1.

1: Entrepreneurship and
Technopreneurship
ENTREPRENEURSHIP
 Is a term coined in the 1700s and has many interpretations in the current context as
time evolves. Entrepreneurship is considered an act of creating or building a business or
a venture while building and scaling it to generate a profit. Generally, entrepreneurship
follows a high-level path from identifying needs, building products, mitigating risks, and
taking the products to market. The modern definition of entrepreneurship is:
           “ Entrepreneurship transforms the world by solving big problems. It initiates social
change, creates an innovative product or presents a new life-changing solution.”
However,  according to Hisrich (1995) there are different personality types that can lead
even the brightest entrepreneur with the best idea into bankruptcy such as:

o Shotgun Sam: quickly identifies new promising business
opportunities but rarely if ever follows through on the opportunity
to create a successful new venture
o Simplicity Sue: always thinks everything is a lot simpler than it is to
create a successful business through one or two easy solutions
o Prima donna Paul: so in love with his own idea that he feels
everyone is out to take his idea and take advantage of him
o Ralph the Rookie: well-grounded in theory but lacks real-world
business experience
o Meticulous Mary: having things under control that he or she cannot
manage during a catastrophe
o Underdog Ed: likes to attend seminars and discuss problems but
does not like putting things into action
o Hidden Agenda Harry: does not have the right motives
o Invertor Irving: more concerned about the invention itself rather
than creating business
 
 

TECHNOPRENEURSHIP
Technopreneurship on the other hand was coined from the words “technology” and  “
entrepreneurship”. It was first used in the year 1987 but gained popularity due to the
wide use of the internet during the second millennium.
 
Technopreneurship can be defined as follows:
 Integration of technology, innovation, and entrepreneurship
 “act of turning something” into a resource of high value by converting good
ideas into business ventures that relies heavily on the application of human
knowledge for practical purposes.”
 “entrepreneurship in the field of technology.”
 “process of engineering the future of an individual, an organization or a
nation.”
 “application of the newest inventions and advancement in coming out with
new and innovative products through the process of dissemination.”
 “manufacturing of hi-tech products or making use of hi-technology to deliver
the product to consumers.”
 “exhaustive use of technology in making a profit.”
 
ENTREPRENEUR VS TECHNOPRENEUR

ENTREPRENEUR

  a person who identifies an opportunity converts it into a product or service, estimates

earnings and profit, and builds a successful business with it.
 Entrepreneurship is an important driver of economic growth and innovation.
   Entrepreneurship is high-risk, but also can be high-reward as it serves to generate
economic wealth, growth, and innovation.

 
Examples of successful entrepreneurs:
Many household-name businessmen exemplify entrepreneurial success. Here are just a
few examples:
 STEVE JOBS- the late tech leader who started Apple in a garage and grew it
to the dominant tablet, smartphone, and computer company it is today.
 JACK MA -Alibaba Group’s executive chairman.
 BILL GATES - the Microsoft creator and founder who has been listed as the
world’s wealthiest individual and has become a global leader on pandemics
and how to handle them.
 
Examples of successful technopreneur in the Philippines:
 DIOSDADO “DADO” BANATAO.Dado was popular for having invented the
two foundation technologies in every Personal Computer (PC) until today, that
is the chipset and the graphics acceleration architecture. He also founded
technology start-ups during his time. Mostron, was one of them.
 JOEY DURANGO. He is currently the CEO of Gurangco Software, global
provider of Human Capital Management solutions. It is hailed as the most
successful Microsoft Dynamics partner in the Philippines.
 ORLANDO B. VEA.  He was appointed Chief Wireless Advisor of SMART.
 WINSTON DAMARILLO. Is the chief executive officer and co-founder of
Morphlabs.

1.2: Importance of
Technopreneurship
1. Creating Employment. Employers will offer opportunities for employment as
they need manpower to run the business operations.  
2. Local Resources. Raw materials or ingredients in certain products can be
utilized by entrepreneurs for business success. Surely, the usage of local
resources increases its value.
3. Diversification and decentralization of Business. Technopreneur can find out
the business opportunities and locate these businesses in suitable areas
including remote areas.
4. Technological advancement. Obviously, technopreneurs can play an
important role in the field of utilization as well as the development of
technology.
5. Capital formation. Technopreneurs require funds to start a business by asking
for financial assistance from investors. The increase of capital formation and
investment will benefit the owners as well as the workers that eventually
leads to economic development.
6. Promotion of entrepreneurial culture. Young people will be inspired to work
with such technopreneurship firms and learn how to get success. Eventually,
these young people will also start up their business firms too.

