Entrepreneurship and New Ventures

Units

1. 1

   Opportunity and the entrepreneurial mindset

   4 lessons

   1. What entrepreneurs doDescribe what entrepreneurs do, contrast causal and effectuation reasoning, and read the odds of venture success off a funnel, to see why learning fast beats betting on a first idea.
   2. Recognizing opportunitiesFind problems worth solving from unmet needs, technology shifts and trends, and rank them on a map of customer pain against the number of customers affected and the solutions that already exist.
   3. Evaluating an ideaScreen an idea against customer need, market size, competition, team fit and timing, score two competing ideas on a weighted scorecard, and test whether the winner survives a change in weights.
   4. Social entrepreneurshipCompare a social venture with a for-profit one, measure a double bottom line, and trace a theory of change on a logic model from inputs to impact.
2. 2

   Customer discovery and validation

   4 lessons

   1. Customer segments and personasSplit a market into segments, pick the early adopters by need intensity, describe them with a persona and a job to be done, and size the first segment to serve.
   2. Customer interviewsAsk about past behavior rather than opinions, rewrite bad interview questions into good ones, and record insights in a log that shows when a theme is real.
   3. The minimum viable productRun build, measure, learn loops with a minimum viable product, choose the cheapest MVP that tests the riskiest assumption, and decide with a metric whether to persevere or pivot.
   4. Competition and positioningMap direct competitors and substitutes, place them on a two-attribute positioning map to find white space, and check with customer data that the white space is a real market.
3. 3

   Business models and go to market

   4 lessons

   1. The business model canvasDescribes the nine blocks: segments, value proposition, channels, relationships, revenue, resources, activities, partners and costs, drawn as the canvas with each block filled for a sample startup.
   2. Revenue models and pricingCompares subscription, marketplace, freemium, licensing and advertising models and price setting, shown as a table of models against how money flows with a sample price ladder.
   3. Go to market strategyChooses channels, a beachhead market and sales motion, drawn as concentric circles of a beachhead market expanding to adjacent segments with channels labeled. It also sets first year sales targets.
   4. Founding team and equity splitBuilds a complementary founding team, roles, advisors and equity splits with vesting, shown as an org sketch and a pie chart of founder, option pool and advisor shares.
4. 4

   Market sizing and unit economics

   4 lessons

   1. Market sizing: TAM, SAM, SOMSizes markets top down and bottom up, TAM, SAM and SOM, with price times customers, shown as three nested circles with a bottom up calculation table beside them.
   2. Unit economics: CAC and LTVComputes customer acquisition cost, LTV = margin x lifetime, the LTV to CAC ratio and payback months, drawn as a cash curve per customer crossing zero at the payback point.
   3. Retention cohorts and churnReads cohort retention tables and monthly churn, with lifetime = 1 / churn, shown as a cohort heat table and retention curves flattening or falling to zero.
   4. Break even and contribution marginComputes break even units = fixed costs / (price - variable cost), drawn as a graph of revenue and total cost lines crossing at the break even point with profit and loss regions.
5. 5

   Financial projections

   4 lessons

   1. Building a revenue forecastForecasts revenue from customers, price and growth drivers month by month, shown as a driver tree feeding a stacked bar chart of revenue over three years.
   2. The startup income statementProjects revenue, cost of goods, operating expenses and net income, shown as an income statement table with gross margin and a line of losses turning to profit.
   3. Cash flow, burn rate and runwayComputes burn = monthly cash out minus cash in and runway = cash / burn, drawn as a declining cash balance line with the zero cash date and fundraising point marked.
   4. Scenarios and sensitivityBuilds best, base and worst cases and tests which assumptions matter, drawn as a tornado chart of the drivers' effect on year three revenue. Probabilities can weight the three cases into an expected value.
6. 6

   Intellectual property and legal structure

   4 lessons

   1. Patents and trade secretsExplains what is patentable, novelty, filing and duration, and when secrecy is better, shown as a timeline of a patent from provisional filing to grant and expiry.
   2. Trademarks and copyrightsDistinguishes marks, copyrights and licensing, and brand protection, drawn as a table matching each right to what it protects, its term and a sample asset.
   3. Choosing a legal entityCompares sole proprietorship, LLC, S corporation and C corporation for liability and taxes, shown as a decision flowchart ending at the best entity for a venture type.
   4. Founder agreements and vestingCovers vesting with a cliff, assignment of IP and shareholder agreements, drawn as a four year vesting timeline with a one year cliff and monthly steps.
7. 7

   Financing and valuation

   4 lessons

   1. Funding stages and sourcesWalks through bootstrapping, friends and family, angels, seed, Series A and debt, shown as a ladder of funding rounds with typical amounts, investors and company milestones.
   2. Cap tables and dilutionTracks ownership across rounds with post money = pre money + investment and dilution, drawn as a cap table and stacked bars of ownership shrinking across rounds.
   3. The venture capital methodValues a startup as exit value times ownership, discounted at a target return, with post money = terminal value / target multiple, shown as a timeline from investment to exit with the return multiple.
   4. Term sheets and convertible notesExplains pre money valuation, liquidation preference, board seats, SAFEs and convertible notes with caps, shown as an annotated term sheet and a waterfall of exit proceeds.
8. 8

   Growth, exits and pitching

   4 lessons

   1. Scaling the ventureExamines growth metrics, hiring, culture and the risks of scaling too early, drawn as an S curve of growth with phases from search to scale and key metrics for each.
   2. Exit options: IPO and acquisitionCompares acquisition, IPO and other exits and how proceeds are divided, drawn as a waterfall chart from exit price down to founders, investors and employees.
   3. The investor pitchStructures a ten slide pitch covering problem, solution, market, traction, model, team and ask, shown as a storyboard of ten slides in order with the key claim of each.
   4. Business plan and riskPulls the plan together with milestones, key risks and mitigation, drawn as a risk matrix of likelihood against impact and a milestone timeline linked to funding needs.