portland environment consulting your trusted environmental partner business “pivot” background...

Portland Environment ConsultingYour Trusted Environmental Partner

1Confidential

Business “Pivot” Background

• Testing Assumptions Revealed Issues with Initial Business Plan– Substance Testing Equipment Purchase Problematic

• Lab Certification more important than capability or individual skill set: Customers require ISO-17025 certification to be considered a viable lab analysis supplier (1 year + equipment + defined space + documented SOP & methods + Quality System Manual + working gathering data for evaluations)

• Tough to get customer base established– Internal Intel business unit will NOT use uncertified labs– More of a commodity: Doesn’t leverage existing expertise– Uncomfortable making ‘cold calls’ for this service

• Significant Investment• May question chemical knowledge/background

– Resulting “Pivot” – Push this activity to Phase 2 or 3 when customer base is established and requesting analysis (sub out analysis?)


2Confidential

Business “Pivot” Background• Expertise Valued Internally @ Intel

• Intel evaluating new environmental software and needing short term (12 -18 months) consulting expertise.

• Teaching/Instruction emerging as a “Phase 1” service for the business– Long term desire– Values individual expertise over company certification– Dovetails with primary services offered– Intel offering Tuition for Teachers as a part of retirement benefits

• Pay up to $15.5k in program costs (half Teaching Certificate Cost)• Teaching opportunity available for pre-requisite to program

• Teaching Certificate Benefits the Long Term Business– Professional quality teaching aids (e.g. Presentations, lesson plans, etc.)– A chance to be philanthropic; paying it forward by teaching children about environmental issues– Requirement for teaching in the Oregon Public Schools– Great networking opportunity– Masters Degree in only one year in retirement

• Encore only allows for ONE track…either Business or Tuition for Education– Lobbied for paying 100% of Encore Business Track – Denied– Contingent on acceptance into Tuition for Teacher’s Program

• Dual paths until acceptance…requires volunteer teaching completion

– Pivoting, but still committed to pursue creating a business


3Confidential

2014Phase 1

• Teaching Certificate• Develop teaching

materials• Kahn Academy

• Consulting for Intel• Start Business

(URGENCY)• Eliminate 2nd party• Intel specific

guidelines

2015+Phase 2

• Consulting+ Teaching+ Auditing

OptionalPhase 3

* Analysis


4Confidential

Phase 1


5Confidential

Key Partners

Cost Structure Revenue Streams

Key Resources

Value Propositions

Channels

Customer SegmentsCustomer Relationships

Key Activities


6Confidential

Key PartnersKEY PARTNERS• Supply Chain and/or ODM’s• Intel• University• **Competitors (incumbents) ***

– Potential “Lego Partners”: SGS & Allion

• Trusted Accountant/CPA: Financials• Tax Lawyer: Setting up the corporation, contract reviews, etc.• Business Insurance Broker (liability coverage)• PHILANTHROPIC: Public School tutoring: Virginia Garcia Medical Clinic & Mattel

KEY SUPPLIERS– Thermo (XRF Supplier), – Outside Test Lab (that is certified) – Strategic outside lab that can do specific quantitative testing that we are not planning to do. CESI, CCIC, CEPRI Certified test labs in CHINA– Environmental Legal: Review of proposed regulations and minimum collateral expectations– Analytical Chemist – Provide consulting on testing methods or standards for newly introduced restricted substances.– Toxicologist – California Prop 65, CPSIA– Web publishing

UNTESTED ASSUMPTIONS• (1) year waiver will be accepted by Intel (high probability and will be pre-approved by Intel senior management)• Acceptance into the Tuition for Teaching program (highly likely as all pre-requisites have been met and approval to switch

from one track to another has been given).• Volunteer hours completed by mid year• Business details (e.g. business license, LLC formation, bank account, etc.) in place by EOY• Intel grants Portland Environment Consulting preferred supplier status• Will the electronics industry want to do business with a smaller, independent test lab or consultant (are those two separate

questions)?• Will INTEL want to do business with us as a CONTRACTOR? What kind of restrictions (6 month wait period?)• Can we DIFFERENTIATE our services ENOUGH from larger, established labs that they are willing to pay? (i.e. faster, better

service, offer other services unavailable from other labs, more expertise, etc.)• Is there enough VOLUME to remain profitable? Does the rate of new business coming on support cash flow requirements?


