Business Planning in Real Life, Part 1

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In the context of "Innovation and Entrepreneurship" course of Health and Exercise MSc of University of Thessaly we gave the following lecture on business planning (http://www.pe-uth.gr/msc/). We adopted a case study approach elaborating on a project that resonates with the background of the majority of the students in the class, originating from medical, coaching and nutritionist backgrounds.

In particular we describe a fitness and biorhythms monitoring portal where end users upload their trainings and life-casting behaviors, socializing and getting advices from experts on fitness straining, diets, supplements and apparel!

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  • Business Planning in Real Life, Part 1

    1. Business Planning in Real Life part 1 Case Study : OnLine Exercise Portal Kostas Chrysagis, Yiannis Doxaras
    2. There is real magic in enthusiasm. It spells the difference between mediocrity and accomplishment.” Norman Vincent Peale
    3. Greek VC’s, same as Greek Statistics Early stage investment is purely risk management. High risk capitals. Greek Projects have low upside since they target Greek market and do not have prominent exit strategies. NOTE: aim globally! Greek VC’s seek for lower risk and large scale investments to fix their success ratios!
    4. When to Search for VC Estimated profit >300 K or 10 M $ for the company Good client database. 100k users or 1 key Account (eg. Vodafone GR, Nike etc.) At least one key advantage or one key differentiation to existing solutions. My question is always “Does it save some time ?”. Ask yourself similar questions. NOTE: Do not search for VC when you are competent enough to develop your beta by your own, or the initial budget does not succeed 30-40K
    5. Common Pitfalls in Early Stages Execution Great Idea Plan Product End User Mentality Mentality One Turn A weighted Key Person team
    6. Celebrated Talk: The most worthy 14:42 minutes of your business life. TED::http://www.ted.com/talks/lang/eng/david_s_rose_on_pitching_to_vcs.html
    7. How to come up with the Idea What you do well in life ? How to make money What I sell ? To whom ? Why would anyone care to buy ? Innovation *do not reinvent the wheel, just make a better working one People *Work with the best and make build the circumstances and the environment to attract the best. Commitment * stick to your idea until the end
    8. After a lot of consideration and thought we have come up with an idea that exploits the medical and athletic knowledge background of various members of our team.
    9. After a lot of consideration and thought we have come up with an idea that exploits the medical and athletic knowledge background of various members of our team. The Idea ? A social network for diet and training based on users exercise profiles measured with wearable sensors.
    10. Some Figures to Get Started Athletic Apparel and Shoes Industry is over 15B $ per year. All Athletic Companies are open to alternative marketing. (eg. Nike, Adidas, Puma have launched social media, augmented reality and mobile app campaigns) Large user bases attract more information. Good and marketable product since it appeals to modern lifestyles and beauty/fitness Supplement industry is over 2.5B $ annually. (currently not mainstream, but they try to be)
    11. Encouraging Investors Create a good impression Create a sense of urgency to generate momentum Frame ideas to make them more appealing Prepare a good business plan
    12. Business Plan A Living Document A business plan changes often as a new business develops. Do just enough business planning to get the new company started. Refine the plan with information gathered from running the new venture.
    13. Business Plan A Living Document keep in mind that even without funding your own startup will definitely need a business plan A business plan changes often as a new business develops. Do just enough business planning to get the new company started. Refine the plan with information gathered from running the new venture.
    14. Model of Successful Business Planning Closed Circle Prepare a Continue to Start the Refine the relatively grow the business business plan simple plan business
    15. Key Aspects Attractiveness Potential Capabilities of Potential of product market, founding team returns or service competitors Decisions about providing funds
    16. Components What is the basic idea? Why is the new product appealing—and to whom? How will the idea be realized? Who are the entrepreneurs? How will the venture be structured & operate? How much funding is needed? What type of financing? How will it be used? How will you realize a return?
    17. Successful Business Plan Orderly Cover page | Table of contents | Executive summary | Various sections | Appendices | Succinct In proper form Persuasive Be prepared to answer all devils advocate questions
    18. Executive Summary An impassioned statement about the wonderful things going on in the industry involved Provides a brief, clear, and persuasive overview of the new venture Target 2 to 3 pages
    19. fit2life portal case Sensor technology latest developments Mobile phones and programmable platforms Existing devices for exercise tracking Data mining algorithms for trend analysis Collaborative knowledge algorithms Supplement industry developments Apparel and sports wear Beauty figures and contemporary healthy way of life
    20. Business Plan Section Background, purpose, and opportunity Marketing Competition Development, production, and location Management Financial section Risk factors Harvest or exit Scheduling and milestones Appendices
    21. Background, Product, & Opportunity What is the nature of the idea driving your company and how did it arise? What does the product/service have to offer? What is the basic nature of the company? What are the company’s mission & goals?
