The value proposition refers to the unique value or benefit that a product or service offers to its customers. It answers the fundamental question of "why should customers choose your product or service over alternatives?" A strong value proposition clearly articulates the benefits or solutions provided to customers, addressing their needs, desires, or pain points. It encompasses both tangible and intangible aspects, including features, performance, quality, convenience, cost-effectiveness, emotional appeal, and differentiation from competitors.

1. Entrepreneurship and New Venture
Dr. Alok Nikhil Jha
www.linkedin.com/en/alokni
khil
Alok.nikhil@gmail.com
1
CLASS # 04 : VALUE
PROPOSITION
24th Feb 2024

2. Value Proposition

3. Value props: Create a Product People will
Actually Buy

4. Define Evaluate Build
Framework
Problem
Need
Solution
Gain Pain Value Prop
Idea

5. Value Prop Statement
• For (target customer segments)
• Dissatisfied with (existing solution)
• Due to (key unmet needs)
• (your venture name) offers a (product
category)
• That provides (key benefits of your solution)

6. Value Prop Statement
• For (target customer segments)
• Dissatisfied with current card products
• Due to high interest rates
• Cardback offers a card points utility & scheme
market places
• That provides utilization benefits

7. Value Prop Statement
For (target customer segments)
 Who is your customer?
 everyone?
 a segment?
 How do you define that segment?

8. Define the Problem
“A problem well stated is half-solved”

9. Define the Problem
Problems with 4Us
• Unworkable (how painful)
• Unavoidable (how necessary)
• Urgent (how time sensitive)
• Underserved (how many alternatives)

10. Unworkable
It is going to cause a problem, consequences are painful or costly. Who gets fired if this
doesn’t work?
It can have a potential loss of revenue, loss of customers, loss of reputation, or some
other significant loss that the unworkable problem causes.
Does your solution fix a broken business process where there are real, measurable
consequences to inaction?
E.g.
 Broken business process
 Security risk
 consequences?
 Impractical or far too expensive?

11. Unavoidable
Is the problem so fundamental you can’t avoid it and just have to comply?
A problem is unavoidable if there is something compelling people to address the problem or
act
Is it driven my some mandate or key requirement of governance or compliance?
e.g. education
Taxes
Covid

12. Urgent
Are you on top 3-list of urgency or on top lists?
• Urgency is relative to other needs
• Priority, which determines resources allocated or choice consumers have to
spend their money
• E.g. cyber security, finding a job, vaccination for covid

13. Underserved
• You are competing for finite resources:
• Money
• Time
• People
• Attention
• Are there many competitors and alternatives in existence or are there a scant
few?
• Is there a conspicuous absence of valid solutions to the problem you’re looking to
solve
• If you’re looking to create a product or solution, you don’t want to enter an already
crowded market, unless you have a novel and differentiated way of addressing
the problem.

14. Does a Problem Need to Have ALL 4
Us?
A problem may be unavoidable and underserved, but not
unworkable or urgent.

15. Define the Market Need
Is it BLAC or white?
Blatant
Latent
Aspirational
Critical
Is it addressing a white space in the market?
An open area of opportunity that you
can capture uniquely well
2
1
3
4
Blatant
Latent
Aspirational Critical

16. Define the Market Need
How does your product fit into the whole solution of the customer?
E.g. iPhone
What are you Selling has all the problem needs?

17. Define the Market Need
• Does the market need has DEBT?
• What are Dependencies involved?
• What External factors are involved?
• Would you face any Backlash?
• What is the Timing?
E.g. Tesla, Mobile phone

18. Startup Opportunity
• Faster
• Better
• Cheaper
Dangerous

19. What to do
• IP
• Location
• Scale
• Network
• …etc

20. Define the Solution 3D
• Disruptive – Technology or
Business model (Airbnb, Touch
technology)
• Discontinuous or evolutionary
• Defensible – Persisting technology,
niche, segment

21. Disruptive
• initially cater to niche markets but
eventually displace established
competitors by offering superior value
or accessibility or ease
• gain momentum and disrupt established
markets by providing more affordable,
convenient, or accessible alternatives

22. Discontinuous
Innovation
• involves
introducing new
products, services,
or technologies
that significantly
depart from
existing offerings.

23. Defensive Technology
Defensibility from the outset
• Proprietary IP
• Government License
• Favorable Location
• Long term contract
• Access to data
Defensibility of Scale
• Switching costs
• Economies of scale
• Brand Loyalty

24. Define Evaluate Build
Framework
Problem
Need
Solution
Gain Pain Value Prop
Idea

25. The business is going to endure and be
sustainable

26. Qualitative
Evaluation
Before After
Acute Pain Absolute Joy

27. Inertia of Adoption
Do I really
need this?
How it is
helping me?
What is
switching
cost?
What are
maintenance
costs?
Gains Pains

28. Customer
View
Gain/Pain
Revenue
Cost Savings
Time
People
Competitive advantage
Reputation
Etc

29. Customer View Gain/Pain

30. Value Prop Statement
• For (target customer segments)
• With BLAC problem or need
• That is 4U
• Dissatisfied with (Unworkable or Underserved
alternative)
• Our product is a (3D new product MVP)
• That provides (compelling problem-solving
capability – Gain)
• That overcomes (switching costs Gain/Pain
ratio >10x)
• Unlike (the Unworkable product alternative that
Underserves the need or opportunity)

31. Activity
• Design your Value Proposition
• Demonstrated the problem and
solution steps along with pain
and gain areas