the business paradox mc gill university 17 05 2011
DESCRIPTION
Do we understand why business fail; perhaps we're not looking at the right things?TRANSCRIPT
Presentation to McGill University, Montreal May 17th 2011 1
Value ≥ ƒ (Risk)
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The Business Paradox ©
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1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
États-Unis Canada
Source AUTM
Extrait: Conseil de la Science et de la Tecnologie – Nouvelles perspectives et pistes d’action
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Copyright
Abandon - Transition Rate - Licenses 6
1:20
1:5
1:25
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1 commercial success ~ $50MTotal cost: $ 331.25M (minus ~ $3M license revenue)
5 VC projects @ $10M Cost: $50M
125 Spin-off @ $250kCost: $31.25M
2,500 R&D projects @ $100kCost: $250M
The Business Paradox ©
Is the market big enough? Do we solve a market issue? Is the solution better than the
competition? Is the management team competent? Can we raise money?
In other words, is it good enough?
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Opportunity A vs. Opportunity B
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Cause #1: Push strategy;
Cause #2: Little interaction with the market;
Cause #3: Opportunistic approach for project
selection;
Cause #4: Lack of experienced entrepreneur;
Cause #5: Dysfunctional value creation chain;
Cause #6: Dysfunctional financial community;
Cause #7: Reactive governance;
Cause #8: Short-term vision.The Business Paradox ©
“Ultimately, most business will fail to create value as the leaders reject the importance of setting a trusting environment. Trust is the ultimate ingredient that enables risk factors to be exposed and openly discussed. Considering the risks will bring rapid alignment on the priorities, instigate mitigation plans and create the momentum essential to value creation.”
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Identification of Value Creation Opportunity; Attainable; Sustainable Valuable.
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fundamental and observable trends; Known drivers; Destined for growth; Ready to move; Known to the stakeholders;
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The existing players; The Clients (the prize); Potential Partners (Friends or Foes); The competition (the enemies);
Market dynamics (Procurement Practices and Regulation);
The gaps and strongholds.
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Climbing the food chain; Becoming the gate keeper; Creating the momentum - Time to market; Partnering; Exit planning.
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Market Need vs. Business Opportunity; Core value; Value Proposition; Competitive distinction; Deployment; Product Road Map; Branding.
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Relevancy to the plan; Timing; Commitment & Performance; Extended Management Team
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Creation Phase Sowing
Momentum Phase Accelerating Growth Depletion Phase
Harvest Declining Phase Rest
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VCO 1 VCO 2 VCO 3 VCO 4
Total value creation
The Business Paradox ©
Are the Basics checked? Do we understand HOW to do the job? Is the critical path defined?
The deliverables? The risks? The priorities?
Can we assemble the Right team? The competencies? The Attitude?
Can we go the distance (Cash & Time)? Is the team aligned?
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Only then you are ready!
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