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New eCornell certificate highlights customer-centricity as the key to product launches

Launching a product is no walk in the park. From identifying the right customer base and pricing strategies to winning over investors, the path is fraught with challenges. To truly excel, professionals need guidance that is rooted in real-world experience.

Cornell’s Marketing Strategy online certificate program – authored by S.C. Johnson Professor of Marketing Stijn van Osselaer – offers a comprehensive approach to launching a product with a customer-centric view.

“What distinguishes this course from other marketing courses is that it’s really built around all the steps you need to go through to market a product, to bring a product to market,” says Osselaer.

At its core, the program emphasizes customer-centricity as an approach to marketing strategy and decision-making. This paradigm shift encourages learners to consistently prioritize and empathize with the customer’s viewpoint. Students in the program learn to calculate metrics such as customer lifetime value and the proper interpretations of such analysis. There are multiple projects at every step of the go-to-market plan, providing participants much-needed experience with authentic scenarios.

“In venture capital, investors place great importance on numerical evidence; getting the right metrics and understanding which ones to highlight in your pitch is critical to securing an investment. The course thoroughly covers the essential metrics venture capitalists will expect founders to know,” says Osselaer.

By integrating customer-centricity into the marketing strategy, professionals can better align their products and services with the market demand, ensuring that their go-to-market plans are successfully implemented and will reach the right target market.

Firms across various sectors seeking a critical competitive advantage can adopt the approach when collecting and analyzing data on customer behavior, preferences, feedback, and satisfaction levels. Companies that successfully implement this strategy can see improved customer retention, increased word-of-mouth advertising and higher returns on marketing investments.

“This program has a lot of useful things that you can take directly to practice. There are a lot of tools and explanatory notes. There are many spreadsheet templates you can take directly into the workplace.”

Ready to improve the odds of success for your next product launch? Enroll in eCornell’s Marketing Strategy certificate program.

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The Age of the Mompreneur: Empowering Working Mothers

Modern societal shifts and emerging trends in the startup ecosystem present new challenges and opportunities for women, particularly for mompreneurs – those juggling the responsibilities of motherhood and entrepreneurship. The success of early-stage enterprises founded and led by women depends greatly on dismantling systemic barriers, including the uneven distribution of venture capital.

In the recent Keynote webcast “The Boss of Me: Entrepreneurship and Motherhood,” Andrea Ippolito – CEO of SimpliFed, director of Women Entrepreneurs Cornell, and lecturer in the university’s engineering management program – shared her experiences as a mother and businesswoman, delivering compelling insights into what it takes for women to thrive as working mothers in today’s competitive, fast-paced labor market. 

How has the landscape of entrepreneurship changed for mompreneurs, particularly during and after the COVID-19 pandemic?

“What happened is that by forcing us to be at home, we showed folks that we can be effective and efficient, despite what some CEOs are saying. We actually saw an increase of women starting companies. When you look at 2019 compared to 2021, in 2019, there were a whole lot less women starting companies, 28%. Whereas during the pandemic, 49% of new companies were started by women. It was a much more flexible work environment.

Before the pandemic, it was all about meeting in person or working through stakeholder meetings in person. My journey looked a lot different than someone that was in their 20s, pre-kids, that could hustle 24/7. And don’t get me wrong, I hustle 24/7. My effectiveness and efficiency of working has always been pretty “right on” with having kids. But the time horizon has taken me a little longer.”

What are some of the largest hurdles working mothers encounter when trying to found a startup, and how does societal infrastructure play a part in this?

“The infrastructure is not in place to help support [founders], especially parents, whether that’s paid parental leave, universal child care support. There are so many things that we need to do as a society to better support entrepreneurs getting their organizations off the ground.

Startups founded by women are more profitable, and they exit faster. If you are an investor, it’s in your best performance interest for your fund to invest in women. If we want to have a more profitable economy, and we know that startups are the engine for that, then we need more folks participating. And the biggest pool of people we’re not taking advantage of right now is women. We need to rethink the structures to help support them.”

What are your secrets to striking a healthy work-life balance that comes with being a businesswoman and a mother?

“One of the things we see often is, especially for women that are parents, is they feel like they have to hide different parts of their life. For me, I have a five-year-old. I have a two-year-old and a T-minus five-week-old. And I don’t try to hide it. There are times where, yes, I don’t want them around because I want to focus 100%. But I also don’t try to hide it.

There’s this big misconception that people are taking off in the middle of the workday, and they’re not focused. The reality is that by giving folks a more flexible schedule, you actually get more out of them. They value their work. They’re aligned with your mission. But you’re also respecting them as a human being as well.”

Can you share your insights on the bias in investment toward women-led startups? How does this coincide with major life events like motherhood?

“We know that women [are] seen as less investable. There are tremendous biases out there, no doubt. And the research has shown that. One of the things that I feel very strongly about is that by the time a woman gets enough experience, expertise, and confidence, it’s around the same time that she’s having kids. One of the challenges is how do you start a company when you have this crazy unpredictable life of being a parent.

Venture capitalists have to raise money from somewhere. They have to raise money from what are called limited partners, or LPs. And those limited partners are pension funds, college endowments, sovereign wealth. And so we need folks like limited partners, like college endowments, to actually invest more in women-led funds.”

How can businesses better support working mothers, particularly with regards to incorporating child care into their business models?

“I think more and more, we need to have universal child care as a federally-funded entity. The companies that find ways to support child care or maybe fund it as a benefit will do better. And so I think there’s a responsibility of larger organizations to have this as a benefit. And then for, say, small businesses where they don’t have, frankly, those types of funds or resources, I do think [we need] a government federal response. It’s good for our economy. It pays for itself. It creates an engine in our economy.”

In a rapidly evolving entrepreneurial world, businesswomen are breaking down barriers, mastering the juggling act of work-life integration, and shaping business models to include family needs. Learn how to navigate a tech career as a woman leader in Cornell’s Women in Product certificate program, designed by Andrea Ippolito or gain a better understanding of funding models in Cornell’s Startup Funding and Finance certificate.

