Team 554
Middle/high school students studying microscope incorporated STEM courses.
An add-on lens that turns a smartphone into a microscope.
Incorporated into existing microscope curriculum and existing science kits to increase student engagement 110 interviews (106 F2F, 4 Skype) time by 100%. PI Wei-Chuan Shih
Expertise in nanobiophotonics Associate Professor Electrical and Computer Engineering University of Houston
EL Yulung Sung
Expertise in microfluidic chips PhD student Electrical and Computer Engineering University of Houston
IM Ken Jones
Expertise in starting companies Director Wolff Center for Entrepreneurship University of Houston
6mm Mosquito x60
Everybody wants one I will change the world B2C, reach out through Strategic alliance with Lens manufacture Need for high-quality, Ensure customer traditional marketing school districts to provide R&D low-cost, portable, satisfaction, timely methods microscope lenses for Marketing and sales microscope setup for response of questions, Students, teachers, students/teachers to efforts observation, analysis, set up an online researchers, field facilitate in STEM Understanding and data sharing. education moderated community laboratories. Doctors, feedback Strategic alliances with of users. nurses, engineers. elderly care facilities to Combine a microscope lens with a smartphone. provide magnifiers for B2B, reach out through elderly directed meeting Features: Medical facilities Joint-ventures with High-quality, low-cost, Employees (R&D, Jewelry shops traditional microscopes portable, convenient, Marketing, Sales) Traditional retail, direct IC fabrication checking and optical component Production hardware easy-to-use. sellers and resellers. sale, online, B2B companies Manufacturing control Joint-ventures with accessories providers system
Value driven, economy of scale Direct sales, subscription sales, resellers, and distributors Costs: Employees, production and packaging hardware/software, marketing and sales (conferences, booths, print ads) IC manufacturers Jewelers Stamp & Coin Collectors Ophthalmologists Hobbyist Oncologists Researchers Undergraduates Dermatologists Wildlife biologists Nurses High school students Dentists Laboratories Middle school students
Kids IC manufacturers Jewelers Stamp & Coin Collectors Ophthalmologists Hobbyist Oncologists Researchers Undergraduates Dermatologists Wildlife biologists Nurses High school students Dentists Laboratories VAGUE Middle school students Kids IC manufacturers Jewelers Stamp & Coin Collectors Ophthalmologists Hobbyist Oncologists Researchers Undergraduates Dermatologists Wildlife biologists Nurses High school students Dentists Laboratories Middle school students
Kids Quit selling!
We will sell to students via the teachers.
Everyone loved it!
TEACHERS
Hypothesis We have something everyone wants! WEEK 1 Quit selling!
We will sell to students via the teachers.
Everyone loved it!
TEACHERS
STUDENTS Hypothesis We have something everyone wants! WEEK 1 Concerned with the price/features
TEACHERSm
Forensics Biology Env Sci Hypothesis Phys/Chem Less expensive STUDENTS Better quality Fewer training hours required WEEK 1 Concerned with the price/features “At this price, everyone can have their own microscope”
Gregory Holley Head of Biology Pioneer High School
TEACHERSm
Forensics Biology Env Sci Hypothesis Phys/Chem Less expensive STUDENTS Better quality Fewer training hours required WEEK 1 Concerned with the price/features “At this price, everyone can have their own microscope”
Gregory Holley Head of Biology Pioneer High School
TEACHERSm
Allison Chang Forensics Year 12, AP biology student Biology Clements High School Env Sci Hypothesis Phys/Chem “More fun than a STUDENTS Less expensive traditional Better quality microscope” Fewer training hours required WEEK 1 Concerned with the price/features “At this price, everyone can have their own microscope” “High quality and easy to use” Gregory Holley Head of Biology Pioneer High School “If only it came with a light”
Donald Winsor Head of Biology Dulles High School TEACHERSm
Allison Chang Forensics Year 12, AP biology student Biology Clements High School Env Sci Hypothesis Phys/Chem “More fun than a STUDENTS Less expensive traditional Better quality microscope” Fewer training hours required WEEK 1 Concerned with the price/features “At this price, everyone can have their own microscope” “High quality and easy to use” Gregory Holley Head of Biology Pioneer High School “If only it came with a light”
Donald Winsor Head of Biology Getting “YES” all the Dulles High School time led us to a dead TEACHERSm end.
Only gave us a set of Allison Chang Forensics Year 12, AP biology student “desired features” Biology Clements High School Env Sci Hypothesis Phys/Chem “More fun than a STUDENTS Less expensive traditional Better quality microscope” Fewer training hours required WEEK 1 Who will pay for it?
