this year. The four days were magical. This years Class of 2016 founders are bright, creative, curious and not afraid to challenge anything. All of us at FOUNDER.org are humbled to be working with such incredibly talent people. We're looking forward to a great year together.
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Today we announced the Class of 2016 awards at The World Founder Forum in Stockholm Sweden. 10 teams from the class were awarded $100,000 each, 4 teams were awarded $50,000 each and 26 teams were awarded $10,000 each. Each year we select teams with big ideas from universities in North America and Europe to join our 8D company building program. And this year our friends at **KTH - The Royal Institute of Technology** sponsored us for the event. Thank you to everyone at KTH, especially Lisa Ericsson, My Klint and Malin Luuke who organized everything. Our Class of 2016 hail from 45 Universities, 9 countries and more than 20 different industries including space technology, life sciences, mass customization, agriculture 2.0, industrial sensors, robotics, digital health and genomics. The ten $100,000 teams are: * **Akanocure Pharmaceuticals**: Nature inspired cancer therapies (Purdue University) * **AlphaSheets**: Cloud-based financial modelling (MIT) * **Audacy**: Space-based Internet (Stanford University) * **Building Radar**: Geo-opportunity analysis (Center for Digital Technology Management, Munich and London School of Economics) * **Civil Maps**: Intelligent big data driven maps (University of California Berkeley) * **Dramatize**: Streaming Bollywood worldwide (Harvard Business School) * **ICEYE**: Radar-based satellite imaging service (Aalto University) * **LocoRobo**: Learning programming through robotics (Drexel University) * **SUN Bioscience**: Organoids as a service (Ecole Polytechnique Fédérale de Lausanne) * **Symbio Robotics**: Software for industrial robotics (University of California Berkeley, University of Southern California) The four $50,000 awards were presented together with **Cisco** who has been a corporate partner and donor to FOUNDER.org. Piotr Pluta, Senior Manager of Corporate Affairs in Europe co-presented the awards with us. He is a big champion of innovation and entrepreneurship in Europe. The $50,000 award teams are: * **Biocarbon Engineering**: Industrial scale reforestation (University of Oxford) * **BioInspira**: Airborne chemical detection (University of California Berkeley) * **Cambridge Bio-Augmentation**: Platform for interactive prosthesis (University of Cambridge) * **Rorus**.: Water purifiers for natural disaster relief (Carnegie Mellon) Our $10,000 award winners are: * **Additive Rocket Company**: Light weight propulsion engines (University of California San Diego) * **BeamLine Diagnostics**: Real-time diagnosis of pre-cancerous biopsies (University College London) * **Blocks**: World’s first modular smart watch (Imperial College London) * **Cariboo.co**: Sharing economy connecting passionate locals willing to make a discover their city with tourists from all over the world (ESCP, Ecolé Centrale Paris) * **Cevotec**: Industrializing the manufacturing of advanced carbon fiber parts through robotics (Center for Digital Technology Management) * **Deekit**: Cloud based white board canvas for collaboration (Tallinn University of Technology) * **Desaia**: Software for the design and creation of large 3D virtual worlds (TU Berlin) * **GiveVision**: Software suite that powers smart glasses and act as eye for the visually impaired (University of Oxford) * **Gravity Sketch**: Sketching in 3D using augmented reality (Imperial College London) * **Havenly**: Sharing economy connecting interior designers with customers who want to transform their spaces (The Wharton School) * **HeySuccess**: Marketplace for international internships and other student programs abroad (Tallinn University of Technology) * **LaserX**: 100 Gbit/s optical communications for nano/micro-satellites (MIT) * **ManoMotion**" Real-time 3D gesture tracking and analysis software (KTH) * **OpedSpace**: Credible, digestible, peer-to-peer insight on what’s going on in the world for young professionals in different countries (Harvard Business School) * **peerCast**: Real-time spontaneous streaming service with your closest connections (KTH) * **Poly6**: Transforming the global plastics industry with a novel sustainable plastics technologies (MIT) * **rankmi**: Software for employee leadership skills, development (UCLA) * **Rubbee**: e-bike conversion kit for the masses (Kaunas Technical University) * **Sandbox SEF**: Sharing Economy service for enterprise research (MIT) * **Serket**: Drug adherence solution for consumers and pharmacies (University of Cambridge) * **Spoiler Alert**: Sharing Economy service for food waste (MIT) * **Tern**" Sustainable water solutions (Drexel University) * **Transcense**: Digital Health solution for hearing impaired (University of California Berkeley) * **Unite Genomic Solutions**: Big data service for genomics discovery (University of California Berkeley) * **Vendri**: The world''s first intelligent media engine (The Wharton School) We're looking forward to a great year with the Class of 2016!
