Comments on: Sorry Guys – It's the Size of the Wave, Not the Motion of the Ocean http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/ Entrepreneur turned VC Sun, 14 Mar 2010 19:08:34 -0500 http://wordpress.org/?v=2.8.3 hourly 1 By: SiliconANGLE — Blog — Winning the Muggles: Designing for the Mainstream http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-3545 SiliconANGLE — Blog — Winning the Muggles: Designing for the Mainstream Tue, 26 Jan 2010 22:00:19 +0000 http://bothsidesofthetable.com/?p=53#comment-3545 [...] you do basic market segmentation and know the size of the market you plan to serve.  I cover market sizing in this post entitled, “It’s the size of the wave, not the motion of the [...] [...] you do basic market segmentation and know the size of the market you plan to serve.  I cover market sizing in this post entitled, “It’s the size of the wave, not the motion of the [...]

]]> By: Sorry Guys – It’s the Size of the Wave, Not the Motion of the Ocean | CloudAve http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-62 Sorry Guys – It’s the Size of the Wave, Not the Motion of the Ocean | CloudAve Sat, 25 Jul 2009 15:09:11 +0000 http://bothsidesofthetable.com/?p=53#comment-62 [...] leave some comments.  Love to get all input and get the discussion going.(Cross-posted @ Both Sides of the Table) Posted Under : General Tags startups entrepreneurship vc funding venture capital pitching a [...] [...] leave some comments.  Love to get all input and get the discussion going.(Cross-posted @ Both Sides of the Table) Posted Under : General Tags startups entrepreneurship vc funding venture capital pitching a [...]

]]> By: Shane http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-61 Shane Fri, 24 Jul 2009 18:00:35 +0000 http://bothsidesofthetable.com/?p=53#comment-61 Will do, thanks again! Will do, thanks again!

]]> By: marksuster http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-60 marksuster Thu, 23 Jul 2009 17:34:23 +0000 http://bothsidesofthetable.com/?p=53#comment-60 It's always a tough question. Your numbers need to be ambitious enough to warrant investors being interested and yet everybody knows the "out years" numbers are useless. My suggestion is to walk a very tight line, which is to have your next 12 months be very realistic and you can be slightly more ambitious in years 2,3 and even more ambitious is years 4,5. Everybody knows years 4,5 are irrelevant but they want to see that this "can be big" and they want to be sure that the logic of how it can be big holds. And just don't make it sound like years 4,5 are either impossible to achieve or "conservative." Good luck. It’s always a tough question. Your numbers need to be ambitious enough to warrant investors being interested and yet everybody knows the “out years” numbers are useless. My suggestion is to walk a very tight line, which is to have your next 12 months be very realistic and you can be slightly more ambitious in years 2,3 and even more ambitious is years 4,5. Everybody knows years 4,5 are irrelevant but they want to see that this “can be big” and they want to be sure that the logic of how it can be big holds. And just don’t make it sound like years 4,5 are either impossible to achieve or “conservative.” Good luck.

]]> By: Shane http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-59 Shane Thu, 23 Jul 2009 17:05:42 +0000 http://bothsidesofthetable.com/?p=53#comment-59 Question: how do I, as an entrepreneur, make sure that I avoid falling into the "that's ridiculous" trap? I realize that the only way to do this is to be objective in our analysis, but even if I am realistic, how do I best communicate that to a potential investor? Thank you again for this terrific series of posts, they are awesome. Question: how do I, as an entrepreneur, make sure that I avoid falling into the “that’s ridiculous” trap? I realize that the only way to do this is to be objective in our analysis, but even if I am realistic, how do I best communicate that to a potential investor? Thank you again for this terrific series of posts, they are awesome.

]]> By: Jan Schultink http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-58 Jan Schultink Sat, 11 Jul 2009 07:11:16 +0000 http://bothsidesofthetable.com/?p=53#comment-58 Another ex-McKinsey reader here. Especially for consumer-related products, there is a second type of "bottom up" analysis. Get down the the number of customers, price per unit and back up from there. I like to think about things you can touch. Another ex-McKinsey reader here. Especially for consumer-related products, there is a second type of “bottom up” analysis. Get down the the number of customers, price per unit and back up from there. I like to think about things you can touch.

