Next, they got out of the building again.

It turns out that the answer is pretty specific.

So now they're looking at industrial enzyme manufacturers, their key activities are R amp D, and production support is their next change.

I mean how do they hear of our products, how do they know about you, and as we'll see later one of the interesting things is there are some customers that are users like in Google

Let's take a look at the next step in searching for a business model, and that's customer validation.

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

This is where you construct your hypotheses, and you get out of the building and start testing your assumption about whether other people have the same problem or need you think they have.

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

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?

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.

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

They actually learned another alternative for sports jersey owners would be a monthly subscription and also a one time rental.

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

And when you finally, finally think you do have something that matches customer needs, you get to the next step, which is customer validation.

Many companies have huge databases of customer information.

How much did it cost to acquire a customer? How much did the campaign cost?

And since the enthusiastic new d a has Put all my competitors out of business..

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

Instead of pricing based on cost,

You cater an event where the cost to you was 200

I have no idea where my husband is.

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

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.

The pivot was a term that my best student ever Eric Reese coined when he noticed the arrow between customer validation and customer discovery, and he actually gave it a name, which I think is incredibly accurate.

And if I don't have that, then the good news about the customer development process is it allows us to keep searching without going out of business and so what you'll find is we'll be iterating back and forth doing things called pivots and iterations as we kind of discover what customers really want versus what we think we're building for them.

Apple is one of the few, truly cares.

And in this class, we're going to be talking about the first two steps, customer discovery, customer validation, the pivots that connect them, and then a few that are lucky.

As was simulated, the value proposition includes all the features of your product but also the pains and gains you're solving for the customer segment and that's where the market goes.

Do people agree that you're solving a high value problem or need, and do you understand your business model enough to start test selling, which is the next step in customer validation.

So in the last lecture, you remember the business model canvas, all the 9 components of a startup.

They could tell you that I want bigger, faster, cheaper status quo.

Here's your client list.

This is what I called the you should be so lucky to have this problem part of the funnel, and that's how you grow the customers you have.

Let's go to month two

JU That's a good question, and we ask ourselves that every day.

Many of our clients are AfricanAmerican.

We have recently accepted a client who is VampireAmerican.

A tech company's one of my clients.

Most of my clients are married.

Because no one, and that was a constant problem...

It's a big idea.

That's your job as the facilitator and coach.

We've got customers.

Who do you do that for?

Defense department's largest contractor.