Is the problem real? What we mean by a problem, could be a problem that you seek to solve in the market, it could be an opportunity that you've discovered. What we mean by real are, are there enough customers that really care about it? Is it truly something that the market is going to have value in, and is it something that you can build a business on? We're going to start the discussion by looking at opportunity identification, and that's going to be the core element that will get us kicked off in our final segment of the opportunity analysis canvas. So, defining the problem. Elements that we seek to understand at this point are things like, who is the customer? This is the first step to really defining the problem because we want to understand, again, who we're trying to serve. The analyses of the industries, the markets, competition, and value innovations are all very important to help us answer this question of who our customer is. We also want to take a look and assess, what are the needs and wants of that customer that we've identified? We want to focus on customer value. We want to continue to think about, why do they need this product? We want to think about the benefits that we'll deliver. Will we help them make money, save money, save time, or experience other advantageous elements, or reduce disadvantageous elements that they might be experiencing? So, the other side of the coin is, are there enough customers? It's likely that there are some people out there that will see value in what it is that you're going to bring to the market, and some people will pay for that, but we want to know, are there enough? If you have a real customer, if you can deliver value, we want to think about, how many out there experience that problem now or in the future? We want to think about how many buyers there are of that population. It's not one to one, so a number of people might experience a certain issue or problem, but a subset of them are really going to experience it to the degree or place the economic necessity on it to pay for a solution. Are there enough people that care about the problem for you to be financially successful, is influenced by all of these various factors. Is it a problem that they experience, are there enough people that are willing to pay for it? And so, when we look at an example of this, Clemson University, Florida State University, two large universities here in the US with a large alumni base, a large student base, and a large fan base for their sports. They do very well at licensing and selling merchandise that's branded with their university brand name. A combination, Clemson-Florida State sweater or sweatshirt, where you have half from one school and half from another is a different shaded product. There may be someone that sees value in it, and that person may be going to pay for it. To my knowledge, there is only one person that's done that, at least that I have seen, and that's Ann Balden. Ann Balden, when her husband was the head coach of Florida State University, and her son was the head coach of Clemson University, when the teams would play football against each other once a year, she would wear a sweatshirt or a sweater that was half for one school, half for the other school. Probably made by her or made by a friend or family member. Just because there is someone out there that is interested in that doesn't necessarily mean that there's a market opportunity that you should go out and build these hybrid combination products. That's what I mean by, are there enough? Now the question of how many is enough, is it single digits? Is it thousands? Is it millions? It certainly depends on your product and the product category. If you're developing something that's a fairly low price point, fairly low profit margins, you need a lot of people. If you're Rolls Royce or Ferrari, you may need 2,000 customers globally in a year to develop a profitable product. So, in that measure, there's not a magic number, but it's influenced by your financials and what your cost structures are. We also want to think about big problems that are out there. John Dewar from Kleiner, Perkins, Caufield, and Byers, arguably the top VC that's ever lived, is going to talk a little bit about green technology and what his firm has been doing since 2007, of setting up a fund that's geared towards investing in startups in the green tech space. We're going to spend a few minutes hearing about the beginnings of that and what turned him on to this, as something that's not only an important business opportunity, but an important opportunity and obligation. >> I'm really scared. I don't think we're going to make it. Probably by now most of you have seen Al Gore's amazing talk. Shortly after I saw that, we had some friends over for dinner with the family. The conversation turned to global warming. Everybody agreed, there’s a real problem, we've got a climate crisis, so we went around the table to talk about what we should do. The conversation came to my 15-year-old daughter, Mary. She said, I agree with everything that's been said. I’m scared and I’m angry, and then she turned to me and said, dad, your generation created this problem, you better fix it. All the conversation stopped, all the eyes turned to me. >> [LAUGH] >> I didn’t know what to say. Kleiner's second law is, there is a time when panic is the appropriate response. >> [LAUGH] >> And we’ve reached that time. We cannot afford to underestimate this problem. If we face irreversible and catastrophic consequences, we must act, and we must act decisively. I've got to tell you, for me everything changed that evening, and so my partners and I, we set off on this mission to learn more, to try to do much more. So, we mobilized, we got on airplanes, we went to Brazil. We went to China and to India, to Bentonville, Arkansas, to Washington DC, and Sacramento. And so, what I'd like to do now is tell you about what we've learned in those journeys, because the more we learned, the more concerned we grew. My partners at Kleiner and I were compulsive networkers and so- >> So, what you've seen here is a bit of an introduction of really how he became to be more aware and take more interest, from both a personal standpoint and as well as a financial opportunity standpoint, of why greentech is something that VC should be involved in. In this case, we're going to post the video online, and you can go in and watch the remainder of it in its entirety. So, in summary, we want to think about real problems. We encourage you to validate the ideas that you have, and to validate those candidate solutions. The best way to do that is talk with prospective customers very early in the product development process, of engaging with customers pre-prototype to get their insights early on on what features matter. What values matter? What would they pay for such a solution? Before you go down the path of actually developing it and building it, only to find that it's either not a real problem or it's not something that can be solved at the price point that you need to charge.
