long term, and what are you going to do to grow them in the next couple of years as we.

Let's do an exercise and see what it feels like and how does it work to get an activated customer and how much it cost.

And we found after much research that actually not much research, quite simple research that the counterfeit customer was not our customer.

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.

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

Now let's go to month 3.

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?

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

We care how we make our profit.

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

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

And they love to tell you, Oh, it's about 10 percent, proudly.

It's a big idea.

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

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.

And then grow is a neat trick that smart companies do is that they understand that it's a lot more expensive to get customers than to keep them and grow them.

They love to tell you, It's about 10 percent, proudly.

We will take it to the potential customers.

And again, are you getting a viral loop and referral loop from happy and satisfied customers telling others word of mouth and so this is a balancing game, and for first time entrepreneurs who are focused here, it's really important to think about customer acquisition cost and a lifetime value.

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

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

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

We have recently accepted a client who is VampireAmerican.

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

I have no idea where my husband is.

So, while the goal in value prop is to figure out the MVP, yes, we il see later the goal in customer segments is to figure out who and what the archetype of the customer is.

And the goal of all this is to actually define the customer persona or archetype, which is just a fancy way for saying

What's most important to us when we make a video is what the customer sees.

It's exactly the same idea we might want to offer loyalty programs, contests and events, blogs, RSS and email, or social media all designed to engage customers.

Well getting customers is just like it sounds.

If you have world's most perfect business model, investors would love to see this number much bigger than this number and so what you want to look for is a well balanced model that takes into account how much you need to acquire customers but how much ultimately you'll extract from them over the lifetime.

One of the most important metrics to think about now that we have an end to end funnel is something called lifetime value and a lifetime value LTV is not your lifetime but your customer's lifetime.

Seems intuitively obvious but what you want to make sure is the amount of money you're collecting over here is bigger than the customer acquisition cost to remember the amount of money you're spending from here to here.

Well, 0.50 10,000, that cost me 5,000, but the goal isn't to just have people visit, the goal is to get them to the end of the funnel and at the end of the funnel,

When I got there, we had zero happy customers.

Apple is one of the few, truly cares.

Get is how you actually acquire customers and get them to purchase your product.

And they started to think about seniority royalty programs and how they would grow those customers by cross selling and up selling them with premium subscriptions and family plans.

How we do that is the first thing we need to do is make sure our existing customers we've just gotten don't go away, and so if you're in business long enough, you'll start thinking about how to keep customers.

Another common paid activity is advertising. What kind of advertising?

We got customers, acquired them, and activated them.

We all work on little laptops and try to move desks to change the way we think.

Once I understand who my archetypes or persona is, the next thing I want to figure out is how do I get them in to this funnel.

So one of the interesting equations for every startup is that

That was the customer acquisition cost, CAC, here.