New business development model: “fail fast, fail cheap”
When you start a new project, hundreds of questions about how to conduct our business model we arise. In a previous post we explained how to properly define our new project and start from the beginning with the right foot. In this article we go a step further. Once I have defined my business model, how do we make all that is reflected in our planning come true and get the most benefit from every euro we invest?
To make this post we will build on the knowledge that Sandra Navarro, Project Manager of Flat 101 , shared in the Analysis Module online business models and feasibility of the Master of Digital Marketing Fundesem Business School .
The statement “fail fast, fail cheap” may seem quite pessimistic, but try to solve the big problem of startups based in a traditional style, according to statistics say 9 out of 10 startups fail. Since the money does not arrive, because the income plan that was designed is not met, and the expenses do not give us respite.
Recall that the traditional model followed the diagram showing the image below .:
As it explains Navarro in a post written on his blog: I have already defined my business model and now what , according to traditional teachings, “The Business Plan” includes: detailed macroeconomic analysis, microeconomic analysis, sectoral survey and study of competition, SWOT Analysis, Strategic Plan: Mission and Vision, Technical Study, Legal Study, Marketing Plan, Human Resources Plan and Financial Plan: investment plan, financing plan, 5 year operating accounts, investment analysis Return on investment, NPV, IRR and sensitivity analysis), and finally, the 5-year balances.
This methodology can remain valid in stable and familiar environments, but not in conditions of uncertainty that often launched new online startups. Here we show another way to carry out the creation of this type of companies. We will build on the methodology of lean startup of Eric Ries, whose maximum lies in the statement: “Fail fast, fail cheap”; and customer development model of Steven Blank .
Navarro began his class explaining how to make a minimal viable version of a business, based on a clear example as a car. “The least viable version of a car is not a wheel, but a vehicle without any sophistication that works properly. The same goes for a business. We need this minimal version to carry out this new model of customer-based business development. “