NYU ITP Business 101.1 Innovation + Entrepreneurship
NYU ITP Fall Semester
This course is about understanding the levers that drive business, and learning how to turn them into your favor.
You will learn through experience and work in teams to develop a concept from the generation of an idea to launch or market test.
Warning: the course involves a field work commitment of 5-6 hours per team per week. Much of the work of business model innovation is done outside of the classroom, in direct observation and conversation with your potential customers. The primary focus of the course is the work of developing your network capital – building connections with potential customers, partners, investors, and subject matter experts to help define opportunities that the concept is designed to solve, and early stage product development. A strong component of individual leadership development is built into the course- for students to identify your core values, and to work in teams to co-create a vision for your project, or your business.
We’ll bring the best thinking and methods from MBA school, Lean Startup, Design Thinking, Business Model Canvas, Innovation Accounting, Social Impact Entrepreneurship, Leadership Development, and Agile Methodology.
Key questions answered:
- How do you get support for your ideas to attract customers, investors, and partners?
- What’s the smartest thinking in business that actually helps you get an idea launched in the world, or get a job?
- What is the MBA dominant logic that stops creativity – that you should know about – and learn to work around?
- What is the difference between startup innovation and innovation inside of a company or existing organization?
- What are the new forms of company (B-Corps, LC3s, Co-Ops) and new flows of money (social impact investing, equity crowdfunding) and what do these mean for the dominant logic of business?
- What are your individual and team values, motivation, and vision for the future -and how do you manifest your vision through business structures?
Learning Outcomes:
Develop your entrepreneurial capacities, defined as:
- Understand innovation methodologies practiced in startups and corporate innovation teams (Lean Startup, Design Thinking, Business Model Canvas, Innovation Accounting, Social Impact Entrepreneurship, Leadership Development, and Agile Methodology)
- Build pattern matching skills through an understanding of common business model archetypes, and how to formulate and test hypotheses to determine your business model evolution
- Foster your storytelling and presentation skills
- Enhance your financial literacy, learning the basic building blocks of innovation accounting (traction metrics, market sizing, financial assumptions)
- Strengthen your network capital – identify and engage key potential advisors that may connect you to igniting your business, or your career
- Turning insights into a Minimum Viable Product
Emergent outcome:
- While not a planned learning outcome of the class, a number of cross-school businesses have been formed within the Lean LaunchPad class at ITP, including Cognitive Toy Box, Sage, Vidcode, and Jewelbots among others.
We’ll also involve key advisors and mentors from the startup and innovation community. Previous advisors and mentors have included:
Andy Weissman from USV
Chris Milne from IDEO
Julie Berkun Fajgenbaum of Amex
Phin Barnes of First Round Capital
Charlie O’Donnell of BB Ventures
Christin Roman of IHateRobots
Tarikh Korula from Seen
Angad Singh of LollyWollyDoodle
Christine Lemke of Evidation Health
Leah Hunter of Fast Company
Scott Miller of Bolt Ventures
Sarah Krasley of Autodesk
Britta Riley of Windowfarms
Frank Rimalovski of NYU Ventures
Other experts recruited based on team interests
Note: this course was originally developed as Lean LaunchPad- the course taught by Steve Blank during the 5-day program offered at NYU and the NYU Summer LaunchPad Accelerator. We have adapted the curriculum and augmented the approach with business fundamentals and leadership development exercises to strengthen the student and team experience, and are developing videos to replace the Udacity business model canvas training videos. The syllabus will be updated by September 1, 2016 to reflect these video additions.
Required Texts:
Business Model Generation, Alexander Osterwalder
Talking to Humans, Giff Constsable and Frank Rimalovski
Required Papers and Articles:
The End of Competitive Advantage, by Rita Gunther McGrath, HBR, 8, 2013.