2.1: Startup
Do you want to create jobs, or change the world or make your business vision a reality?
Think about Facebook, Apple, Netflix, Google, those are considered as startups that
made a big impact in today’s generation
A  technopreneur starts out with nothing but an IDEA. He defies existing practices and
systems also thinks of doing things differently. He creates a product or solution which
destroys the existing economy by using the heft and capability of technology to change
the way something was traditionally done. For a technopreneur, it’s not as much about
the money as it’s about the affirmation and the validation that IDEA needs to work for
the greater common good it doesn’t need to be a global blockbuster. (Hamraoui, 2018)
 
 STARTUP
Is a newly emerged business or company aimed at value creation with innovation to
meet a marketplace by developing a viable business model around a product, service,
process, or platform.  It is a form of a  business/company or partnership which is
designed to search for a REPEATABLE and SCALABLE business model in order to meet
the needs of the customers.
A startup is a team of entrepreneurial talent developing new innovations, in identifiable
and investable form, in progress to validate and capture the value of the created
innovation - with the ambition to grow fast with a scalable business model for maximum
impact. 
A great company is a self-sustaining entity that is no longer dependent on any single
individual or other organization, where all necessary knowledge, values, strategies are
permanently embedded in its existence in a way that it can continue to operate, improve
and build value for customers, shareholders and other key stakeholders while remaining
financially stable by the value of solutions and products it creates.
 
Evaluating Startup Potential
 To help you deepen your understanding of our topic, mouse over the video below
                      Watch: “Startups: what we know about
startups”(YouTube)https://www.youtube.com/watch?v=FCiHWQlrlvY
 
Startups are “optimal” vehicles to validate and bring new innovations to the markets.
Especially more disruptive innovations due to the fast development of technology, the
internet, software, open-source concepts, app stores, and other platforms.
 
      “ A startup is an act of
                                                              

rebellion.”
                                                                                                                                                           
- Ken singer
DISRUPTION
 A proposed change in the order of things
 A rejection: that the current way is insufficient
 Threatens the incumbents
 They use their market dominance and power to keep out new players
 
THE DISRUPTORS:
 Grab
 Airbnb
 Paypal
 Lazada
 Netflix, streaming video
 Startups encapsulate all but only relevant things for what's needed to build new
innovations with a minimum “wasted resources” combined with maximum drive &
motivation.

Startups create most of the new jobs, attract international talent and foreign direct
investments. “Over the last twenty-five years, almost all of the private sector jobs have
been created by businesses less than five years old. Between 1988 and 2011, companies
more than five years old destroyed more jobs than they created in all but eight of those
years.” - Source: a study by Kauffman Foundation and the Institute for Competitiveness
& Prosperity

2.2: Why Do Startups Fail?

                                   “… failing to involve customers and their feedback from literally the
first day of startup’s life….
                                             get out of the building’ and talk to the only folks who matter---
your customers.”
                                                                                                               - Steve Blank,
technopreneur and author  of  “The Startup Owners Manual”
  
                                                      There is no value until customer needs and technical
capabilities intersect.
 

Why do startups fail?

Factors, why startups fail, are due to the following reasons:

o
 lack of adequate marketing research( e.q. poor product timing,
competition, pricing issues)
 problems with pivoting
 user-hostile product
 wrong team, burnout
 lack of passion
 financial problems

2.3: Diversity in Teams

A startup is a venture that is initiated by its founders around an idea or a problem with a
potential for significant business opportunity and impact.  The aim of the initial
founder(s) is to establish a committed co-founder team with the necessary skills and
abilities to be able to validate the initial problem/solution fit and product/market fit,
before scaling it to a significant company and self-sustained business. 

So in addition to the innovation process itself, from idea to value-generating product

and business model, startups also need to have a strong and committed founding team.
                                         “ To run an efficient team, you only need three people: a
hipster, a hacker, and a hustler”
                                                                                                                                              ----
Rei Inamoto, founding partner of Inamoto & Co.
       
According to Rei, startup teams should at least consist of three types of people:

o
 HIPSTERS:   The designers. They are great at coming up with
ideas. Hipsters are responsible to build the company and
 product branding as well as the aesthetic of the company
websites and the application developed. They handle the
design and marketing work.
 HACKERS:  They are problem solvers, application developers.
As developers, hackers should have a strong capability to
programming and coding. They have to master the
development or front-end and back-end parts of the
application development. Usually, Hacker takes the position as
the company Chief Technology Officer (CTO) that is
responsible for the use of technology on the products of
services development.
 HUSTLERS: The leaders of the group.  In many cases, a Hustler
is the one who works as the CEO or Chief Executive Officer of
the startup that takes care of the company business activities,
pitching to investors or stakeholders, and builds the networks
to prospective partners.

