They need to understand the external environment and they need to come in.

Now if you remember we started here on the left. We didn't earn and paid media.

In an existing market, if customers react to your hypothesis that what they needed was higher performance and you are correct, this is your revenue curve.

Again the only way to figure this out is being able to interact with tens or hundreds or thousands of customers so you finally understand what the right revenue streams and revenue model is.

Well, if you think about it, in a new market on year 1 you have no customers, and so your revenue is essentially flat.

And now they started to get a better understanding of what customer relationships were, about getting customers, keeping them and growing them.

This was a startup killer for decades.

The next thing is revenue streams.

What you've already put together is a business model canvas with your hypothesis that says, Look, we're really passionate about this product or service, and we think there's a set of customers out there, and we've put together a revenue model, our first hypotheses and saying we're going to make a lot of money, and that's great, but there's really kind of a method to this madness, and there's not only one way to do this, but this is the way we kind of think of it.

So archetypes really helped us understand our customers, they value prop, the revenue and some of our pricing tactics.

More than likely we'll make money from royalties and commercial licensing, etc.

That's a gentlemen's club. I told you about it. The Singapore clients come to the city, they love that crap.

Our new contacts will give us access to bluechip clients, national governments...

By now, you're intimately familiar with the business model canvass.

Just as a reminder, what the teams will be starting with in Week 1 is filling out the business model canvas and getting out of the building and testing their hypotheses about the value proposition, customer segments, and channel.

I want them to either pay for the product or sign up for something and become a user.

We care how we make our profit.

How do they currently buy and what's the revenue stream that's associated with these kind of pricing tactics?

So a plus b have to be equal to 50.

And in value proposition, the goal of this is to find out that minimum viable product.

You cater an event where the cost to you was 200

In particular, because the idea is that if you analyze the data, that data will tell you something about your customers and then you can better serve your customers and then your profits will go higher.

I realized that recurring revenue from one client is amazing.

We've already talked about value propositions, customer segments, distribution channels, customer relationships, and revenue streams.

Now we finally come to the last part of the business model canvas.

In a non perfect world, you might just be a user and I'm going to monetize you by getting pairs to pay for the fact that I have lots of users, but acquisition that is acquire, and activation is a 2 parts strategy.

Well getting customers is just like it sounds.

In customer relationships all the get keep grow metrics, some of which we talked about, some of which you'll discover, what were the customer acquistion costs?

The company's profitability improved.

And we can eyeball it right here.

So this is trailing 12 months.

So in our last lectures we talked about value proposition, customer segments, distribution channels, customer relationships get, keeping and growing customers.

Maybe Abby made 50 and Ben earned 0.

So on day one, these were their initial hypothesis coming into the class.

Because when someone says earnings, are those the earnings last year?

Then again for your revenue stream.

Profitable.

Everything on this line would be a valid combination of

Let me be clear, you could use the business model canvas and customer development to go through the process for nonprofit but actually having some goals that are fairly concrete revenue and profit allows us to measure whether we're succeeding and failing in very clear ways and then we adjust to the question.

I want to use and on the web, I might be paying Google forever.

Many companies have huge databases of customer information.

Another example of a customer segment was someone making new kite boarding equipment.

Look, I've got a fantastic idea for an embryonic product in a marginal market, with consumers we've never dealt with before, and I'm not sure it's going to have a big payoff, but it could be really, really big in the future?

That's your job as the facilitator and coach.

So let's follow our Jersey Square team down and see what they've done for customer relationships.