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Entrepreneurship program emboldens spice startup founder

For Abena Foli, the farm-to-table lifestyle is a birthright. Each day she uses the knowledge she gained from growing up on her father’s farm in Ghana to enrich her career as a food scientist and regulatory affairs leader.

“Working in the food industry, I get to sit in marketing ideation sessions, and research and development meetings. Whenever we talk about innovation in ingredients or products, West Africa is never mentioned,” said Foli, who now lives in Texas. “There was a lack of West African-originated products on shelves. I wanted to leverage my food science background as well as my West African heritage to solve that problem.”

She decided to start small for maximum impact: “When people are new to cuisines,” she said, “they tend to try seasonings first.”

Foli founded POKS Spices in 2016 to bring flavors from West Africa into American home kitchens. In 2021, she became one of the 60,000 women to participate in the certificate program offered by the Bank of America Institute for Women’s Entrepreneurship at Cornell, which is managed by the Cornell Law School and powered by eCornell.

Funding from Bank of America makes it possible for the students to gain the skills and resources to build a successful venture – and earn a business certificate from the university – at no cost.

Read the full story on the Cornell Chronicle Website.

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Women’s entrepreneurship institute set for major expansion

Two years ago, the Bank of America Institute for Women’s Entrepreneurship at Cornell launched their certificate program delivered through eCornell. Demand for the program was so strong that the original goal of providing free online education to 5,000 entrepreneurs quickly increased to 20,000 – thanks to a follow-on grant from Bank of America – and seats in the program were filled as soon as they were added.

On Nov. 19 – Women’s Entrepreneurship Day – the bank announced an additional grant that will allow another major expansion, more than doubling total enrollment. The institute in the coming months will add another 30,000 seats – for a total of 50,000 – while continuing to emphasize diversity, including the development of a Spanish-language component.

“We at Cornell are extremely proud of the impact the Bank of America Institute for Women’s Entrepreneurship is having on aspiring entrepreneurs,” said President Martha E. Pollack. “The institute builds on Cornell’s commitment to the public good and on the strength of our faculty in providing practical, focused, accessible education.”

Bank of America will partner with nonprofits – including the National Urban League, the U.S. Hispanic Chamber of Commerce, the National Association for Latino Community Asset Builders and Prospera – to increase opportunities for Black and Latinx entrepreneurs. Those partners will offer their members access to the certificate program beginning in January 2021.

Already, more than 80% of the institute’s roughly 22,000 enrolled students identify as women of color. Registration is open to anyone worldwide, regardless of gender identity, educational background or business stage.

Students take a series of two-week online courses designed by Cornell faculty to help women develop and grow businesses, access resources and join a network of fellow entrepreneurs.

Instructors support students and moderate discussions in the six classes:

  • Creating Your Venture;
  • Laying the Legal Building Blocks;
  • Assessing and Obtaining Financial Resources;
  • Growth Leadership for Women Entrepreneurs;
  • Product Development and Digital Marketing; and
  • Communication, Negotiation and Persuasiveness.

“A human instructor is present in each course, so the students are receiving feedback on their course projects and in their discussion forums, as well as engaging and networking with each other,” said Kirsten Barker ’92, program director for the institute.

Upon completing all six courses, students earn a certificate in women’s entrepreneurship – the only one of its kind offered by an Ivy League university. To date, students have completed nearly 21,000 courses and earned nearly 2,400 certificates.

Citing a study by the consulting firm McKinsey and Company, Bank of America noted that the coronavirus pandemic has more adversely impacted the careers of women, who accounted for 46% of U.S. employment before the pandemic but 54% of job losses this year.

At the same time, the institute’s leaders say, women, and specifically women of color, represent the fastest-growing segment in entrepreneurship, but historically have lacked access to training, resources and networks.

“We’ve been amazed by our students’ resilience throughout COVID-19,” said Deborah Streeter, the institute’s faculty director and Professor Emerita in the Charles H. Dyson School of Applied Economics and Management, part of the Cornell SC Johnson College of Business.

Responding to an institute survey about their transitions to working from home, students reported dealing with caregiving challenges that have disproportionately fallen on women, as well as disrupted businesses, longer hours in essential jobs and fatigue. Some also said they had found opportunities to bond with family and friends, expand their businesses online and improve efficiency.

After completing the program, one student proudly posted an image of her certificate to her LinkedIn page and stated “COVID-19 season has had a silver lining. I feel equipped and empowered.”

Having launched as an online certificate program serving students from across the nation – and a small international contingent representing dozens of countries – program leaders say the institute is well-positioned to grow and support more students despite the challenges posed by the pandemic.

“This expansion will allow us to improve the chances that these entrepreneurs will be successful,” said Stewart Schwab, the Jonathan and Ruby Zhu Professor of Law at Cornell Law School and executive director of the institute. “That’s our goal, to give our students the tools for success.”

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Bank of America expands the Bank of America Institute for Women’s Entrepreneurship at Cornell

CHARLOTTE, N.C.–(BUSINESS WIRE)–As part of Bank of America’s $1 billion, four-year commitment to advance racial equality and economic opportunity, today – Women’s Entrepreneurship Day – the company announced a further expansion of the Bank of America Institute for Women’s Entrepreneurship at Cornell. Due to the program’s success, Bank of America will add 30,000 seats – bringing the total enrollment of small business owners to 50,000 – and will work with Cornell to develop a Spanish language curriculum and hire Spanish-speaking teaching assistants to more effectively support Hispanic-Latino entrepreneurs.

The Bank of America Institute for Women’s Entrepreneurship at Cornell is the only Ivy League program offering a certificate in women’s entrepreneurship, and at no cost. Since its launch in 2018, the institute has enrolled more than 20,000 individuals, primarily women, of whom 86% identify as women of color. Registration is open to anyone worldwide, regardless of gender, educational background or business stage.

