The document summarizes a presentation given by Dr. Takeru Ohe on business model competitions. It discusses that the goal of a business model competition is different than a business plan competition, as it focuses on testing assumptions with customers rather than creating detailed plans. It provides examples of criteria for judging entries, such as validating hypotheses through customer interviews and tests. It also provides an example of a company called Owlet that iteratively tested and improved its business model based on customer feedback.

1. Business Model Competition
JBMC-Nigata
October 24,2015
Waseda University
International University of Japan
Dr. Takeru Ohe
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2. Dr. Takeru Ohe
Chairman, JBMC Executive Committee
 He sits on the boards of Cognex Japan K.K., a machine vision
manufacturer, and My Vision, a nonprofit organization
specializing in entrepreneurship education for youth.
 He taught Entrepreneurship at Waseda University, Business
School and served as managing director of the Waseda
University Incubation Center. Currently he serves as an
advisor to Research Promotion Division of Waseda
University and visiting professor at the International
University of Japan.
 Ph.D. in Experimental Physics from the University of
Maryland and an MBA from Columbia University Graduate
School of Business.
 Dr. Ohe has initiated various successful programs: “Born
ASEAN” program, Consulting Based Learning for ASEAN
SMEs program, Teaching Incubation Center program at
Waseda University. Waseda Venture Kids program and etc.
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3. Table of Contents
1. Business Model Competition is not a
Business Plan Contest
2. Uncertainty and Experiment
3. Judging criteria
4. Preparation for BMC
5. JBMC
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4. BUSINESS MODEL COMPETITION IS
DIFFERENT FROM BUSINESS PLAN
CONTEST
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5. The IBMC is not a business plan competition.
• Over 85 percent of new businesses fail
within a few years, often because they
try to plan their way to success.
• The International Business Model
Competition represents a radical
departure from the past and the crest of
a new paradigm in entrepreneurship.
• The IBMC is not a business plan
competition.
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6. Business Model Competition evaluates the
process of checking of assumptions
Business Model Competition
(BMC)
• The objective is to help start
the business
• Most of time spent meeting
potential customers or
searching markets
– Customer segmentation
– Value propositions
– The most important thing is
revenues
• The simple profit statement
is good enough
Business Plan Contest
(BPC)
• The objective is to write an
elaborate and logical plan
• Most of hours are spent in
front of the PC to get
secondary data
• A lot of time is spent to
prepare financial statements
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7. The IBMC rewards students for:
1. Identifying and tracking key business model hypotheses (use the
Business Model Canvas)
2. Testing and validating those hypotheses with customers (get
outside the building)
3. Pivoting and iterating their business model based on customer
interactions
• Submissions for the competition focus on the process and learning
a team goes through as they test their unexamined hypotheses in
the field and develop validated business models.
• The goal is validated learning about the business model
assumptions and failing early is a success compared to failing late.
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8. UNCERTAINTY AND EXPERIMENT
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9. How to compete: the wave of transient
advantage of uncertainty world
R
e
t
u
r
n
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Source: The End of Competitive Advantage (P13) Rita Gunther McGrath, HBRP 2012
Launch Ramp up Exploit Reconfigure Disengage

10. Uncertainty for startups
• There is uncertainty for any business due to
being in the uncertain world.
• There is additional uncertainty for any new
business since there are many unknown for
startups.
• To promote a new business, you must deal
with uncertainty and take advantage of the
uncertain environment.
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11. Experimental Methodology for
Business Management
• As experimental physics has led to the
advancement of physics, "experimental
management” can lead to the development of
Business management.
• "Experimental management" which was
developed for new business must be applied
at once to the main lines of the company due
to uncertainty in the ultra-competitive world.
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12. Experimenting
Five skills of disruptive
innovators
New ideas are often created during
verifying ideas, business concepts and
business models through experiments
and prototypes.
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13. JUDGING CRITERIA OF BMC
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14. JUDGING CRITERIA
1. Did the team use the Business Model Canvas or similar tool to
identify and track hypotheses?
2. Did the team clearly state their hypotheses (assumptions)?
3. Did the team identify the most crucial assumptions to test first (the
ones that will kill their business)?
4. Did the team design, low cost, rapid, but reliable tests of these
hypotheses?
5. Did the team conduct the tests in a reliable manner?
a. Number of tests - # should be adjusted for industry, product
type (web vs physical product), and business type (B2B vs
B2C)
b. Quality of tests - interviews are high quality, surveys & focus
groups are much lower quality (you don’t know which
questions to ask) unless interviews have been conducted first
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15. • 6. Did the team clearly state what they learned, how it validated an
assumption or not, and if that informed any changes/pivots?
• 7. If changes were made, was the pivot the team made to support by
evidence or did they fail to pivot when the evidence clearly stated it?
• 8. If appropriate, has the team developed a prototype or minimum
viable product (MVP)? Does the team understand the assumptions
they are tested with a prototype or MVP? Is the prototype or MVP
appropriate to answer those assumptions?
– We want to reward prototypes over full products unless the product is the result of many
prototypes tested with customers—in other words, we want to reward testing assumptions
before building and building from prototypes up to products. We do not want to reward just
building products too early based on untested assumptions.
• 9. Is the team solving a significant problem (defined in terms of
money or impact)?*
• 10. Does the team have significant evidence that the solution is
validated (includes letters of intent, purchase contracts, sales, and
partners)?*
– * these two criteria serve as tiebreakers
– NOTE: Because web-based businesses are easier to test, these companies can often pivot faster.
We tend to treat physical products, services, and web/software as slightly different categories in
the judging, then pick the best of these categories to compete.
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16. 16
Resource: Business Model Generation, Osterwalder, A. & Pigneur, Y. (2010)
4.
Customer
Relationshi
ps
3. Channels
2.
Value
Proposition
s
7.
Key
Activities
6. Key
Resources
(Intellectual
property,
Assets)
8.
Key
Partners
5.
Revenue Stream
9.
Cost structure
Business Model Canvas
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1.
Customer
Segments

