Authorised & Regulated by the Financial Services Authority Slide 1

Product Management – who cares?! A VC speaks

Alex van Someren

General Partner

Amadeus & Angels Seed Fund

Slide 2

Alex van Someren – My product history

• Acorn Computer (1980-1984)

– BBC Micro, Acorn Electron

• Capricorn Consulting (1984-1989)

– Publishing ERP system– Autocue Teleprompters– Direct-drive laser printer

interfaces

• Aleph One Ltd. (1989-1992)

– ARM3 CPU upgrades• Three generations

– Intel PC virtualisation products• 286, 286SX, 386SL and 486DX

• ANT Limited (1992-1996)

– Ethernet NICs– Fresco Web Browser– Marcel email client– Oracle NC Network Computer

• nCipher plc (1996-2007)

– nFast: Cryptographic accelerator– nForce: Hardware Security Module– nShield: Secure Execution Engine– netHSM: Network Security Device

Slide 3

IN THE BEGINNING…

Slide 4

Start-ups: More Product, Less Management

• In the beginning, it’s about a Vision– The Founders believe they have a Solution

to a Problem– Customers with the Problem buy into the

Vision– The Product is an instance of the Vision– If the Product is Good, then the Customers

will come, and they will buy it

Slide 5

Start-ups: More Product, Less Management

• More Product variants are demanded• The Market shifts• The Product may, or may not, remain

market-ready• This is where a Product Manager is good...

Slide 6

More customers, more problems!

For each Product

pand, given a number of Customers C, the number of Opinions about the product’s features will be O, where:

O ≥ C + 1

the number of demands for product Variants will be V, where:

V = P * O

and the number of potential support Problems with the product will be P, where:

P = p * V C

It’s not real maths – be cool

Slide 7

Start-ups don’t usually have PMs

• What are the signs that you might need to add someone/something ?– Market complexity

• Understanding and communicating segmentation

– “Controlling” Engineering• Harnessing and directing IP

– “Controlling” Sales• Taking a strategic view beyond the next

sales quarter

Slide 8

PRODUCT MANAGEMENT & PRODUCT MARKETING

Slide 9

Product development: the Official Version*

• Identifying new product candidates• Gathering the Voice of customer• Defining product requirements• Determine business-case and feasibility• Scoping and defining new products at high level• Evangelizing new products within the company• Building product roadmaps, particularly Technology

roadmaps• Developing all products on schedule, working to a

critical path• Ensuring products are within optimal price margins

and up to specifications

* This means I got it off WikiPedia

Slide 10

Product marketing - the Official Version

• Product Life Cycle considerations• Product differentiation• Product naming and branding• 7 functions of marketing• Product positioning and outbound messaging• Promoting the product externally with press,

customers, and partners• Conduct customer feedback and enabling (pre-

production, beta software)• Launching new products to market• Monitoring the competition

Slide 11

NCIPHER PRODUCT STORY

Slide 12

Building value through product evolution

SPEEDSPEED

Performance

SECURITYSECURITY

Performance

Key management

FLEXIBILITYFLEXIBILITY

Performance

Key management

Application security

SOLUTIONSSOLUTIONS

Performance

Key management

Application security

Solution delivery

+ + +

+ +

+

1996 2004+Company lifetime

Slide 13

nCipher product portfolio

nFast netHSM

Increases throughput of encryption and digital signatures

Offloads processing from host computer

Provides scalable, high-availability operation

Multiple devices can load-balance; fail-over capability

“Plug & Play” support from Microsoft, Netscape, Apache

Network-attached HSM

Validated to FIPS140-2 Level 3 standard

Capable of hosting application software

Secure, shareable, scalable, interoperable

Reduced deployment costs

Centralised administration

Cryptographic Accelerators

nShield

Secures crypto keys, accelerates crypto processing

Validated to FIPS140-2 Level 3 standard

nCipher Security World™ has potentially infinite storage capacity

Support for multi-user activation (e.g. “safety deposit box”)

Optional SEE for custom application delivery

Hardware Security Modules

nForce

Secures keys and speeds cryptographic processing for web servers

Supports up to 1600 SSL sessions per second

Security validated to US FIPS140-2 Level 2 standard

Approved for US Government use

Industry de facto standard for banks

Secure Web product range Network-attached hardware security module

NETWORK OEMs SSL WEB SERVERS DIGITAL IDENTITY (PKI & AUTHORIZATION)

Slide 14

Nine year product roadmap

2000 2001 2002 2003 2004 2005 2006 2007 2008

* March 03First FIPS 104-2 cert* April 01

CodeSafe /SEE

* Nov 00nFastnForcenShield Branding

* Dec 06miniHSM

* Oct 01nFast800(BRCM)

* Feb 07PCIe

* Oct 03netHSM

* Aug 05nForce Ultra(Britestream)

July 08Thales Acquisition

Slide 15

A PRODUCT MANAGER SPEAKS

Slide 16

The value of PM

Ed Wood, Thales e-Security* says PMs:• Make decisions

– Provide transparent logic: e.g. because this, we’ll do that next

• Communicate across boundaries– Engineering from Mars, Sales is from Venus

• Champion the Product– There’s value in someone actually giving a damn

about the thing– ‘Passion’ is a cliché, but I contend every successful

product has someone who ‘cared’ somewhere whether called PM or not* The views are Ed Wood’s, not Thales’, and he wants to keep his job please KTHXBI

Slide 17

PMs prevent innovation being stifled

• Good PM is about nurturing innovation in a business, wherever it might come from

• PM could stifle it, but it should support it irrespective of source, internally or externally

Slide 18

PMs get in the way of “just building stuff”• The Product or Service needs to be

created, and actually delivered to the market.– When the proposition is simple and the

need unambiguous this is ‘easy’– When you need to refine & focus, when

Version n+1 of ‘stuff’ is not immediately obvious, you may need someone to specifically consider issues

• So PM should help build the right stuff

Slide 19

A VC SPEAKS

Slide 20

Open Innovation – the modern view

Our current market

Our new market

Other firm´s market

External technology insourcing

Internal technology base

External technology base

Stolen with pride from Prof Henry Chesbrough UC Berkeley, Open Innovation: Renewing Growth from Industrial R&D, 10th Annual Innovation Convergence, Minneapolis Sept 27, 2004

Internal/external venture handling

Licence, spin out, divest

Slide 21

What a VC looks for…

• Seed (pre-Product)– not expecting any PM at all, only

passionate Founders• Early-stage (pre-revenue)

– some PM function might have been added• Growth-stage (revenues)

– PM function definitely in place• Late-stage (profitable)

– Mature PM across the organisation

Slide 22

THANK YOUAlex van Someren (with the hard work courtesy of Ed Wood)