What is Disruptive Innovation? By Clayton Christensen, Michael E. Raynor, and Rory McDonald, HBR, December 2015
A Friedman Doctrine–; The Social Responsibility of Business is to Increase Its Profits, by Milton Friedman, The New York Times, 9, 1970. (paywall)
The Founder’s Dilemma by Noam Wasserman, HBR, 2008
The Role of the Business Model in Capturing Value from Innovation: Evidence from Xerox Corporation’s Technology Spinoff Companies Henry Chesbrough and Richard S. Rosenbloom, Oxford University Press, 2002
Why the Lean-Startup Changes Everything, by Steve Blank, HBR, 2013
Optional Texts:
Interviewing Users: How to Uncover Compelling Insights, Steve Portigal, 2013
Traction: How Any Startup Can Achieve Explosive Customer Growth, Gabriel Weinberg, 2015
Lean Analytics, Alistair Croll and Ben Yoskovitz, 2013
The Founder’s Dilemma, Noam Wasserman, 2013
Grading criteria:
- 15% Participation in class, giving constructive feedback to your peers in the form of questions
- 40% Progress in customer development interviews (emphasis on customer discovery, not user testing)
- 20% Lessons learned weekly presentation and class blog
- 25% Final lessons learned report
Class Schedule:
Week 1: Class Intro, Team Formation, and Concept Development
Week 2: Business Models and Customer Development
Week 3: How to Interview, Deeper Dive
Week 4: Value, Value Props, and The Purpose of Business
Week 5: Personal Values, Motivation, Vision, and Team
Week 6: Customer Relationships and Channels Overview
Week 7: How to Read Analytics
Week 8: Key Resources, Activities, and Partners – sketch MVP
Week 9: The Money: Cost, Revenues, Investment – plan MVP
Week 10: Adding Insights into MVP
Week 11: How Small Can it Start, How Big Could it Get? – launch MVP
Week 12: What We Learned
Week 1: Class Intro, Team Formation, and Concept Development
Lecture (30 minutes) Class Intro and Overview
Workshops (2 hours 15 minutes): A series of workshops to find teams with likeminded values, complementary skills, and to develop and refine initial concepts and arenas for exploration
Teams will be encouraged to self-organize against a startup track, or to respond to a provided company brief. We’ve identified 6 organizations that are seeking innovative high growth, high impact businesses that are designed to contribute to improvements in health, the environment, social justice, and cultural expression.
Homework Reading: Business Model Generation by Osterwalder Intro pp. 1-55.
Why the Lean-Startup Changes Everything, by Steve Blank, HBR.
Week 2: Business Models and Customer Development
Lecture (30 minutes) Business Models and Customer Development – why is this an old but new way of working? How far have these methods spread? What is the overlap and difference between Lean Startup, Design Thinking, User Experience Design, Business Models, and Customer Development?
Workshops (2 hours, 15 minutes) A series of workshops to initial Personas, work with the Business Model Canvas to develop initial assumptions, and creative approaches to finding customers to interview.
Homework: Team talks to at least 5 potential customers and presents findings.
Homework Reading: Talking to Humans by Constable and Rimalovski, all.
Post customer interview narratives to your team blog.
Week 3: How to Interview, Deeper Dive
Lecture: (30 Minutes) How to conduct a strong customer discovery interview vs. conducting user research. How to build trust. How to create an interview guide. How not to pitch or sell. Best ideas from Design Research and Design Thinking to increase your learning capacity and insight skills. Also: How to quantitatively size a market (TAM or total addressable market, SAM or served available market, TM or target market). Where to find quantitative sources, how to evaluate accuracy and trustworthiness of third party research sources.
Workshops: (2 hours, 15 minutes) Customer Interview Role Play. Quantitative Market Sizing workshop.
Homework: Team develops a shared interview guide, and talks to at least 5 potential customers and presents findings.
Post customer interview narratives to your team blog.
Homework: Reading:
The End of Competitive Advantage, by Rita Gunther McGrath, HBR, 8, 2013.
What is Disruptive Innovation? By Clayton Christensen, Michael E. Raynor, and Rory McDonald, HBR, December 2015.
A Friedman Doctrine–; The Social Responsibility of Business is to Increase Its Profits, by Milton Friedman, The New York Times, 9, 1970. (paywall)
Week 4: Value, Value Props, Competition, and The Purpose of Business
Lecture (40 minutes) Milton Friedman, the quick history and evolution of the purpose of business, C.K. Prahalad’s Dominant Logic Theory, Clayton Christensen’s Disruptive Innovation Theory, Rita McGrath and The End of Competitive Advantage, David Aacker’s Definition of Value Proposition, and Alexander Osterwalder’s Value Proposition Design,
Workshops: (2 hours, 5 minutes) Additional workshops: Design a Value Proposition. How to create a competitor/frenemy map/petal diagram. Develop a Concept Paper Prototype. Identify the dominant logic business model of the industry you’re trying to attack.
Reading: The Founder’s Dilemma (HBR) and optional – The Founder’s Dilemma Noam Washerman
The Role of the Business Model in Capturing Value from Innovation: Evidence from Xerox Corporation’s Technology Spinoff Companies Henry Chesbrough and Richard S. Rosenbloom, Oxford University Press, 2002
Homework: Team talks to at least 5 potential customers, initial paper prototype, TAM/SAM/TM expectations, and presents findings. Post narratives and findings to team blog.
Week 5: Personal Values, Motivation, Vision, and Team
Lecture (30 minutes) Values, Motivation, Vision and Team, and the connection between Values, Business Models, and Decisions. How decisions in a startup are different than decisions in a big company. Incremental, Adjacent, and Breakthrough Innovation. The Conscious Pivot.
Workshops (2 hours, 15 minutes) Students present findings and lessons learned from previous week. Defining your personal values, your team values, your collective motivation and vision. How to make a deliberate, conscious pivot.