Imagine the holy grail of entrepreneurship: an extensive list of burning hot customer leads, a thoroughly validated problem, a clearly expressed market need, and a close set of industry contacts giving advice on every product decision. What many founders don’t realize is that all of the above, and more, can be gained through customer development. In practice, most startups go through the motions of customer development, but ultimately fail to integrate the process in a holistic manner. This leads to bad brand image and doubles the effort to get to market, while burning through precious cash. # When do I do Customer Development? Customer development done right, starts at beginning, middle and never stops. You should constantly be refining to ensure that your potential leads, and eventually, your customers, are getting their pains solved by your product. Customer development does not end when you find the first problem to tackle- that’s just the beginning. Applying a holistic customer development approach puts the founder in the shoes of his or her actual customer through a series of interviews, structured experiments, and user testing, getting the founders closer and personal with your customer’s “Day in the Life.” This means not only understanding their pain (the opportunity), but also knowing exactly how your customers make key technology and business decisions. Understanding customer roles are critical across various verticals or business units. Once you effectively understand your customer-you will be more effective in your messaging by mirroring your customer. This will lead to more engagement and effective customer relationships that enable brand loyalty. If you want to improve your chances of building a successful company, customer development is your best friend to help execute your vision. It may take months for effective customer development, but it is time well spent and allows you to execute with precision. You have to be patient, listen closely and communicate effectively with your team. When customer development stops, all things go wrong. Innovation will suffer, A Player talent will exit and customers will look elsewhere. This is not an exaggeration, but a true challenge that many successful companies face with fast growth. Most fast growth companies move towards “scaling”, but in reality half the scaling strategy involves sticking to “what is working” for risk management purposes and slowly digress from direct engagement with customers. # Who is Involved in the Customer Development Process? The process should include consistent communication at ALL levels within the organization while maintaining a continuous loop with customers. Customer development efforts are usually executed by technical founders in the field and as the company grows, product managers. However, the problem lies in that many fail to share this data with the rest of the organization. This happens for many reasons, but usually it has to do with underestimating the importance of the information gathered and how it can impact decision making for marketing, sales, business development, operations and fundraising plans. # Escalating from Customer Development to Ongoing Growth: Once you have conducted interviews, gained beta customers, and built brand loyalty from your users, a repeatable sales cycle and customer happiness processes will take your company to the next stage of growth. An effective sales engine is centered on customer development and understanding customer needs. Many of the practices used in customer development are highly effective sales tactics. Leveraging CRMs like RelateIQ or Salesforce allows teams to communicate information and creates engagement internally. Sales teams can leverage the tool by entering information from customers in near real time manner. Once everyone understands the overall sales methodology, forecasting customer feedback and cycles, customer development continues to evolve as long as it is managed properly. FOUNDER.org’s 8D program helps teams take customer development through different “real world” exercises to ensure that the best proven startup methodologies are executed the right way.