TEACHERS
STUDENTS Hypothesis Teachers will drive the purchase WEEK 2 Who will pay for it? “Too many competing items for attention and budget” “Ask parents to buy it”
William Armstrong Head of Env. Sciences Clements High School
TEACHERS
PARENTS
STUDENTS Hypothesis Teachers will drive the purchase WEEK 2 Who will pay for it? “Too many competing items for attention and budget” “Ask parents to buy it” Parents spend William Armstrong Head of Env. Sciences Clements High School $600/year on educational related TEACHERS supplies. “Too many options”
PARENTS
STUDENTS Hypothesis Teachers will drive the purchase WEEK 2 Who will pay for it?
TEACHERS
PARENTS
STUDENTS Hypothesis School will drive the purchase WEEK 3 Who will pay for it? “Money already spent on microscopes.” Judy Matney Head of Sci Dept “Microscope purchase Dulles High School not part of operating DEPT HEAD budget.”
TEACHERS
PARENTS
STUDENTS Hypothesis School will drive the purchase WEEK 3 Who will pay for it?
“Money already spent PRINCIPAL on microscopes.” Judy Matney Head of Sci Dept “Microscope purchase Dulles High School not part of operating DEPT HEAD budget.”
TEACHERS
Ronnie Howards HeadPARENTS of Sci Dept Dulles High School “Science STUDENTS department Hypothesis already gets the School will drive the most money.” purchase WEEK 3 EXTERNAL GRANT Who will pay for it? AGENCY
PRINCIPAL
DEPT HEAD
Amber Khan TEACHERS Biology teacher Energy Institute
“High tech equipment can be usedPARENTS to apply for next generation STUDENTSscience curriculum.” Hypothesis Grant money will drive the purchase WEEK 3 EXTERNAL GRANT Who will pay for it? AGENCY
“Money not PRINCIPAL worth the time and effort.” Jeffrey Morgan Provost of Education DEPT HEAD TeachHOUSTON
Amber Khan TEACHERS Biology teacher Energy Institute
“High tech equipment can be usedPARENTS to apply for next generation STUDENTSscience curriculum.” Hypothesis Grant money will drive the purchase WEEK 3 Business Model Canvas (High School)
Joint venture in curriculum Lens manufacture, R&D Cost-friendly ($10 /student Online Science students (users) development with teachers, Marketing, sales, Feedback /year compare with $100 for Ensure customer satisfaction Science teachers (buyers) teaching community, and STEM traditional microscopes). through timely response of Parents (payers) promotion platforms such as The most portable option, and Q&A, updated FAQ, set up Students enter college knowing the basics of Project Lead The Way. easiest to use. online moderated sharing Dept head, Principal, Board, ISD (payers) Website moderator for Students enter college community of teachers. curriculum sharing knowing the basics of Grant approval agencies App developers for ecosystem microscope use. (payers) development Allows lower grade levels to fully immerse in scientific experimentation.
Employees Retailers Manufacturing system Education equipment vendors App platform Textbook publishers Web platform Good to have Apps
Employees, production and packaging hardware/software, marketing and sales Sales (direct, subscription, resale, distributors) conferences, booths, print ads
WEEK 3 It’s Pivot Time BOARD
PRINCIPAL
DEPT HEAD
TEACHERS
PARENTS
STUDENTS Hypothesis Need to incorporate into existing curriculum. WEEK 4-5 It’s Pivot Time BOARD CURR Mariam Manuel DEV Director Katy ISD Curr Dev Center PRINCIPAL
Having new curriculum improves teaching quality and student engagement DEPT HEAD
TEACHERS
PARENTS
STUDENTS Hypothesis Need to incorporate into existing curriculum. WEEK 4-5 It’s Pivot Time BOARD CURR Mariam Manuel DEV Director Katy ISD Curr Dev Center PRINCIPAL
Having new curriculum improves teaching quality and student engagement DEPT HEAD
TEACHERS
PARENTS
STUDENTS Hypothesis Need to incorporate into existing curriculum. WEEK 4-5 It’s Pivot Time BOARD CURR DEV PRINCIPAL
DEPT HEAD
TEACHERS
PARENTS
Hypothesis Can be incorporated into existing STUDENTS science kits with minimal modifications, to increase kit value. WEEK 6 It’s Pivot Time BOARD CURR Peggy Pitts DEV Editor PRINCIPALSSS Easily incorporated into existing curriculum with only slightDEPT HEADmodifications to improve student engagement. TEACHERS
PARENTS