7Confidential

Key Activities

• Substance Testing– Internal (testing performed by PEC): XRF Screening to ensure company compliance – External (testing managed by PEC, but performed by partner lab): Ex: Phthalates

• R&D – Research Regulations – Keep abreast of what is going on– Subscribe to services that report back on new environmental regulations around the world– Conferences – Speaking and attending to learn/network– Investigation: We have a substance, determine the METHOD of testing (i.e. – How are we going to test this new substance?)– Join Environmental Working Groups – I-NEMI, IPC 1753 WG, etc.

• Consulting– Analysis of current environmental systems (hourly)

• Information Sharing– Level 1: FREE (blog or web content, videos) – As advertising/marketing– Level 2: Paid Report or instruction (specific area customized for specific customer)

• Teaching/Instructions– Various Classes: Information, training, or customized content.– Instruction manuals – Dis-jointment Instructions

• Audits: IEC-Q (QC-080000) Format (ISO 9001 audit primarily focus on environmental quality system, but expandable to Mfg process and EHS focus. )– ODM Environmental – Supplier Audits – Customer Audits – Corrective Action Follow Up for Gaps & Observations: Manage and ensure the closing of audit findings (additional fee)

• Marketing/Advertising– Philanthropic Substance Testing as advertising/marketing

• Test children’s toys for hazardous substances (Feb 2013 CPSIA) • Partner with toy company or toy store for replacement toy

– Level 1 information Sharing: FREE (blog or web content, videos) – As advertising/marketing– Speaking at Conferences

UNTESTED ASSUMPTIONS• Creating curriculum during the first year of • Is this an interest to our customers and would they PAY for any of these services?• Each activity has a positive ROI or tangible gain? Need to do cost analysis for EACH Service, including

certifications.• What should we concentrate on for Phase 1?


8Confidential

Key Resources

• Substance Testing Equipment ($30K)– XRF + other equipment

• Office space• Fluent Technical Mandarin Speaker• Website• Logo Artist • Computer• Certifications

– EG – ISO 17025, CPSIA, ODM, Sony “Green” etc.

• International Access – Email, phone number, etc.• Credit Card machine for payment• Working Capital for incidentals • LOANS – Small Biz Administration, Gov’t grant for handicapped, etc.

UNTESTED ASSUMPTIONS• We can get an SBA Loan?• We can get a gov’t grant (handicapped biz loan)?• We can successfully fund our first year (cash flow)?


9Confidential

Value Propositions

• We Keep you Legal!– Eliminate your ‘pain point’

• Risk Mitigation– Global Regulation and Audit Experience (we know where the bodies are buried)– Minimum requirements defined (efficiency, not wasting your time)

• Preferred Supplier Status - “Certified Green”– Understand OEM green programs and can assess a customer’s quality system against the OEM requirements.

• Faster Time To Market– Quick turn around time, expertise

• Maximize Customer Asset utilization– Provide ‘burst capacity’ – Provide “expedited responses” to meet critical timelines– Provide targeted expertise to augment their existing staff

• Increase Companies Environmental IQ…on a budget– We can help the customer assess which regulations apply to their customers– Training and information on ALL regulatory initiatives including latest/greatest regulations

• Knowledge of Intel processes, procedures and key contacts

Untested Assumptions• We will have access to OEM green partner updates (if we are not a customer, will they give it to us?• Can we remain independent (not become an Intel Green badge)• We can find a lawyer that meets our quality and financial requirements.• Is there a subscription service that meets our needs? C2P, Young & Global Partners, etc.• Can we join INEMI, IPC WG as contributors, voting members?• What are they willing to PAY for these Value Propositions?• Competitive Differentiation – What value propositions do we have that DIFFERENTIATE us from the others (Intel

knowledge?)…and different markets such as food, toys, etc.– Survey potential customers on THEIR requirements – Have them weigh the importance of these factors


10Confidential

Customer Relationships

• Customer Segments– Electronic OEM/ODM Large – With existing product ecology– Electronic Small/Medium – With limited or NO product ecology

• Oregon small electric suppliers who may want to become Intel suppliers.

– Expanded Scope Industries – Medical, Control and Instrumentation– NEW MARKETS – Food containers, toys, etc.

• Competitors – Potential Lego Partners

• Need additional Certifications– Electronics: Radiology certification, OEM Green partners, ISO 17025, – Toys – CPSIA– Food & Drug - ???

