nickelring - oap submission 1
DESCRIPTION
Team Data Insights - OAP submission 1.TRANSCRIPT
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nickelring corp.OAP – Submission 1
Team Data Insights12 May 2012
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Executive Summary
Background• nickelring is a team dedicated to the common vision of developing a meaningful data analytics solution for SME’s• We have chosen to adopt a slightly different approach for the OAP, in that:
– We have deployed the survey to understand the current situation at SME’s (their needs and constraints)– We are conducting a comprehensive competitor analysis to identify features being offered and gaps– We intend to use the field-interviews to test our specific proposition
Key milestones achieved during the first two weeks• Based on our research, we are convinced that Data Analytics is a large, growing business and that our target
market (SME’s) is of significant size (this is not a niche play) that is under-served• The survey feedback (to date) validates our hypotheses that current systems are not “easy to use”, there is only a
average satisfaction with current systems and highlights interesting aspects that will need us to pivot• We understand that “not listening to customers” is the key reason for most start up failures; we are taking steps
to ensure we listen and built our website (www.nickelring.com) clearly emphasizing this message to target clients
Next steps• We are working on our value proposition – it is a challenging task to find a middle ground between advanced data
analytics and primitive reporting, which will drive the price point of our product
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Our process
Proposition Finalisation
Key tasks Team formation – Assignment of roles & responsibilities
Agree on communication tools Develop questionnaire & deploy Develop functional website Educate “diverse” team on
fundamentals of “Data Analytics” Conduct competitor analysis Develop high level market sizing
Finalise proposition Market test proposition with ~25
potential clients Pivot and refine proposition –
develop detailed product features
Determine price range Outline market level risks &
mitigation plan
Opportunity Execution Project
Develop prototype Develop service proposition Develop marketing strategy Develop distribution strategy Develop financial model Outline operational risks and
mitigation plan
Phases
Outcomes Initial feedback from potential customers
Market sizing
Finalised value proposition Results from market testing
Prototype Cost benefit analysis Execution plan
Proposition Development
Opportunity Analysis Project
Our approach is slightly different. However, given the complexity of the task, we believed this to be the optimum approach
12 May 19 May
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Hypothesised market size*
Total number for firms in the world - ~ 500 million
Total number of SME’s in the world• ~90% of registered firms are SME’s• ~450 million SME’s globally
SME’s who are active & material - ~ 90 mil• There are ~20% are inactive SME’s and
40% are “mom & pop shops”
Target Market Analysis
• ~20% are sizeable firms with no critical need for Data Analytics (DA) / Business Intelligence (BI) tool
• ~25% are estimated to have an existing solution• Profile of target client
• Revenue p.a.: USD 1 mil – 500 mil• Number of employees: 10 – 250
• Target market for nickelring – ~50 million firms
nickelring target
market
Tier 3
Tier 2
Tier 1
Our proposition is global in nature with a large target market!
Source: Based on nickelring research and estimates
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Industry analysis highlights that this is an attractive market
Supplier power
• Technology is continually maturing & hence there is a need to constantly adapt
• Recruiting resources (especially for startup) is a challenge
• Funding will be a constraint, but not a show-stopper for unique proposition
• Strength of threat: Medium
Supplier power
• Technology is continually maturing & hence there is a need to constantly adapt
• Recruiting resources (especially for startup) is a challenge
• Funding will be a constraint, but not a show-stopper for unique proposition
• Strength of threat: Medium
Industry rivalry
• A fragmented market with – large global players & niche / boutique firms
• Large players dominate big corporates space but are weak in SME’s
• Niche firms lack scale & differentiation
• SME market under-served
• Strength of threat: Low
Industry rivalry
• A fragmented market with – large global players & niche / boutique firms
• Large players dominate big corporates space but are weak in SME’s
• Niche firms lack scale & differentiation
• SME market under-served
• Strength of threat: Low
Buyer power
• Typical SME management team will have limited technology and/or analytical resources
• SME’s will appreciate simple product with good service at affordable price point
• Strength of threat: Low
Buyer power
• Typical SME management team will have limited technology and/or analytical resources
• SME’s will appreciate simple product with good service at affordable price point
• Strength of threat: Low
Threat of new entrants
• This is a very lucrative market globally with strong growth forecast (>15% pa over the next 5 years) & will attract a number of new entrants
• However, effective execution and access to distribution channels is a challenge