Hypothesis Can be incorporated into existing STUDENTS science kits with minimal modifications, to increase kit value. WEEK 6 It’s Pivot Time BOARD CURR Peggy Pitts DEV Editor PRINCIPALSSS TEXTBOOK PUBLISHERS Easily incorporated into existing curriculum with only slightDEPT HEADmodifications to improve student engagement. TEACHERS
PARENTS
Hypothesis Can be incorporated into existing STUDENTS science kits with minimal modifications, to increase kit value. WEEK 6 It’s Pivot Time BOARD CURR Peggy Pitts DEV Editor PRINCIPALSSS TEXTBOOK PUBLISHERS Easily incorporated into existing curriculum with only Abbey Woodward DEPT HEAD Editor slight modifications to McGraw-Hill improve student engagement. Bundled with TEACHERS textbook to increase value. PARENTS
Hypothesis Can be incorporated into existing STUDENTS science kits with minimal modifications, to increase kit value. WEEK 6 BOARD EpiphanyCURR DEV PRINCIPAL TEXTBOOK PUBLISHERS
DEPT HEAD
TEACHERS
DISTRIBUTORS PARENTS
Hypothesis STUDENTS Incorporate into distributor science kits with minimal kit modifications. WEEK 6 BOARD EpiphanyCURR
Liam Casey DEV Head of Marketing in Biology PRINCIPAL TEXTBOOKWard’s Science (VWR) PUBLISHERSCombine with current kits to create kit of greater interactivity and value.DEPT HEAD
Use existingTEACHERS distribution channels.
DISTRIBUTORS PARENTS
Hypothesis STUDENTS Incorporate into distributor science kits with minimal kit modifications. WEEK 6 BOARD EpiphanyCURR
Liam Casey DEV Head of Marketing in Biology PRINCIPAL TEXTBOOKWard’s Science (VWR) PUBLISHERSCombine with current kits to create kit of greater interactivity and value.DEPT HEAD
Use existingTEACHERS distribution channels.
DISTRIBUTORS PARENTS
Hypothesis STUDENTS Incorporate into distributor science kits with minimal kit modifications. WEEK 6 Business Model Canvas (High School)
Curriculum development with Marketing, sales, Feedback Fits into current curriculum Online Distributors (VP add value, Katy (TX) ISD, Alief (TX) ISD Curriculum development, and kits on microscopes Ensure customer satisfaction add marketshare, books Promotional kits to STEM improvement without extensive through timely response of slides, kits) projects Project Lead The Way modification. Q&A, updated FAQ, set up Curriculum developers Students enter college knowing the basics of Future R&D via distributors. Provides ecosystem to online moderated sharing Textbook publishers Website moderator for enhance proper use of community of teachers. curriculum sharing technology in high school classes. Science students (users) App developers for ecosystem development Increased student Science teachers (buyers) interactivity with improved Parents (payers) quality, decreased cost. Dept head, Principal, Board, Students enter college ISD (payers) knowing the basics of Employees microscope use. Education equipment vendors Grant approval agencies Manufacturing system (payers) Allows lower grade levels to Textbook publishers App platform fully immerse in scientific Retailers Web platform experimentation. Apps Cost-friendly ($10 /student /year compare with $100 for traditional microscopes).
Employees, production and packaging hardware/software, marketing and sales Direct sales conferences, booths, print ads Subscription sales Distributor resale Our decision
App development
Sales Cycle Volume Pricing When will you need these resources
2014 May: Discovered process 2014 Nov: Failed crowdfunding 2015 May: Considered startup 2015 Oct: I-Corps
2016 Jan: Start ramping up production to projected sales volume. 2016 Apr: Check to see if we are on track. Cash flow breakeven
$100K monthly sales
Start I-CORPS 2 years Resource assumption spreadsheet
Distributor +50% Selling Costs (for 100,000 lenses) $500,000 Taxes
Profit
Packaging and Shipping ($2 per packaging, $2 per shipment. Office space, office equipment $1,000 $14,030 for 1K lenses Equipment $1,000 $33,200 for 10K lenses $10,000/month RD $215,000 for 100K lenses $2,000/month packaging 100,000 lenses cost $1,000 Key financials metrics for costs in your business model? Cost for raw material Cost for disposable supplies and equipment Cost for packaging Costs vs. ramp vs. product iteration?