    22. fit2life portal case Group of medical and fitness post graduate students. Online exercise monitoring and consulting portal Networking between members Customized and self regulating diet programs Training and goal setting/monitoring Mission: Provide better quality of life to end users
    23. Market Analysis What have you done to identify the market? How large is the market? How will products or services be promoted? What do you know about competing products and companies? How will the product or service be priced?
    24. fit2life portal case Facebook application approach 350 M users 40M 15-35 upper class, income over 60K $ /year 20% of them regular exercise regular (>3 per week) 40% of them regular exercise rarely (1-2 per week) 20% of them seeks motivation to start
    25. Market Research 2.0 Google Trends Google Alerts Google Searches per month Alexa page traffic (always look the first 5 top sites of the industry) [good way to mark saturated markets if number of searches== number of unique visits] See supplement industry sales forecasts See clothes and apparel industry sales forecasts common and private reports and memos
    26. Development, Production, and Location Where are the products or services in the development process? What are the projected costs and timetable for making the product or delivering the service? What steps have been taken to assure quality and safety?
    27. fit2life portal case 1 Home office Sensor fabrications and development in China (CE) Quality Control Plan Training and exercise database. Diet database. Algorithms for trend analysis Web portal, facebook application, iphone application
    28. fit2life portal case 2 Nike+iPod WIN Human Recorder wii biorythms fitbit
    29. Management Team Do team members have the experience, expertise, skills, and personal characteristics needed? Do team members having good working relationships, defined roles, and clear communication?
    30. fit2life portal case Medical background Statistics Electronics and embedding programming Management Sales people Fitness trainers
    31. Financial Plans and Projections NOTE: will be closely & carefully examined by potential investors Pro-formal balance sheet Pro-formal income statement Cash flow statement Break-even analysis
    32. Break even analysis with non linear sales model Multiproduct break even analysis with Linear and non-linear models. Mathematica files will be uploaded on the elearning space.
    33. Critical Risks Price cutting by competitors Unforeseen industry trends Sales projections not achieved Costs exceed estimates Schedules not met Lack of experience Difficulties raising required financing Unforeseen political, economic, social or technological trends
    34. Harvest and Exit Exit Strategies Managing Strategies
    35. Harvest and Exit Exit Strategies Managing Strategies For instance a startup that exploits google sketch up and google 3D buildings by developing a product that generates 3D vector objects with texture from plain images can have an exit plan a google buy out.
    36. fit2life portal case Buy out from Garmin Buy out from Poral Buy out from Nike and their social networking site Buy out from a large Gym chain
    37. Scheduling and Milestones Formal incorporation Completion of design Completion of prototypes Hiring of initial personnel Product displays Agreements Moving into production Receipt of orders First sales Profitability
    38. Marketing Google Ads. FB Campaign Affiliate Marketing Viral Videos [iphone app Boston Marathon] Guest Posts to Conventional Media
    39. Revenue Streams Membership Model Gold Membership [privileges] Social Networking, Matching Companions Supplements Affiliate Marketing Gym Advertising Apparel Advertising
    40. Competition Fitbit [simple data collection smart] Garmin connect. Polar. iPhone Runner App. iPhone Android Running Companion Apps. [GPS, Speed Data, future Accelometer] Nike iPhone app. Nike myTown Social Media Portal
    41. Differentiation Extra Data Collection [temp, humidity, acceleration, inclination, Rest, Absence of exercise] Integration with existing devices (polar, garmin, build on top of the competition) Data mining and collaborative knowledge algorithms for diet, supplement and exercise suggestions. Integration with existing training services Trainees pairing. similar exercise profiles run together at the central park people that like to play basketball for instance can form online teams and schedule plays.
    42. Competition http://techon.nikkeibp.co.jp/english/NEWS_EN/ 20100119/179393/ http://www.fitbit.com/product
    43. Useful Addresses Παρατηρητήριο για την Κοινωνία της πληροφορίας. http://www.observe.gr/page/ default.asp?la=1&id=103, http://www.observe.gr/page/default.asp?la=1&id=183 Πρότυπα επιχειρηματικά σχέδια από το πρόγραμμα Δικτυωθείτε για ηλεκτρονικό εμπόριο σε πολλαπλές θεματικές περιοχές. http://www.go-online.gr/ebusiness/ebps.html ΕΣΠΑ δράσεις και προκυρήξεις. http://www.espa.gr Εθνική Στατιστική Υπηρεσία http://www.statistics.gr/portal/page/portal/ESYE/PAGE-database  Οικονομικά και Χρηματοπιστωτικά Δεδομένα από το Υπ. Οικονομικών http:// www3.mnec.gr/sdds/users_gr.asp Παρουσίαση της Ελληνικής Οικονομίας από το Υπουργείο Οικονομικών http:// www.mnec.gr/el/economics/Greek_economy_at_a_glance/ Δημοσιεύσεις προσχεδίων, νόμων εργασιών της βουλής   http://www.parliament.gr/ ergasies/nomosxedia.asp
    44. Planning and thinking is human, acting and creating is divine!
    45. references some thoughts on VC status in Greece are borrowed from Aristos Doxiadis opencoffee talk http://opencoffee.gr/ 2009/01/12/oc-ath-xviii-doxiadis/ the approach on how to come up with the idea was borrowed from Fanis Rigas opencoffee presentation http://opencoffee.gr/2009/01/21/oc-ath-xviii-kariera/

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