• REFERAL BASED – TRUSTED– Go to Market – YouTube Video with some delighted customer to mailing list

Relationship Methods: F2F, Web-based, email, & Skype (See Channels)

Untested Assumptions• We can partner with competitors and provide a value that they don’t possess OR may be outside of their business practice

(ex – Auditing OR managing audit follow up).• We can provide value and they are willing to pay for it in NEW MARKETS ( Expanded electronics, toys & food containers)• Are our services understood well enough to know who our competitors are? (Analytical testing understood…other services

need assessment)• What are our financial assumptions about new vs. repeat customers? Strive to have a group of ‘core customer client base’

and build key partnerships…ideally sustaining cash flow (90% business repeat customers).


11Confidential

Channels

• Direct F2F – Audits, initial customer contact, etc.

• Business Cards• Promotional Items

– Pamphlet out of wild flower seeds, 100% recycled material– Pens, etc.– 100% recycled bag

• Facebook Company Site (!)• E-Mail• Paper Copies and/or Electronic Copy (IPC-1753)• Linked-In• Web – Awareness (how do you drive people to your sight?)

– Short Webinars on Various Topics – Pay Google Ad Works??

• Direct Mail• Develop a program with ODM’s• Blogging to provide FREE UPDATES• University lectures?

Untested Assumptions• What are the BEST ways to reach our customers? Different for different target markets?• Is there a NEW MARKET that we are missing that uses NEWER communication strategies?• Is there a communication channel that SGS/Allion are NOT using effectively? • Where do clients in this field go to get their information? Important to help in focusing marketing outreach.• Analysis of Intel contacts – Who makes the decisions and who are the influencers? Opportunity to carve off project work

like with Intel Tier 3 suppliers or Intel Reference Design Vehicles? Getting Intel to make recommendations directly to suppliers?

• What does the sales cycle look like for the industry?• What messages will be most compelling?


12Confidential

Customer Segments

• Customer Segments– Electronic OEM/ODM Large – With existing product ecology– Electronic Small/Medium – With limited or NO product ecology– NEW MARKETS – Food containers, toys, etc.– Company size

• Geography may be a factor• OEM & ODM: May FOCUS on ODM because they get a 2-fer

Untested Assumptions• Will the electronics industry want to do business with a smaller, independent test lab

or consultant (are those two separate questions)? INTERVIEW TO TEST ASSUMPTION – Gather data

• There is a market for food industry/toys. The market will support us…costing structure may be different…willingness to engage may be different.


13Confidential

Cost Structure

Variable Costs• Travel• Communications• External Lab partner testing (lab fees, lawyer fees, toxicologist• Working Capital• Web• Hazardous Materials disposal fees• Shipping/Packaging costs

Fixed Costs• Capital Equipment• Office Space• Salary• Telephone• Internet• Security Protocols (VPN)• Office Equipment: Furniture, Computer• Liability Insurance

Untested Assumptions• Need to verify “Burn Rate”: We can successfully fund our first year (cash flow)?• Need to work out ‘salary’ with one FULL time, one PART time and how much goes into the business?• Pricing needs to align with our brand intention – are we a premium, mid-range, or value provider?


14Confidential

Revenue Streams

• Substance Testing– Internal (testing performed by PEC): XRF Screening to ensure company compliance – External (testing managed by PEC, but performed by partner lab): Ex: Phthalates

• Information Sharing– Level 2: Paid Report or instruction (specific area customized for specific customer)

• Consulting– Analysis of current environmental systems (hourly)

• Teaching/Instructions– Various Classes: Information, training, or customized content.– Instruction manuals – Dis-jointment Instructions

• Audits: IEC-Q (QC-080000) Format (ISO 9001 audit focus on environmental quality system)– ODM Environmental – Supplier Audits – Customer Audits – Corrective Action Follow Up for Gaps & Observations: Manage and ensure the closing of audit findings (additional fee)

UNTESTED ASSUMPTIONS• Review cost structures (Terry) – Create LIST PRICE for all of the services we provide (we are

we pricing….15% below standard US rate?) – Note – need extra for RUSH• How are customers paying? • What is the preferred method of payment? Need to validate wiring instructions, credit card.• XRF gun will provide more and steadier income than audits.• Determine method of billing (audits – ½ now and ½ after audit report?)• Is this an interest to our customers and would they PAY for any of these services

portland environment consulting your trusted environmental partner business “pivot” background...

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