Enabling a Different Perspective for Potential Entrepreneurs

1. Enabling a Different Perspective for Potential Entrepreneurs Emel Bulat Gordon-CenSSIS/ALERT –Industry & Government Liaison President – MySkin Technologies 04/12/13 ACW Workshop, Chicago, IL

2. Agenda • NSF I-Corp, • Why is I-Corps Important? • Biz Plans, Adjacent Markets • Other sources of funding • SBIR, AIR & SECO • Discussions • Recommendations

3. I-Corps Intro “The National Science Foundation (NSF) has established a new opportunity to assess the readiness of emerging technology concepts for transitioning into valuable new products through a public-private partnership. The NSF Innovation Corps (I-Corps) program will bring together the technological, entrepreneurial, and business know-how to bring discoveries ripe for innovation out of the university lab” • Takes academics out of their comfort zone & “out of the building” • Brings different people together enabling interdisciplinary collaboration • Funds only “Biz Plan” & “Voice of the Customer” activities

4. I-Corps Tools • Great “Team” concept • Great books • “Business Model Generation,” Alexander Osterwalder, Yves Piguer; Wiley Press • “Canvas”for understanding nuances of market, value proposition, supply chain, etc. • Makes for a better SBIR, etc.

5. B2B Higher quality matching of skin care products to customers High-End (prestige) Cosmetics Manufacturer Product Development Long-term Exclusive Spas-Beta sites Correlating measurements with OEM cosmetics Exclusive Spas B2B2C Low cost Cosmetic companies In-Home Cosmetics (Avon, Mary Kay, Arbonne) Train OEM More accurate Melanin measurement Direct OEM Over the counter (CVS, Walgreen) IP Database of skin tones to better target products Marketing Cosmetic R&D Brand Reduce returns Consistent results Leasing In-Home Sales Advertising & Marketing COGS = $200 / Instrument OEM Sales Integration with OEM product Service & Calibration Contracts Human Resources

6. Canvas • Forces team to look from many different perspectives • “Voice of the Customer” rather than “my invention is the best thing since sliced bread” • Value Proposition-Is your assumption valid? • Is there something you missed? • Can you Pivot? • Economics; Adjacent Markets • Competition • Channels-overlooked by many start-ups

7. Teaming with MBA’s & Mentors a Must Diagram of Payment Flows $250 Year $200 unit Cosmetics Firm or Spas / Salons Department OEMorSales Reps Contract Manufacturer MySkinTone Increased Sales $500 - $1K unit Consumer • MySkinTone purchases product from contract mfg • Product received from manufacturer • MySkinTone delivers to cosmetic firms • MySkinTone receives payment from cosmetic firms • Cosmetic firms place MySkinTone product into department stores or leases it to regional sales reps • Department store sells cosmetics to consumer, increase sales MySkinTone Product Money Cosmetics Cosmetic Money

8. Linking Other Programs • SBIR I & II, (IB & IIB) • Great next step after I-Corps • Requirements could be more in-line with the momentum created from the I-Corps • STTR • SECO • Currently there are two Options: • Option I for new start-ups teamed with ERCs • Option II for active SBIR II teamed with ERCs • State Funding • Angels, VCs

9. Discussion Topics • Making sure the technology is robust • Getting high quality mentors who are willing to donate their time • Having the “right team” • Networking with start-ups in similar markets • Positioning for other funding opportunities

10. Recommendations • I-Corps is unique for the “.gov” community • Focusing founding teams on “Biz Plan & Mkts” • Developing more interactions with potential customers • Funding agencies providing more one-on-one access with the private sector