As part of the program expansion, Bank of America will partner with several nonprofits, including the National Urban League, U.S. Hispanic Chamber of Commerce, the National Association for Latino Community Asset Builders and Prospera, to create more enrollment opportunities for Black and Hispanic-Latino entrepreneurs.

The challenges that women entrepreneurs face have multiplied over recent months. According to a recent McKinsey study, while women made up 46% of U.S. employment pre-coronavirus, they account for 54% of overall job losses year to date – with women of color the hardest hit.

“With women bearing much of the economic brunt of the pandemic – and particularly women of color – our further investment in the Bank of America Institute for Women’s Entrepreneurship at Cornell has never felt more important,” said Anne Finucane, vice chairman at Bank of America. “Amid the unforeseen challenges and events this year, we must continue to invest in women entrepreneurs to drive economic growth, because when women-owned businesses thrive, our communities flourish.”

“We at Cornell are extremely proud of the impact the Bank of America Institute for Women’s Entrepreneurship is having on aspiring entrepreneurs,” said Martha E. Pollack, president of Cornell University. “The institute builds on Cornell’s commitment to the public good and on the strength of our faculty in providing practical, focused, accessible education.”

Through coursework that draws on curricula from across Cornell’s schools, the instructor-led classes and limited class size provide women the opportunity to learn new skills, connect with a vibrant network of entrepreneurs and social innovators, and access the resources they need to manage and scale a successful business. These courses include Creating Your Venture; Laying the Legal Building Blocks; Assessing and Obtaining Financial Resources; Growth Leadership for Women Entrepreneurs; Product Development and Digital Marketing; and Communication, Negotiation and Persuasiveness.

Investing in women

Bank of America’s investment in women as they make meaningful contributions within the company and in communities around the world includes a focus on being a great place to work for its female employees, improving the financial lives of female clients, and advancing women’s economic empowerment worldwide. The company has several long-standing partnerships, through which it has helped more than 30,000 women from 85 countries grow their businesses, including:

  • Tory Burch Foundation Capital Program: Since 2014, Bank of America has committed $100 million in capital to the Tory Burch Foundation Capital Program, helping women business owners gain access to affordable loans. To date, more than 3,400 women have received nearly $57 million in loans through community development financial institutions (CDFIs) to help them grow their businesses.
  • Global Ambassadors Program: A partnership between Bank of America and Vital Voices, the Global Ambassadors Program pairs women entrepreneurs with senior women executives for a week of one-on-one mentorship and workshops designed to build business acumen. To date, the program has impacted more than 400 women from 85 countries – helping mentees grow their businesses and organizations through more than 8,000 hours of training and mentorship.
  • Cherie Blair Foundation: Since 2013, Bank of America has partnered with the Cherie Blair Foundation on its Mentoring Women in Business program, which has matched more than 2,700 women in developing and emerging countries to online mentors, including more than 500 mentors from Bank of America.
  • Kiva: Through a partnership with Kiva, Bank of America has committed more than $2 million in funds to women business owners, assisting more than 17,200 women entrepreneurs from 45 countries.

Recent Bank of America announcements focused on racial equality, diversity and inclusion, and economic opportunity include:

Bank of America Environmental, Social and Governance
At Bank of America, we’re guided by a common purpose to help make financial lives better, through the power of every connection. We’re delivering on this through responsible growth with a focus on our environmental, social and governance (ESG) leadership. ESG is embedded across our eight lines of business and reflects how we help fuel the global economy, build trust and credibility, and represent a company that people want to work for, invest in and do business with. It’s demonstrated in the inclusive and supportive workplace we create for our employees, the responsible products and services we offer our clients, and the impact we make around the world in helping local economies thrive. An important part of this work is forming strong partnerships with nonprofits and advocacy groups, such as community, consumer and environmental organizations, to bring together our collective networks and expertise to achieve greater impact. Learn more at about.bankofamerica.com, and connect with us on Twitter (@BofA_News).

For more Bank of America news, including dividend announcements and other important information, visit the Bank of America newsroom and register for news email alerts.

www.bankofamerica.com

Contacts
Eliza Murphy, Bank of America
Phone: 1.347.603.6845
eliza.murphy@bofa.com

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eCornell gives high school students an analytic edge

A collaboration between eCornell and the nonprofit National Education Equity Lab is giving high school students in underserved communities the opportunity to develop skills in business analytics while also gaining the confidence to recognize they can excel in college, even in the Ivy League.

The partnership has resulted in eCornell’s first certificate course aimed at high school students. Pre-college Analytics and Spreadsheet Modeling is a four-week pilot course that launched June 24 with a class of 132 students, who are learning how to organize and analyze data in Excel and use that information as a decision-making tool.

This course follows a “buy one, give one” model, whereby 60 students recruited by eCornell each pay $150 to enroll, which helps offset the costs of 72 students selected from Equity Lab’s network of partnering underserved high schools across the country. All of these schools receive Title 1 federal funding because of their high concentrations of poverty and families in need.

“Highly talented, motivated students in our lowest income communities – who tend to be largely students of color and first-generation students – are often unable to demonstrate that they’ve got what it takes to be a successful college student,” said Leslie Cornfeld, founder and CEO of Equity Lab. “Research shows that current college admissions metrics can mask talent, particularly for low-income students. Education, we know, is the number one lever for social and economic mobility, and the future success of our country.”

Equity Lab works to advance educational and life opportunities for highly talented, low-income students and students of color by collaborating with philanthropic, nonprofit and academic institutions such as the Common Application, the Carnegie Corporation of New York and Harvard University. Equity Lab and eCornell were brought together by Steven Carvell, vice provost for external education strategy, at a crucial time. COVID-19 has created an enormous surge in the need for innovative online education models, especially in communities that the Equity Lab targets, which have been hit hardest by the pandemic.