17. HOW TO PREPARE FOR THE
COMPETITION
2013 BEST BUSINESS MODEL
“OWLET”
SOURCE: VALUE PROPOSITION DESIGN, OSTERWALDER, A. & ETC., WILEY (2014)
The owlet is a wireless monitor measuring
your baby's heart rate and oxygen. The
data is sent to your smartphone and will
alert you if there's an emergency.
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18. Owlet; constant progress with
systematic design and testing
• Wireless monitoring of babies' blood oxygen, heart rate
and sleep data.
• The owlet is a smartphone compatible baby monitor. But
for added safety and security, Owlet is designed to function
independently of your Apple device. The Smart Sock and
the Base Station connects through low power Bluetooth. If
your iOS device dies, or home internet goes out, your Base
Station will still alert you if your baby stops breathing. For
convenience, the Base Station will upload your infant’s
heart rate and oxygen levels to the cloud. You, and anyone
with permission, can view your baby’s levels from
anywhere in your home, Grandma’s house, or even the
office.
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19. 19
Source: Value Proposition Design, Osterwalder, A. & etc, Wiley (2014)
4.
Customer Relationships
3. Channels
2.
Value Propositions
7.
Key Activities
6. Key Resources
(Intellectual property,
Assets)
8.
Key Partners
5. Revenue Stream9. Cost structure
Owlet Business Model: version 0
1. Initial Idea: an opportunity (Monitoring pulse oximetry could be easier
without the cord between the device and the monitor display)
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1.
Customer Segments
Pulse
oximetry
monitor
Nurses
Hospitals Hospitals
Salesmen

20. Test 1A
Nurse Interviews
Items
1 Hypothesis Wireless pulse oximetry is more convenient
2 Metric Percentage of positive feedback
3 Test Interview nurses
4 Data Of 58 interviews, 93 percent prefer the wireless
monitoring
5 Validate results Validated
6 Period and cost 1 week, $0
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Source: Value Proposition Design, Osterwalder, A. & etc, Wiley (2014)

21. Test 1B
Hospital Administrator Interviews
Items
1 Hypothesis Wireless pulse oximetry is more convenient
2 Metric Percentage of positive feedback
3 Test Interview hospital feedback
4 Data 0 percent ready to pay more for wireless. Ease of use is
not a pain, it not cost effective.
5 Validate results Un-validated
6 Period and cost 1 week, $0
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Source: Value Proposition Design, Osterwalder, A. & etc, Wiley (2014)

22. 22
Resource: Value Proposition Design, Osterwalder, A. & etc., Wiley (2014)
4.
Customer Relationships
3. Channels
2.
Value Propositions7.
Key Activities
6. Key Resources
(Intellectual property,
Assets)
8.
Key Partners
5. Revenue Stream9. Cost structure
Owlet Business Model: version 2
Pivot: Change the customer segment from nurses and hospitals
to worried parents
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1.
Customer Segments
7.
Key Activities
8.
Key Partners
Baby
alarm
Parents
Baby
store
< $200 price

23. Test 2
Parent Interviews
Items
1 Hypothesis Parents are ready to adopt and buy a wireless baby alarm
2 Metric Percentage of adopting parents
3 Test Interview months
4 Data Of 105 interviews, 96 percent adopt the wireless
monitoring “Awesome. I want to buy now!”
5 Validate results Validated
6 Period and cost
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Source: Value Proposition Design, Osterwalder, A. & etc, Wiley (2014)

24. Test 3
MVP Landing page
(minimum viable product)
Items
1 Hypothesis A smart sock is convenient and easy to use for monitoring
2 Metric Number of positive comments
3 Test An MVP, with a video an a website
4 Data 17,000 views, 5500 shares of facebook, 500 positive
comments by parents, distributors, and research
organizations
5 Validate results Validated
6 Period and cost 2 week, $320
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Source: Value Proposition Design, Osterwalder,
A. & etc, Wiley (2014)

