Executive Summary Workshop - Ideas, Innovation & Purpose

Dr	
  Bernard	
  Leong
Partner,	
  Thymos	
  Capital	
  &	
  Co-...
Outline
• Why:	
  Idea	
  against	
  Problem?
• What:	
  Developing	
  from	
  Prototype	
  to	
  Product?
• How:	
  Writi...
Team    Cash




Idea   Cashflow




               3

                   3
In	
  everyday	
  life,	
  we	
  are	
  trying	
  to	
  solve	
  problems.



                                            ...
Then	
  an	
  Idea	
  sparked	
  in	
  your	
  head	
  and	
  ....

                                                      ...
You	
  gather	
  the	
  People,	
  Resources	
  and	
  Partnership	
  to	
  Make	
  It	
  Happen

                        ...
What	
  is	
  the	
  problem	
  
        Once	
  you	
  work	
  that	
  out,	
                                            ...
8

    8
Idea	
  without	
  ExecuSon	
  is	
  useless,	
  ExecuSon	
  without	
  Idea	
  is	
  dangerous.

                        ...
ExecuSon	
  depends	
  on	
  a	
  A-­‐Team

                                             10

                             ...
“A	
  players	
  hire	
  A	
  players;	
  
                                                B	
  players	
  hire	
  C	
  pl...
You	
  will	
  definitely	
  not	
  make	
  it	
  if
                           you	
  submit...
• Ideas	
  that	
  can	
  ...
The	
  Big	
  Picture




                        13

                             13
Why	
  write	
  an	
  ExecuIve	
  Summary?
• Organizes	
  and	
  clears	
  the	
  confusion	
  
  and	
  ambiguity	
  of	
...
Criteria	
  for	
  ExecuIve	
  Summary
• Organized	
  and	
  Understandable.
• Use	
  plain	
  language	
  and	
  vocabula...
Language
Avoid	
  Phrases	
  like	
  ...                                                Use	
  Phrases	
  like	
  ...




...
Layout	
  of	
  ExecuIve	
  Summary
• IntroducIon	
  -­‐	
  Type	
  of	
  Business
• Problem	
  &	
  Opportunity
• Technol...
The	
  Mantra
• Name	
  of	
  your	
  Company/Project/Idea.
• Logo	
  and	
  Tagline.
• Mission	
  Statement




         ...
Type	
  of	
  Business
• What	
  is	
  the	
  Industry?
• Product	
  or	
  Service	
  
  based?
• How	
  Product	
  or	
  ...
When	
  is	
  an	
  idea	
  an	
  opportunity?
• Create	
  or	
  add	
  value	
  to	
  
  customer.
• Solve	
  a	
  signifi...
RelaIonship	
  -­‐	
  Markets	
  &	
  Tech




                                             21

                          ...
Industry                            Sample	
  Introduc:on



                                      MaterialSod	
  aims	
  ...
Problem	
  &	
  Opportunity
• You	
  are	
  selling	
  the	
  
  soluIon	
  to	
  a	
  problem.
• What	
  is	
  the	
  “bl...
Opportunity                  Example	
  Descrip:on

                      Recently,	
  the	
  Singapore	
  government	
  h...
Technology	
  or	
  Idea
• You	
  must	
  make	
  your	
  
  technology	
  or	
  idea	
  
  understandable	
  to	
  your	
...
Technology                    Example	
  Descrip:on


                   MaterialSod	
  uses	
  an	
  improved	
  composit...
Team
• Diversified	
  and	
  
  Complementary	
  Skill	
  Sets.
• Get	
  Grey	
  Hairs	
  and	
  put	
  
  them	
  in	
  yo...
People                    Example	
  Descrip:on


                  John	
  Ho	
  is	
  the	
  CEO	
  of	
  MaterialSod.	
...
Route	
  to	
  Market	
  &	
  Business	
  Strategies
• How	
  do	
  you	
  sell	
  your	
  service	
  or	
  
  product?
• ...
30

     30
Route	
  to	
  Market/
                                    Example	
  Descrip:on
 Business	
  Strategy

                  ...
How	
  to	
  EsImate	
  Market	
  Size
• Start	
  with	
  simple,	
  reasonable	
  
  and	
  valid	
  assumpIons.
• Approx...
PracIce	
  Problems
• How	
  many	
  Internet	
  users	
  are	
  there	
  in	
  Singapore?	
  