“These are the families that are on the front lines in our country right now. They are not only the essential workers. They are suffering the highest levels of unemployment, food and housing insecurity, and illness,” Cornfeld said. “And in the midst of this crisis, these students leaped at the opportunity to take this course.”

While some teenagers might blanch at the idea of spending a month of their summer vacation learning about spreadsheets, most of the slots Cornell made available to the Equity Lab students were filled within 24 hours of posting.

“These students don’t get opportunities like this very often, and they are determined to take full advantage of it,” said Cornfeld, a former federal civil rights prosecutor who served as an adviser on education equity issues for former President Barack Obama’s administration.

Knowledge of data analytics is essential for anyone hoping to join the 21st-century workforce, and it’s also a practical tool for managing personal finances, according to Donna Haeger, professor of practice in the Charles H. Dyson School of Applied Economics and Management, who created and teaches the course.

“I always tell students that understanding how to make decisions with data is becoming just as important as reading and math,” said Haeger. “Businesses are really challenged right now to find qualified individuals who know how to model and make decisions using data. It doesn’t matter what industry you choose to enter. Data is everywhere.”

Haeger previously created a professional development certificate course in business analytics for eCornell. She modified those materials for a high school audience by simplifying the terminology and using age-appropriate examples. Rather than investing in a diversified portfolio, students solve problems like organizing a bake sale or buying clothing for a sports team. Haeger worked with eCornell to develop explanatory videos that are incorporated into the modules. And she added a weekly hourlong synchronous group session, so students can ask her questions directly and feel more connected.

“This course is a great equalizer. Everybody is able to jump in and try it for the first time. And it’s low risk for them,” Haeger said. “I think people are really intimidated by terms like ‘big data’ and ‘business analytics.’ I try to demystify all of that and make sure the students have a really positive experience. They realize, ‘Wow, I can do this.’”

The Equity Lab team has also been meeting with the students in weekly sessions to track their progress. Their feedback has been overwhelmingly positive, Cornfeld said. While the material is difficult, it has given them a chance to prove to themselves, and to higher education institutions, that they are able to meet the challenge.

For Donovan Blount, a rising senior at Rockaway Collegiate High School in Queens, New York, the certificate course is potentially life-changing.

“Opportunities like this are important for students like me because most students who grow up in low to average income neighborhoods cannot afford prestigious classes,” he said. “So a free, informative class like this can open up doors of opportunity that we did not know were even possible.”

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Cornell launches online entrepreneurship program

To bring a startup business to market, an entrepreneur needs to assess the viability of their concept, develop a strategic framework and navigate the due diligence required to finance it.

On Nov. 19, National Entrepreneurs Day, Cornell launched a new Entrepreneurship certificate program, designed to develop the necessary knowledge and skills to take a new idea from theory to realization.

“Ideas are easy to come by, but the real challenge comes in getting them off the ground,” said Tom Schryver, program author, visiting lecturer in the Samuel Curtis Johnson Graduate School of Management, and executive director of the Center for Regional Economic Advancement. “This program will help students understand how startups raise capital to execute on their plans, both from the perspective of an entrepreneur seeking to raise money as well as from the point of view of an investor looking to make an investment in a startup.”

The program will enable participants to structure a business model to protect their interests, assign fair valuation to an opportunity and secure funding. Participants will also explore many types of funders, from equity and angel investors to venture capitalists, crowdfunders and grant programs. Courses in this program include:

  • Assessing Startup Viability and Funding Options
  • Pitching Your Business Opportunity
  • Protecting Your Interests
  • Financial Planning, Valuation and Dilution
  • Company Structure and Due Diligence
  • Post-Investment Best Practices

After completing the six courses, participants will receive an Entrepreneurship certificate and 60 professional development hours. Visit the eCornell website to learn more about this program.

— Bailey Karfelt

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How to Successfully Pivot Your Startup

The fundraising and engagement platform GiveGab made waves in January 2018 by purchasing one of its biggest national competitors. With the acquisition of Kimbia, GiveGab is one step closer to becoming the biggest charitable software program out there.

But that success would not have happened if the company hadn’t decided to completely change direction from its original vision of being a social network connecting volunteers and nonprofits. In 2015, GiveGab pivoted to focusing on helping nonprofits attract and maintain donors rather than volunteers.

The company’s CEO and co-founder, Charlie Mulligan, spoke with eCornell’s Chris Wofford about his “painful” yet highly successful pivot decision and to share tips on how to decide when it’s the right time to change strategic direction. What follows is an abridged version of Mulligan’s presentation, delivered as part of eCornell’s Entrepreneurship webinar series.

Mulligan: I’ve met thousands of entrepreneurs at this point. I think almost all of them would describe themselves as having a vision of what they want to happen and being very persistent. While I agree that these are really important traits, they can also impact the challenges of pivoting. If you really pride yourself on what you are doing, it can be very hard to have to admit that your vision was wrong. When reality hits, it’s sometimes like you suddenly realize you’re climbing the wrong mountain. It’s not a matter of changing little tactics. You have to change your entire strategy. That’s what a pivot is to me.

When you are starting out, there is really no way to predict the future. Yeah, some people get lucky but for a lot of startups you’ll find that the reality is different than what you envisioned so you’ll have to decide what to do. You can quit or you can be flexible and make a different choice.

Wofford: How do you know when it’s the right time to change direction?

Mulligan: It could come at any stage. When you’re starting out, you have this idea of what the customer wants. Well, you better talk to as many customers as you can and you need to realize that oftentimes you will hear what you want to hear so you have to be very careful and make sure that you start to listen before you get too far down the road. You might have to pivot very early once you’ve assessed the demand and done the research.

The key thing about a startup is a lot of times you’re trying to create something new or completely different, but when you’re doing research, the research is about old products or old ways of thinking. So you won’t really know for sure whether your new way is going to be right.

Wofford I’m sure the audience would love to hear the details of your decision to switch tactics at GiveGab.