25. Test 4
A/B Price test
Items
1 Hypothesis Rental versus sale at $200+ sale price
2 Metric Percentage for a sale price
3 Test A/B testing, 3 rounds on the website
4 Data 1170 people tested, $299 the best price
5 Validate results Validated
6 Period and cost 8 weeks, $30
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Source: Value Proposition Design, Osterwalder, A. & etc, Wiley (2014)

26. 26
Source: Value Proposition Design, Osterwalder, A. & etc, Wiley (2014)
4.
Customer Relationships
3. Channels
2.
Value Propositions7.
Key Activities
6. Key Resources
(Intellectual property,
Assets)
8.
Key Partners
5. Revenue Stream9. Cost structure
Owlet Business Model: version 3
With a more minimal, less risky product, and infant health tracker (heart rate,
oxygen levels, and sleep patterns), but without alarm, for another customer
segment; the less worried parents
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1.
Customer Segments
7.
Key Activities
8.
Key Partners
Baby
alarm
FDA
clearance
<$200 price
Infant
health
tracker
Baby stores
Worried
parents
Less
worried
parents
Baby stores

27. Test 5
Interview/Proposition: Owlet Challenge
Items
1 Hypothesis Less worried parents are ready to adopt and buy a
wireless baby health tracker, without alarm
2 Metric Percentage of parents adopting the no-alarm tracker
3 Test Interview at retail locations, having to choose between
Owlet tracker and other similar systems (video, sound,
and movement)
4 Data Of 81 people interviewed, 20%adopted the Owlet tracker
5 Validate results Validated
6 Period and cost 3 weeks, $0
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Source: Value Proposition Design, Osterwalder, A. & etc, Wiley (2014)

28. Testing step-by-Step
• Your customers are the judge, jury, and
executioner of your value proposition, so get
outside of the building and test your ideas
with the customer deployment and lean start-
up process. Make sure you start with quick
and cheap experiments to test the assumption
underlying your ideas when uncertainty is at
its maxim.
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29. JBMC NIGATA, JBMC AND IBMC
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30. IBMC Founders, Host Schools, Judges
The IBMC is currently co-hosted by Brigham Young University, Harvard University,
and Stanford University.
2013 Host - Harvard University
2014 Host - Brigham Young University
2015 Host - Brigham Young University
2016 Host – Stanford University (Plan)
The Founders:
Nathan Furr (Ph.D., Stanford; Entrepreneurship Professor, BYU)
Steve Blank (Entrepreneurship Professor, UC Berkley; Lecturer, Stanford)
John Richards (Entrepreneurship Professor, BYU)
Scott Petersen (Director, Center for Entrepreneurship & Technology, BYU)
The judges of the 2015 IBMC
Prof. Steve Blank (Stanford University)
Prof. Nathan Furr (Bringham & Young University)
Dr. Alexander Osterwalder etc.
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31. The Japan Business Model Competition
(JBMC)
• JBMC was founded in 2013 by
– Prof. Takeru Ohe (Waseda University adviser, IUJ ),
– Dr. Makoto Sarata (ASTEM)
– Mr. Satoshi Okuda (Primestyle) in 2013.
• JBMC is one of feeder competitions for IBMC,
and the winner of JBMC automatically will be
sent to the IBMC.
• The 3rd Japan Business Model Competition will
be held on February 27 and 28. 2016 in Tokyo.
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32. 2nd JBMC Finalists (2015 March)
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Business Model University
3
"Dream Pharos" Cloud notebook between
parents and nursery
Japan Advanced Institute of Science and
Technology
"Next .I " Decoration kit for lunch Keio University
Tailored health analysis system Tokyo University
"Dream Come True" new SNS Keio University
Japanese Language and culture lessons
through Youtube
Waseda University
1 Log System for low back pain Kyoto University
Customer service system for beauty salons Tokyo University
2
Total hair care system based on gene
analysis
Tokyo University
Assist device system with dispensable
actuator
Waseda University
Social "fitting room" platform International University of Japan

33. Ministry of Economy, Trade and Industry
"Innovator nurturing world-class?
20 people will be dispatched to Silicon Valley Dispatch
• Toshiba
– Service to create a nail that was decorated on the
basis of the 3D scan of nails.
• Nikon Corporation
– Smartphone application to help select vegetables
that seen when the vegetables of nutrients and
freshness take pictures
• FutureArchitect
– Clothing rental services for visiting Japan,
foreigners
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34. References
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35. Contacts
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Home Page:japan-bmc.com/
Facebook: https://www.facebook.com/japan.bmc
Mail: admin@japan-bmc.com
IBMC: http://www.businessmodelcompetition.com/