The Poem Framework
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The document outlines the POEM framework for techpreneurs to create wealth. POEM stands for Proposition, Organization, Economics, and Milestones. The Proposition section describes the value proposition, target market, benefits, and competition. Organization covers the processes, people, technology, and management structure. Economics shows the financial model through statements, forecasts, and assumptions. Milestones establishes goals for different stages like seed funding, growth, and exit. The framework provides an organized way for techpreneurs to communicate their business to investors and solicit funding.
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The Poem Framework
- 1. 1 © 2013 Techpreneuring for Wealth Creation The POEM® Framework by Tomi Davies
- 2. 2 © 2013 1st Some Definitions... • Techpreneur • A warm-blooded animal, male or female, who feeds on no sleep, limited resources and a passion for technology: aka, any person who creates a company around his or her vision of leveraging technology to change the world around them. • Wealth • a great quantity or store of money, valuable possessions, property, or other riches. • the state of being rich; prosperity; affluence. • Vision • a vivid, imaginative conception or anticipation
- 3. 3 © 2013 Next, The Context • People invest in people, not just ideas - Investors buy into other people first then their story. That story when told must contain the information necessary to quickly engage and retain the interest of any potential investor • Because investors (and partners) are interested in learning about the business of the company first and foremost, Techpreneurs need to also focus on how their product or service makes money by solving a problem rather than only on how delivery of the technology solution is achieved. • My POEM ® framework provides Techpreneurs with a model that helps meet this need in a way they can use day to day knowing you need more than a brilliant idea or fantastic innovation to start and sustain a successful technology business – you need a vision!
- 4. 4 © 2013 The POEM ® Framework PROPOSITION ORGANISATION ECONOMICS MILESTONES
- 5. 5 © 2013 P is for PROPOSITION – what’s the value? • The Techpreneurs vision should deliver a value proposition which provides clear descriptions for: • Functions & Features on Offer (Customer experience) • Target Market(s), Segment(s) & Customer Profile(s) • Derived Benefits of the Offer – WIIFM? • Alternatives and Differentiation • Regulation & Compliance • Inputs & Dependencies • Competition & Substitutes • Elevator Pitch….3 minute guide
- 6. 6 © 2013 O is for ORGANISATION – who and how? • PROCESS • BUY • PROCURMENT & LOGISTICS • VENDORS • MAKE • HUMAN CAPITAL • RESEARCH • ANALYSIS & DESIGN • PROGRAMMING & DEVELOPMENT • TESTING • COMMISSIONING/LAUNCH • SELL • MARKETING • SALES • CUSTOMER SUPPORT • CORPORATE AFFAIRS • PEOPLE • BOARD OF DIRECTORS/ADVISORS • EXECUTIVE • TECHNICAL • COMMERCIAL • OPERATIONS • NON-EXECUTIVE • MANAGEMENT • SENIOR • MIDDLE • JUNIOR • STAFF • CAREER PROFILE • EXPERTISE & EXPERIENCE • PERSONAL VISION/ MISSION/ OBJECTIVES • CAPABILITIES & COMPETENCIES • TECHNOLOGY • CLIENT • INTIMATE, PERSONAL, DESKTOP TGY • SERVER • APPLICATION, INFRASTRUCTURE, SECURITY, SERVICES
- 7. 7 © 2013 E is for ECONOMICS – show me the money! P&L STATEMENT PERIOD 1 REVENUE 1,000,000 Less DIRECT COST OF SALES 300,000 GROSS MARGIN 700,000 Less OPERATING EXPENSE 500,000 EBITDA (Profit or Loss) 200,000 CASHFLOW STATEMENT PERIOD 1 INFLOWS - REVENUE 1,000,000 - LOANS & FACILITIES 700,000 - SHAREHOLDERS EQUITY 500,000 OUTFLOWS - EXPENSES 800,000 - INTEREST 70,000 - REPAYMENTS 400,000 NET FLOW 930,000 BALANCE SHEET ASSETS LIABILITIES FIXED ASSETS 1,300,000 PAYABLES 300,000 CASH & BANK 300,000 LOANS 700,000 RECEIVABLES 700,000 EQUITY TOTAL ASSETS 2,300,000 PAID UP CAPITAL 1,000,000 RETAINED EARNINGS 300,000 TOTAL LIABILITIES & EQUITY 2,300,000 MARKET(S) • $ SIZE? • % SHARE? • % INFLATION? • DEMAND • TRENDS ROI - NPV - IRR FORECAST ASSUMPTIONS ACTUAL PERFORMANCE
- 8. 8 © 2013 M is for MILESTONES – where are you going? • SEED • CONCEPT DEFINITION • BUSINESS MODEL • FRIENDS, FAMILY & FOOLS FUNDING • START-UP • BANKABLE BUSINESS PLAN • ESTABLISHED CUSTOMER BASE • FULL-TIME OPERATIONAL STRUCTURE • STEADY CASH BURN RATE • ANGEL/VC FUNDING • GROWTH • REVENUE GROWTH • INCREASED MARKET SHARE • PE FUNDING • ESTABLISHED • PRODUCTIVITY • NEW PRODUCTS/SERVICES • COST MANAGEMENT • EXIT • AGREED VALUATION … and when will you get there?
- 9. 9 © 2013 CONCLUSION • The POEM ® framework provides Techpreneurs with a model that meets the need for organising the business of their company in a form which they can use on a day to day basis. • Each Techpreneur will need to determine the level of detail they require for each peculiar situation they find themselves in be it operational, marketing, selling, soliciting for funding or recruiting resources, POEM ® provides guidance for execution while ensuring that all critical information are given consideration • Because investors don’t only come to organised pitch events and you may run into them anywhere, a simple mental model such as POEM ® that can be backed up with as much documentation as required gives you an edge in todays world where a growing number of entrepreneurs compete for a shrinking pool of capital.