]]> By: Vijay Goel, MD http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-57 Vijay Goel, MD Tue, 30 Jun 2009 07:39:09 +0000 http://bothsidesofthetable.com/?p=53#comment-57 Mark, Outsourcedppt.com is a side project-- got really used to overnight PPT production from India while at McKinsey and helping a group of graphics alums find former consultants who miss the service (its $20/hr to not wrestle with formatting, chart edits, and other such low-value work). Using it more as a teaching tool-- let me know if there are slide types/ stories helpful as templates for entrepreneurs. Still plugging away at building a retail healthcare network with HealthShoppr, about to finish a competition design for a $10M+ healthcare X PRIZE competition to improve health while reducing cost, and helping my wife wrestle with massive growth (and open a store) at Bite Catering Couture. Would love to pick your brain on your health portfolio company and level of interest/ desired features for a Health Innovator's ecosystem we're designing for the competition. Mark,
Outsourcedppt.com is a side project– got really used to overnight PPT production from India while at McKinsey and helping a group of graphics alums find former consultants who miss the service (its $20/hr to not wrestle with formatting, chart edits, and other such low-value work). Using it more as a teaching tool– let me know if there are slide types/ stories helpful as templates for entrepreneurs.

Still plugging away at building a retail healthcare network with HealthShoppr, about to finish a competition design for a $10M+ healthcare X PRIZE competition to improve health while reducing cost, and helping my wife wrestle with massive growth (and open a store) at Bite Catering Couture.

Would love to pick your brain on your health portfolio company and level of interest/ desired features for a Health Innovator’s ecosystem we’re designing for the competition.

]]> By: marksuster http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-56 marksuster Mon, 29 Jun 2009 00:46:50 +0000 http://bothsidesofthetable.com/?p=53#comment-56 Hey Vijay. Thanks for the comments - some valuable additions. I knew some McKinsey alum would rush to fill in my voids ;-) And thinks for the linke to Outsourcedppt.com - I presume this is your new venture? Good luck - I'll stay tuned to it. Hey Vijay. Thanks for the comments – some valuable additions. I knew some McKinsey alum would rush to fill in my voids ;-) And thinks for the linke to Outsourcedppt.com – I presume this is your new venture? Good luck – I’ll stay tuned to it.

]]> By: Vijay Goel, M.D. http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-55 Vijay Goel, M.D. Sun, 28 Jun 2009 23:26:19 +0000 http://bothsidesofthetable.com/?p=53#comment-55 Mark, Had to answer the call for the ex-McKinsey types, although entrepreneurial times have degraded my patience for market sizing-- after all, we thought cell phones would only sell 100K units (and they would have been limited to that with the brick-phones available at the time of the analysis). Couple of additions off the top of my head for market sizing: - Replacement cost: How much are people spending today to solve your problem (in people, time, lost customers, etc). You can take most (or sometime even all) of this if you can make the problem go away - Benchmarks: What is the expected cost of your approach in a comparable market (ie, if Nielsen can take X% of the TV market by creating measurement currency, I can do the same in my market) For those taking a TAM, I do recommend the use of a funnel (at least behind the scenes) to double-check assumptions around customer conversion. I've posted an example here: http://outsourcedppt.com/2009/06/marketing-funnel-sample-slide/ Mark,
Had to answer the call for the ex-McKinsey types, although entrepreneurial times have degraded my patience for market sizing– after all, we thought cell phones would only sell 100K units (and they would have been limited to that with the brick-phones available at the time of the analysis).

Couple of additions off the top of my head for market sizing:
- Replacement cost: How much are people spending today to solve your problem (in people, time, lost customers, etc). You can take most (or sometime even all) of this if you can make the problem go away
- Benchmarks: What is the expected cost of your approach in a comparable market (ie, if Nielsen can take X% of the TV market by creating measurement currency, I can do the same in my market)

For those taking a TAM, I do recommend the use of a funnel (at least behind the scenes) to double-check assumptions around customer conversion. I’ve posted an example here: http://outsourcedppt.com/2009/06/marketing-funnel-sample-slide/

]]> By: marksuster http://www.bothsidesofthetable.com/2009/06/16/sorry-guys-its-the-size-of-the-wave-not-the-motion-of-the-ocean/comment-page-1/#comment-54 marksuster Wed, 17 Jun 2009 20:54:09 +0000 http://bothsidesofthetable.com/?p=53#comment-54 The Internet has much data. Trade associations are a great place. Check for docs on Docstoc, Scribd or Slideshare. Call friends at consulting firms, big co's and bankers who have access to tons of reports. Need to be scrappy - the definition of an entrepreneur. Thanks for your comment. You're right - many people don't know where to look for data. The Internet has much data. Trade associations are a great place. Check for docs on Docstoc, Scribd or Slideshare. Call friends at consulting firms, big co’s and bankers who have access to tons of reports. Need to be scrappy – the definition of an entrepreneur. Thanks for your comment. You’re right – many people don’t know where to look for data.

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