I-Corps @ NIH – Pivoting the Curriculum

We’ve pivoted our Lean LaunchPad / I-Corps curriculum. We’re changing the order in which we teach the business model canvas and customer development to better-fit therapeutics, diagnostics and medical devices.Udacity canvas and value prop

Over the last three years the Lean LaunchPad class has started to replace the last century’s “how to write a business plan” classes as the foundation for entrepreneurial education. The Lean LaunchPad class uses the three “Lean Startup” principles:

  • Alexander Osterwalders “business model canvas” to frame hypotheses
  • “Customer Development” to test the hypotheses outside the building and
  • “Agile Engineering” to have teams prototype, test, and iterate their idea while discovering if they have a profitable business model.

Teams talk to 10-15 customers a week and make a minimum of 100 customer visits. The Lean LaunchPad is now being taught in over 100 universities. Three years ago the class was adopted by the National Science Foundation and has become their standard for commercializing science. Today the National Institutes of Health announced their I-Corps @ NIH program.

The one constant in all versions of the Lean LaunchPad / I-Corps class has been the order in which we teach the business model canvas.

Value Propositions and Customer Segments are covered in weeks 1 and 2, emphasizing the search for problem/solution and then product/market fit. Next we teach Distribution Channels (how are you going to sell the product) and Customer Relationships (how do you Get/Keep/Grow customers) and Revenue Streams (what’s the Revenue Model strategy and pricing tactics.) Finally we move to the left side of the canvas to teach the supporting elements of Resources, Partners, Activities and Costs.

current teaching order

Teaching the class lectures in this order worked great, it helped the teams understand that the right-side of the canvas was where the action was. The left- hand side had the supporting elements of the business that you needed to test and validate, but only after you made sure the hypotheses on the right were correct.

This lecture order was embedded in the Udacity Lectures, the syllabi and educators guide I open-sourced. Hundreds of teams in the NSF, and my Stanford, Berkeley, Columbia, and UCSF classes learned to search for a repeatable and scalable business model in this way.

It’s consistency was the reason that the NSF was able to scale the I-Corps from 15 to 30 University sites.

So why change something that worked so well?

Rationale
Last fall at UCSF we taught 125 researchers and clinicians in therapeutics, diagnostics, medical devices and digital health in a Lean LaunchPad for Life Sciences class. While the teaching team made heroic efforts to adapt their lectures to our “standard” canvas teaching order, it was clear that for therapeutics, diagnostics and medical devices the order was wrong. Hypotheses about Intellectual Property, Reimbursement, Regulation and Clinical Trials found on the left side of canvas are as, or more important than those on the right side of the canvas.

I realized we were trying to conform to a lecture order optimized for web, mobile, hardware. We needed to cover Intellectual Property, Reimbursement, Regulation and Clinical Trials a month earlier in the class than in the current format.

The National Institutes of Health has adopted our class for its I-Corps @ NIH program starting this October. Most teams will be in therapeutics, diagnostics and medical devices. Therefore we’re going to teach the class in the following order:

1) value proposition, 2) customer segments, 3) activities, 4) resources, 5) partners, 6) channel, 7) customer relationships, 8) revenue/costs

LS Suggested Order simple

I-Corps @ NIH Lecture Order Details
Customer Segments change over time.  CROs or Payers may ultimately be a resource, a partner or a revenue source, but until you get them signed up they’re first a customer. Your potential exit partners are also a customer. And most importantly, who reimburses you is a customer. (You get an introduction to reimbursement early here, while the details are described later in the “Revenue” lecture.)

Activities are the key things you need to do to make the rest of the business model (value proposition, distribution channel, revenue) work. Activities cover clinical trials, FDA approvals, Freedom to Operate (IP, Licenses) software development, drug or device design, etc.

Activities are not the product/service described in the value prop, they are the unique expertise that the company needs to deliver the value proposition.  In this week we generally describe the business rationale of why you need these. The specifics of who they are and how to work with them are covered in the “Resource” and “Partners” lectures.

Resources - Once you establish what activities you need to do, the next question is, “how do these activities get accomplished?” I.e. what resources do I need to make the activities happen. The answer is what goes in the Resources box (and if necessary, the Partners box.) Resources may be CRO’s, CPT consultants, IP, Financial or Human resources (regardless of whether they’re consultants or employees.)

Partners are external resources necessary to execute the Activities. You’ve identified the “class of partner” in the Resources box. This lecture talks about specifics – who are they, what deals work with them, how to get them, how to work with them.

Customer Relationships is what we think of as traditional sales and marketing; assembling a SAB, getting the KOL’s, conferences, articles, etc.  Customer Relationships answers the question, “How will we create demand and drive it to our channel?”

Suggested Order

We think we now have a syllabus that will better fit a Life Science audience. Once the syllabus stops moving around we’ll open source it along with the educators guide this fall.

Lessons Learned

  • The Lean LaunchPad class has started to replace the last century’s “how to write a business plan” classes
  • The lecture order emphasizes testing the right-side of the canvas first
  • That works for almost all markets
  • However, for life sciences hypotheses about Intellectual Property, Reimbursement, Regulation and Clinical Trials are critical to test early
  • Therefore we created a more effective lecture order for Life Sciences

11 Responses

  1. This is a great shift and would also add this order makes sense for connected devices, wearables, and hardware – the decision to partner, OEM, or resell affects the business model so substantially that it may make sense to follow the Life Sciences order.

  2. Like always… Fantastic😄

  3. Several Sustainability (a type of Life Science) course prototypes have been posted online within the Udacity LLP since March 1 of this year. Visit rates for the Sustainability prototypes through June 1 were derived as follows: Of over 7,000 new LLP students in the quarter, 11%, just under a thousand, visited one or more of over 500 forums.
    The Sustainability course forums averaged about 10% each of these 500 student visits.

    The most visited Sustainability forum was “What are your Key Sustainability Partnerships?”, nearly 25% of those visiting any Sustainability forum.This suggests that most startups expect a partner to do heavy lifting when it comes to Sustainability issues. Other above average visits were to Value Proposition, Sustainability Overview, Student’s Own Model (Business Model YOU), and Revenue Model. LLP sequence changes will be factored into the prototype forums.

    http://forums.udacity.com/questions/100156779/sustainability-what-do-eco-innovation-startups-do#ep245

  4. Fresh and opportune insight! It really help to understand even traditional market canvas deeper and in a more comprehensive way. Thanx a lot :)

  5. Steve,

    Good stuff. At Inovo, we have believed that the b-model framework was lacking a section for Brand. Just curious what you think about that. You could argue that this falls under Customer Relationships but it does not fit all that well with the other content of that section.

    Brian

    • agree – it goes under customer relationships. it’s part of the strategy of Get/Keep/Grow customers.

  6. Really like the shift for diagnostics – it’s a much better fit.

  7. Kudos for applying your own product-market fit philosophy to your teaching approach and making that change. It’s also a refreshing reminder that innovation is principles-led, not rule-bound. Thanks for sharing.

  8. This is a wonderful change – I love and use the Business Model Canvas with my clients. But as my consulting practice is in the medical/scientific space – medtech, biotech, pharma, etc.- I needed some more specifics for all of the challenges/barriers to entry in our industry – clinical trials, regulatory and reimbursement.
    This is wonderful – Thank you!
    Carol Upton, Australia (UCB Haas Australian Alumni Rep)

    Steve, do you want to come “down under” to help spread the word here in the antipodes?

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