As a startup founder, you’re constantly hit with glamorous headlines about the next big investment that an idea-stage company raised. It seems that everyone and their mother is raising millions when reading the investment headlines of TechCrunch and Venture Beat. So why can’t all entrepreneurs demand investment on their terms? It’s not a one-stop shop. Fundraising is a marathon that requires a pinpointed and calculated approach. Raising money can be the result of months (or years) of progress and traction. * Most VCs hear hundreds to thousands of pitches annually and only select a handful depending on the stage of investment. * All VCs are not created equal. For example, they have different investment strategies, write different types of checks (small and large) and the venture partners all have different backgrounds that impact investment decisions. * Raising an A Round is never easy…probably the hardest part of fund raising. Most investment decisions are based on the team vs. technology. # How do early stage startups increase the odds of success? At FOUNDER.org we help teams in the following areas and take teams through real world exercises to prepare them for a successful raise. ## Getting into the Fast Track Finding good advisors/mentors will put you on the fast track in the complex fundraising process. Because investments are a long-term relationship and each VC is different, companies need to do extensive research on specific firms and angel investors. New founders often do not understand the intricate landscape and spin their wheels meeting with investors that can never fund their company. ## Select the Right Stage Second, understanding the different between seed and Series A is crucial. Make sure you select the right early stage investors for seed because it will impact the types of Series A investors you attract. Many times early stage investors will take seed investment from mostly anyone, but it having bad or numerous investors on your cap table is a red flag for most venture firms. ## Preparation A careful process that takes foresight, you’ll need to prepare your company, team and investment presentations. Getting your entire team and company to understand the critical fundraising process will enable the CEO to leverage all resources available. There are many various templates for the right investor pitch, but the most valuable is the investment thesis, business model and financial plan. If you don’t have these items very well thought out and prepared along with your product plan, you will suffer. ## Here are the key components: The **investment thesis** should clarify how you will change the world or disrupt the current status quote. It should contain why you are unique and why this market opportunity is great. Most venture pitches go too deep into only the technology, team or market opportunity. But remember, it’s a big picture vision with multiple facets. The **business model** is always the “ugly step child” in the overall investor deck. It’s often painful; so many pitches do not even contain a business model (huge mistake). Not only are investors are not going to blindly invest without seeing a clear business model, but also founders are selling themselves short if they don’t take the time to really think through a careful and comprehensive future plan. Furthermore, the business model should be simple, innovative and disruptive, like the idea. The **final financial plan** has to be extensive and detailed. Assuming the initial presentation went well, this is where you will want to spend a lot of your time as a weak financial plan can reflect poorly on the founders. The plan should be detailed covering 3-5 years of all aspects of the business. It is important to include your company’s objectives, goals, strategies and metrics to show a comprehensive plan to impress investors. The **founding team** makes all the difference. More than fifty percent of the decision will be based on your personality and passion. The best tactic is to be genuine and respect your investors. This includes having active and dynamic listening skills and knowing when to stop talking. Lastly, traction and sales always beat the house odds. The more you can show in this area at seed stage and, definitely, at Series A, the stronger the odds of investment. Completing detailed customer interviews, pilots and having customer references will allow you to take control of the investment process leading to great outcomes. # In summary: * Advisors and mentors are key to helping with introductions, timing, and refining your investor targeting. * Planning your seed round, minimizing your number of investors, and raising at the right time is crucial for a successful Series A round. * A good deck is short and concise, but highlights a clear problem statement, investment thesis, financial plan and product roadmap. * Be genuine. Investors invest in the team and traction, not just the idea.
