11.07.2012 1 INiTS Hightech Business Incubator © INiTS Innovation into Business Dr. Irene Fialka, CMC Managing Consultant 09.07.2012 [email protected] Introduction A company of:
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INiTS Hightech Business Incubator
© INiTS
Innovation into BusinessDr. Irene Fialka, CMCManaging Consultant
Introduction
A company of:
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Our mission
Boost startup success in Vienna by helping founders conceive, launch and grow innovative startups
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INiTS Stakeholders:
Academia plus Business: basiNational program with the goal to exploit research results bysuccessful start‐ups/spin‐offs.
INiTS Partners:
Universität fürBodenkultur Wien
INiTS in a nutshell
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INiTS in a nutshell
INiTS is a business incubator designed to improve the rate of startup success in Vienna by:
• Identifying and investing in bright, ambitious people with great ideas
• Helping founders grow sustainable, high‐growth companies
• Providing expert training, critical objective feedback and peer support
• Facilitating valuable connections and relationships
Consulting
•Product & Service
• IPR
•Market & Competitors
•Business Modell & Organization
•Marketing & Sales
• Team & Management
•Fundraising
•Business Development
Training
•Development ofbusiness concept
− Value Proposition
− Gatheringcustomerinsight
− Business model
•Professionalisationof start‐up teams
• Preparation forfollow‐on financing
•Pitchtraining
Financing
• INiTS subsidy
• INiTS loan
• Sourcing of additional
• Public funds
•Private capital
Networking
• Team building
• First customers
• Development partners
• Investors
• Experts
− in law,
− marketing,
− tax,
− patent attorneys
− …
Infrastructure
• Office space
• IT infrastructureand support
INiTS Offering
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Pre‐Incubation The FutureIncubation
≈ 4 months End of 18th month18 months
Build & RefineWhere the magic happens:Business plan, toolsResourcesEvents, connections Acceleration
Scale & GrowINiTS alumni:International growthAccess to• Markets• Funds
Think & PlanOpportunity checkWorkshops:• Value proposition• Business modelIntellectual propertyFirst business concept
CheckProject advisory boardPitch-trainingPresentationExperts’ feedback and input
Selection
INiTS – The Process
114INiTS
Companies€ 96mPrivate Funding
€ 50m Public Funding
605New Jobs Created
154Patents Filed
68 Patents Approved
INiTS Results (cumulated since 10/2003)
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AplusB (Austria) INiTS (Vienna) % of AplusB
AplusB‐national fundsx 30.9 Mio. 6.6 Mio. 21,5%
AplusB‐regional fundsx 26.8 Mio. 5.4 Mio. 20,2%
Incubated projects/start‐ups+ 433 104 24%
Jobs created (inkl. founders)+ 1846 572 34%
Academic jobs (average)+ 71% 76%
Additional public funds f. Startups++ 74.1 Mio. 40.5 Mio. 36%
Additional private capital f. Startups++ 109.4 Mio. 81.9 Mio. 75%
INiTS compared to AplusB
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x: AplusB-Budget 2002-2012 (s. www.ffg.at/aplusb)+: as of November 2011++: as of December 2010 („AplusB Leistungsbericht 2010“, www.aplusb.biz), more recent figures in other slides
AplusB ‐ INiTS
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• INiTS‘ basic budget € 11.1 Mio.
Ministry: € 6.36 Mio.City of Vienna: € 4.72 Mio.
• EU: € 0.75 Mio.• Founders: € 0.7 Mio.
Public Bodies
€ 5.5 Mio. Collaborative research
€ 96 Mio.Investors
Business AngelVenture Capital
Innovation for• SME/Industry• Consumers
Taxes*:2011: 56 Start-ups 13 Mio p.a.2017: 98 Start-ups 46 Mio p.a.Source: Joanneum Research
114 Start‐Ups605 Jobs
Innovations
Universities, R&D
€ 2.1 Mio.