Mulligan GiveGab set out to be the social network for volunteers, which meant that we were a connection portal to help volunteers and nonprofits find each other. We interacted with a lot of nonprofits and they were really happy to talk about this. They loved the idea and then as we built our product they thought it was great. We had a free product so we had thousands of nonprofits and hundreds of universities sign on. We passed 100,000, things were growing and moving fast and we were getting great press and great feedback.

But it didn’t take us long to realize that there was really low engagement. Nonprofits would sign up but then only come back like every six months to do something. It was really challenging to get them to actually post volunteer opportunities.

When I first started I thought it was going to be really easy to get nonprofits to post volunteer opportunities because they were consistently telling us that they need more volunteers. But we couldn’t get nonprofits to actually sign in and create volunteer opportunities. That meant that we were having a hard time matching the volunteers who had signed up with opportunities in their area. You know, a volunteer in Montana and a nonprofit in Minnesota don’t really match up.

That’s why we decided to go after universities to help build an ecosystem because a lot of times they have volunteers and nonprofit partnerships. The problem we found there was that it was a super long sale because we were talking to low level employees. We should’ve noticed this problem earlier but if you want to know what a nonprofit really cares about, you need to go see what the executive directors are doing. What the directors are doing is looking for donors, not volunteers.

Raising money is really what mattered the most and we weren’t listening to that. So we decided to go down a new path. We sat down and really looked at what the nonprofits were using their volunteers for. Almost always, the volunteers were being used as a direct or indirect way to get donors. It’s really about money for nonprofits and volunteers are a way to get donors more engaged. One of the things we kept hearing all of the time – and the research backs this up – is that only 19 percent of first-time donors ever come back. Nonprofits spend all of this time getting donors and then four out of five of them are gone and never come back. We were skirting around the edges with volunteering but the core problem was how to get more donors and keep them coming back. So that’s now the problem that we decided to solve.

Wofford How big was your organization when you decided to make this pivot?

Mulligan We had 90 employees and we had a lot of funding. We had dozens of investors and so I had to go back to all of them and admit I was wrong. Then we had to let about half our company go. These were really good employees so that was a very painful day.

For a lot of people, ‘pivot’ is just a word, just a strategic choice. For me, it’s a painful memory. It was necessary and I’m really glad we did it, but it was painful.

We had to totally re-brand. We were the social network for volunteers so we were highlighting happy volunteers and like things like that, which makes no sense for a fundraising platform. So conceptually we had to change everything. Then we had to build it and go back to our development team and say, “Ok, we’re starting from scratch, let’s learn how to do this.”

There are also laws around fundraising so there was a lot of work in just making sure we were doing things the right way.

Wofford That sounds really challenging.

Mulligan It was, but one of the great things about pivoting is that if you’ve built a great team, as we had, then you’ve already figured out how to work well together. In our case, the employees we were left with were great, so we got a second shot at something and the second product looked a million times better than the first product because we really knew what we were doing by that point and we had a system in place.

There’s also a certain amount of incentive in a pivot situation because maybe you’ve run out of money, so you know that this could be your last lifeline. So you better make progress and you better make it quick. There is nothing like the gallows to give people focus.

As an entrepreneur, it can be very challenging because you have told a lot of people about your vision and you’ve been very persistent and then you have to go and tell them, “OK my vision sucks but now I have a new one.” You’re asking people to buy into this new idea even though your first was wrong.

Wofford That must take a certain humility.

Mulligan Sure, and you also have to make some super painful choices. Like I said, we had to let employees go. We had to go back and talk to investors and let them know that all of their investments just went backwards. Nothing about it is fun but you have to just face it head on, so I just owned it. I think that approach was super helpful.

You have to pick your new course of action and then you have to forget the past. Pick your new vision and just sell that like that was the only one you ever believed in. And of course you’ve got to somehow get everyone to buy into this one as much as they we’re into the first one. These are all way harder things than I think people realize.

Wofford It certainly sounds hard. Was it a challenge to keep morale up?

Mulligan Well, when you’ve just let half your workforce go, keeping morale up was already a challenge. People’s workloads had doubled and then it was like, “Now let’s do it over.” I think what helped us is that we spent a lot of time making sure that our new course of action was picked by everyone, not just me.

Wofford Everyone needs to be on board to make a pivot work.

Mulligan Right. We had conversations with the people that we were going to keep and said, “Look, if your heart’s not 100 percent in this, you need to let us know because there are people we are letting go whose hearts are 100 percent in this.” That wasn’t a threat, it was just the reality. I think people really appreciated the openness and transparency. When we let people go, we really supported them but we also sat everyone down and said, “OK guys, we’ve got to forget about it. There is a lot of pain here, but we need to just move forward.”

When we did our pivot in January 2015, we had five nonprofits raising money on GiveGab.
At the end of the year, we had 700. All paying customers, so we were making money off all of them. We are currently on pace to potentially have well over 20,000 nonprofits by this year. We also have 10 states using us as their statewide giving day platform later this year. So the pivot worked.

Wofford Wow, it’s very impressive. Congratulations.

Mulligan We’re really excited and of course relieved. We saw the bottom and that makes you appreciate it more when things are really working.

So much of the startup ethos is ‘vision and persistence’. I think you need vision and flexibility. You can also think about it in terms of the difference between persistence and resilience. Persistence is putting your head down and running into the wall. Resilience is putting your head down but looking around a little and realizing there’s a door over there and you can walk right through it.

Wofford Charlie, thank you so much for sharing your experience and giving such great advice about changing strategic direction.

Mulligan Thank you, Chris. I enjoyed being with you.

Want to hear more? This interview is based on Charlie Mulligan’s live eCornell WebSeries event,The Startup Pivot: Changing Strategic Direction. Subscribe now to gain access to a recording of this event and other Entrepreneurship topics.

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How to Make the Business Model Canvas Work For You

Neil Tarallo has more than two decades of entrepreneurial experience under his belt and is a senior lecturer at Cornell’s Hotel School as well as the director of the Cornell Entrepreneurship Bootcamp for Veterans with Disabilities.

