7 Domains

Question 1

What are the 7 domains?

Answer 1

They help assess and shape opportunities; and provide solid foundations for a venture plan (crucial to identifying flaws - abandon ideas that can’t be fixed)

Question 2

market

Answer 2

(Buyers) a group of current and/or potential customers with the willingness and ability to buy a product or service (ex. market for workplace snacks)

Question 3

industry

Answer 3

Sellers, typically organizations, that offer products that are similar/close substitutes (ex. vending industry, coffee industry, restaurant industry, salty snack industry)

Question 4

macro market assessment key questions

Answer 4

1. is the market large enough to allow competitors?
2. Short term growth predictions?
3. Long term growth predictions?

Question 5

micro market assessment key questions

Answer 5

1. is there a target market segment?
2. how are our benefits differentiated?
3. how large is the segment - growth?
4. will this lead to other opportunities?

Question 6

Describe target market

Answer 6

demographics (gender, location, married status, age)
psychographics (likes, dislikes, frugality) (ex. miller lite finds perfect market segment in older men who used to be athletes who now like to watch sports but want to watch their figure)

Question 7

features vs. benefits

Answer 7

features: what the product has (like an easy UI)
benefits: what the features give the customer (emotional, social, health, financial)

Question 8

macro industry assessment

Answer 8

Porter’s five forces: to diagnose the principle competitive pressures in an industry (when a force increases, industry attractiveness decreases)

Question 9

micro industry assessment

Answer 9

initial advantage: differentiated benefits
sustained advantage: trade secrets/patents (Zantac), superior organizational processes (Nokia), resources, capabilities, and a strong business model

Question 10

Team Domain

Answer 10

1. is the opportunity aligned with the team’s business mission, personal aspirations and risk propensity?
2. Team’s ability to execute on critical success factors?
3. important network connectedness to stay in the know

Question 11

macro market assessment how-to

Answer 11

short term growth: use recent growth rates and evidence-based forecasting
long term growth: look at macro trends (economic, demographic, social, technological)

Question 12

evidence-based forecasting

Answer 12

determine size of target market, use survey’s to determine how many will try your product (market size x % try x % aware x reach)

Question 13

micro market growth how-to

Answer 13

look at number of current customers, total expenditures, historic and predicted growth
look at all the same trends, but specifically about your sub-segment

Question 14

defining your industry

Answer 14

narrow: southwest is in the airline industry (clarifies focus, easy to overlook substitutes)
broad: southwest is in the transportation industry (easier to pivot and change and see substitutes, lack of focus)

Question 15

Threat of new entry

Answer 15

are barriers to entry high?
high barriers are more product differentiation, large economies of scale, high capital requirements, government or legal barriers (sometimes good, sometimes bad) (high for pharmaceuticals)

Question 16

Threat of substitutes

Answer 16

how easily can your good be replaced? (Ex. electronic security system vs. human guards) (high for restaurants)

Question 17

Bargaining power of suppliers

Answer 17

supplier power is high if there are few suppliers, switching costs are high, threat of forward integration (low for pharmaceuticals) (tends to be low for restaurants - unless they have specific desires)

Question 18

Bargaining power of buyers

Answer 18

buyer power is high if products are standardized, threat of backward integration exists, there are few buyers (high for restaurants - because there are so many other options)

Question 19

Rivalry among existing firms

Answer 19

determine number and balance of competitors, degree of differentiation, level of fixed costs (competitive: airlines, retail, restaurants)