  (Hint:	
  Start	
  with	
...
34

     34
Gartner’s	
  Hype	
  Cycle




                             35

                                  35
4	
  Ps	
  of	
  MarkeIng




                            36

                                 36
Risks	
  &	
  Barriers	
  to	
  Entry
• Who	
  are	
  your	
  compeItors?
• How	
  do	
  you	
  prevent	
  your	
  
  comp...
Barriers	
  to	
  Entry/
                                              Example	
  Descrip:on
      Compe:tors

           ...
SWOT	
  Analysis




                   39

                        39
40

     40
Financials
• How	
  much	
  do	
  you	
  need?
• How	
  much	
  equity	
  you	
  
  want	
  to	
  give?
• How	
  do	
  you...
Financials                Example	
  Descrip:on


                MaterialSod	
  seeks	
  US$300K	
  as	
  an	
  iniSal	
 ...
43

     43
Who	
  do	
  you	
  raise	
  funds	
  from?
• Friends,	
  Family	
  and	
  Fools.
• Business	
  Angels.
• Venture	
  Capit...
45

     45
46

     46
Source:	
  www.mengwong.com/capital

                                      47

                                           ...
Exit	
  Strategy
• What	
  happens	
  to	
  the	
  
  company	
  in	
  3	
  to	
  5	
  years	
  Ime?
• 	
  Possible	
  Exi...
Exit	
  Strategy                 Example	
  Descrip:on



                       MaterialSod	
  hopes	
  to	
  exit	
  in	...
Appendices




             50

                  50
Top	
  10	
  Lies	
  by	
  Entrepreneurs
1. Our projection is conservative.

2. (Pick your favourite market research compa...
Top	
  9	
  Lies	
  by	
  Investors
1. I liked your company but my partners don’t.

2. If we get a lead, we will follow.

...
References
• StarIng	
  Up,	
  New	
  Venture,	
  McKinsey	
  &	
  Co.
• The	
  Art	
  of	
  the	
  Start	
  by	
  Guy	
  ...
Resources:	
  Intellectual	
  Property




              h=p://www.ipos.gov.sg




                                       ...
Resources:	
  Business	
  Info




        h=p://www.business.gov.sg

                                    55

            ...
Resources:	
  InnovaIon	
  &	
  Tech




                                  h=p://www.exploit-­‐tech.com
                  ...
Resources:	
  Business	
  RegistraIon




             h=p://www.acra.gov.sg      57

                                    ...
Resources:	
  CommuniIes




      h=p://www.sgentrepreneurs.com   58

                                           58
Resources:	
  Other	
  CommuniIes




  h=p://www.e27.sg


                     h=p://www.youngupstarts.com


            ...
“Study	
  the	
  past	
  if	
  you	
  would	
  define	
  the	
  future.”	
  -­‐	
  Confucius

Contact:	
  bleongcw	
  (GMai...
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Executive Summary Workshop Ideas Inc

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This is based on the Executive Summary Workshop I have been conducting in the past two months for NTU Ideas Inc. It also focus on the following topics: (1) Identification of Idea and Opportunity, (2) How to write an executive summary and (3) Resources required for setup in Singapore.

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  • Executive Summary Workshop Ideas Inc