• Strength of threat: High
Threat of new entrants
• This is a very lucrative market globally with strong growth forecast (>15% pa over the next 5 years) & will attract a number of new entrants
• However, effective execution and access to distribution channels is a challenge
• Strength of threat: High
Substitutes
• Limited substitutes to BI/DA tools for an organisation to glean insights
• Excel is perhaps the most popular tool, especially in the SME space
• Strength of threat: Low
Substitutes
• Limited substitutes to BI/DA tools for an organisation to glean insights
• Excel is perhaps the most popular tool, especially in the SME space
• Strength of threat: Low
Supplier power Industry rivalry Buyer power
Barriers to entry
Substitutes
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Competitor analysis
Source: 1)Source: Lowering the Cost of Business Intelligence With Open Source2) nickelring analysis based on competitor pricing information
2
Large players that service big enterprises; Leverage other products; Not suited for SME’s (despite promise)
Basically reporting / dashboard systems; Low level differentiation; highly fragmented
• Trad. Players represent the larger firms & “Open” represents smaller firms
• Analysis will enable nickelring pricing
Competitive landscape1
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Value proposition
Concept: Blue Ocean Strategy
Low
High
By providing advanced analytics and choice for efficient deployment, nickelring wishes to democratize the use of analytics
Strategy Canvas*
Value Attributes
Capa
bilit
y
DRAFT
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Selected Survey results (Venture Lab participants only; N=20)
Sales improvement
Marketing Strategy
Operational
Technology
Planning & forecasting
Customer relationship
Finance
In which area do you or would you find the most benefit from a data analytics tool?
What problems (if any) have you encountered with your current tool?
Difficult to turn DA into a real solution
Usability
Interpretation of data
Lack of customisation for
different data
Cost
None
Extensive focus on sales /
marketing data
Ease of use is the primary concern – costs come in last
Lack of skill
Not aware of tools, which can help me
Cost of tools
They don’t provide an useful advantage
for the firm
If you are not using a BI/DA tool, it is because of Satisfaction rating of current tool being used(1 – poor and 5 – excellent)
Reflects complexity in deploying current
tools
A gap in the market (?)
A startling response-set with no scores
above 3
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Risks and mitigations
Key Risks Mitigating activitiesIgnore customers • Deploying our survey to over 300 SME’s globally
• Conduct at least 25 face-to-face interviews with target customers• Build relationships with 5-10 clients to test proposition on an ongoing basis
No market need • Our research and credible market reports (by IDC, Gartner, IBM) clearly indicate that:– There is a need for data analytics globally and this is a growing market– SME market is significantly under-served– The market is large and profitable
Not the right team • We have a built a balanced team that consists of motivated individuals that are representative of key organisational functions (Product, Technology, Marketing, Finance, Operations, etc.,)
• During the first two weeks the team members have displayed an affinity to high performance and those who could not contribute found themselves self-selecting out of the team
Poor marketing • We are working on our marketing strategy in conjunction with product development• The emphasis of the message will be on key value attributes – Simple, Secure & Easy to use
Need business model • We have a good grasp of our business model (that is being fine tuned) – Both in terms of solution delivery and the economics of operations
• We will elaborate on this during the OEP presentation
Based on the analysis* of 32 startups that failed, the following were the top 5 risks that were identified for new ventures. Here is how we plan to mitigate the risk
Source: http://www.chubbybrain.com/blog/top-reasons-startups-fail-analyzing-startup-failure-post-mortem/Note: We excluded “Ran out of cash”, which was the 5th reason, as it is not yet applicable for us.
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Next steps
• Finalize document for OAP submission (19 May)
– Consolidate survey feedback from enterprises
– Finalize proposition definition – including product features & points of differentiation
– Market test proposition through face-to-face interviews
– Fine-tune proposition – Pivot as necessary
• Commence work on OEP
– Technical foundation for the prototype is currently underway
– The marketing & distribution team is working on the positioning and brand message
– Financial model is being built
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Appendix
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Team description
SAJITH
Name Location Work experience Core competence Education
Alessandro Dublin 2 Years Software Engineering (C++, VHDL) BSc, MSc
Anthony Johannesburg South Africa
2 Years IT Entrepreneurship, Marketing and Finance Bcom (IT)
Arnaud Tahiti, French Polynesia
13 Years Marketing & Business development BSc, MSc
Bharath Singapore 2 Years Software Engineering, Database Administration
BSc Eng.