But that doesn’t mean that he can simply come up with an idea and magically turn it into a successful startup. When Tarallo brainstorms ideas, he leans heavily on the Business Model Canvas. Created by Alexander Osterwalder, it is arguably the most important innovation in entrepreneurship and strategy in quite some time.

Tarallo joined eCornell’s Chris Wofford to discuss the Business Model Canvas as part of the Entrepreneurship webinar series. An abridged version of their conversation follows.

Tarallo: Entrepreneurs are problem solvers. We solve problems in a marketplace, and in doing so we create businesses. For us as entrepreneurs, it’s important to understand exactly who is feeling the pain, so to speak, that has been created by that problem. One of the nice things about the Business Model Canvas is it really helps us focus on that.

When I talk to entrepreneurs around the world about their businesses, one of the things they tend to miss is the value that their solution creates for their customers, and exactly what those customers think about that value.

People get a little upset with me sometimes when I say these things but products and services don’t create markets. Solving problems in markets, and creating value, allow us to create new markets. But in order to have a sustainable business, you have to solve real problems for real people and understand what that solution means to them.

It’s really not about your products or your cool technology or how great your food tastes. It’s always about how you create and capture value for your customers. So that’s what we want to focus on and I think one of the great things about the Business Model Canvas is it really helps us focus on that important element of our business.

There’s no shortage of new products. It’s not even cool anymore just to have a new product or new technology. There’s so many of them out there, but very few of them really bubble up to the top. That’s because the manufacturers misinterpret what it is that they’re trying to do. There’s that old adage: Build it and they will come. Whenever I hear that, I run as fast as I can and you should too because you need to do more than just build it. You need to make that connection and that’s really what the Business Model is about. It’s all about how a business captures and delivers value to the customers.

Wofford: Before we go much further, perhaps we better get into what the Business Model Canvas actually is and how it works.

Tarallo: OK. The Business Model was created by a guy named Alexander Osterwalder. He was doing his Ph.D. and his interest was in business models. What he discovered as he was doing his research is that when he would ask people about business models, no two people could define it the same way.

I give him a lot of credit for seeing that. I think it’s something that all of us who teach and talk about entrepreneurship over the last 15 or 20 years have encountered but we just never identified it.

Osterwalder wrote his dissertation, ‘The Business Model Ontology – a proposition in a design science approach’, about how we build and generate business models. His premise was that we need to have a common understanding of what a business model is and that we need sort of a shared language around it.

So he created this tool called the Business Model Canvas and that was followed shortly thereafter by another canvas called the Value Proposition Canvas. We won’t spend as much time on the Value Proposition Canvas today but it has also become a fundamental tool in innovation.

The Business Model Canvas has nine building blocks and we’re going to quickly go through each of those building blocks. In the very center of the canvas is the Value Proposition. This is where we articulate the problem that we’re solving as well as how we are solving it for our customers. It is the first building block and is at the dead center of the canvas because it is central to everything that we do.

All the way over to the right is Customer Segments. We need to understand, as specifically as we can, who the customers are. Who will be interested in our solution and what value do they see in what we propose for them? Continuing on, building block number three is Channels, and that’s how customers actually get and access our Value Proposition. It could be online, it could be in our store – there are a whole bunch of variations on how we do that.

Next, Customer Relationships, which is primarily the marketing component of what we do. Moving to the left on the canvas, we have Key Resources, what we need in order to deliver our value proposition. Above that is Key Activities, where you identify what activities your business engages in on a daily basis that deliver the Value Proposition.

All the way on the left is Key Partners and those are other organizations or people that we can work with to help us deliver our Value Proposition. An example there might be, if I sell coffee, coffee growers may be a key partner for me because I have to bring them on board.

The bottom of the campus is all about the financial aspects of our business. To the right, we see Revenue Streams, and that’s those unique products or services that generate revenue for our business. To left is Cost Structure, or what it costs us to deliver our Value Proposition.

Notice that when I talk about each of these building blocks, I’m always referencing the Value Proposition. The activities that happen within these building blocks are central to that. Everything I talk about on the Business Model Canvas focuses on that Value Proposition.

Wofford: Yes, I did notice that you were really driving that home.

Tarallo: Now, if you look at the layout of the canvas, what you really see on the right side is what we call front stage operations or what we call front of house in the hospitality industry. These are the forward-facing activities that customers see and feel and touch. On the left side of the canvas are what we call backstage or back of house operations and those are the things we do behind-the-scenes that customers don’t necessarily see that support the delivery of our value proposition.

My work with companies and with entrepreneurs tends to focus on that left side because it’s a much more difficult thing to do. I call the front stage operations low-hanging fruit: we get to talk to our customers, we get to do some research, we see what they value and what they don’t value. That’s all pretty easy to do. The interesting thing about backstage operations is that if we can figure out how to deliver value through our operations, we tend to create a competitive advantage that’s very difficult for our competitors to break into.

An example I always use for that is Disney World. It’s one of my favorite places to go because I learn so much about operations there. Disney really delivers value through their operations. They entertain you while you’re going through lines, they have a series of tunnels underneath the entire facility, so that they can get anywhere in the park in six minutes or less. Other parks can’t do that so they’re creating value through operations that really gives them a big advantage over their competitors.

Wofford: It’s fascinating, and for our viewers who are interested, just Google ‘Disney World front stage operations and backstage operations’. There’s so much stuff out there written about it.

Tarallo: Now, the lower part of the Business Model Canvas is what I call the economic model.
It’s how different elements of the cost and revenue structure of our business come into play and work together. So that’s the way I think about the model: right, left and lower side, with value being in the center of everything.

Wofford: So how does the canvas work?

Tarallo: As we build our Business Model Canvas, we really hypothesize and we’re guessing what we think is going to happen or could happen in each of these building blocks. Then our job is to go into the marketplace and test our hypotheses. We learn from those tests and we go back and we repeat this over and over again until we get it right.