    1. 1. Executive Summary Workshop - Ideas, Innovation & Purpose Dr  Bernard  Leong Partner,  Thymos  Capital  &  Co-­‐Founder,  SGEntrepreneurs.com h=p://www.bernardleong.com 1
    2. 2. Outline • Why:  Idea  against  Problem? • What:  Developing  from  Prototype  to  Product? • How:  Writing  an  Executive  Summary? • Q&A 2
    3. 3. Team Cash Idea Cashflow 3 3
    4. 4. In  everyday  life,  we  are  trying  to  solve  problems. 4
    5. 5. Then  an  Idea  sparked  in  your  head  and  .... 5 5
    6. 6. You  gather  the  People,  Resources  and  Partnership  to  Make  It  Happen 6 6
    7. 7. What  is  the  problem   Once  you  work  that  out,   you  are  trying  to  solve? ExecuSon  is  key. What  type  of  resources do  you  need  to  solve   Are  there  customers  or   your  problem?   there  is  an  exisSng   Mentors,  Partnerships  or market  for  your   Resources? soluSon? Who  are  the  exisSng   players  from  partners  to   compeSSors?  How  are   they  benchmarked   against  your  idea? 7 7
    8. 8. 8 8
    9. 9. Idea  without  ExecuSon  is  useless,  ExecuSon  without  Idea  is  dangerous. 9 9
    10. 10. ExecuSon  depends  on  a  A-­‐Team 10 10
    11. 11. “A  players  hire  A  players;   B  players  hire  C  players;   and  C  players  hire  D   players.” Steve  Jobs,  Apple  Inc “I  am  a  winner  because  I’m   good  at  what  I  do  and   because  I  am  surrounded   by  people  who  think  they   are.” Jose  Mourinho,  Coach,  Inter  Milan  FC 11 11
    12. 12. You  will  definitely  not  make  it  if you  submit... • Ideas  that  can  be  easily  replicated. • Ideas  that  has  no  business  or  tech  innovaIon. • Ideas  that  are  not  scalable. 12 12
    13. 13. The  Big  Picture 13 13
    14. 14. Why  write  an  ExecuIve  Summary? • Organizes  and  clears  the  confusion   and  ambiguity  of  your  business   idea. • Correct  posiIoning  to  convince   potenIal  investors. • PotenIal  investors,  partners  and   clients  have  no  Ime  for  your   grandmother  stories  about  the  idea.   14 14
    15. 15. Criteria  for  ExecuIve  Summary • Organized  and  Understandable. • Use  plain  language  and  vocabulary. • Present  the  Problem  and  SoluIon   on  the  same  page. • The  Purple  Cow  effect:  making   your  summary  disIncIvely   different  even  if  it  confines  to  basic   rules. 15 15
    16. 16. Language Avoid  Phrases  like  ... Use  Phrases  like  ... “We  would  like  to  be  the  leading  provider  of  ...” “We  aim  to  become  the  leading  provider  of  ...” “We  want  to  be  the  best  in  ...” “Our  company’s  core  competency  is  ...” “Based  on  our  financial  projecSons,  we  esSmate   “We  will  make  $X  by  the  end  of  the  year.” our  sales  revenue  to  be  $X  and  profit  margins  to   be  $Y.” 16 16
    17. 17. Layout  of  ExecuIve  Summary • IntroducIon  -­‐  Type  of  Business • Problem  &  Opportunity • Technology/Service/Product • Management  Team • Business  Strategy  &  Route  to  Market • Financials • Exit  Strategy 17 17
    18. 18. The  Mantra • Name  of  your  Company/Project/Idea. • Logo  and  Tagline. • Mission  Statement 18 18
    19. 19. Type  of  Business • What  is  the  Industry? • Product  or  Service   based? • How  Product  or   Service  delivers? • Who  are  the   customers  to  your   business?  B2B,  B2C? 19 19
    20. 20. When  is  an  idea  an  opportunity? • Create  or  add  value  to   customer. • Solve  a  significant  problem,   removing  a  pain  point  or   meeIng  demand. • Have  robust  market,  profit   margin  and  money  markeIng. • Good  fit  with  founder  &   management  team  at  the   right  Ime  &  place 20 20
    21. 21. RelaIonship  -­‐  Markets  &  Tech 21 21
    22. 22. Industry Sample  Introduc:on MaterialSod  aims  to  be  the  provider  in   creaSng  proprietary  fabrics  that  can  withstand   Materials  Engineering  Product harsh  condiSons.  We  sell  our  fabrics  to  the   users  in  the  defence  and  coal/mining  industry. RealTime  is  a  Singapore  based  company  that   focuses  on  delivering  an  innovaSve  real  Sme   IT  based  Product adverSsing  soluSon  to  brands.  Our  chief   consumers  are  brand  marketers  and  digital   markeSng  agencies.   22 22
    23. 23. Problem  &  Opportunity • You  are  selling  the   soluIon  to  a  problem. • What  is  the  “blue  ocean”   you  are  exploiIng? • Is  there  any  interest  in   your  business  lately? • Lies,  Damn  Lies  &   StaIsIcs 23 23