Deepak Singapore 8 Years Software Engineering, Machine Learning Techniques
BSc, MSc, MTec
Filip Antwerp Area, Belgium
10 Years Business Consultancy BSc Eng.
Matej Slovenia, EU 10 Years Software Engineering, System Administrator BSc. Math
Munir NC, USA 15 Years PLM, Business Analytics (Data Mining) BSc. Eng , MBA
Patrick CA, USA 1 Year Software Engineering Reading BSc. Eng
Romil New Delhi, India
10 Years Internet Marketing & Branding, E-commerce and Web development
BSc (HM), MTM
Sajith Singapore 5 years Software Engineering, Data Mining, Semantics
BSc (Hons) Eng.
Sandeep Singapore 14 years Strategy ConsultingBusiness case development
Engineer & MBA
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Why SME’s?
• Empirical research has highlighted that SME's currently have 4 critical technology needs
1. An accounting package
2. An email system
3. A website
4. A set of productivity tools (Excel, Word, etc.,)
• It is our hypothesis is that there is a fifth need and that is around the need to better understand their data -
predominantly financial and customer/sales data
• The systems that are currently on offer are
– Too technical to implement
– Reasonably expensive
– Difficult to change and are quite static
– Unable to handle multiple, unstructured data sources in an easy to use manner
– Not intuitive
• However, technology has now advanced such that cloud based solutions delivered in SaaS/PaaS format make
it affordable to develop a meaningful solution for SME's.
• Most software firms aim to service the large enterprise- there is a big gap in the SME space
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About nickelring
Why nickelring?
• Nickel is a chemical element with the chemical symbol Ni and atomic number 28. It is a silvery-white lustrous metal with a slight golden tinge (Source: Wikipedia).
What does that have to do with Data Analytics for SME, you ask?
• The answer lies in the underlying characteristic of Nickel. We all know that Nickel is an easily available metal that was widely used in manufacturing… well a nickel (US currency). However, did you know that Nickel is also a key component of superalloys that are used in the aerospace, industrial gas turbine and marine turbine industry? Today, over 60% of the global Nickel production is consumed in making nickel-steels used as part of high-strength infrastructure. Moreover, under appropriate treatment Nickel can obtain the luster of silver.
• One simple metal – multiple benefits!
• Similarly, we are committed to developing a simple solution that will provide you and your organization with multiple benefits. We intend to indulge in a virtuous cycle of listening to you and taking your feedback onboard to develop insanely great products.
And hence the name – nickelring!
You can visit us at www.nickelring.com
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Supporting data points – Data Analytics is a booming market (1/2)
More data required to support decisions – McKinsey 2011 Survey*
• Executives say their companies still rely upon a mix of data and experience in decision making, although
they are increasingly looking to analytics tools for support
• Despite the promise of big data to reshape strategy and decision making, more than 75 percent of
respondents to this survey report that their organizations’ greatest benefits from data use flow from clear
and timely reporting of financial and performance metrics
– Only about half say they seek to use data to provide new business insights or develop new
information-based products and services
• Respondents highlight three barriers to more effective use of data and analytics :
– A cultural preference for experience over data;
– A lack of skills in synthesizing and translating the analytics and data for decision makers and
– Concerns that the data quality is poor
Source: McKinsey & Co online survey conducted from October 4 to October 14, 2011, and generated responses from 927 executives.
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Supporting data points – Data Analytics is a booming market (2/2)
• Analytics is the application of computer technology, operational research, and statistics to solve problems in
business and industry*
• Analytics is a rapidly growing industry with a lot of existing and emerging players. According to IDC analytics
market will be $33.9 Billion in 2012 – growing at 8+% since 2011.
• Most of the advanced analytics market is currently owned by big players such as IBM, Oracle, SAS,
Microsoft, SAP, Microstrategy, etc.
• Most consumers of advanced analytics capabilities are medium-large size enterprises as these solutions are
resource-intensive in terms of hardware, software and licensing costs.
Excel still the predominant solution in finance – WesierMazars study of Global Insurance related firms 2011
• The WeiserMazars study found that 87% of the CFOs they surveyed relied heavily on Excel spreadsheets in
their financial close and also in their FP&A activities, as well as for budgeting and reporting.
Source: Wikipedia