Without a successful product, you cannot have a successful company. No matter how extensive your sales, marketing, customer development, or team is… your company starts and ends with the product. A good product will dramatically reduce the stress on sales and marketing, as client referrals will help scale revenue. A good product results in happier customers, reducing workload and customer support. And a good product needs less maintenance, reducing the need for development upkeep. # Launching your first product It’s significantly better to have a product that solves one pain-point flawlessly, than a product that solves five pain points in a mediocre fashion. While the common mentality is build to an “MVP” (minimum viable product), it’s important that your first version solves an actual need. Do not launch a minimum viable product simply for the sake of launching a product – do your homework. If you start with a mediocre product, you will constantly be picking up the pieces, building workarounds, and you’ll fail to gain any strong advocates and adopters. If your first version is simple, but solves a key need, you can scale and add more features as needed. Google did not start with self-driving cars, mobile phones, and online collaboration tools. Google started with search, but they solved the pain of finding online content. To determine the product you build first, you should reference your early customer development and interviews. As part of the customer development process, you should validate that your product (which will feel more like a simple tool at first) solves the most pressing need that your customers face. # Prioritizing your Roadmap Understanding where you are headed and how you will get there is key to scaling your growth. A company without a clear product roadmap lacks direction and focus, feels misaligned, and can quickly fall apart. Your roadmap should center on your alternate future and focus on solving validated problems that came from customer interviews. You want to constantly refer back to your customer development and vision to help guide your next features. Features should be added because they solve true pain points that arise when you put yourself in the Day in the Life of your customers. Don’t add features to the roadmap simply for the sake of adding new features. Prioritize the features that appear often and help deliver outsized returns. # Managing Developers As with any aspect of your company, it’s important to refer back to your A-player hiring techniques to ensure that the team is properly equipped to tackle your goals. Early stage CEOs, even those that are non-technical, need to be closely connected to the development team. It’s very important that developers are aligned, have a central platform for communication, and consistently move the product forward. Developers should not be siloed from the conversations with customers and advisors. As they are building the product, it’s important that they have complete information as to why they are creating the features they’re building. Many management techniques such as kanban, scrum, or Waterfall can help with the development organization and planning. However, all techniques roughly focus on the same core tenants: * Break down large features into smaller, bite-sized, tasks based on customer feedback. * Tie all features back to customer development and active pain points. * Implement a step-by-step process from idea to development to deployment. * Maintain a clear product roadmap with expected deadlines and deliverables
For pre-revenue companies, there’s a strong temptation to not worry about processes, tools, and staffing until you’ve released your product or service (or at least launched a pre-sales campaign). Suddenly, you’ve now got real customers to support, revenue to recognize, customer contacts to create, and potentially a manufacturing and distribution process to manage (if you think you get a lot of email now, brace yourself!). Even as you disrupt an industry, you’re still going to need some level of internal systems to be effective. Our focus in this dimension is to prepare founders to scale by designing an appropriate level of infrastructure - focusing on leveraging tools and repeatable processes with the right mix of outsourced support and in-house staffing. # Accounting, Finance, Legal and HR Early on you want to put as much resource as possible behind product, marketing and sales. However, you can’t completely ignore G&A activities. In areas such as accounting and finance, legal, and HR, the key thing is understanding what you should do in house vs. outsourcing. In these areas, you can generally outsource these functions for quite a while (it will be some time before you need a full-time CFO or a general counsel) and bring in part-time contractors to handle things. For certain roles, there are a lot of options for part-time bookkeeping accountants and contract recruiters. In determining the right level of in-house vs. contract, you need to designate the difference between strategic versus transactional services. Ultimately, you’ll need someone internal who is the point person and clear owner of the area, who can manage process and contractors. # Marketing Automation and Customer Relationship Management In these areas, we encourage founders to have the foresight to think through their marketing engagement and CRM strategies early on. That way, they can get the appropriate systems in place ahead of the curve. Of course there are a lot of competing priorities for a founder’s time, but if you’re leading marketing or sales (in advance of bringing in specialists in these areas), we encourage founders to start thinking through a strategy and leveraging tools as early as possible. We live in good times as there are multiple cost-effective options now geared toward early stage companies. # Outsourcing and Manufacturing With more and more hardware companies, one thing that we see come up more are discussions around outsourcing hardware design, prototyping and understanding contract manufacturing. A lot of companies we see are combo hardware and software, with the founders having much more experience on the software side. Thus, we often focus on understanding the process of choosing a partner, accurately assessing how much things are really going to cost, and building a strong supply chain.