    24. 24. Opportunity Example  Descrip:on Recently,  the  Singapore  government  has   allocated  S$13.5B  into  high  technology   research  and  development  and  placed  their   efforts  in  three  industries:  biomedical  sciences,   Facts/StaIsIcs/News renewable  energies  and  digital  media.  The   soluSon  we  proposed  is  in  the  life  sciences   market,  where  we  can  reduce  drug   development  process  by  a  half  with  our   technology. Based  on  the  assumpSon  that  Singtel  has  sold   a  100K  iPhones,  we  esSmate  each  smart    EsImate phone  will  purchase  about  5-­‐10  applicaSons   and  spent  on  average  S$10  on  them  each   month.   24 24
    25. 25. Technology  or  Idea • You  must  make  your   technology  or  idea   understandable  to  your   audience. • For  an  execuIve  summary,   never  put  too  much  jargon   into  your  descripIon. • Make  comparisons  on  how   your  soluIon  can  increase   producIvity  and  efficiency. 25 25
    26. 26. Technology Example  Descrip:on MaterialSod  uses  an  improved  composite   ceramic  material  to  build  fibres  which  can   efficiently  hold  vehicles  on  muddy  grounds.   Materials Our  soluSon  supercedes  the  present  ones  with   half  the  cost  but  twice  the  material  strength  to   hold  vehicles  above  muddy  grounds. Our  soluSon  uses  a  proprietary  based   algorithm  developed  to  resolve  blurred  objects   Digital  Media of  movies  in  a  format  1000  Smes  be=er  than   the  formats  which  are  adopted  by  the  industry.   26 26
    27. 27. Team • Diversified  and   Complementary  Skill  Sets. • Get  Grey  Hairs  and  put   them  in  your  advisory   board.   • Don’t  give  too  much  Itles   to  your  team.   • Be  mature  about  your   experience. 27 27
    28. 28. People Example  Descrip:on John  Ho  is  the  CEO  of  MaterialSod.  Prior  to   joining  this  company,  he  was  the  Vice   President,  Sales  in  Nippon  Fabrics,  a  MNC   Experienced specializing  in  fabrics.  His  experience  with  the   market  will  help  to  generate  sales  lead  for  the   company.   Larry  Pang  is  the  founder  of  Project  AceFire.   Currently  a  second  year  undergraduate,  he  has   spent  a  year  working  in  Prof  Johnston’s   Young  Rookie mulSmedia  laboratory.  He  will  act  as  the  CTO   of  AceFire  and  will  seek  to  find  a  CEO  who  can   mentor  and  guide  the  team.   28 28
    29. 29. Route  to  Market  &  Business  Strategies • How  do  you  sell  your  service  or   product? • 80-­‐20  rule  on  market   segmentaIon? • What  are  the  markeIng  channels   on  your  product? • What  business  strategies  do  you   use  to  generate  revenues? 29 29
    30. 30. 30 30
    31. 31. Route  to  Market/ Example  Descrip:on Business  Strategy MaterialSod  engages  directly  with  known   industry  partners  in  the  fabric  industry.  The   company  does  not  deal  directly  with  customer   base  but  sells  via  resellers  or  fabric   Partnerships/Licencing distributors.  One  alternaSve  strategy  to   generate  revenues  is  done  via  licensing  of  the   proprietary  technology  to  other  fabric   producing  companies. RealSme  offers  the  customers  a  free  beta   version  of  the  sodware  with  limited  features   so  that  they  can  enSce  them  to  buy  the   Freemium  Model premium  version  (with  addiSonal  features)  of   the  sodware.  The  company  is  currently  in   negoSaSons  on  strategic  relaSons  with   different  gaming  companies. 31 31
    32. 32. How  to  EsImate  Market  Size • Start  with  simple,  reasonable   and  valid  assumpIons. • Approximate  to  the  closest   figure  (10K,  1M)? • PracIce  makes  perfect  by   making  esImates  to   problems. 32 32
    33. 33. PracIce  Problems • How  many  Internet  users  are  there  in  Singapore?   (Hint:  Start  with  the  populaIon  and  number  of   households) • How  many  mobile  handsets  each  person  will  hold  on   average?  (Hint:  make  a  guess  from  how  many  people   losing  phones?) • How  many  students  are  playing  World  of  WarCrae?   (Hint:  Demographics) 33 33
    34. 34. 34 34
    35. 35. Gartner’s  Hype  Cycle 35 35
    36. 36. 4  Ps  of  MarkeIng 36 36
    37. 37. Risks  &  Barriers  to  Entry • Who  are  your  compeItors? • How  do  you  prevent  your   compeItors  trumping  you? • What  are  the  problems  you   face  against  them? • Don’t  assume  that  you  are   the  only  one  or  have   indefensible  patents. 37 37
