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E102 Lecture 2 Introduction (continued)

E102 Lecture 2 Introduction (continued). Jan 06, 2011. Today. More Introductory Comments Guest Speaker Fred Farina Guest Introduction Kristin Buxton Look again at ideas Time runs out (tomorrow 9:00AM) for choice of Ideas. Event Announcement.

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E102 Lecture 2 Introduction (continued)

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  1. E102 Lecture 2 Introduction (continued) Jan 06, 2011

  2. Today • More Introductory Comments • Guest Speaker Fred Farina • Guest Introduction Kristin Buxton • Look again at ideas • Time runs out (tomorrow 9:00AM) for choice of Ideas

  3. Event Announcement • Stanford/Princeton national entrepreneurship conference April 7-10 • A Bootcamp • Stanford • all-expenses-paid • brings together students with founders, entrepreneurs, and venture capitalists for an intensive learning experience.

  4. Applications close Feb 1, 2011 • Applicants will be evaluated • on idea • Student entrepreneurial potential • Event will feature  • small-group workshops • participants will competitively present business ideas • ebootcamp@bases.stanford.edu.  Apply at bases.stanford.edu/e-bootcamp!

  5. Grading HW presentations 20% Midterm presentation 10% Midterm paper (5 pages) 10% Criteria 1. Depth of market research- especially primary research 2. Quality of understanding of the problem Quality of Final presentation 15% Quality of Final paper (20 pages) 25% Criteria: 1. Convincing argument (logic, self consistency, flow) 2. Originality of thought 3. Depth of Understanding Class contribution 20% 1. Prepared, show up, volunteer opinions, extra credit “learnings”, attends TCA, Caltech-MIT enterprise forum, etc. 2. Individual differentiator (all other grades above are as a team)

  6. Grading • Extra credit for Individual: A 10 minute presentation on “New Learnings” At your volition, if you come across a subject of relevant entrepreneurial business interest to the class, you can research it and apply to the instructor to present it. The extra credit will be 0-5% depending on quality of insight.

  7. Technology Push Vs Market pull Caltech spin-out example Technology Push Market A Market B Market C Consumer need example Market A Pull Technology A Technology B Technology C Market A

  8. Types of ideas • An IP protected “cool technology” • “Technical Barrier” areas such as • Energy • Batteries, more efficient turbines, solar power) • Energy efficient devices • Information • Right data at the right time to the right person • A product area you feel passionate about • A product you can learn from

  9. Funding • Not necessary to be an Angel or VC idea as long as it can be self-funded. • But what if you want some outside investment? • What works . . .

  10. Funding • Not necessary to be an Angel or VC idea as long as it can be self-funded. • But what if you want some outside investment? • What works . . . • And what doesn’t work

  11. VC: “Thanks, but don’t call me- I’ll call you. . .” • An idea which affords you no competitive advantage and no barrier to entry from competition • Something that is “nice to have” rather than something which addresses a real market pain • An idea which requires a large infrastructure as a core competence • Something which is a “feature” on a present product • Something which attacks an entrenched competitor

  12. VC: “Great idea- but not in our space. . .” • Something which requires a very large Capital Outlay • Something where it is very hard to prove the business model quickly • Something where the investment cannot be returned in <5-7 years • Something where there is no “path to profitability”

  13. VC: “What did you say your name was?” • Something which is unmanufacturable using current technology • Something where you are only 2X better than current product • Something where you say your unproven idea is worth 5 million dollars • Something which says that you will be successful in China if only you got 1% of the market • Etc, etc.

  14. Final take-away thoughts The biggest barriers to building a successful technology-based business are

  15. Final take-away thoughts The biggest barriers to building a successful technology-based business are Poor Management

  16. Final take-away thoughts The biggest barriers to building a successful technology-based business are Poor Management Poor Marketing

  17. Final Final take-away thoughts . Success is the ability to go from failure to failure with no loss of enthusiasm -Winston Churchill

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