case study: bootstrap vs. venture funding
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Case Study: Bootstrap vs. Venture Funding
How did FitBit, Inc become market leader with organic growth
Case Study: Bootstrap vs. Venture Funding
What we will see today
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Agenda
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About Us Bootstrap vs. Venture
Funding
Case Study: Fitness
Trackers
FitBit vs. Jawbone
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Go-to-market Strategy Contact Us
Business Growth Consulting for Startups & Small Businesses Overcapitalization may lead to
managerial complacencyFitBit, Inc market leader in less
than 2 years
Minimal vs extensive venture funding
Customer acquisition Quality
Case Study: Bootstrap vs. Venture Funding
Download case study document
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Watch this presentation
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http://www.anagard.com/blog/2015/05/06/case-study-bootstrap-vs-venture-funding/
Case Study: Bootstrap vs. Venture Funding
For Startups and Small Businesses
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ANAGARD, LLC:
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Our approach
Tested and validated value proposition is the fundamental building block to a successful business
How will you serve your customers and make money
BUSINESS MODEL
Market Research Customer Discovery
PRODUCT-MARKET FIT
Define customer segment, their problems, and the advantage of using your solution over currently available ones in the market
VALUE PROPOSITION
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Case Study: Bootstrap vs. Venture Funding
For startups and small businesses
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ANAGARD, LLC: BUSINESS GROWTH CONSULTING
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+Our Services
MARKET RESEARCHCustomer Discovery Target Market Segment Competition
BUSINESS PLANSBusiness plan document doubles probability of funding, yet only 40% of companies have one.
Business Plan Evaluation & Development Business Model Canvas
INVESTOR-READY CONSULTINGReduce time needed to raise funds
Pitch-book
Business Model
TECHNOLOGY
COMMERCIALIZATIONPlatform Technology developed by
researchers or academics
Find Technology-Product-Market Fit
Case StudyHow did FitBit, Inc grew organically to be a market leader
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How did FitBit Bootstrap its Way to a Market Leader
FitBit has raised only $83.8M from investors and have captured 70%
of the market within three years.
Rival Jawbone, has raised well over $518M and captured only 19% of
the wearable fitness trackers market.
Case study: wearable fitness trackers
Sufficient Venture Capital Investments Do Not Guarantee Business Success in the Market Place
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Bootstrap vs. raise money from venture capital investors
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Case Study: Bootstrap vs. Venture Funding
2014 Market Share
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Wearable Fitness Trackers
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3%8%
19%
70%
FitBit Jawbone Nike FuelBand Others
Launch Dates FitBit and Jawbone November 2011 Nike FuelBand, January 2012
Discontinued April 2014
70M units shipped in 2014
For 3 times less market share
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Jawbone raises 6 times more money than FitBit
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FitBit, Inc
Raised $83.8M
70% Market Share in 2014
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0
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Jawbone
Raised $515.8M
19% Market Share in 2014
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0
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$0M
$50M
$100M
$150M
$200M
2006 2007 2008 2009 2010 2011 2012 2013 2014$0M
$13M
$25M
$38M
$50M
2008 2009 2010 2011 2012 2013 2014 2015
$83.M venture funding, over $300M net income in just two years
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Hockey Stick Growth
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FitBit, Inc
Raised $83.8M and grew it to $750M in revenue
70% Market Share in 2014, grew it to 85% by March 2015
/
0
.
$0M
$13M
$25M
$38M
$50M
2008 2009 2010 2011 2012 2013 2014 2015
• Profitable in 2013 • $130M Net Income in 2014 • $170M Net Income projected for 2015
Comparable product line, different distribution strategy
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Key Differentiator: Go-To-Market Strategy
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Case Study: Bootstrap vs. Venture Funding
Jawbone ignored Android users in the first year
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Size of the Ecosystem Matters
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FitBit, Inc Jawbone
40% of all smartphones in 2012 were Android phones
Jawbone ignored almost half of potential market size for a full year
Case Study: Bootstrap vs. Venture Funding
Utility trumps beautiful design
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Quality Matters
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“The UP No Questions Asked Guarantee” Poor hardware design lead to immediate widespread device replacements
HARDWARE DESIGN
Jawbone emphasized beautiful design over R&D vigor, and operational efficiencies
R&D
Dissatisfied customers
CUSTOMER SERVICE
Case Study: Bootstrap vs. Venture Funding
Smartphone and tablet app, website interface, paid premium analytics
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Access to customer analytics
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FitBit, Inc Jawbone
Multiple platforms let customers gain insight into their fitness and nutritional goals
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Case Study: Bootstrap vs. Venture Funding
FitBit: Wellness Program for Businesses
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Expanded distribution channels
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B 2 C + B 2 B > B 2 C
Case Study: Bootstrap vs. Venture Funding
Planning IPO vs fending off creditors
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Spring 2015
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Planning $100M IPO March 31, 2015: increased market
share to 85% S-1 filing
Launched UP3 after 6 months delay Fending off creditors
VC backed out from equity financing, claim money was loan
Suing FitBit for poaching employees & IP
Case Study: Bootstrap vs. Venture Funding
For 30-minutes long complimentary discovery consultation
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Contact Us
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9360 Falls of Neuse Rd
Suite 205
Raleigh, NC 27615
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Phone
+1-919-876-13147
twitter.com/DraganaMendel
plus.google.com/+AnagardBizGrowth
linkedin.com/company/anagard-llc
www.ANAGARD.com
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