business model, business model canvas, columbia, customer development, lean launchpad, lean startup, steve blank

1. Connor Bogin
MBA
Thomas Gaubert
IEOR MS&E
Troy Hodges
EEE
Sam Jones
MBA
Pranav Nagesh
IEOR MS&E
Measuring real-time crowd sizes in public places and empowering users to
make more informed decisions every time they leave the home
Total Interviews Performed: 119
Interviews Since Last Class: 24

2. Day 1

3. HotSpot – Business Model Canvas – Day 1
Key Partners
Venues – we use
bouncers/staff as source of
data
Venues – we create a
marketplace in which they
are the “suppliers”
Google / other data
providers – to obtain
historic and real-time
location information and
occupancy levels
Hardware providers – for
tracking occupancy and
crowd information
Key Activities
Offer an application, which
allows people to see how
busy venues are (either
historically at a given time
or in real-time)
Facilitate better venue
decision making in any
given city
Provide a marketplace that
enables venues to
communicate directly with
potential customers
Value Propositions
Problem - Right now we
have no way of knowing
which venues are busy on
an aggregated, real-time
basis
Solution – We will:
More concisely and
accurately inform people
which venues are best for
their needs
Aggregate the location
info of users to enable
venues to better
understand customers and
serve them
Customer
Relationships
Engagement based on
customer desire for optimal
venue information
Very limited requirements
from a support perspective
Customer Segments
Generally this has mass-
market appeal –we will
target the 21-30
demographic
Initial customer segment
will working professionals
without families between
age 24-28
Channels
Distribute product through
a smartphone app
Key Resources
Publically available map,
geographic, and venue
information
User location data
Cost Structure
Upfront development of UI/UX
Collection of traffic and occupancy data
Marketing to acquire users
Scaling product and processes to support growing user base
Headcount for technical and sales team
Revenue Streams
Online marketplace between users and venues – commission model –
taking % of transaction fee
Advertisements in-app
Sale of data to SMBs and financial firms

4. Over the next five days, we tested hypotheses across
the business model canvas by performing 119 interviews
means hypothesis passed
means hypothesis failed

5. Day 2

6. HotSpot – Business Model Canvas – Day 2
Key Partners
 Venues – we plan to
provide information for
a wide range of venues,
each with their own
unique information
which will be valuable to
different customer
segments.
 Venues – if we create a
marketplace in which
they are the “suppliers”
our app will provide the
platform for direct sales
/ marketing efforts.
 Google / other data
providers – to obtain
historic and real-time
location information and
occupancy levels
 Hardware providers – for
tracking occupancy and
crowd information
Key Activities
 Offer an application,
which allows people to
see how busy venues are
(either historically at a
given time or in real-
time) and provide useful
information about such
venues.
 Provide a marketplace
that enables venues to
communicate directly
with potential customers
Value Propositions
 Problem - Right now we
have no way of knowing
which venues are busy
on an aggregated, real-
time basis. Solution – We
will:
 More concisely and
accurately inform people
which venues are best
for their needs
 Venues: additional sales
channel & marketing
avenue, analytics will
enable venues to better
understand customers
and serve them
 Users: One stop shop for
users which provides
crowd information,
venue information,
reviews, uber transport
options, and
merchandise purchase
opportunities and deals.
 Customer
 Relationships
 Engagement based on
customer desire for
optimal venue
information
 Very limited
requirements from a
support perspective
 Customer
Segments
 Generally this has mass-
market appeal –we will
target the 21-30
demographic
 Initial customer segment
will working
professionals without
families between age 24-
28
 We have broadened our
customer segment as we
have widened our target
market and
demographic.
 Our product has a much
wider application and
customers will be self
segmented depending
on their specific
requirement
Channels
 Distribute product
through a smartphone
app
 Distribute the product
through an online web
offering in addition
Key Resources
 Publically available map,
geographic, and venue
information
 User location data
 Active input from both
users and venue staff
Cost Structure
 Upfront development of UI/UX
 Collection of traffic and occupancy data. Storage data costs. Google API
Key.
 Marketing to acquire users
 Scaling product and processes to support growing user base
 Headcount for technical and sales team
Revenue Streams
 Online marketplace between users and venues – commission model –
taking % of transaction fee
 Advertisements in-app
 Sale of data to SMBs and financial firms

7. HotSpot – Petal Diagram
HotSpot
Social Reviewers
Search
Maps
Reservations
Crowd-sizing
Software
Crowd-sizing
Hardware
1
1
2
2
2
1
1
2
Conducted meeting
Contacted