Each role is important to startup development. A solid and complete team is needed. A
team should consist of those 3 types of people to complement one another to be able to
produce products and services and offers solutions to the target customer problems.
Which type of people are you?
 
HOW TO BUILD A TEAM:
 Do not choose members because they are “agreeable.”
 Find smart people you can disagree with but can come to an agreement eventually
 Discuss everyone’s strength and weakness early on
 Find teammates whose strengths fill your weaknesses
 Set clear delineated roles and functions
 Set clear achievable goals
 Set up regular check-ins and established a strong culture of communication
 It is important that you choose the best teammates than joining the best idea

3: Design Thinking Process

                                                                                                          “Design is not what it
looks like or feels like. Design is how it works.”

                                                                           
Steve Jobs
Design thinking is not only a system of ideas but also a problem-solving approach in
trying to seek to solve complex problems in a user-centric way. The focus is more on
targeting practical results and solutions leading to innovation and value creation for the
users.
Design thinking is a non-linear, iterative process of creative problem solving that is
human-centric in nature and encourages startup members to focus on the people they
are developing the product for hence, the user-centric design. This, in turn, leads to
better product services, and internal processes.

The five phases of Design Thinking, are as follows:

 Empathize – with your users
 Define – your users’ needs, their problems, and your insights
 Ideate – by challenging assumptions and creating ideas for innovative
solutions
 Prototype – to start creating solutions
 Test – solutions
 
Principles of Design Thinking
1. The Human Rule. All kinds of design activities are ultimately social in nature.
2. The Ambiguity Rule. Requires all design thinkers to preserve ambiguity in the process
of design thinking.
3. The Re-design Rule. All designs are basically examples of re-design.
4. The Tangibility Rule. Making ideas tangible always facilitates communication between
design thinkers.

3.1: Empathize- Research You

User's Needs
It's great to create an innovative product or service. It's not so great to build one that's
useless to people. That is why your users should be your number one focus. When you
can empathize with them and take inspiration from their needs, feelings, and
motivations, your team can create meaningful solutions to actual
problems. Empathize with your users. Drop assumptions, judgments, and biases. This is a
great way to understand and share the feelings of your users to foster deep user
understanding and be able to uncover deep user insights and needs.
 
Methods of Empathizing

o   Observe.  This method is when startup incubatees view users and their
behavior in the context of their lives.
o   Engage. Interact with and interview users through both scheduled and short
‘intercept’ encounters. 
o   Immerse. Experience what your users experience and put yourself in their
shoes.

 
Leading questions are ineffective.
Open-ended questions that provide insights.

o
 Who?
 What?
 When?
 Where?
 Why?
 How?
3.2: Define - State Your User's
Needs and Problems
In this phase of Design Thinking, members of the startup will need to collaborate within
the team and collate all data collected from the previous Design Thinking step, Empathy.
From there, all data will be unpacked and synthesized as the team seeks out insights and
user needs.
In order to define the problem, the startup incubatee must come up with an actionable
problem statement by creating a Point of View (POV)
 
3.1.1:  Storytelling
Startup incubatees will be tasked to list down what they've seen, describe what they've
heard and observed, and list down all important details on post-its. All while keeping in
mind to not misinterpret or judge as well as to indicate if an assumption has been made
by a team member.
 
3.1.2: Defining Persona/s
A Persona is a fictional character created to represent user types and will be useful in
considering the goals, desires, and limitations of the users to help guide design decisions.
Creating a Persona will help startup incubatees put a personal human face on otherwise
abstract concepts with regard to their users.
 define your PERSONA Fictional characters created to represent user types. Useful in
considering the goals, desires, and limitations of the users to help guide design
decisions. A way to put a personal human face on otherwise abstract
data about customers. 

Personas may include but are not limited to:

                      Name and picture
                      Demographics (age, education)
                      Needs and tasks
                      Goals and aspirations
 
3.1.3: Creating a Storyboard. 
Similar to how directors and writers of movies or TV shows create rough sketches of
scenes, members of the startup incubatee will be creating a visual representation of their
encounter with the users by means of creating a simple storyboard.

3.1.4: Creating a POV

A POV or point-of-view is one sentence that creates an image in the mind of members
of the startup incubatees and consists of the user, need, and insight/why.
 

