Startup Opportunities

203 Pages·2017·11.584 MB·English

by  Feld, Brad;Wise, Sean

Startup Opportunities

Startup Opportunities
KnOw when tO Quit YOur DaY JOb
Second edition
Sean wise and brad Feld
Cover images: Memo with paper clip © t_kimura/Getty Images;
background © Nicolas Balcazar/EyeEm/Getty Images
Cover design: Wiley
Copyright © 2017 by Sean Wise and Brad Feld. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
The first edition of Startup Opportunities was published by FG Press in 2015.
Published simultaneously in Canada.
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Library of Congress Cataloging-in-Publication Data:
Names: Feld, Brad, author. | Wise, Sean, 1970- author.
Title: Startup opportunities: know when to quit your day job/Brad Feld and
Sean Wise.
Description: Hoboken, New Jersey: John Wiley & Sons, 2017. | Includes
index.
Identifiers: LCCN 2017011359 (print) | LCCN 2017009358 (ebook) | ISBN
978-1-119-37818-1 (cloth) | ISBN 978-1-119-37817-4 (ePDF) | ISBN
9781-1-19-37819-8 (ePub)
Subjects: LCSH: New business enterprises. | Entrepreneurship.
Classification: LCC HD62.5.F445 2017 (ebook) | LCC HD62.5 (print) | DDC
658.1/1—dc23
LC record available at https://lccn.loc.gov/2017011359
Printed in the United States of America
10 9 8 7 6 5 4 3 2 1
To Amy and Marisa,
our wives, who are by far the best opportunities we have ever invested in

Contents
Foreword xiii
Preface xvii
Trust Me, Your Idea Is Worthless 1
by Tim Ferris
Chapter 1 What Is a Startup?  3
How to Use This Book 5
Who This Book Is For 5
Notes 6
Chapter 2 The Democratization of Startups 7
The Cost to Launch Is Approaching Zero 7
The World Is Flat 8
The Path Is Known 9
Access to Capital 10
Chapter 3 Opportunities  13
The Four Criteria for an Opportunity 13
What Is Opportunity Evaluation? 14
What Is the Cost of Poor Opportunity Evaluation? 16
Execution Trumps Opportunity 19
Risk, Uncertainty, and Ambiguity 21
The Issue of Bias 23
Notes 27
vii
viii Contents
Chapter 4 Approaches to Opportunity Evaluation 29
Where Does Opportunity Evaluation Fit into the Overall Startup Process? 29
Overview of Business Model Generation 31
Overview of Customer Development and Lean Startup 33
Overview of the Disciplined Entrepreneur 35
A Modern Version of the Scientific Method 36
Notes 40
Chapter 5 People  43
Team 43
Working Full Time 47
Been There, Done That 47
Passion 48
Coachability 50
Ability to Attract Talent 53
Business Acumen 53
Domain Knowledge 55
Operational Experience 55
Mentors 56
Board of Directors/Advisors 57
Customers 58
Social Capital 59
Notes 60
Chapter 6 Pain 63
Compelling Unmet Need 65
Size 65
Durability and Timeliness 68
Notes 71
Chapter 7 Product  73
The 10× Rule 73
Rate of Adoption 75
Rogers’ (1976) Diffusion of Innovations Theory 75
Intellectual Property 76
Key Asset Access 77
Proof of Concept—Selling Your Product in Advance of Making It 78
Gross Margins 79