Agenda Presentations- expectations and content (20’) Work breakdown- class by class (10’) Sample financial analysis and presentation-

Superior Agrifuels (10’) Small business funding sources (20’) Team cash flow updates (60’)

Presentations SWOT Meeting- Tues, April 24th

Portland Business Round Table- Wed, April 25th

“Toward 2020” AEP Event- Thu, May 3rd

(top two teams only)

Expectations of Presentation and Final Report For SWOT, Portland BRT, and AEP events please prepare

formal business presentations Formal business attire recommended! Bring a resume if

you have one (just in case). Plan for 10-12 minute presentation and ~8 minutes of

questions. AEP event will be 8 minutes total Presentations will be scored on

1) Quality and completeness of the commercialization analysis and recommendations

2) Appropriateness of commercialization approach for the technology

3) Content and clarity of the presentation4) Compelling nature of your business case

Some suggestions

Use your mentors as a resource!- they have started up numerous companies and released countless products. Several have not been contacted and are willing to help.

Divide up the work! Break down research, interviews, and preparation of report and presentation into smaller pieces.

Use available class work time! Review your progress and decide what needs to be done next.

Mentor Contact Info

Dan Whitaker 760-6533 Todd Miller 713-1341 Ray Dandeneau 760-3981, 745-

3970

Presentation and Written Commercialization Plan- Spin Off

Executive Summary Technology- description, problem solved, status Recommendation to form spin-off- reasons this is best approach Company Overview- name, strategy, objectives Product and Services Description- form, customers, position in

value chain, reasons your offering is superior to competitors, pricing

Marketing and Sales- market size, growth, competitors, customer profile, product positioning, current interested parties and collaborators

Staffing Needs for first few years- personnel, skills, background Development and Manufacturing Ramp Plans- development and

ramp costs & timeline Financials- Cash flow for first several years, breakeven point,

funding needs and proposal Issues, Solutions, and Next Steps – potential “show-stoppers”

and suggested solutions, important milestones

Presentation and Written Commercialization Plan- Licensing

Executive Summary Technology- description, problem solved, status (mention any current

licensing activity but do not name the company) Recommendation to license- reasons this is best approach License description- exactly what you will license, scope, field of use Potential license terms- recommend exclusive or non- exclusive, for cash,

deferred payment, or equity stake, reasons for suggesting this approach Potential Licensing companies- company profile and size, reasons for

choosing these characteristics, specific companies to approach Licensing status, schedule, and potential plans- additional development

work needed, timeline, mechanism for information transfer, ongoing involvement of inventors

Financials- cash flow for licensing company, startup and recurring costs, estimated breakeven point

Issues, solutions, and long term plans- potential “show-stoppers” and suggested solutions, license lifetime, technologies or IP which may obsolete the license

Reading Assignments for Wed- Preparing your commercialization plans

Review “An Oregon Researcher’s Guide to Commercializing a Technology or Starting a New Business”, (including Appendices). In particular, the Idea Resume in Appendix 2 is a good high level summary of what your commercialization plan should contain http://corvallisedp.com/drupal/files/StartUpGuideSWOT.pdf

Read Marketing Survey Checklist (from Ryan Kirkpatrick). This is an excellent list of questions you should be able to answer after performing your analysis and research.

Review the final presentation and financials from the Superior Agrifuels project last year.

Note: All four documents can be accessed from links at the end of the class syllabus

Week-by-week Schedule

Week of April 9 Complete cash flow projection Complete schedule planning and checkpoints Recommend funding amounts, sources, and

deliverables associated with these funds MEET WITH MENTORS: get their input on

finances, schedule, and funding. Invite them to SWOT presentation.

TALK WITH INVENTORS: Describe your general plan and get their input TALK TO ME: Sign up for a 45 minute time slot for Tuesday, April 17 ( between 1-6 pm)

Week-by-week Schedule (continued)

Week of April 16 Prepare your slide set with details of your

commercialization plan, including any modifications from mentors and inventors

PROVIDE A DRAFT COPY to Mary Foley of Tech Transfer office by Thursday, April 19th

PROVIDE A DRAFT COPY to inventors by Thursday, April 19th

Choose a presenter from your group for each section of presentation and practice, practice, practice.

Week-by-week Schedule (continued)

Week of April 23 Mon (4/23) Practice & “fine tune” presentations in

class Tues (4/24) 3:00-4:30 pm SWOT Meeting Wed (4/25) 6:00-8:00 pm Portland BRT meeting

Capital Sources for Formation and Growth

R&D

Gov’t, Industry - discovery

Ongoing Growth

Public Markets

Formation

The “3 F’s” (friends, family, & fools) - “just the basics”

Don’t overlook non-equity capital - Grants (SBIR, STTR), foundations, other? - Customer NRE - Strategic relationships (access, credibility, risk reduction / loss of freedom, …)

Angel Institutional

Angel Investors - “early and often” - Individuals, unorganized, limited follow-on - 2003: $18.1 billion invested, 42,000 deals

Venture Capital funds - Home run mentality - Significant investment $$; governance and oversight - 2003: 915 funds, $18.2 billon invested, 2,700 deals

“Private Equity”

Sources of Non-equity Capital: SBIR and STTR The Small Business Innovative Research Grants (SBIR) and Small

Business Technology Transfer (STTR) can be good sources of start up funds

SBIR created in 1982 and renewed at least until 2008

Requires 2.5% of all “extra-mural” research funds must be set aside for small business development ($2B in 2005)

Many government agencies participate: DOD, NIH, NASA, DOE, NSF, DOC, DoAg, EPA, DOE, DOT, HSArpa. Each agency has structured their program differently

There are some differences in SBIR and STTR with respect to required partnerships and percentage of total funds allocated

This a grant, NOT a loan. The small business is not required to repay. Also, the company can allocate up to 7% of the grant to profit.

SBIR/STTR Funding Structured around a 3 phase process

Phase 1- feasibility ($50K-$100K, 6 mo) Phase 2- prototype ($500K-$750K, 2 yr) Phase 3- commercialization (not funded by

government directly)

Can be either a grant or contract Grant- no expectation of a product that

funding agency will buy Contract- expectation that in Phase 3 that

agency will be a customer

SBIR/STTR Funding Success rates vary among agencies

NIH: Funds 1 out of 3 proposals NSF: Funds 1 out of 13 proposals

41% of SBIR awardees are 2-9 employees

33% of SBIR awardees are new

More information is available at the website: http://www.sbirworld.com, and is also posted on our class website accessible through the syllabus

Senate Bill 853

The State of Oregon passed a bill in 2005 for the purpose of “facilitating the commercialization of university R&D”

This fund is to provide Capital for university entrepreneurial programs Opportunities for students to gain experience in applying research to

commercial activities Proof-of-concept funding Entrepreneurial opportunities for those wishing to convert research

into commercial enterprises

It will be funded by credits applied to state income taxes on a voluntary basis- implementation details are still being worked out

OSU, UO, and OHSU have expressed interest in participating

This could be a source of spin-off funding as early as this year