    38. 38. Barriers  to  Entry/ Example  Descrip:on Compe:tors MaterialSod  faces  the  risk  of  a  saturated  and   tradiSonal  ceramics  industry  mindset  not  to   adopt  new  technologies.  To  miSgate  the  risk,   TradiIonal  Industry  Mindset the  company  will  launch  markeSng  campaigns   and  present  the  product  in  various   conferences  to  provide  industry  players  an   awareness  of  the  product. The  compression  format  of  RealTime  sodware   cannot  be  replicated  based  on  the  proprietary   Unique  Selling  Point algorithm  used  in  performing  the  compression.   We  are  in  the  process  of  patenSng  the  product   to  act  as  a  deterrence  against  our  compeStors. 38 38
    39. 39. SWOT  Analysis 39 39
    40. 40. 40 40
    41. 41. Financials • How  much  do  you  need? • How  much  equity  you   want  to  give? • How  do  you  raise  that   amount  of  money? • Can  you  bootstrap  without   raising  funds? 41 41
    42. 42. Financials Example  Descrip:on MaterialSod  seeks  US$300K  as  an  iniSal   investment  to  build  a  proof  of  concept  and  will   raise  US$2M  to  bring  the  prototype  to  market.   Fundraising The  company  generates  revenues  via  sales  in   producing  fabric  for  the  defence  and  coal/ mining  industries.   RealSme  generates  revenues  via  the  number   of  purchases  made  on  the  premium  version   and  online  adverSsing  with  the  huge  traffic   Bootstrapping generated  by  visits  from  the  site.  The  company   seeks  to  bootstrap  via  hiong  1M  sales  target   within  two  years.   42 42
    43. 43. 43 43
    44. 44. Who  do  you  raise  funds  from? • Friends,  Family  and  Fools. • Business  Angels. • Venture  Capitalists. • Government  InsItuIons. • FoundaIons  and  Agencies. • Private  Equity  Firms • Banks 44 44
    45. 45. 45 45
    46. 46. 46 46
    47. 47. Source:  www.mengwong.com/capital 47 47
    48. 48. Exit  Strategy • What  happens  to  the   company  in  3  to  5  years  Ime? •  Possible  Exits: –IniIal  Public  Offerings  (IPO) –Trade  sale/Merger/Management   Buyout –Family/Company  Succession –Wind  it  Down! 48 48
    49. 49. Exit  Strategy Example  Descrip:on MaterialSod  hopes  to  exit  in  3  years  with  a   profit  margin  of  20M  via  a  trade  sale  to  a   Trade  Sale/Buyout larger  player  within  the  industry,  for  example,   Cepheus  Ceramics.   RealTime  seeks  to  IPO  in  3  years  as  an  exit   IPO strategy.   49 49
    50. 50. Appendices 50 50
    51. 51. Top  10  Lies  by  Entrepreneurs 1. Our projection is conservative. 2. (Pick your favourite market research company) predicts our market to be US$50B. 3. (A big MNC) is signing our contract next week. 4. Key employees will join us as soon as we get funded. 5. Several investors are already doing due diligence on us. 6. This big company is too old, big, stupid and slow to be a threat. 7. Patents makes our business defensible. 8. All we have to do is to get 1% of the market. 9. We have 1st mover advantage. 10. We have a world-class proven team. 51 51
    52. 52. Top  9  Lies  by  Investors 1. I liked your company but my partners don’t. 2. If we get a lead, we will follow. 3. Show us some traction and we will invest. 4. We love to co-invest with other venture capitalists. 5. We are investing in your team. 6. I have lots of bandwidth dedicated to your company. 7. This is a vanilla term sheet. 8. We open doors for you at our client companies. 9. We like early stage investing. 52 52
    53. 53. References • StarIng  Up,  New  Venture,  McKinsey  &  Co. • The  Art  of  the  Start  by  Guy  Kawasaki • Singapore  Entrepreneurs  blog  (Dummy’s  Guide)           hmp://www.sgentrepreneurs.com • Gladstone,  Venture  Capital  InvesIng • CompeIIve  Strategy,  Michael  Porter • Crossing  the  Chasm,  Moore • ACRA  -­‐  hmp://www.acra.gov.sg 53 53
    54. 54. Resources:  Intellectual  Property h=p://www.ipos.gov.sg 54 54
    55. 55. Resources:  Business  Info h=p://www.business.gov.sg 55 55
    56. 56. Resources:  InnovaIon  &  Tech h=p://www.exploit-­‐tech.com 56 Go  to  this  page  only  if  you  are  looking  for  a  technology  to  commercialize 56
    57. 57. Resources:  Business  RegistraIon h=p://www.acra.gov.sg 57 57
    58. 58. Resources:  CommuniIes h=p://www.sgentrepreneurs.com 58 58
    59. 59. Resources:  Other  CommuniIes h=p://www.e27.sg h=p://www.youngupstarts.com 59 59
    60. 60. “Study  the  past  if  you  would  define  the  future.”  -­‐  Confucius Contact:  bleongcw  (GMail) 60 60
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