Homework: Refine validation plan based on team discussions and present shared agreements, disagreements that can be validated through discovery. Post narratives and findings to team blog.
Optional Reading:
Weinberg, Traction
Croll, Lean Analytics
Week 6: Customer Relationships and Channels Overview
Lecture (30 minutes) How to get, keep and grow customers. How to create an Oz Test. Growth metrics, customer metrics, how to develop assumptions in your customer marketing efforts. Customer Channels: how to choose which channels will work for you. channels, indirect channels, OEM. Multi-sided markets. B-to-B versus B-to-C channels and sales (business to business versus business to consumer).
Workshops: (2 hours 15 minutes) Students present findings and lessons learned from previous week. How to develop a marketing test concept before you have a product. Setting up an Oz Test and analytics. Setting up a lead generation funnel. Preparing a test.
Homework: Develop a validation plan: what can be tested through a marketing test plan? Run organic or low cost paid test (no more than $20/day in paid advertising). What do you think will happen? Prepare to present findings.
Optional Reading: Lean Analytics by Alistair Croll and Ben Yoskovitz
Week 7: How to Read Analytics
Lecture (30 minutes) How to understand effectiveness of your marketing test, comparison of the “bow tie” funnel to the advertising funnel used by many established companies.
Workshops (2 hours 15 minutes) Students present findings and lessons learned from previous week. Additional workshop: update Business Model Canvas, and Validation Plan
Homework:
Uncover qualitative questions posed by quantitative findings, and interview 5 customers or experts. Update Business Model Canvas.
Week 8: Key Resources, Activities, and Partners + Sketch MVP
Lecture (30 minutes) How do you understand the backstage of a business model- what makes the business model work. Key Resources, Activities and Partners. Assumptions for resources – people, things, patents, software. What is a Bill of Materials. How does it differ when you are a social impact company?
Workshops (2 hours 15 minutes): Students present findings and lessons learned from previous week.
Workshop 1: Sketch the initial MVP
Workshop 2: Envision the resources activities and partners required to deliver the business model.
Homework: Uncover questions posed in designing the backstage of the business model – interview 5 experts to validate key assumptions. Assemble a resources assumptions calculation, including people, hardware, software, prototypes, financing, etc., and determine when will you need these resources, at what time in the first year? For physical product projects: Get real costs from suppliers – Bill of Materials.
Update Business Model Canvas.
Week 9: The Money: Cost, Revenues, Investment – Plan MVP
Lecture (30 minutes) How Money Drives everything, unit economics, how to calculate CAC (cost of customer acquisition) and LTV (lifetime value). Personal runway vs. company runway. Bootstrap vs. raising money. How to present financials to investors. How to present financials to yourself, your family, your team. How to present financials to an innovation steering committee inside of a company or non profit.
Overview of financing options and new company structures. What does an angel investor look for? What does a social impact investor look for? What does a VC look for? What does an investment steering committee in a larger organization look for?
Workshops (2 hours 15 minutes):
Workshop 1: Planning the MVP
Workshop 2: Plenary co-development of financial assumptions, tradition metrics, and key assumptions. Using Google Docs, student teams create a core assumptions and unit economics financials model. Students analyze ability to bootstrap vs. inject capital to achieve growth potential.
Homework: Revise key assumptions for unit economics, conduct any expert interviews to understand cost and revenue anchors. Update Business Model Canvas.
Week 10: Turning Insights into MVP
Lecture (30 minutes) What constitutes an MVP (minimum viable product/service)
Workshops (2 hours, 15 minutes)
Full deep dive turning class insights into the MVP.
UX workshops: How to eliminate and reduce down to key features necessary for an MVP launch. How to storyboard the onboarding sequence.
Homework: Begin developing lessons learned deck/video.
Week 11: How Small Can it Start, How Big Could it Get? – MVP advances
Lecture (30 minutes) How to figure out if you should proceed with your emerging business idea. Lean startup and cost investments. Upside and valuation expectations. Options for financing, incubation, grants, bootstrapping, or finding a home for your tech and team. Exploration of new company structures such as BCorp and L3C, what to do when you realize you have a not for profit. LLC vs. C-Corp.
Workshops/Expert Interviews (2 hours 15 minutes)
Workshop 1: Choose what tests you need to run to choose your company type
Full MVP deep dive.
Homework: Develop final lessons learned deck / video.
Example: Owlet example on Strategyzer
Format:
- Show original assumptions and business model progression over time. What did you know then? What do you know now? What do you still not know?
- Describe the size of prize and how your team’s understanding of the opportunity changed over the course of the semester.
- Make a go/no go decision. Will you continue with the idea?
Week 12: What We Learned
Teams present lessons learned, and receive loving appreciative applause from class advisors and mentors, who are all invited to celebrate with a delicious catered dinner.