8. HotSpot – Market Size
TAM
160M
SAM
80M
Target Market
20M
Total Available Market
 200M smartphone users in US in 2016
 80% of the US population lives in urban
and suburban areas, and we believe
these populations would gain value from
using this product
 TAM in US market is 160M
Served Available Market
 50% of TAM leverages digital tools to
inform public destination decision
making
 As a reference, Yelp has 80M unique
monthly US visitors
 SAM in US market is 80M
Target Market
 Assuming 25% penetration of the SAM
in a 3 year period
 As a reference, this would mean
achieving 25% of Yelp’s penetration
 Target Market is 20M

9. HotSpot – Type of Business
We leverage existing technology, aggregate passive data feeds, and add incremental user
generated data inputs
We are building a technology-enabled startup
A wide range of
people want to know
historical population
density in public
venues
Users are
increasingly
interested in this
information if it is
accurate in real time
Users will want this
data delivered
through an
interactive
application
1 2 3

10. Day 3

11. HotSpot – Business Model Canvas – Day 3
Key Partners
 Venues – we plan to
provide information for
a wide range of venues,
each with their own
unique information
which will be valuable to
different customer
segments.
 Venues – if we create a
marketplace in which
they are the “suppliers”
our app will provide the
platform for direct sales
/ marketing efforts.
 Google / other data
providers – to obtain
historic and real-time
location information and
occupancy levels
 Hardware providers – for
tracking occupancy and
crowd information
Key Activities
 Offer an application,
which allows people to
see how busy venues are
(either historically at a
given time or in real-
time) and provide useful
information about such
venues.
 Provide a marketplace
that enables venues to
communicate directly
with potential customers
Value Propositions
 More concisely and
accurately inform people
which venues are best
for their needs
 Venues: additional sales
channel & marketing
avenue, analytics will
enable venues to better
understand customers
and serve them
 Users: One stop shop for
users which provides
crowd information,
venue information,
reviews, uber transport
options, and
merchandise purchase
opportunities and deals.
 Customer
 Relationships
 Engagement based on
customer desire for
optimal venue
information
 Very limited
requirements from a
support perspective
 Customer relationship
for each sub sector of
product offering should
be different
 Most efficient call to
action is social adoption
amongst friends and
peers
 Customer
Segments
 We have broadened our
customer segment as we
have widened our target
market and demo.
 Our product has a much
wider application and
customers will be self
segmented depending
on their specific
requirement
 We need to narrow
down to a core following
who find the greatest
value as an initial hook –
nightlife
 We have segmented the
bar/club market into 3
segments:
Undergraduate and
graduate students/
white collar
professionals / creative
professional
Key Resources
 Publically available map,
geographic, and venue
information
 User location data
 Active input from both
users and venue staff
Channels
 Distribute product
through a smartphone
app
 Distribute the product
through an online web
offering in addition
Cost Structure
 Upfront development of UI/UX
 Collection of traffic and occupancy data. Storage data costs. Google API
Key.
 Marketing to acquire users
 Scaling product and processes to support growing user base
 Headcount for technical and sales team
Revenue Streams
 Online marketplace between users and venues – commission model –
taking % of transaction fee
 Advertisements in-app
 Sale of data to SMBs and financial firms

12. Museums
Retail Shops
Grocery Stores
Restaurants
Bars and Clubs
HotSpot – Identifying Our Focus Areas
HotSpot
is a tool for your life
Through interviews, we have identified
bars and clubs as the most relevant
and underserved venues for
measuring crowd size
But WHO are our target customers at bars and clubs?
Untested
Untested

13. HotSpot – Customer Segments and Product / Market Fit
In the bar and club venue category, we have identified three target customer segments
CustomerSegmentValueProposition
Undergrad
and Grad
Students
White Collar
Young
Professionals
Creative
Young
Professionals
Students with active social lives
and excitement to experience
new places in the city
 Age 18-29
 Limited disposable income
 Low loyalty to specific venues
 In search of the right vibe
Professionals with high stress
jobs and a “work hard, play hard”
attitude
 Age 22-28
 High disposable income
 Willingness to spend for the
right thing
Professionals with highly creative
jobs in fashion, marketing, and
media
 Age 18-26
 Medium disposable income
 Goal to find trendy,
understated venues
Identify the right place based on:
 Crowd Size – Crowded but not
overwhelming
 Price – $, $$
 Location – Near campus
 Vibe – Beer bar, dive bar
Identify the right place based on:
 Crowd Size – Hottest spots in
the city, packed or exclusive
 Price – $$$, $$$$
 Location – Trendiest hoods
 Vibe – Night clubs, craft
cocktail bars
Identify the right place based on:
 Crowd Size – Medium to large
crowd
 Price – $$, $$$
 Location – Hipster hoods
 Vibe – Alternative longue,
dive bar with taxidermy

