7 Steps to a

Successful
Startup
Naeem Zafar
Professor of the Practice, Deans
Teaching Fellow
University of California Berkeley, Brown
University
Twitter: @naeem
www.Startup-Advisor.com
Startup Workshop

All rights reserved Naeem Zafar

Personal Background
Faculty member at Univ of California Berkeley (College of
Engineering, Center of Entrepreneurship & Technology & Haas
business school) and UCSF
Founder www.Startup-Advior.com advisory to entrepreneurs
Served as the CEO of five startup companies
Worked in engineering, research, marketing & sales
Experience at one large multinational & 7 startups
One IPO (Initial Public Offering)
Sold Bitzer Mobile (co-founder & CEO) to Oracle in 2013
Raised over $70M in multiple ways (VC, asset sale, debt, angel)
Traveled to 76 countries, lived in 3
Brown University engineering 1981, Univ of Minnesota
Charter member of TiE Silicon Valley, Chairman of OPEN SV
Advised or mentored over 1,000 entrepreneurs
Startup Workshop

All rights reserved Naeem Zafar

www.FiveMountainPress.com

www.startup-advisor.com

All rights reserved Naeem Zafar

Entrepreneurship
Pursuit of business opportunity with
the resources that you currently do
not control

Startup Workshop

All rights reserved Naeem Zafar

Startup vs. Large

Business

search

execute

Unknown biz model

Unknown customers,
channel
Startup Workshop

Known biz model

Known customers,
channels, problems
All rights reserved Naeem Zafar

Pre-Ideation
Intersection
of these 3
forces yield
initial ideas

Deep
insights on
customers
needs

Macro
tech
trends

Founders
skills &
motivation
s

ENGN 1010 S03

All rights reserved Naeem Zafar 2015

The Business Plan

What problem are you solving?

Who has this problem?

Your business plan is this clarity in your mind that comes after
extensive market research & talking to your customers
Startup Workshop

All rights reserved Naeem Zafar

7-Step Process: Starting

Scalable Business
1. Are you really an entrepreneur?
2. Identify a big unmet need
3. Market research- validate
assumptions
4. Customer discovery: who needs
me more?
5. Define unique positioning
6. Confirm scalable business model
7. Inspire the right team
Startup Workshop

All rights reserved Naeem Zafar

Steps for Starting Up

Find unmet need
Validate need

Market
research

Develop Biz Plan

Find team

www.startup-advisor.com

Create
Investor
Materials

All rights reserved Naeem Zafar

Scaling Your Company

All rights reserved Naeem Zafar

10

1: Personal Clarity
Profile of an entrepreneur
Resilience, determination,
perseverance!
Creative & resourceful
A misfit of society

Your reasons for starting

Have clarity on why you

want to be an
entrepreneur!
Startup Workshop

All rights reserved Naeem Zafar

11

Make up of an
Entrepreneur
1. Strong convictions but flexible in
execution
2. Able to work in the fog
3. Knows how to network,
communicate & sell
4. Choice of life partner is crucial

Startup Workshop

All rights reserved Naeem Zafar

12

2: Identify Big
Opportunity
Is there an unmet need?
Most important homework
Not just a solution looking for a
problem
Observe people who claim there is
a need

Startup Workshop

All rights reserved Naeem Zafar

13

Sizing the Opportunity

Will this be worth your time?
Will this idea be easy to raise
money for?
What is wrong with smaller
markets?

Startup Workshop

All rights reserved Naeem Zafar

14

Size The Opportunity

Market size
buy

# of people who can

X price
X # of times they will buy
per year

Startup Workshop

All rights reserved Naeem Zafar

15

3: Research to Validate
Assumptions

Surveys, talk to people, group

sessions to discover:

Who is interested in my product or

service?
How many such people are there
Why do they need me
Why will they buy from me
How many can we reach easily
Where are they looking
Startup Workshop

All rights reserved Naeem Zafar

16

4: Who Needs Me More?

Market Segmentation
Start by intense
domain & customer
knowledge
Articulate pain users
have
Who has more pain
now!

