15.390: Cachet aka Akamai

1
15.390 Cachet aka Akamai

• Opportunities in the Internet Age

2
The Team

• One Professor, One PhD student, One Sloan 1st
  year, and several advisors
• Very Technical and very Academic?
• Very smart, driven and aggressive?
• Not much market knowledge.
• Good domain knowledge getting better every day.

3
The Idea

• Big, hairy problem to solve.
• Current solutions expensive and inadequate.
• Not a technology looking for a problem.

4
The Opportunity

• Who are the customers?
• What will we sell them?
• What is our clear value proposition?
• What is the optimal business model?
• How do we size the opportunity?

5
Opportunity Assessment

• Talk to experts and stake-holders.
• Talk to customers.
• Look at the current market and size what exists
  today.
• Take the leap to estimate the size of your market
  segment both top down and bottoms up.

6
Sizing the Market

• Cache team looked at current hosting and isp
  market
• They looked at current systems players serving
  the market
• They established boundaries for their market
  segment
• They established comparables for their company.
• They used comparables data to estimate their
  revenue based on units shipped, pricing, and
  costs associated with building the products and
  the business.

7
Development of the Plan

• There is no substitute for knowledge of the
  customers, market, and competition.
• Start with the hypothesis that you are on to a
  major market opportunity.
• Prove the hypothesis.
• Make sure you have the back-up data and solid
  assumptions.

8
The Competition

• Know your enemy well.
• Choose your competitors carefully.
• Define your market segment.
• Establish the rules of engagement.

9
Cache Lessons Learned

• Why did Cache lose out in the 50k competition?
• Did it matter?
• What lessons can we learn from Caches
  experience?
• What did Cache do in its early stages to lay the
  groundwork for the success of Akamai?

10
Cache Success Factors

• Team
• Technology
• Product/Service
• Market Positioning
• Funding
• Execution