CSUF Business Plan Competition Boot Camp

1. CSUF Business Plan CompetitionBoot Camp Dr. Atul Teckchandani February 5, 2014

2. Agenda • Introduction to the Contest • Judging Criteria • Business Concepts: • Idea Generation • Competitive Analysis • Business Model • The Team • Contest Details • Schedule • Guidelines for business concepts • Resources Available

3. Business Plan Competition • Open to all current CSUF students • Participants will complete a “Business Concept” questionnaire • 21 questions • 200 words or less to respond to each question • Semifinalists and finalists will present their business opportunity to a panel of judges • Contest winners receive cash prizes and in-kind services (over $10,000 in prizes to-date)

4. Judging Criteria • Overall attractiveness of the product/service the firm intends to offer • Is there a customer that really needs or wants your product/service? • Can you make money? • Can the team assembled execute on the opportunity? • What evidence have you gathered to support your assertions?

5. Raffle • Everybody sign in with Adrienne • Prizes will be awarded throughout the session • Stay to the end – the prizes get more valuable as the session continues

6. The Story of Starbucks

7. Generating Business Ideas • Method 1: Observing Trends Source: Entrepreneurship – Successfully Launching New Ventures (Barringer and Ireland, 2011)

8. Generating Business Ideas • Method 2: Solving an existing problem • Notice a problem and find a way to solve it. • Key source or problems: Complaints / frustrations

9. Generating Business Ideas • Method 3: Finding gaps in the marketplace • A gap in the marketplace is often created when a product or service is needed by a specific group of people but doesn’t represent a large enough market to be of interest to mainstream retailers or manufacturers.

10. How do you know if your idea is an opportunity? • Is it attractive? • Does it have sufficient market potential and profitability? • Is it timely? • Is there a need for this product now or in the near future? • Is it durable? • Is it based on a temporary fad? Or more? • Does it add value for the buyer? • Is there a tangible benefit (preferably financial) to the buyer over the alternatives?

11. Tip #1: Refine your idea till it becomes an opportunity • See if the idea can … • … take advantage of trends • … solve a problem/frustration • … address a gap in the marketplace • Solicit feedback from others about the idea • “Experts” that can provide specific information (people with first-hand knowledge of the areas you are interested in) • Family and friends • Others who will give you candid feedback

12. Let’s talk about your ideas • Do your ideas … • … leverage trends in the marketplace? • … solve current customer problems or frustrations? • … address gaps in the marketplace? • Is it an idea or an opportunity? How can it be refined to make it an opportunity?

13. Starbucks: In the beginning

14. Competitor Analysis • Goal: • A detailed analysis of your firm’s competitors. • Benefits: • Understand the positions of your major competitors and the opportunities available. • Help clarify and refine your competitive advantage(s). Source: Entrepreneurship – Successfully Launching New Ventures (Barringer and Ireland, 2011)

15. Performing a Competitor Analysis • Step 1: Identity 5-10 competitors • Direct competitors: businesses offering identical or similar products • Indirect competitors: businesses offering close substitute products • Another product or service fulfills the same need and offers a better price-for-performance trade-off (at similar usage levels).

16. Performing a Competitor Analysis • Step 2: Understand the strategies and behaviors of your competitors. • Sample Methods: • Study competitors’ websites • Study other Internet sites containing information about customer perceptions of competitors (e.g., Yelp, amazon, etc.). • Read industry-related books, magazines, and Web sites. • Read recent news related to competitors.

17. Tip #2: Know the key players in your industry • Study your key competitors and substitutes

18. The Starbucks Business Model

19. Business Model • A plan or diagram for how the firm ... • competes • uses its resources • structures its relationships • interfaces with customers • and creates value to sustain itself on the basis of the profits it generates • Generally speaking, a business model is all the activities that define how a firm competes in the marketplace.

20. The Lean Canvas 4 8 1 2 3 5 7 6

21. Italian-style cafes Quality Premium coffee is only available at home Unique drinks Personal assistance Coffee connoisseurs Pleasant Environment No “third place” Convenience Mass Market Consistency Company stores Creating a sense of community Ingredients Rent Coffee Drinks Coffee –related products Employees Equipment

22. Tip #3: Complete the canvas for your opportunity • The canvas can serve as an outline to help you answer many of the questions in the Business Concept paper • Download copies of the canvas at: http://blog.diotalevi.com.s3.amazonaws.com/leancanvas.pdf

23. New Venture Team • The group of founders, key employees, and advisers that move a new venture from an idea to a fully functioning firm. • The team involves more than paid employees. • Usually, the team doesn’t come together all at once. Instead, it is built as the new firm can afford to hire additional personnel. Source: Entrepreneurship – Successfully Launching New Ventures (Barringer and Ireland, 2011)

24. The Founder(s) • Founders’ qualities that may contribute to venture’s success: • Part of a team (especially one that has worked together before) • Prior entrepreneurial experience • Relevant industry experience • Quality of network and/or ability to develop a strong network of professional contacts • Higher education

25. Tip #4: Show why you should be the one pursuing this opportunity • An entrepreneur recognizes an opportunity gap and creates a business to fill it. • Are you passionate about this idea? • Does it leverage your skills and experiences? • Do you have resources at your disposal that can help turn this opportunity into a successful business? (e.g., social networks)

26. Tip #5: Be honest about the quality of your team • Discuss who is part of the team today and their strengths • Discuss who else is needed on the team and how you plan to address these needs • Think about what are the most critical skills needed to make the venture successful and whether all of them are possessed by current team members

27. Tip #6: Request a mentor’s help with your business concept paper • Email tlindsay@fullerton.edu to request a mentor

28. Business Plan Contest Schedule • 2/21: Competition application closes • 3/7: Business concept due • 3/14: Semifinalists announced • 3/28: Semifinal presentations • 4/11: Finals presentations and awards ceremony

29. Business Concept Questionnaire • The Opportunity: • What is your company going to make or serve? • Why did you pick this idea to work on? • Who is the target customer? • How do you know people need what you’re making? • What’s new or different about what you’re making? • What are your different revenue streams? • How much could you make?

30. Business Concept Questionnaire • The Industry: • What are the substitutes for your product? • Who are your competitors? Name two or three of your most important competitors. • What do you understand about your business that other companies just don’t get?

31. Business Concept Questionnaire • Current Status: • If you have already started working on your business, how long have you been working and what progress have you made? • Do you have a prototype yet? Have you tested it? • Do you have any intellectual property? • Do you have an initial working product or service you can sell? If not, when will you? • Have you launched your business yet? If so, how many customers do you have? • Do you have revenue? If so, how much? • If you are launched, what is your monthly growth rate in customers and revenues?

32. Business Concept Questionnaire • The Team: • How long have the founders known one another and how did you meet? • Have any of the founders not met in person? • Do you have any work experience or expertise in this area?

33. Resources Available • Center for Entrepreneurship • Travis Lindsay: tlindsay@fullerton.edu • Adrienne Bailey: adbailey@fullerton.edu • Phone: 657-278-4589 • CSUF Librarians • Book: Art of the Start, by Guy Kawasaki

34. Next Steps • Apply for the contest • Complete the lean canvas • Spend some time looking at competitors • Write the business concept paper Good luck!