Wofford: So following this model allows you to test your assumptions, right? That’s where you validate whether or not you do have unique value, whether you’ve got a competitive advantage and so on?

Tarallo: Exactly. You need to be objective. One of the big challenges for me in disseminating information about the canvas both to my students and entrepreneurs is that they’re very emotionally invested in their solution to the problem. For me, one of the measures that I use to determine whether I think somebody is in fact going to be successful as an entrepreneur is how flexible they’re willing to be in that solution.

Wofford: How do you know when you’ve got it right?

Tarallo: To be very candid with you, as much as we work on this and as much as we test, it will not be accurate. The day that we open our business is when we really find out whether it’s accurate or not. None of this is an absolute, but the canvas gets me on the right page. It gets me as close as I can so that when I have to make adjustment when I open my business, or as I’m running my business, I don’t have to take big leaps. I’m trying to mitigate risk and I think one of my favorite things about the Business Model Canvas is it lets me do that.

Entrepreneurs don’t like risk, contrary to what a lot of people believe. We understand risk. We understand it’s part of our lives and we work hard to mitigate that risk, but we don’t love risks.

Wofford: So you’re not rushing off to Vegas every chance you get?

Tarallo: Haha, no. When it comes to testing ideas we’re really trying to set up a series of controlled experiments that you can fail without jeopardizing your business. I always say that entrepreneurship is nothing more than a series of small failures. I’m very careful about how I say this though, because I think there is this belief out there that it’s good for entrepreneurs to fail big and fail fast. I’m not a fan of that. Failure is never a good thing. I want to try to control my failures so that I’m mitigating risk and I learn from my market in a way that’s not going to damage my brand or what I’m trying to accomplish.

It’s important to me to stress that in my opinion, the Business Model Canvas is not a replacement for a business plan. It’s not a replacement for a marketing plan or a strategic plan. It is an effective tool for understanding who your customers are, what they value and how you can create a solution for their problem.

One of the things that Steve Jobs was really good at with Apple was not even thinking about a product necessarily but going into the market and interfacing with the market and seeing what it is that they were struggling with. The iPod is a great example of that. He saw a problem that was happening in the marketplace and he really found it through observation and getting people to tell stories about how they get music and how they listen to music.

I contend that Apple’s business model as a whole is that they’re problem solvers. They find problems in the market that they can solve with their core competencies, which are design and technology. That’s how they come up with these really great innovative products.

I shouldn’t say this because you’re recording, but I think Apple is going to be out of the phone business before too long.

Wofford: Really? Why do you say that?

Tarallo: Because the problem is solved. It’s no longer compelling for them and for the first time ever we saw iPhone sales drop last year. If you think about the iPod, you can’t buy one of those on a store shelf anymore. Why not? Because the problem has been solved, so Apple no longer makes them. Our phones are now substitutes for iPods and I think you’ll see the same thing happen with the iPhone, perhaps sooner than a lot of people think.

Wofford: Well, if you’re right you’ll be glad we were recording this so you can pull up the video and say “told ya so”. Neil, this has been very interesting. Thank you for sharing your insights into the Business Model Canvas.

Tarallo: Thanks, Chris. I enjoyed it.

Want to hear more? This interview is based on Neil Tarallo’s live eCornell WebSeries event,Business Model Canvas: A Tool for Entrepreneurs and Managers. Subscribe now gain access to a recording of this event and other Entrepreneurship topics.

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How to Manage Risk, Uncertainty and Opportunity (The Smart Way)

Having spent many years as a business consultant, Stephanie Thomas says she has “a long history with risk.” But although many people view risk as a negative thing, Thomas says that risk is more like the flip side of opportunity.

Now an economics lecturer at Cornell University’s ILR School, Thomas joined Chris Wofford to discuss the relationship between risk, uncertainty and opportunity as part of eCornell’s WebSeries.

An abridged version of her presentation follows.

Thomas: It’s important for people to realize that, risk isn’t necessarily a negative thing. Without risk, there’s no opportunity. If we never take a risk, we can’t really ever move forward to build, grow, develop and expand. So we have to take calculated risks but not stupid risks.

Wofford: To make sure we’re all on the same page, how do you define risk?

Thomas: Risk can take a variety of forms. There are four kinds of risks within the business setting: hazard risks, financial risks, operational risks and strategic risks.

The first, hazard risks, are usually the kinds of things that we think of when we hear the word ‘risk.’ This is the risk of something bad happening – natural disasters, floods, car accidents, those kinds of things.

Wofford: The risk there is not having prepared for them, right?

Thomas: Yes, and it’s really difficult to prepare for them because oftentimes they’re unanticipated. But when they do happen, they’re going to impact the business. Hazard risks are things that happen to the organization from the outside. Insurance, contingency planning and emergency preparedness plans can really mitigate hazard risks. So even though hazard risks are unanticipated, we usually have some pretty good mechanisms in place to deal with them.

Most organizations will also have protocols and policies in place to manage financial risks. These are things like fluctuations in interest rates, debt, asset losses or shrinkage if you’re in a retail environment. We all face these kinds of financial risks, but they’re typically well controlled and well understood as a part of routine discussion.

Then we can talk about the operational risks like supply chain issues and cost overruns. These are things that you might not plan for or take insurance out to mitigate against, but they’re still risks that are pretty well understood. If you have supply chain issues and can’t finish your product because something has happened to the person that you’re relying on – their truck broke down or they’re behind in production – this can really blow everything up.

But again, these kinds of risks are usually able to be managed pretty well. As an organization, you’re going to have a sense of what could go wrong and what you’re going to do to mitigate that situation.

Wofford: So that leaves the big category.

