Launching Technology Ventures
Course Number 1755
Senior Lecturer Jeffrey Bussgang
Senior Lecturer Jeffrey F. Rayport
Spring; Q3; 1.5 credits
One short essay, based on project work, published on the course blog.
Launching Technology Ventures (LTV) is designed for students who will join startups, launch their own companies, or work in established firms launching information technology products, in particular, new ventures in the Internet, mobile, and enterprise software sectors.
The course takes the perspective of functional leaders in information technology startups, with a focus on product, engineering, sales, marketing, and business development. For each function, we explore challenges that managers encounter before and after a startup achieves product-market fit, that is, a match between its product solution and market needs. We also study cross-functional conflict in new ventures and ways in which managers cope with such conflict. LTV will emphasize implementation rather than strategy issues, and thus should overlap minimally with The Online Economy, Competing with Social Networks, and Strategy & Technology. Likewise, LTV will largely avoid concepts covered in Entrepreneurial Finance and Founders' Dilemmas.
Through case studies and panel discussions, LTV will examine functional management challenges in startups during the early "search and discovery" stage as well as the "scaling" stage. These challenges include:
- Product Management: When and how should an early-stage startup-especially one with a strong, product-oriented founder-introduce formal product management processes, e.g., project prioritization and tracking systems, product roadmaps? How do product managers deal with typical sources of conflict with engineering, e.g., tradeoffs between cost/time-to-market on the one hand and functional performance/quality testing/breadth of features on the other?
- Engineering: How can managers in a seed-stage startup mitigate risks with outsourced software development? What are the tradeoffs with different approaches to software development, e.g., "waterfall" versus "agile," and when does each make sense? What is "technical debt," and what can engineering managers do to reduce its impact?
- Sales: When should a seed-stage startup recruit its first sales professionals, and what hiring criteria are appropriate? What are the attributes of ideal beta customers for radical new innovations? How can sales managers and their counterparts in other functions respond to enterprise customers' demands for product customization? What are best practices for scaling a direct sales force? For setting up and managing channels?
- Marketing: How can a resource-constrained early-stage startup optimize the use of different customer acquisition methods, e.g., SEO, SEM, affiliate programs? What considerations are relevant in pricing a radical new innovation? What are best practices for managing public relations and the trade press?
- Business Development: How should the business development team prioritize smaller "easy wins" versus blockbuster deals that could significantly improve a startup's position? How can the team protect the startup's interests in the face of asymmetric bargaining with powerful partners? What are best practices for managing "turnkey" relationships with large numbers of small partners, for example, developers who leverage a platform's API?
When exploring these challenges, we will assume the perspective of functional leaders, and pay close attention to how they manage conflict with their counterparts in other functions. We also will study organizational structures and systems used in scaling startups to manage cross-functional conflict as well as managing through acquisitions (acquihires) versus continuing to pursue product market fit.
A project session in Batten Hall will entail a team exercise supervised by Senior Lecturers Bussgang and Rayport along with local venture capitalists and entrepreneurs. Through this exercise, a team of students will specify, for one team member's startup idea, business model assumptions and rigorous tests to validate those assumptions, leveraging tools and techniques covered in the LTV's case sessions. Students will present their projects at the end of the term and draft a short essay, optionally published on the LTV course blog, about what they learned.
The course has 10 cases, 2 panels (VPs of sales and VPs or product) and a Business Model Exercise along with a wrap-up session. In nearly all of the cases, the case protagonist will be a class guest. Case protagonists are 50% female, 50% male.