Founders might say, "We're a startup, we're moving so fast that an extensive plan is ultimately a waste of time. We just need to get a product out there and the rest will sort itself out by trial and error." Move fast and break things, right? While it’s true that an operating plan is out of date the moment you’re finished, such thinking is shortsighted. Here’s why it’s so important to fully engage in a business planning process: # Team Alignment, Focus, and Communication Our first step is to use a strategic planning framework (OGSM) where founders start with their vision of the alternate future that they’re creating for their customers. This framework is used to guide the company’s strategy, and sketch out a tactical plan to achieve goals. Process provides two benefits: 1. Focus: You start to get a sense of what you really need to focus on, and where your key hiring areas are. This also means saying no to the things you can’t prioritize. 2. Communication and alignment: process provides opportunity to uncover disconnects among the founding team and allows them to test assumptions. Setting up a good communication tool that will be crucial as the company scales… silos can develop more quickly than you could possible believe in a startup. If you don’t address them early, you won’t be able to move fast. # Knowledge = Speed. Once we have the OGSM framework, we turn our attention to building out a financial model. At FOUNDER.org, we have founders spend time reviewing recent S-1s for the closest comparable companies that they can find. These documents provide great insights into historical financials and growth rates, an understanding of pricing models, key metrics, and spend on key areas such as Sales, Marketing, and Development. Founders tend to overestimate revenue growth, and vastly underestimate costs (and thus time to breakeven). Armed with data and a better understanding of financial statements and concepts, founders go faster when they sit down to build out their own financial model in their operating plans. # Understanding key drivers It’s not until you start experimenting with different pricing models and assumptions in an operating plan that you can really see how different variables affect the business and how much funding you might need. By sweating the details around salaries for different roles, and estimating CAC and LTV, you are going to make better decisions around pricing, hiring, and fundraising. # Practical tool for managing cash Speaking of fundraising, if you don’t have a solid operating plan, you aren’t going to have a good sense of how much, and when, you need to raise. Treat the operating plan as a guide, because reality never plays out exactly as you plan. When you have variances, you can adjust your model appropriately. Get into the good habit of being on top of your finances with a plan because no one wants to be surprised when it comes to cash balances. # Investors In today’s environment, you may be able to raise money for an early stage company without having any kind of financial projections. But this is rare, as the majority investors still want to see you think through the economics, and more importantly, that you can defend your assumptions. Often there is a P&L slide in an investor deck, but founders want to skip over this quickly and avoid questions they might not be able to answer. We spend a lot of time getting founders comfortable with presenting this slide. You’ll need to be comfortable doing this when you have board meetings anyway. # Opportunity to innovate It's not enough to innovate just on product anymore. The most interesting companies we see innovate on the business model as well. Planning gives you focused time to get creative around this. Having a plan doesn’t mean you’re not experimenting - of course you need to experiment. But you’ll have a better understanding of the cash impact of your choices, business planning will give you confidence to anticipate and course correct when the time comes.
Entrepreneurship is not a one-man operation. In the early days, highly skilled founders often bring on people in their immediate network (friends and former colleagues) as co-founders and early hires. While this does create a positive work environment among a group of friends, the result of poor hires can be detrimental and cause residual impact for years. Even in the scenario above, everything often runs smoothly early on as friends generally have history together and share a sense of excitement for what lies ahead. Communication takes place on the fly and whoever has the time to do the work does the tasks at hand. Consistently, founders often find themselves underwater as the pace of the business accelerates and problems emerge. In many cases, the founder realizes that their initial team largely shares a similar set of skills, network, and experiences that isn’t fit to grow and scale the organization. In order to avoid this scenario, a founder should ask themselves a few key questions before bringing on someone new: * Does this person offer a unique set of skills that nobody on the team can replicate? * Can this person maintain their role as the company grows and scale. Can they manage a team? * Will this person compliment the current skills of our team to yield outsized returns? * Do we have an active need for this candidate over all other potential positions? Sounds pretty straightforward, yet the majority of first time founders haven't built a team before. Without a proven process to find, recruit, and hire A player talent, many founders delay bringing on new people into the company or worse, they tend to hire people they immediately "feel good about" during a preliminary interview. Saying no to a potential candidate is hard; saying no to a friend or former colleague is even harder. “No reason to not hire them” is not a reason to hire them. It’s imperative that all candidates, especially early employees, are thoroughly vetted and solve an immediate pain point for the company. Both courses of action, not hiring soon enough and hiring on instinct, can have dire consequences. Waiting too long to bring additional talent on board usually results in failed product launches and unhappy customers. Hiring the wrong person can cost you significant time, money and a whole lot of pain and suffering along the way. Smart founders avoid these pitfalls-even in the company’s earliest days, by adopting a strategic approach to building their team. Starting with key business goals, they determine the skills/capabilities needed to accomplish these goals and then create detailed scorecards for these roles. This approach to building a team can instigate some uncomfortable exchanges amongst founders as it requires them to courageously discuss existing gaps between what they "want' to be doing versus what they actually do best. Regardless of how difficult this process can be, the reward is a hiring strategy that will allow you to confidently build a team of A players who will thrive in your company. The life of the company lives and dies with the early founding team. Poor talent will kill moral, burn much needed cash and resources, create a management headache, and eliminate any chances of high growth. On the other hand, the attitude of a true A player is contagious. Their presence will motivate and inspire all others in the company to accelerate their growth; they will attract top talent, manage and grow a successful team, and dramatically decrease the pressure of the founders.