Thomas: Yes, the fun one. Strategic risks. Here we’re talking about things like customer retention. We’re talking about R&D projects. We’re talking about industry or sectorial issues and broader macroeconomic fluctuations. You’ve forecasted demand and it turned out that your forecasts were wrong and you have all this excess inventory. What are you going to do with it? Or you manufacture a toy and all of a sudden it becomes the “it” toy for the holidays and everybody is buying them and you haven’t produced enough to satisfy demand. What now?

These are examples of strategic risks and you really need to think about how they can potentially impinge on your strategy and what you’re going to do.

Wofford: So do you get everybody in the same room and sort of talk through these different possible scenarios and your responses to them?

Thomas: Absolutely. I’d like to turn to some real-life risk examples. When Apple did their R&D to create the iPhone, they didn’t really know for sure if it was going to be a success. It was a touch screen; it looked nothing like the flip phones or the clam shells of the day. It was a huge risk. But what was the upside? Well, it was enormous. The iPhone is now on its seventh generation and everybody has one.

To give another example, do you like to cook?

Wofford: Yes, a lot.

Thomas: Okay, let’s say that you’re making a new recipe for the first time. If it doesn’t turn out the way that you hope it does, what’s the downside?

Wofford: Well, I’d certainly be disappointed myself, and I could have unhappy guests. Worst case, someone gets ill.

Thomas: Let’s not even get into the getting ill part. Let’s just say it doesn’t look the way it’s supposed to look or it doesn’t taste the way it’s supposed to taste. The downside is, well, you can’t eat it and you have to order take-out. This is relatively minor in the grand scheme of life. But the upside is you prepare something wonderful for your family, you’ve learned a new skill and you’ve added to your credentials as a chef.

Wofford: Right, it’s not a huge downside if we have to order pizza because I messed up dinner.

Thomas: It’s not catastrophic. But in some cases, the downside of strategic risk can be catastrophic. If we look at Exxon Valdez, if we look at Deepwater Horizon, those things have huge potential downsides in terms of not just money and resources but in terms of human life. So how we balance these risk-versus-reward situations depends on what’s at stake. Context is super important when we talk about managing these risks.

Wofford: When we think of risks, we sort of associate them with trying new things. But can you think of any examples in which it is better to stick to what you were doing? I ask because I’m from Rochester, New York, the home of Kodak. And that’s a company that willfully decided to neglect the burgeoning digital market to their peril.

Thomas: Again, I think it depends on the situation. In the case of Kodak, it was a strategic choice that they were the leader in what they do and wanted to focus on that core capacity. I certainly can’t speculate on the decision-making process, but if I had to guess, I would say that they felt that even with this new digital marketplace coming, there was still going to be a need for the old analog film. And there are still photographers and artists that use film even though the market has gone overwhelmingly digital.

Wofford: I know it depends on the situation, but typically, how do companies typically deal with risk, uncertainty and opportunity?

Thomas: I think that you need to take a holistic approach. There’s not necessarily one single correct answer but we can assign likelihoods to things. To go back to the cooking example: if you’re trying a new recipe, what is your level of cooking ability? Can you read a recipe? Do you know how to measure ingredients? If you’ve never cooked anything before, the downside for you is a lot more likely than if you’re an experienced cook. You need to really think about what those potential upsides and downsides are and how likely they are to happen.

The classic expression is “nothing risked, nothing gained.” If Apple had not taken the risk to move forward on their R&D project, they would have lost a lot. The iPhone really helped make Apple one of the world’s leading consumer brands.

There are a few common approaches that are used to address risk. The first one is to be like an ostrich and put your head in the sand and ignore it. Not a good idea. Ignoring everything around you is a catastrophe waiting to happen.

A second approach is to say, “Okay, so we know last quarter this happened. And the quarter before that, this happened. And two years ago this happened, so we’re going to predict what we’re going to do in the future based on historical information.” That often works, especially if you’re in a stable environment and producing a product or service that hasn’t changed in the last 10 to 15 years. In that situation, looking at history is going to help you predict the future.

But if you’re in the tech world, you certainly don’t want to look at what’s happened in the last five years to try to predict what’s going to happen in the next five. Things change too rapidly.
To tie it back to your Kodak example, they had been a leader for a number of years so they might have thought that what worked in the past was going to continue to work in the future.
It didn’t. Projecting the past into the future is like driving on the highway looking only in your rear view mirror. You’ve got some information — you know where you’ve been — but you’re still missing what’s in front of you.

Wofford: Let’s talk about the distinction between risk and uncertainty.

Thomas: The way I think about risk is that it is something that can be known. If I cross the street, there are certain inherent risks. With uncertainty, on the other hand, we have no way to quantify it. It’s the realm of unknown unknowns.

If it’s risk, we can manage it. We can manage hazard risk through insurance policies. We can manage financial risk through standard operating procedures and audit controls and generally accepted accounting principles and so on. But if it is truly uncertain, there’s really not much you can do. Uncertainty in my mind is a lot scarier than risk. If it’s true uncertainty, you’re not able to even articulate the array of possible outcomes.

Wofford: So we’ve made that distinction and we’ve talked about a couple of risk case studies. Do you have any advice for putting risk assessment into practice?

Thomas: I think that when coping with risk, particularly strategic risk, you really need to understand what it is that you do and what your customers expect. What is it about you that distinguishes you from your competitors? What is your strategy? You need to have a firm grip on these things in order to think about what is likely to happen in the future.

Do we want to go from making widgets to digital switches? Are we going to transition into that new area to cope with the new business environment or are we going to stay on track and continue to do what we’ve always done? Again, depending on the scenario and the environment that you operate in, both could be viable alternatives. But when you choose one path, you should be able to articulate a set of reasons as to why you made that decision. You need to understand the opportunities as well as the risks and make a calculated decision.

Wofford: Stephanie, thanks for that practical advice and thank you so much for joining me today.

Thomas: Thanks, Chris.

Want to hear more? This interview is based on Stephanie Thomas’ live eCornell WebSeries event,How to manage Risk, Uncertainty and Opportunity. Subscribe now gain access to a recording of this event and other Entrepreneurship topics.