                                  User  +  Need  +  Insight 

= POV
Based on an understanding of a user group and insights into a specific need, it narrows
down the problem space and focuses on a specific problem
Below is an example of a POV along with the problem/challenge that needs to be
addressed:
           Challenge: Redesign the ground experience at the local international airport
            POV: Meredith is a mother of three who needs to entertain her energetic
children at the airport while waiting for boarding time.
                          User: Meredith is a mother of three
                           Need: To entertain her energetic children at the airport
                           Insight/Why: Waiting for boarding time
 
3.1.5: How Might We/HMWs
In  this phase, you will start to progress to the third stage, Ideate, by asking questions
that can help you look for ideas for solutions by asking:
                                                        “How might  we (HMW)?"
 
Examples:
Amp up the good:
                   HMW use the kids’ energy to entertain fellow passenger?
Remove the bad:
                HMW separate the kids from fellow passengers?
Explore the opposite:
               HMW make the wait the most exciting part of the trip?
Question an assumption:
              HMW entirely remove the wait time at the airport?
Unexpected resources:
             HMW leverage free time of fellow passengers to share the load?
Create an analogy from need or context:
           HMW make the airport like a spa? Like a playground?
Play  point of view against the challenge:
           HMW make the airport a place that kids want to go?
Change a status quo:
        HMW make playful, loud kids less annoying?
Break POV into pieces:
       HMW entertain kids? HMW slow a mom down? HMW mollify delayed passengers?

3.3: Ideate- Challenge Assumptions

and Create Ideas
Aso known as brainstorming and expansive thinking, ideation is all about helping startup
incubatees of the UC Innovation and Nurturing Space come up with multiple ways to
solve a problem or improve a situation. Instead of trying to think of one perfect solution,
startup incubatees are encouraged to think about reframing the problem or looking at it
from all conceivable perspectives to get several possible solutions. It is completely OK 
that most of the ideas the team comes up with won't end up working.
 
To begin your brainstorming, have the team challenge to come up with ideas that arent's
just 10 % better than the status quo but 10x better. Basically, thinking big, really big --
can give the startup incubatee radical new ideas.
 
3.3.1: Brainstorming
            In this stage of Design Thinking, members of the startup incubatee start to
imagine possibilities and generate ideas.
    
    Quantity of Ideas
             The goal of Ideation is to generate as many ideas as possible to solve the
problem. In this stage of Design  Thinking, it is essential that the team does not check for
feasibility and viability as this is done later during prioritization.
    
    Rules  on Brainstorming
     There is no set way to brainstorm, as a team and team members are unique in their
own way but generally, the following rules may contribute to the ideas and the overall     
brainstorming   session that will take place:

o
  Defer Judgment - Constructive Criticism within startup
incubatee teams is encouraged but Negativity is not. The key
is to make everyone in the team feel like they can say any idea
that's on their mind and allow others to build on it.
 Encourage Wild Ideas - Creative leaps can oftentimes rise
from wild ideas. In thinking about ideas that are wacky or out
there we tend to think about what we really want without the
constraints of technology or materials.
 Build on the Ideas of Others - Being positive and building on
the ideas of others can take some skill. In conversation,
encourage the startup incubatees to try to use "and" instead of
"but."
 Stay focused on the Topic - Try to keep the startup incubatees
engaged and the discussion on target, otherwise they may
diverge beyond the scope of what problem it is they want to
solve.
 One Conversation at a Time - The startup incubatee team is
far more likely to build on an idea and make a creative leap if
everyone within the team is paying full attention to whoever is
sharing a new idea.
 Be Visual - In live brainstorms encourage the startup
incubatees to write down their ideas on Post-its and then put
them on a wall. Nothing gets an idea across faster than
drawing it.
 Go for Quantity - Encourage startup incubatees to aim for as
many new ideas as possible. In a good session, up to 100 ideas
are generated in 60  minutes. Have them crank the ideas out
quickly and build on the best ones.