Startup Workshop

All rights reserved Naeem Zafar

17

Questions

Is there a real unmet need in this area (where your products address the
problem)?
How does he/she want to see this problem solved?
Why have they not solved this until now what issues are preventing the
problem from being solved?
If a solution (or a product) existed, what would it look like?
Who will use this product (or service) what are these users looking for?
How badly do they want it?
What is the buying process (in other words, who needs to approve this
purchase)?
What are usually the selection criteria?
What price point will make this decision a no-brainer? At what price point
are we likely to find resistance?
What are the reasons somebody would decide not to buy?
Why hasnt the customer bought this solution from someone else until
now?
Who else may be interested in solving this problem?
Who in the organization is the most likely to champion solving this problem
can I get an introduction to them?

Startup Workshop

All rights reserved Naeem Zafar

18

Doing Online Research

Sites.Google.com

Drive traffic to
landing page
Google Adwords
Facebook Ads
Emails to targets

www.Zoomerang.com
www.SurveyMonkey.com
Survey
Online

Landin
g Page
Tell them Value Prop &
Link to take survey

Collect
contact

www.constantContact.com
www.aweber.com

Startup Workshop

All rights reserved Naeem Zafar

19

Target Market

Identify your Find a sliver

target market who needs
you more!
5/15/2009

all rights reserved Concordia Ventures LLC

20

Customer Discovery
Method

Create a product brochure

See what peoples reaction

Google AdWords to gauge customer interest

You should have an extremely good idea why

your customers would buy your product
before you even start the company

Startup Workshop

All rights reserved Naeem Zafar

21

How to Pick Your 1st

Customer?

Look inside
your chosen
sliver
5/15/2009

Find a
customer
whose hair is
on fire now!

all rights reserved Concordia Ventures LLC

22

5:Creating Differentiated
Positioning

Positioning = what do you do?

Who else is doing anything close to

what you are trying to do and
How do you appear different to
customers that they do?

Startup Workshop

All rights reserved Naeem Zafar

23

Positioning
Positioning statement must be
simple & self explanatory
Make it specific
Bad: increase website security
Good: cuts fraud in online
transactions for commercial banks

Must connect with core

competency
Startup Workshop

All rights reserved Naeem Zafar

24

How Will You Appear

Different to Your
Customers

Startup Workshop

All rights reserved Naeem Zafar

25

6: Business Model
How do you make money?
who pays you
what channels
what gross margins

Startup Workshop

All rights reserved Naeem Zafar

26

Business Model Drives

Clarity
$3
$2
Licensing
fee

Google
Ad

Your
Company

User
$9
Customer
27

7: Why us: The Team

Where not to find a team?
Who is on a team?
Not just your founders!

www.startup-advisor.com

All rights reserved Naeem Zafar

28

What Makes a Good

Team?
What is a good team?
The only common thread among
successful teams: deep mutual
respect
People who share your vision
People whom you have worked
with
Complementary skills

Startup Workshop

All rights reserved Naeem Zafar

29

Team

Co-founders
Advisory board members
Strategic consultants
Professional service providers
(Law firm, accounting firms, Professors)

www.startup-advisor.com

All rights reserved Naeem Zafar

30

What Investors Look For?

1. Team
Passionate, committed, smart, misfits

2. Deep customer knowledge & insights

An unfair advantage

3. Traction
Proof that users want this
Accelerators Exits & Funding

All rights reserved Naeem Zafar 2015

31

Culture Differences
Planning vs. doing
Getting out of the building
Customer empathy [not traditional
market research]

Igniting Innovation: UC Berkeley

All rights reserved Naeem Zafar 2015

32

Know Your Core Strength

Startups start with core
strength/knowledge of the founders
intersecting with deep customer
insights
Find a customer with hair on fire

Igniting Innovation: UC Berkeley

All rights reserved Naeem Zafar 2015

33

Why Startups Innovate

Startups know that they dont know
So they look, pivot, change & not
worry about killing sacred cows!
They innovate out of survival

Igniting Innovation: UC Berkeley

All rights reserved Naeem Zafar 2015

34

Summary: Essential
Homework
Many ideas
Unmet need
Market size
Differentiated Positioning
Scalable Biz Model
Why us & why now

Good ideas
Startup Workshop

All rights reserved Naeem Zafar

35

7 Steps to a Successful
Startup
Signup &
download this
book for free
www.NaeemZafar.co
m/free

Startup Workshop

All rights reserved Naeem Zafar

36