€ 50 Mio.Public funds
• consulting• cash• infrastructure• network
Innovation ‐ Funds
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Complementary Public Funding
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departure
FFG Haus der Zukunft
FFG Basis Programme
FFG Start‐up
ZIT Call Life Science
ZIT callFemPower
AWS seed
Awspreseed
FFG Innovations‐scheck
waffInnovations‐assistent
IMPULSE Programm FFG FIT‐IT
FFG benefit
NÖBEG preseed
AWS double equity
FFG Feasibility
AWS Pro‐Trans
EU callsAwards
Investitions‐förderunge
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European ICT Grand Price
Winner: Treventus€ 200.000,- Award
2007
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Saint-Gobain Global Innovation competitionfor innovative solutions in the fields of habitat, energy and the environment
Awardee: crystalsol, developing next generation photovoltaics
2011
Best Culture (Fashion, Art etc) Startup
Winner: Lookk
2011
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> 400 European Startups (IT, New Media)50 Startups Short List
Winner:
Hermann Hauser: “ .. mySugr which I think is an excellent project but too early for Amadeus. I wish you every success with this exciting company.”
2011
More INiTS‘ Stars
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• Treventus: € 200,000 (European ICT Grand Prize)• Abotic und LOOKK: € 50,000
Biggest Awards (in €)
• Ubimet: 100 (50 thereof in international subsidiaries)• ProtAffin: 26
Biggest Companies (Head Count)
• F‐star: € 33.5 Mio• ProtAffin: € 19.5 Mio
Biggest private funding
• F‐star ‐ Boehringer Ingelheim 2010: > € 1 billion• Marinomed ‐ Boehringer Ingelheim 2010: international sales licence of nasal spray
License dealsmit Big Players
• Senactive: bought by UC4, AmericaSuccessful Exit
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INiTS‐Team
Katharina Chmielewska: Assistant to CEO
Michael Rauhofer: CEO
Eva Krizsanits: Marketing, PR Peter Litschauer, IT Support
Markus Pietzka
Irene Fialka: Proxy,Managing Consultant
Andreas Gschöpf Michal Nespor
Peter Tschuchnig
Alice Wong
VC
Start‐up
ConsultantsKatharina Wieser
Opportunity?
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Opportunity?
© Irene Fialka/ INiTS 21
„Opportunity Window“
idea resources
team timing
• What for would a customer buy our product? –
Customer‘s benefit, value created?• Who are our clients? What do they need? Unmet needs? Not realized needs?
• USP „Unique Selling Proposition“• What unique advantage can we offer our clients?
• Is the market attractive? • Size? Trends? Competitors? Suppliers? Legal/other limitations?
• Revenue Model: is the idea saleable/scalable?• How do we make money and how much (cover costs), growth potential, profit?
• Rights• Freedom to operate? How can we protect competitive advantage?
Opportunity ‐ Questions
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• Does the idea fit? • My/our expertise, experience, situation, interests, goals?
• Can we recruit and motivate the right team?• Fill gaps? Are we able to share?
• Do we have access to important resources? • Suppliers, infrastructure, partners, consultants, ..?
• Do we have access to money?• How much, where from?
• Is there a reasonable correlation input vs. potential revenue? • State of development, time to market, costs, potential market?
• What are the risks? • e.g. Development, unknown competitors, Network‐effect, …
Opportunity ‐ Questions
© Irene Fialka/ INiTS 23
Entrepreneurs Initial Capital Today
Josephine Esther Metzner (1930s)
$100.‐ Estee Lauder
Roy and Walt Disney (1923)
$290.‐ Walt Disney Co.
43% (of 110 start‐ups)* < $10,000.‐ „Lessons from MIT and beyond“
How much money for a start?
© Irene Fialka/ INiTS 24
Source: E.B. Roberts, Oxford University Press 1991
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• Thomas Watson, Chairman of IBM, 1945, forecast of the world‐wide market: “There might be a need for perhaps four or five computers.”
• Ken Olsen (Digital Equipment Corp.) 1977: “There is no reason for an individual to have a computer in their home“
• Thomas Edison, 1910: “The nickel‐iron battery will put the gasoline buggy .... out of existence in no time.“
• The whole of Volkswagen factory and patents were rejected by Henry Ford II in 1945: “The Beetle is a bad design”
• Albert Einstein, 1932: “There is not the slightest indication that nuclear energy will ever be obtainable.“
Opportunity ‐ Recognition
© Irene Fialka/ INiTS 25
“I was seldom able to see an opportunity until it had ceased to be one.”