3.4: Prototype - Start to Create

Solutions
In line with the fourth principle of the Design Thinking Process, the Tangibility Rule, this
is where startup incubatees get theoretical ideas out of their head and into the physical
world. Startups will be tasked to create Flowcharts, Low Fidelity Mockups, High Fidelity
Prototypes, or anything necessary to help team members visualize the solution to the
problem
 
Low Fidelity Prototypes.  Low-fidelity prototyping involves the use of basic models or
examples of the product being tested. For example, the model might be incomplete and
utilize just a few of the features that will be available in the final design, or it might be
constructed using materials not intended for the finished article, such as wood, paper, or
metal for a plastic product.  Low-fidelity prototypes can either be models that are
cheaply and easily made, or simply recounts or visualizations of them.
Examples of low-fidelity prototypes:

o
  storyboarding
 sketching
 card sorting
         Pros of low-fidelity prototyping:

o
 quick and inexpensive
 possible to make instant changes and test new iterations
 disposable/throw-away
 enables the designer to gain an overall view of the
product using minimal time and effort, as opposed to
focusing on the finer details over the course of slow,
incremental changes
 available to all; regardless of ability and experience, we
are able to produce rudimentary versions of products in
order to test users or canvas the opinions of stakeholders
 encourages and fosters design thinking
 
      Cons of low-fidelity prototyping:

o
 An inherent lack of realism. Due to the basic and
sometimes sketchy nature of low-fi prototypes, the
applicability of results generated by tests involving simple
early versions of a product may lack validity.
 Depending on your product, the production of low-fi
prototypes may not be appropriate for your intended
users. For instance, if you are developing a product
bound by a number of contextual constraints and/or
dispositional constraints ( i.e. physical characteristics of
your user base, such as users with disabilities) then basic
versions that do not reflect the nature, appearance, or
feel of the finished product may be of scant use;
revealing very little of the eventual user experience.
 Such prototypes often remove control from the user, as
they generally have to interact in basic ways or simply
inform an evaluator, demonstrate or write a blow-by-
 blow account of how they would use the finished
product.
 
High Fidelity Prototypes.  High-fidelity prototypes are prototypes that look and operate
closer to the finished product. For example, a 3D plastic model with movable parts
(allowing users to manipulate and interact with a device in the same manner as the final
design) is high-fi in comparison to, say, a wooden block. Likewise, an early version of a
software system developed using a design program such as Sketch or Adobe Illustrator is
high-fi in comparison to a paper prototype.
             Pros of high-fidelity prototyping

o

  Engaging: the stakeholders can instantly see
their vision realised and will be able to judge
how well it meets their expectations, wants,
and needs.
 User testing involving high-fi prototypes will
allow the evaluators to gather information with
a high level of validity and applicability. The
closer the prototype is to the finished product,
the more confidence the design team will have
in how people will respond to, interact with
and perceive the design.
             Cons of high-fidelity prototyping

o

 They generally take much longer to produce
than low-fi prototypes.
 When testing prototypes, test users are more
inclined to focus and comment on superficial
characteristics, as opposed to the content.
 After devoting hours and hours of time to
producing an accurate model of how a product
will appear and behave, designers are often
loath to make changes.
 Software prototypes may give test users a false
impression of how good the finished article
may be.
  Making changes to prototypes can take a long
time, thus delaying the entire project in the
process. However, low-fi prototypes can
usually be changed within hours, if not
minutes, for example when sketching or paper
prototyping methods are utilized.
With everything taken into consideration, it should be no surprise that low-fidelity
prototyping is what is more preferred in the early stages of Design Thinking, while high-
fi prototyping is used in the later stages when the test questions are more refined.
 
Guidelines when Prototyping.
It is important for startup incubatees to remember that prototypes are supposed to be
quick and easy tests of design solutions. The following are a few guidelines that will help
startup incubatees in the Prototyping stage:

o
 Just Start Building. Design thinking has a bias towards
action: that means if the startup incubatee has any
uncertainties about what they are trying to achieve, their
best bet is to just make something. Creating a prototype
will help them think about their idea in a concrete
manner, and potentially allow the team to gain insights
into ways they can improve their idea.
 Don't Spend Too Much Time. Prototyping is all about
speed; the longer the startup incubatee spends building g
a prototype, the more emotionally attached they can get
to their idea, thus hampering their ability to objectively
judge its merits.
 Remember What You're Testing For. All prototypes
should have a central testing issue. Do not lose sight of
that issue, but at the same time, do not get so bound to it
so as to lose sight of other lessons the team could learn
from.
  Build with the User in Mind. Test the prototype against
the expected user behaviors and user needs. Then, learn
from the gaps in expectations and realities, and improve
on the ideas.

3.5: Test - Try Your Solutions Out

 
Being that Design thinking is a Non-Linear, Iterative process, testing can be undertaken
throughout the progress of a Design Thinking project, although it is most commonly
undertaken concurrently with the Prototyping stage.

Testing, in Design Thinking, involves generating user feedback as related to the

prototyped the startup incubatee has developed, as well as gaining a deeper
understanding of the users. When undertaken correctly, the testing stage of the project
can often feed into most stages of the Design Thinking process: it allows the startup
incubatee to Empathize and gain a better understanding of their users; it may lead to
insights that change the way the team would Define their problem statement; it may
generate new ideas in the Ideation stage; and finally, it might lead to an iteration of the
team's Prototype.
 