14. Day 4

15. HotSpot – Business Model Canvas – Day 4
Key Partners
 Venues – we plan to
provide information for
a wide range of venues,
each with their own
unique information
which will be valuable to
different customer
segments.
 Venues – if we create a
marketplace in which
they are the “suppliers”
our app will provide the
platform for direct sales
/ marketing efforts.
 Google / other data
providers – to obtain
historic and real-time
location information and
occupancy levels
 Hardware providers – for
tracking occupancy and
crowd information
Key Activities
 Offer an application,
which allows people to
see how busy venues are
(either historically at a
given time or in real-
time) and provide useful
information about such
venues.
 Provide a marketplace
that enables venues to
communicate directly
with potential customers
 Provide unique in-app
offerings which vary
according to venue type
Value Propositions
 More concisely and
accurately inform people
which venues are best
for their needs
 Venues: additional sales
channel & marketing
avenue, analytics will
enable venues to better
understand customers
and serve them
 Users: One stop shop for
users which provides
crowd information,
venue information,
reviews, uber transport
options, and
merchandise purchase
opportunities , deals
 For bars / clubs –
incorporate new core
value propositions for
this segment: HotSpot
Recommends, In-App
Specials, Real time
Picture Feeds
 Customer
 Relationships
 Engagement based on
customer desire for
optimal venue
information
 Very limited
requirements from a
support perspective
 Customer relationship
for each sub sector of
product offering should
be different
 Most efficient call to
action is social adoption
amongst friends and
peers
 Customer
Segments
 Our product has a much
wider application and
customers will be self
segmented depending
on their specific
requirement
 Initial focus: core
following who find the
greatest value in
nightlife
 We have segmented the
bar/club market into 3 2
segments:
Undergraduate /
graduate students and
white collar
professionals / creative
professional working
young professionals
Key Resources
 Publically available map,
geographic, and venue
information
 User location data
 Active input from both
users and venue staff
Channels
 Distribute product
through a smartphone
app
 Distribute the product
through an online web
offering in addition
Cost Structure
 Upfront development of UI/UX
 Collection of traffic and occupancy data. Storage data costs. Google API
Key.
 Marketing to acquire users
 Scaling product and processes to support growing user base
 Headcount for technical and sales team
Revenue Streams
 Online marketplace between users and venues – commission model –
taking % of transaction fee
 Advertisements in-app
 Sale of data to SMBs and financial firms

16. HotSpot – Channels and Get Strategy
DistributionChannels
Previous Hypothesis: Mobile App Only Revised Hypothesis: Mobile App and Web
People care most about making crowd-
sized based decisions on the go; to do
this, they will use a mobile app
Users will plan ahead and use computers
50% of mobile Yelp searches happen
through mobile web, not app
GetStrategy
Deeply penetrate single
geography – New York City
 Leverage existing networks
across students and working
professionals
 Create referral incentives
 CAC: <$.50
Incentivize social evangelists
across global urban locations
 Utilize existing MBA and
personal networks
 Create referral incentives with
multi-level marketing structure
 CAC: <$.25
Target users via social media
(e.g. Instagram, Facebook)
 Use data attributes to target
high likelihood adaptors
 CAC: <$1.75
+
Untested Untested

17. HotSpot – Revenue Model
1. Fee for In-App Transactions 2. Sale of Analysis from Data
3. Revenue Share with Partners 4. Marketing and Promotion Services
Charge a percentage of in-
app revenue generated by
business posting geo-
based offers to HotSpot
users
Take revenue share of the
sale of venue tickets,
table/bottle service, etc.
through partners like
Tablelist
Sell customer insights to
small and medium sized
businesses
Aggregate macro-analysis
for sale to hedge funds and
investment shops
Charge venues, performing
artists, etc. to have their
events promoted to
HotSpot users
Untested

