Mac teaches Discovery Driven Planning in his entrepreneurship classes at Wharton, and received the following story about how one of his students applied DDP:
I took your MGMT 802 class earlier this year. I'm working for a start-up in D.C. this summer, and I wanted to share with you how incredibly helpful the DDP process has been.
The founders are in the process of raising money and had built a very rough, top-down financial model to show to the VCs. As you can imagine, it got ripped to shreds, and the founders couldn't explain how changing certain variables affected the financial results. I showed up shortly after and built what I think is a pretty in-depth, bottom-up DDP model for just about everything. The founders were blown away when they saw it – especially after seeing the Monte Carlo/sensitivity analysis on the main input variables. I also introduced them to the assumption/milestone planning concept and they loved it. As a result, we're now in the process of formulating ways to test every single assumption in our DDP. The VCs won't know what hit them.
So, in brief, thank you so much for teaching such a great concept. It is, by far, the most worthwhile and practical tool/skill I have learned so far at Wharton. And learning about DDP is exactly why I chose to go to business school (specifically Wharton) in the first place.
Thanks again and take care,