Conducting a User Test
When conducting a user test on the prototype, it is ideal to utilize a natural setting (i.e.,
the normal environment in which the users would use the prototype). If testing in a
natural setting proves difficult, have the team try to get users to perform a task, or play a
tole, when testing the prototype. The key is to get users to be using the prototype as
they would in real life, as much as possible.
 
Improve Your Test Results
Conducting a test is not as simple as getting the user and the prototype in the same
room and watching what happens. In order to achieve the best learning results from
each test, here are some areas of a test that the startup  team members should take into
consideration:

o
   The Prototype. The team's prototype should be
designed with a central question in mind -- a question
that the team will put to the test in the testing stage.
  Context and scenario. As much as possible,  try to
recreate the scenario in which their users are most likely
to be using the product. This way, the team can learn
more about the interaction (or disruptions) between the
user, the prototype, and the environment, as well as how
problems might arise as a result of that interaction.
  How you interact with the user. Make sure the users
know what the prototype and test are about, but do not
over-explain how the prototype works.
  How you observe and capture feedback. While
collecting feedback, make sure the user's interaction with
the prototype isn't disrupted.  Find a way to collect
feedback in a byway that freely allows them to observe
what is happening ( for example, by having a partner in
the test, or by recording an audio or video of the test).
By being deliberate about those four aspects of a test, the team will be able to maximize
their learning experience.  Considering the above points, here are a few things the team
can do to properly plan tests.
 
Guidelines when  Planning a Test

o
  Let your users compare alternatives. Create multiple
prototypes, each with a change in variable, so that the
users can compare prototypes and let the team know
which they prefer ( and which they don't ). Users often
find it easier to elucidate what they like and dislike about
prototypes when they can compare, rather than if there
was only one to interact with.
  Show, don't tell: let your users experience the
prototype.   Avoid over-explaining how the prototype
works, or how it is supposed to solve the user's problems.
Let the users' experience in using the prototype speak for
itself, and observe their reactions.   
 Ask users to talk through their experiences. When users
are exploring and using the prototype, ask them to tell
you what they're thinking. This may take  some getting
used to for most users, so it may be a good idea to chat
about an unrelated topic, and then prompt them by
asking them questions such as, "What are you thinking
right now as you are doing this?" 
 Observe. Observe how the users use -- either "correctly"
or "incorrectly" -- the prototype, and let the team know
to try to resist the urge to correct them when they
misinterpret how it's supposed to be used. User mistakes
are valuable learning opportunities. 
 Ask follow-up questions. Always follow up with
questions, even if you think you know what the user
means. Ask questions such as, " What do you mean when
you say ____?", "How did that make you feel?", and most
importantly, "Why?"

4.1: Establishing your Value

Proposition
A value proposition makes a case for why a customer should pick one product over
another, citing the unique value the product provides over its contenders. It is the
service or solution the startup incubatee provides to solve the problem they are facing.
 
Characteristics of a Value Proposition
 Newness. Some value propositions are based on the newness or novelty factor that
they may provide. This is why technology-intensive products such as those seen in
today's upcoming startups have an edge over products not within the realm of
technology.
 Performance. Better performance has been the hallmark of many product offerings
over the years with most industries managing to thrive for decades on improved
performance versions of the same products. Apple constantly improves the bionic
chip seen in all iPhones resulting in faster computers able to support much more
sophisticated software.
  Customization. A user of any product in this day and age believes in self-expression
and individualism. They, for the most part, expect the products they use to be an
extension of their personality and a medium through which they can communicate
their values and priorities to the world. Providing the option to tailor the product to
the consumer's preferences adds value for the customer. Traditionally, customization
has resulted in prohibitively expensive products, today this option provides the
opportunity for customers to put their personal stamp on a product while still
providing economies of scale.
 Design. Design of a product could make or break the product, it's the first thing a
customer sees. It is one of the most important aspects when building a brand. If time,
effort, and money isn't put into this, it may result in an unsuccessful business. The
design is what will set the startup apart from the competition and help garner the
desired emotion or feeling from customers.
 Risk Reduction. The less risk associated with purchasing a product or service, the
more value a customer derives from it. A reduction of the risk associated with
purchase provides peace of mind to a customer.
 Convenience and Accessibility. Providing consumers with a product that increases
their convenience or is characterized by ease of use provides for a very strong value
proposition.