Mark Twain, 19th century
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• Which customer’s problem is to be solved?• How is the problem currently solved?• What is the innovation (compared to existing technologies)?• Unmet needs and USP (if possible quantitative benefit)• Current state of and future development• Portfolio• Production
Graphs and process charts can support understanding and comparison!Solution is more important than technological detail!
Product/Service Idea
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Customer’s point of view!! Distinct parameters must be• relevant to the customer• perceivable• preferable• ideally measurable
USP –Competitive advantage
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Customer Benefit Analysis
©„Blue Ocean Strategy“, W. C. Kim, R. Mauborgne, Harvard Business school press
High 10 Graph "Customer Value" Competitors
Valuation of Customer Ben
efit
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5 …………………………………
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Low 0 ……………………………………………………………
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Customer Benefit
eg: Short‐Haul Airline Industry
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pric
e
mea
ls
loun
ges
seat
ing
choi
ce
hub
conn
ectiv
ity
frien
dly
serv
ice
spee
d
frequ
ent d
epar
ture
s
Ange
bot /
Nut
zen
Wettbewerbsfaktoren
Strategy Canvas of Short-Haul Airline Industry
Southwest
other airlines
car
©„Blue Ocean Strategy“, W. C. Kim, R. Mauborgne, Harvard Business school press
Customer Benefit Analysis
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Protection – Overview
Quelle: www.wikipedia.de: http://upload.wikimedia.org/wikipedia/commons/d/d1/Geistiges_Eigentum_und_Wettbewerbsrecht.png
Intellectual Property
anti-trust law
Competition law
Trade secretsUtility model
Copyright
Plant breeders‘ rights
Industrial design
Trademark
IndustrialPropertyRights
Intellectual Property Rights ‐ IPR
IntellectualProperty
Potential protective rights
Invention Patent / Utility modelSupplementary protection certificateTrade secretCopyright (Software)
Know‐How Trade secretGeographical Indications
Creations CopyrightTrademarkIndustrial Design
Brand Marke/TrademarkMusterschutz/Industrial designHerkunftsangabe/Geographical IndicationsUrheberrecht/Copyright
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IP – WHY?
33 -
NH
NN
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S
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OO
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1992: Pfizer-Patent1996: VIAGRA, CM Nr. 000233890
1998: Bayer-Patent2000: LEVITRA, CM Nr. 001481936
NNH
NC
N
S
N
O
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OO
O
IP – WHY?
Manufacturer Pfizer Bayer
Website www.viagra.com www.levitra.com
Approved by FDA March 1998 August 2003
Patent Expires 2012 2018
2008 Revenue $1.934 billion worldwide (+10%)
$503 million worldwide(+2%)
Effectiveness Up to 4 hours Up to 5 hours
Common Side Effects
Headache, facial flushing, upset stomach
Headache, facial flushing, stuffy or runny nose, indigestion, upset stomach, dizziness
Source: http://www.accessrx.com/viagra-cialis-levitra-comparison-chart/
Eli Lilly
www.cialis.com
November 2003
2020
$1.445 billion worldwide (+26%)
Up to 36 hours
Headache, indigestion, back pain, muscle aches, flushing, stuffy or runny nose
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IP – WHY?
J.K. RowlingNet Worth (in $ millions): 1,000…Harry Potter, one of the mostsuccessful book franchises in history. …Rowling enjoys a cut of royalties and merchandising ……with the total gross for the four filmsalready released topping $3.5 billion.
Source: www.Forbes.com: „The Richest 20 Women In Entertainment”
© Sipa Press
IP – WHY?
Biotech‐Deal: Bis zu einer Mrd. Euro für f‐star22.11.2010 | 18:25 | MARTIN KUGLER (Die Presse)
Das Wiener Biotechnologie‐Unternehmen f‐star geht eine große Kooperation mit dem deutschen Pharmakonzern Boehringer Ingelheim ein
Bild: (c) AP
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From the textbook…
• Market• Interaction between supply and demand for
goods/services• Sellers
• You and your competitors• Buyers
• Your potential clients
Market
Who are the Players in the Market?• Customers• Competitors• Suppliers• Legal authorities• Other stakeholders• Potential partners • ...