## Challenges **8D** presents your team with a series of **challenges** along each one of the eight **dimensions**. Challenges are quick and to the point for maximum return on investment. Your challenges are tailored to your company and its level of experience on each dimension. The team dimension, for example, includes six challenges aimed at building a strong sense of personal and team self-awareness, filling your team’s next several positions with A-Player talent, and understanding how to scale from a founder to a CEO and from co-founders to a management team with a board of directors. Each dimension has its own set of challenges that are revealed as our year long program progresses. Your team moves through these challenges with the help of your executive mentor, subject matter mentors and other teams. ![Team Challenge Example](http://imagehosting.io/images/2015/06/11/Team-Dimension1.png) Challenges are completed online at FOUNDER.org and then reviewed by your mentor. The challenge calendar is organized to cover a number of topics together that make sense at different stages of company development. ## Missions Every Challenge includes a series of **missions** required to complete the challenge. Some missions are individual, some activities involve two or more people and some activities involve multiple teams. The A Player Hiring challenge, for example, has eight different missions that show you how to source, assess, hire and retain the best talent. In this challenge, learning to conduct an effective Screening Call is a two-person mission where you role play an real interaction. Developing a Scorecard, on the other hand, is a team mission and performing a Scoring Session with a candidate involves two or more teams. Each mission begins with a bit of background and preparation and completes with a wrap-up with your mentor. ![Missions](http://imagehosting.io/images/2015/06/14/ScreenShot2015-06-14at15.01.41.png) ## Canvases Following the successful completion of all the missions in a challenge, you will be presented the the output from the challenge in the form of the challenge canvas. This canvas shows all your work on the challenge and integrates it into a model you can use to share with others. For example, here is my Thinking Styles canvas from the Thinking Styles Challenge. ![Thinking Styles](http://imagehosting.io/images/2015/06/14/ScreenShot2015-06-14at14.44.39.png) ## Learn More about 8D * [What is 8D?](www.founder.org/posts/what-is-8d) * [A Day in the Life of 8D](www.founder.org/posts/day-in-the-life)
Being part of FOUNDER.org is fun - but it's also hard work, as company building should be. We get asked a lot about how it looks and feels to take part in 8D. Generally we tell teams to dedicate: * two hours a week for Challenges and Weekly Office Hours online, * three days a quarter for our in person Quarterly Forums and * two to three days at the end of the program for our World Founder Forum. Like anything in life, you get out of 8D what you put into it. With that said, we know everyone is busy doing research, engineering product and working with customers, so 8D is designed to get right to the point. ## Weekly Office Hours Every team taking part in 8D has a dedicated executive mentor (someone who has been successful already) and a dedicated program mentor (someone who has been through 8D already). These two mentors are your strategic allies in getting the most from 8D. Mentors are responsible for guiding you successfully through the 8D with Weekly Office Hours that take place online. ![Weekly Hours](http://imagehosting.io/images/2015/06/11/zoom.png) ## Quarterly Forums Our Quarterly Forums focus on the important rather than the urgent. The goal is to step away from the day-to-day firefighting and step into a mini quarterly retreat, which most young companies don’t take time to do, but can really help to get big issues unstuck. Here you’ll gain fresh perspectives on the 8D Challenges presented during the quarter, share your output with the rest of the teams and learn from your mentors and classmates. Quarterly Forums are two to three days and are held at different Partner School locations. Please check your class online forum for the complete schedule. ![People at Founder Forum](http://imagehosting.io/images/2015/06/11/Q2.jpg) ## The World Founder Forum Every June we host The World Founder Forum and bring together the new class with the previous classes. The emphasis each year is to expand our cross-cultural, multi-industry network of amazing innovators and entrepreneurs and the value they bring to each other with a rich journey through 8D. The World Founder Forum is a four day event hosted at one of our Partner Schools. ![World Founder Forum](http://imagehosting.io/images/2015/06/11/FL_c877620c-14ee-4924-b4b1-677d7f268d51.png) ## Learn More About 8D * [What is 8D?](www.founder.org/posts/what-is-8d) * [8D Challenges](www.founder.org/posts/8d-challenges)