4.1.2: Designing a Value

Proposition
In designing a Value Proposition the startup  incubatee needs to understand their
customer in its entirety by creating a customer profile by analyzing customer jobs, their
pains, and their gains. This is followed by a value map that clarifies the products and
services offered to the customer, their pain relievers, and gain creators.
Products  and Services
Products can be either tangible or intangible. They can also be characterized as digital or
financial. When designing and evaluating a value proposition, it is crucial to get inside the
customer's head. A useful exercise would be to rank the product and service offerings in
order of importance to the customer. For this, the startup incubatee needs to
understand the appeal of the product. Is it a must-have for the customer because it
fulfills a basic need? Or does it serve a functional, social or emotional requirement?
 
Pain Relievers
The product or service must solve a problem the customer is facing. In essence, it is
relieving chronic pain that the customer goes through on a regular basis and which no
other product has been able to alleviate to the same degree. This pain could take the
form of emotional stress, higher costs, and increased risks.
An effective way to evaluate a product is to analyze whether it generates lower usage of
customer resources such as time, effort, or money; Produces a positive change in the
customer's life by reducing his/her frustration, monotony, or boredom; resolves the
challenges customers may face, reduce the chances of negative social stigmas and
behaviors, reduce risks, alleviate stress, reduce chances of error, eliminate barriers
between the customer and a possible solution, etc. 
 
Gain Creators
The startup incubatee needs to evaluate how the products they have to offer will lead to
customer gains. An effective metric would be to understand how aspects of the product
would enhance the customer experience by fulfilling their expectations and wishes and
even going beyond to surprise and delight them.
The entrepreneur can analyze whether the product or service results in savings that
delight the customer, has results that meet or surpass customer expectations, produce
better results than the alternatives the customer is currently using, result in positive
social relationships and status, fulfill a customer need and are easy to adopt, among
other concerns.

4.1.3: Framework
Best Practices:

o
 List only the combination of products and services that
directly provide value to the relevant customer segment.
 Pain reliever and gain creators list characteristics of your
products and services that are of relevance to the target
customers.
 Products and services will be of value to customers only if they
match the target segment's profile, pains, and gains.
 It is imperative for an entrepreneur to understand that no
product or service will be able to meet all the pains and gains
in a customer's profile. Instead, the entrepreneur needs to
prioritize which pains and gains their product and services
should match.

Common Mistakes:

o
 Mention all the products and services the startup has to offer
regardless of the specific customer segment they target.
  Categorize your products and services as either pain relievers
or gain creators.
 Add additional pain relievers and gain creators even if they
don't match the pains or gains in your target segment's profile.
 Try to resolve all pains or gains of the target segment.

4.2: Determining the Market

(External Factors)
In determining the market of the startup incubatee, Customer Segments shall be first
identified. Once they are identified, the startup incubatee then has to devise the most
effective and efficient way to reach them - these are what we call Channels. With this,
the startup incubatee will be able to know the behavior of their market, thus making it
easier to build Customer Relationship (sustainability of the business).

4.2.1: Customer Segments

These are the groups of people or companies that the startup incubatee is trying to
target and sell their product or service to.
Segmenting the startup's customers based on similarities such as geographical area,
gender, age, behaviors, interests, etc. gives the startup the opportunity to better serve
their needs, specifically by customizing the solution the team is providing them.
After a thorough analysis of the customer segments, it will be possible to determine
whom to serve and whom to ignore. From there, create customer personas for each of
the selected customer segments.
Please see template below for creating a Customer Persona:
Types of Customer Segments
 Mass Market.  A business model that focuses on mass markets doesn't group
its customers into segments. Instead, it focuses on the general population or a
large group of people with similar needs. For example, a product like a phone.
 Niche Market. Here the focus is centered on a specific group of people with
unique needs and traits. Here the value propositions, distribution channels,
 and customer relationships should be customized to meet their specific
requirements. An example would be buyers of sports shoes.
 Segmented. Based on slightly different needs, there could be different groups
within the main customer segment. Accordingly, you can create different
value propositions, distribution channels, etc. to meet the different needs of
these segments.
 Diversified. A diversified market segment includes customers with very
different needs.
 Multi-sided Markets. This includes interdependent customer segments. For
example, a credit card company caters to both their credit card holders as well
as merchants who accept those cards.

4.2.2: Channels
This section of the Business Model Canvas is to describe how the startup incubatee will
communicate with and reach out to customers. Channels are the touchpoints that let
customers connect with the startup.

Channels play a role in raising awareness of a product or service among customers and
delivering the value propositions to them. Channels can also be used to allow customers
the avenue to buy products or services and offer post-purchase support.
 