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This is your market!
CompetitorsClients
Incidence
Prevalence
Sales figures
Turnover figures
Registrations
Substitute productsSocial security reimbursement
SuppliersLicensers
Patent protectionClinical trials
Public opinion
Capital requirements
„force of habit“
Cooperations
Distribution channels
Price development
Definition “Own Market”
• Unmet needs, customer’s benefit
• Who are the customers?
• Which market segment is most interesting?
• Growth
• Trends within market or segments
• Competitors
• Strengths and weaknesses of portfolio
• Competitor’s pipeline
• IPR – freedom to operate?
• Substitutes
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Market Life Cycle
Source: Crossing the Chasm: Marketing and Selling High-Tech Products to Mainstream Customers or simply Crossing the Chasm (1991, revised 1999), by Geoffrey A. Moore
© Erik Johansson
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Crossing the Chasm
Key success factors• understanding the whole product concept• choosing a target market• positioning the product• marketing strategy: appropriate distribution
channel and pricing
Source: Crossing the Chasm: Marketing and Selling High-Tech Products to Mainstream Customers or simply Crossing the Chasm (1991, revised 1999), by Geoffrey A. Moore
Market Research vs. Analysis
• Market researchGathering and collecting of market data• Targeted and systematic• Supports decision‐
making in enterprise planning
• Market analysisProcessing, analysing and interpreting of collected market data
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Business Model
© Irene Fialka, INiTS 45
Business Model
Architecture ofvalue creationValue proposition
What is the processof value creation?
Which steps are involved?
Which steps are done by the company or by who else?
Revenue Model
Which long‐termbenefits aregenerated by the companyfor customers and for stakeholders?
What are theactual sourcesof revenues?
Who paysfor what?
Sustainability!Scaleability!
46images by JAM
customer segments
key partners
cost structure
revenue streams
channels
customer relationships
key activities
key resources
value proposition
Business Model
46© Irene Fialka, INiTS
By A. Osterwalder et al.
http://en.wikipedia.org/wiki/Business_model
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how do you reach your customers?
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spectacular offensive football
stadium
CUSTOMEROFFER
how do you reach your customers? (example)
club owned TV channel fans
mobile phone TV
advertising space & high visibility sales force advertisers
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how do you build relationships? 49
spectacular offensive football
personalized website (ticketing)
CUSTOMEROFFER
team blog (RSS) fans
Fan Shop
how do you build relationships with your customers? (example)
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how do you earn your money with this business model?
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spectacular offensive football
ticket sales
FINANCEOFFER
TV channel subscriber fees fans
mobile phone TV subscriber fees
advertising space & high visibility advertising revenues advertisers
how do you earn your money with this business model? (example)
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53images by JAM
customer segments
key partners
cost structure
revenue streams
channels
customer relationships
key activities
key resources
value proposition
Business Model
53© Irene Fialka, INiTS
By A. Osterwalder et al.
http://en.wikipedia.org/wiki/Business_model
• Who are the founding team members?• Who is the lead entrepreneur?• Strengths and Weaknesses?• What is the motivation for the start‐up?• What are the individual goals?• Sharing and Responsibilities?• Shares?• Individual environment?• Individual exit scenarios?
Team
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• Working force and time• Motivation and drive• Know‐how• Expertise and experience• Creativity• Contacts and network• Representation• Capital• Social skills• …
Team ‐ Input
© Irene Fialka, INiTS 55
• Cash• Shares• Options• Deals• Ideally performance‐based remuneration• Reserve shares for future team members (key positions)
Team ‐ Costs
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How to get going?
Like that?
Like that?
Video: Steve Blank about customer development
Concept Test: Purpose
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© Erik Johansson
“The pessimist sees difficulty in every opportunity.The optimist sees the opportunity in every difficulty”
Winston Churchill (1874‐1965)
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