18. Day 5

19. HotSpot – Business Model Canvas – Day 5
Key Partners
 Venue types; museums,
bars, clubs, restaurants,
grocery stores, retail
stores
 Venues – we plan to
provide information for
a wide range of venues,
each with their own
unique information
which will be valuable to
different customer
segments. Our app will
provide the platform for
direct sales / marketing
efforts.
 Google / other data
providers – to obtain
historic and real-time
location information and
occupancy levels
Key Activities
 Offer an app, which
allows people to see
how busy venues are
(either historically at a
given time or in real-
time) and provide useful
info about such venues.
 Provide a marketplace
that enables venues to
communicate directly
with potential customers
 Provide unique in-app
offerings which vary
according to venue type
Value Propositions
 Users:
 More concisely and
accurately inform people
which venues are busy in
real time and provide
information and insights
about these venues
 One stop shop for users
which provides crowd
information, venue
information, reviews, in-
app deals, Hotspot
Recommends, and
optional real time
picture Feeds
 Venues:
 Additional sales channel
& marketing avenue
 Source of data analytics
which will enable venues
to better understand
customers and serve
them
Customer
Relationships
 Users – Get Strategy:
 Leverage existing
student + working
professionals
 Referral incentives
 Incentivize social
evangelists
 Social media ads
 Venues – Get Strategy:
 Social media ads
 In-store visits
Customer
Segments
 Our product has a wide
application and
customers will be self
segmented depending
on their specific venue
selections
 Initial focus: core
following who find the
greatest value in
nightlife (bar/club
market)
 Segmented into
Undergrad/grad
students and working
young professionals
 Venue segmented by
types: museums, bars,
clubs, restaurants,
grocery stores, retail
stores
Channels
 Distribute product
through a smartphone
app
 Distribute the product
through an online web
offering in addition
Key Resources
 Publically available map,
geographic, and venue
information
 User location data
 Active input from both
users and venue staff
 Other social API plugins
Cost Structure
 Upfront development of UI/UX
 Data: Collection of traffic and occupancy data., storage data costs, third
party API keys.
 Marketing to acquire users
 Scaling product and processes to support growing user base
 Headcount for technical and sales team
Revenue Streams
 Online marketplace between users and venues – commission model –
taking % of transaction fee
 Advertisements in-app
 Sale of data to SMBs and financial firms
Venues Customers
Key:

20. HotSpot – Enabling Data
Using existing data, we built a tool that changes the venue search process

21. HotSpot – Our MVP
After showcasing our MVP product, 60% of interviewees actioned to download it and
75% of interviewees provided their email addresses to receive updates

22. Next Steps

23. HotSpot – Next Steps
Interview
 Users – To validate evangelist growth strategy and “download now” sentiment
 Venues – To understand the value HotSpot provides to them
 Partners – To verify mutually beneficial opportunities with complementary products
Prioritize
Features
 Based on feedback from users, venues, and partners
 Factoring in difficulty to introduce to our platform and cost
Iteratively
Build  Gradually introduce additional features to the UI/UX, verifying customer interest
by using an agile-like methodology
 Work towards a product that users download and start using in their daily life

24. Appendix – Experiment Findings

25. HotSpot – Experiment Results Day 2
Category Subcategory Test P/F Signal Results
Customer
Segment
Millennials
Ask across wide demo if
problem identified is real
Pass: Millennials
confirm problem 30%
more than others
Fail – wide interest
across multiple
demographics
Nightlife interests
Rank venues where
crowd size information
is most useful
Pass: Nightlife comes
up as #1 in 20 of 30
users
Fail – strong interest in
multiple applications:
Restaurants, Bars,
Grocery Stores
Value
Proposition
Crowd size is
inconvenience for
people at venues (too
large, too small)
Rank pain points at
venue types
Pass: Crowdedness
ranked in top 2
problem for venues 15
of 30 users
Pass – Crowdedness
ranked majority as top 2
among 48 users
People gain value
from crowd size
information
Confirmation of
usefulness + to
download app + give
email info for updates
Pass: 75% acceptance
rate by 30 users
Pass – 90% confirmation
+ email commit rate
Venues find value in
incremental sales
channels
Interview venues for
interest in additional
sales channels
Pass: 75% venue
owners confirm
TBD Subject of later tests
Channel
Delivery through
mobile app
Customers rank
usefulness of mobile
app vs. web information
Pass: 2/3 users prefer
app
Pass – strong majority
mobile app, but additional
interest in web-based
offering
Revenue
Commission-based
model
Venue owner interviews
Pass: 75% venue
owners say yes
TBD Subject of later tests
In-app ads Ask user ads ok to have
Pass: 75% of users ok
with ads
TBD Subject of later tests

