T 422: Fall 2010 nerating and Screening Entrepreneurial Ideas Kristin Boyd Ajai Hari Seth Hauben Kush Patel
Mar 23, 2016
ENT 422: Fall 2010Generating and Screening Entrepreneurial Ideas
Kristin BoydAjai Hari
Seth HaubenKush Patel
ENT 422 – Idea Thickening 2
• Team and Creed• Semi-Final Ideas• Vendi Cab• Investigational Highlights• Everywhere Heels• Investigational Highlights• Ideas Pros/Cons• Next Steps
Agenda
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ENT 422 – Idea Thickening
Team Creed
“We see tremendous opportunity in converting the way things are
currently done in everyday life and making convenient improvements
that help us generate significant business revenues.”
Ideas based on every day problems
Scalable
Low tech
Rapid real growth potential and quick profitability
Objectives
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ENT 422 – Idea Thickening
Vendi Cab
Everywhere Heels
Ladies shoes that take the pain out of high-heels
Collapsible heels
Eliminates the need for carrying extra shoes
Mini vending machine (5 items) in taxis in major
metropolitan area
Predictable needs of taxi riders
Integrated with current point of sale system
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ENT 422 – Idea Thickening
Vendi Cab
Product Sketch
Unit would fit in top left corner
To purchase item, select Vendi Cab button on
screen
Product cost is added to the total fare
Advertisement space also available for sale
Products offered
Item of Substance – Cliff Bar
Gum – Stride Gum
Condoms – Trojan
Energy Drink – 5 hr. Energy
Medicine – Advil packs
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ENT 422 – Idea Thickening
Investigational Highlights – Resource Needs
Vendi Cab Supply Chain
Raw Materials for manufacturing vending machines
Manufacturing Unit
Vendi Cab HQInventory Transport
NYC Cab Company
NYC Cab
End Customer
Machine Installation
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ENT 422 – Idea Thickening
Investigational Highlights – Market Economics
13,087 medallions
241 million passengers ride taxis every year
Average -1.4 passenger per trip.
18,415 fares per year per taxi; 51 passengers per day per car
Free vending machines and installation
5% of the passengers make a purchase using Vendi Cab
5% of sales revenue to cab company
Average profit margin of 26% from year 4 onwards
Business Structure Assumptions
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$3166/mo., 2500 sq. ft. office space in Jersey City, NJ
Reception: 200 sq. ft.Office Area: 400 sq. ft.R&D Lab: 700 sq. ft.General Storage: 1200 sq. ft.
Production Cost23.7%
Market Research
0.8%
Installation Cost7.9%
PP&E2.3%Sales & Salaries
31.7%
Cab Company Commision
5.0%
Profit28.6%
Investigational Highlights – Resource Needs
Facilities
Equipment
Staffing
Inventory transport: Year 1: $20,000Year 3: $20,000Year 4: $40,000
Sales/Business Development (Self)Operation Management (Self)Research and Development (3)Manufacturer (Outsourced)Machine Installation/Refill Crew (1)
Cost Structure
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ENT 422 – Idea Thickening
$(0.13)
$(0.12) $(0.15)$0.19
$0.60
$1.45
$(0.13)
$(0.25)$(0.40)
$(0.21)
$0.39
$1.84
-$1.00
-$0.50
$0.00
$0.50
$1.00
$1.50
$2.00
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Net Profit Cummulative Profit
Investigational Highlights – Idea Financials
Net/Cummulative Profit
Note: All $ in millions
Break Even
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Business Structure Assumptions
Percent of Taxi Riders who
Purchase Item
Number of items sold daily in taxi
Profit per Cab Daily
NPV
3% 1.51 $ 2.09 ($1,230,995)
4% 2.02 $ 2.78 ($121,025)
Break/Even 4.109% 2.07 $ 2.85 0
5% 2.52 $ 3.48 $988,945
6% 3.03 $ 4.18 $2,098,915
7% 3.53 $ 4.87 $3,208,885
8% 4.04 $ 5.57 $4,318,855
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ENT 422 – Idea Thickening
Everywhere HeelsProduct Sketch
Click-Out Secure Expansion System™
Flexi-Lock Arch™
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ENT 422 – Idea Thickening
Investigational Highlights – Resource Needs
Everywhere Heels Supply Chain
Raw Materials made into Everywhere Heels by Manufacturer
Manufacturer to Drop Ship to Retailers
Retailer Sells to Consumers
Everywhere Heels makes sales contracts with Retailers
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ENT 422 – Idea Thickening
Investigational Highlights – Market Economics
U.S. - 32% of the world footwear industry
Women’s footwear - 10% of the world market
Heels - 2.5% of world footwear market
Estimated shoes sold/per year - 621 million
U.S footwear revenue - $62.11 billion
Women’s footwear sold/year - 207 million
High heels sold/year in the US - $51.75 million
Potential share of Everywhere heels (0.3%) is approx. 155,250 pairs
Business Structure Assumptions
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ENT 422 – Idea Thickening
Development0.1%
Materials10.0%
Manufacturing & Distribution
6.0%Labor0.8%
PP&E0.2%
Sales & Marketing
0.5%Retail Markup30.0%
Contingency4.7%
Profit47.7%
Investigational Highlights – Resource Needs
Facilities
Equipment
Staffing
$2,000/mo., 2,500 sq. ft. office space in Rochester
Reception: 500 sq. ft.Office Area: 1200 sq. ft.Design Lab: 800 sq. ft.
Year 1: $10,000Computers: $4,000Design & Test Lab: $2,500Technology for collapsible heels: $3,500
Sales/Business Development (Self)Operation Management (Self)Designers/Lab technicians (3)Administrative Assistant (1)Fashion expert/consultant (Fixed Budget Contract)Manufacturer (Outsourced)Drop Shipment (Outsourced)
Cost Structure
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ENT 422 – Idea Thickening
$(0.35) $(0.24) $(1.03)$0.94
$1.88
$7.41
$(0.35) $(0.59)$(1.62)
$(0.68)
$1.20
$8.61
-$4.00
-$2.00
$0.00
$2.00
$4.00
$6.00
$8.00
$10.00
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Net Profit Cummulative Profit
Investigational Highlights – Idea Financials
Net/Cummulative Profit
Note: All $ in millions
Break Even
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Idea Pros/Cons
Product: Unique and conciseProtectable
Market: Large market shareClear value and growth potentialShort sales cycle
Team: Blend perfectly with team creedFull team assembled internallyMembers already committed
Business: Large marginsLow initial investment
Product: New product risk
Market: New market risk
Business: Concept to Market’ lead time
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ENT 422 – Idea Thickening
Next Steps
Licensing/Patents
Product Development
Product Testing & Validation
Technology Investigation
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Questions?