Types of Channels

o
  Owned channels. Company website, social media sites, in-
house sales, etc.
  Partner channels. Partner-owned websites, wholesale
distribution, retail, etc.

4.2.3: Customer Relationships

In this section of the Business Model Canvas, the startup incubatee will need to establish
the type of relationship the members will have with each of the customer segments or
how members of the team will interact with customers throughout the startup journey.
 
Types of Customer Relationships

o
  Personal Assistance. Members of the startup incubatee
interact with the customer in person or by email, through
phone call or other means.
 Dedicated Personal Assistance.  Members of the startup
incubatee assign a dedicated customer representative from
within the team to an individual customer.
 Self-Service. Members of the startup incubatee maintain no
relationship with the customer but provide what the customer
needs to help themselves.
 Automated Services. This includes automated processes or
machinery that helps customers perform services themselves.
 Communities. These include online communities where
customers can help each other solve their own problems with
regard to the product or service.
 Co-Creation. The startup incubatee allows the customer to get
involved in the designing or development of the product.

 
 
Customer Journey Map
The startup  incubatee will be able to understand the kind of relationship the customer
has with the startup through a customer journey map. It helps the team identify the
different stages customers go through when interacting with the startup as well as helps
the team make sense of how to acquire, retain and grow your customers.
4.3: Identifying the Demands of
your Market (Internal Factors)
In identiying the Demands of the startup incubatee's Market, Key Resources comes first.
This is because the startup incubatee will need to know will fund the Key Activities.
Further, giving the team an idea on who the potential key Partners they will be reaching
out to aid in their operations.

4.3.1: Key Resources

This section of the Business Model Canvas is where the startup incubatee lists down
which key resources or main inputs need to be carried out in the key activities in order
to create a value proposition.
 
Types of Key Resources
 Human. Employee, workers, etc.
 Financial. Cash, lines of credit, etc.
 Intellectual. Branding, patents, IP, copyright
 Physical. Equipment, inventory, buildings

4.3.2: Key Activities

This section is where the startup incubatee identifies what are the activities and tasks
that need to be completed to fulfill the startup's business purpose? The team should
then work together and list down all the key activities that need to be done to make the
business model work.
These key activities should focus on fulfilling its value proposition, reaching customer
segments and maintaining customer relationships, and generating revenue.
 
Categories of Key Activities
 Production. Designing, manufacturing, and delivering a product in significant
quantities and/or of superior quality.
 Problem-solving. Finding new solutions to individual problems faced by customers.
 Platform/network. Creating and maintaining platforms. For example, Microsoft
provides a reliable operating system to support third-party software products.

4.3.3: Key Partners

Key partners are the external companies or suppliers that will help the startup incubatee
carry out the key activities. These partnerships are forged in order to reduce risks and
acquire resources.
 
Types of Partnerships
 Strategic Alliance. Partnership between non-competitors.
 Co-opetition. Strategic partnership between partners.
 Joint ventures. Partners developing a new business.
 Buyer-supplier relationships. Ensure reliable supplies.

4.3.4: Cost Structure

In this section of the Business Model Canvas, the startup incubatee must identify all the
costs associated with operating a business model.
The team will need to focus on evaluating the cost of creating and delivering the value
propositions, creating revenue streams, and maintaining customer relationships. This will
be easier to do once the startup has defined its key resources, activities, and partners.
Businesses can either be cost-driven (focuses on minimizing costs whenever possible) or
value-driven (focuses on providing maximum value to the customer). 

4.3.5: Revenue Streams

Revenues streams are the sources from which the startup incubatee generates money by
selling their product or service to the customers. In this section of the Business Model
Canvas, the startup incubatee should describe how they will earn revenue based on their
value propositions.
A revenue stream can belong to one of the following revenue models.
 
Transaction-based revenue: Made from customers who make a one-time payment.
Recurring revenue: Made from ongoing payments for continuing services or post-sale
services.
 
Methods to generate revenue:
 Asset sales. Selling the rights of ownership for a product to a buyer.
 Usage fee. Charging the customer for the use of its product or service.
 Subscription fee. Charging the customer for using its product regularly and
consistently.
 Lending/leasing/renting. The customer pays to get exclusive rights to use an asset
for a fixed period of time.
 Licensing. The customer pays to get permission to use the company's intellectual
property.
 Brokerage fees. Revenue is generated by acting as an intermediary between two or
more parties.
 Advertising. Charging the customer to advertise a product, service, or brand using
company platforms.