26. HotSpot – Experiment Results Day 3
Category Subcategory Test P/F Signal Results
Crowd size
of venue is
important
decider of
venue
choice
All Venues
(Grocery stores,
Restaurants,
Bars/Clubs)
Rank top 3 concerns in
a venue
Pass: Crowd size
ranked as top 3
concern for majority of
users
Pass – highest among
bars/clubs + restaurants
Users find
enough
value in
historical
data to
download
the app
based on
specific
venue
types
Grocery Store
Will download app
solely based on
historical data of
restaurant crowdedness
Pass: Yes confirmation
by 75% of
respondents
Fail – No strong interest
as grocery store as hook
Restaurants
Will download app
solely based on
historical data of
restaurant crowdedness
Pass: Yes confirmation
by 75% of
respondents
Pass – Yes, requires
more testing on bigger
pool
Bars/Clubs
Will download app
solely based on
historical data of
bar/club crowdedness
Pass: Yes confirmation
by 75% of
respondents
Pass – Yes, requires
more testing on bigger
pool
We validated the types of venues where crowd size data was wanted

27. HotSpot – Experiment Results Day 4
Category Subcategory Test P/F Signal Results
Bar and
Club
Venues 
Customer
Segments
Undergraduate
and Graduate
Students
Will download app
based on historical
data of bar/club
crowdedness
Pass: 75% confirmed
yes
Pass
Additional features
will boost
download rate
Pass: 75% respondents
confirm yes + 2 features
wanted by majority
Pass – Live picture
feed + In-app drink
special
White Collar
Young
Professional
Will download app
based on historical
data of bar/club
crowdedness
Pass: 75% confirmed
yes
Pass
Additional features
will boost
download rate
Pass: 75% respondents
confirm yes + 2 features
wanted by majority
Pass – In-app drink
special + HotSpot
recommendations
Creative Young
Professionals
Will download app
based on historical
data of bar/club
crowdedness
Pass: 75% confirmed
yes
Fail – low # surveyed
Additional features
will boost
download rate
Pass: 75% respondents
confirm yes + 2 features
wanted by majority
Pass – HotSpot
recommendations +
In-app drink specials
We aimed to validate “hook” strategies that will drive downloads from target segments

28. HotSpot – Experiment Results Day 5
Category Subcategory Test P/F Signal Results
Distributi
on
Channels
Mobile App Only
1) Ask users if they would engage
with this offering if only offered on
app
2) Comparables – ask people if they
would still use Yelp / Foursquare if
only available as an app
1) Pass: 75% confirmed
yes
2) Pass: 75%
respondents confirm
yes
1) Fail
2) Fail
Mobile App and
Web UI
1) Ask people whether they use
mobile / web to access offerings
which are also offered as an app
2) Ask user preference as to apps /
web access
1) Pass: 75% confirmed
yes
2) Pass: 75%
respondents confirm
prefer both
1) Pass
2) Pass
Get
Strategy
Deeply penetrate
single geography
– New York City
1) Friends and colleagues will
download and test app
2) What incentives would be required
for them to spread the word across
NYC colleagues and friends
1) Pass: 75% confirm yes
2) Qualitative survey
question
1) Pass
1) TBD
Incentivize social
evangelists
across global
urban locations
1) Outreach and gage interest to
known evangelists
2) Speak to competitors who have
tried similar things
1) Show interest / Have
no interest
2) How successful has
this been
TBD
1) TBD
1) Pass
Target users via
social media (e.g.
Instagram,
Facebook)
1) Run $10 trial run of the social
media promotion on Facebook and
look at the effect of $10 campaign
1) Our $10 investment
attracts users
TBD 1) TBD
We aimed to validate distribution channels, get strategies, and revenue models

29. HotSpot – Experiment Results Day 5
Category
Subcateg
ory
Test P/F Signal Results
Revenue
Models
Fee for In-
App
Transaction
s
1) Would customers use In
App Transactions
2) Would venues be happy to
have additional sales
channel + pay fee
1) Pass: 75% confirmed yes
2) Pass: 75% respondents confirm
yes
1) Pass
2) Pass
Sale of Data
Insights
1) Ask SME’s whether there
is value in them having
crowd information about
their venue
2) Rank value of information
to venues
3) Find out how much they
would be willing to pay for
this
1) Pass: 75% confirmed yes
2) Less than 3 of 5 fails
3) Will be relative to each situation
TBD
1) TBD
2) TBD
3) TBD
Revenue
Share with
Partners
1) There are other
applications which we can
partner with to secure
additional stream e.g.
table list
1) Qualitative confirmation and
insights from these products
that they are open to such
methodologies
TBD 1) TBD
Marketing
and
Promotion
Services
1) Would venues / products
see upside in an additional
promotion channel
2) Are there any downside to
venues we haven't
considered
1) Pass: 75% confirmed yes
2) Get Insight
1) Pass, but
need proof
of large user
base
2) TBD
We aimed to validate distribution channels, get strategies, and revenue models