Fixed monthly cost $20K for human resources, equipment, and other resources. Ramping production cost $1 per lens created, may need extra inventory space if exceeds 50K lenses created. Product iteration, R&D requires $20K for human resources, equipment, and other resources. Resource assumption spreadsheet
People $200K in the first year, including product manufacture, design, packaging, fulfillment, etc… Hardware $100K for high volume throughput manufacturing system and office/inventory space. Software $10K for fulfillment system. Prototypes $100K for continuing RD, expanding product line. Legal $20K in the first year for legal paperwork, startup company, apply for sales/resales tax forms, import/export forms. Older slides What type of business are you building Startup We provide Hardware (lens) Software (educational, course-specific apps, general object identification apps) through partnered app developers. Ecosystem (curriculum development sharing and support website for teachers and instructors) through partners in website moderators and developers Petal Diagram - Competitive Adjacent Technological Solutions/Markets Substitutes
Magnifiers
Microscopes + camera DSLR cameras Competitor solution Electron microscopes DIY kit Custom optical tables Technological Current Alternatives Solution Public schools Other Private schools? Ecosystem School board (ISD) User Buyer Key resources Product Principal 3rd party Payer
Material Dept Head
Fabrication
Packaging Lens Teacher
App/web Students App/website developers
Parents Channel diagram
Online
School retailer Buyer Lens (Teacher / Retailers Parent) (Walmart, Amazon, …)
School Inventory equipment vendor Channel diagram
Online
School retailer (School- branded) Retailers Buyer Lens (Walmart, (Teacher / Amazon, …) Parent)
Apparatus Curriculum/Text Manufacturer book publisher Distributor (Vendor) Distribution complexity
Direct sales (system) to professional services (medical)
Direct sales (lens) to professional services
School retailers
Retailer Marketing complexity Marketing Online retailers
Online sales Solution complexity Customer Discovery
Get Keep Grow
Journal publications Excellent customer service Version 2+ product Conference presentations Excellent support Loyalty program Magazine articles Periodically updated Website/FAQ Reseller discounts Trade shows Cross-market licensing TV/Web advertisements Website Demand creation budget and forecast
Market Study Publications Trade Shows Advertisement IP Management
NSF I-Corps Updated website and apps Annual education trade TV ads ($10,000) Patents Cost: $50,000 / 6 weeks shows in different Print ads ($10,000) Seasonal publications on locations. Web clicks ($20,000) Cost: $20,000 / year peer-review journals Social network clicks Cost: $60,000 / year (20,000) Seasonal presentation in professional conferences Cost: $60,000 / year
Bi-monthly magazine articles
Cost: $100,000 / year
TOTAL: $300,000 in the first year Customer acquisition cost
Publications Trade Shows Advertisement
4 journal articles with Trade show attracts 5,000 TV ads ($10,000) 5,000 shares generating with 1,000 visits, and 500 Print ads ($10,000) 500 customers customers 0.1% activation generates 1,000 customers 4 conference 12 shows a year presentations with 1,000 Web clicks and social attendees generating 100 network clicks at $0.50 per customers click with 10% activation rate generates 8,000 6 monthly magazine customers articles with 100,000 readers generating 1,000 customers
Cost: $100,000 for 1,600 Cost: $60,000 for 6,000 Cost: $60,000 for 9,000 customers customers customers = $62.5 / customer = $10 / customer = $7 / customer
$300,000 for the first 20,000 customers $15 per customer acquisition Customer lifetime value
Lifetime value
Average profit x Customer lifetime - Acquisition cost
$9 profit per lens x 3 lenses per sale x 2 lenses per year - $15 acquisition $30 value Channel Economics
Cost of Goods Profit, SG&A, RD Retailer Discounts
Lens material, +$5 profit Direct school, online, Academic discounts fabrication system, +$1 SG&A traditional take 30% Volume discounts packaging, labor +$2.5 RD markup
$1.50 / lens +$5 Payment flow
Raw materials / Systems provider DotLens School board Packaging and Lens design Parents Shipping and inventory
Web/app Website/app developer (considering $0) Revenue model strategy
Licensing deal (Univ of Houston) $0 Upfront payment 10% Company ownership 3% Royalty on sales
OR 2016+
Personal funding $100,000 Upfront payment Further 0% Company ownership 2015 0% Royalty on sales development Market analysis • Interactive website/app 2014-2015 • Product version 2.0 • Mass production testing • Further marketing Discovery strategies • Quality control • Preliminary research • Packaging • Publication • Pricing • Patent