459_GIST - Executive Summary and Pitch - Jakarta Hadzima -Handout

7/29/2019 459_GIST - Executive Summary and Pitch - Jakarta Hadzima -Handout

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Nuts and Boltsof

the Executive Summary and the Pitch

Joe Hadzima(MIT S.B., M.S. in Management; J.D. Harvard Law)Senior Lecturer, MIT Sloan School of Management

President and Co-Founder, IPVision, Inc.Founding Judge of MIT $10K/50K/100K Chairman Emeritus MIT Enterprise Forum

[email protected]

2011-2012, Joseph G. Hadzima, Jr. All Rights Reserved Presented at GIST in Jakarta Indonesia April 2012


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Joe Hadzima

Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012

A Peek Inside the MIT 100K

Judging ProcessWhat Judges Look For:

From the $100K Website:What do the judges look for in a plan? The judges look at many different issues whenevaluating executive summaries and business plans, including:

Is the business opportunity as presented both highly attractive and clearly realistic? Is the business defensible from competitors?

What is the business model?

What comparisons are there to past success stories that indicate this venture will succeed?

What is the amount of up-front capital investment required?

Do the market and financial projections demonstrate that the team understands its business?

How long will it take from the current stage of development to bring this to market?

Can this venture achieve a leadership position in i ts market?

Has the team gone out to the market already to test its ideas?

Who will be the first customer(s)?


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Joe Hadzima

Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012

A Peek Inside the Judging ProcessWhat Judges Look For (continued)

What do the judges look for in a plan? The judges look at many different issues whenevaluating executive summaries and business plans, including:

Is the team of suff icient breadth, balance and quality to make its ideas happen?

Will the ego of the founder(s) get in the way of success?

Is the team focused on its target market?

What is the expected time and amount of pay-off to investors?

Is the reader famil iar with and interested in the given market space?

Is the plan clear and well-written?

Does the team have the necessary communications ski lls to present a compelling story? What roles will the team members play in the venture?

Are the team members dedicated to the venture and their roles in the group?

Does the team have a clear plan for spending the investment money it receives?

Why is this business going to be around and a real world winner in 5 years?


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Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012

How Investors Think:

What are the 2 Basic Investor/Human

Emotions that You Have toUnderstand?

FEAR That you wil l lose the money

GREED That they will miss the deal of the

century


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Joe Hadzima

Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012

The Executive Summary


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Joe Hadzima

Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012

What is an Executive Summary?

It is the First Thing Investors/Judges Read

It is a Resume for your Full Plan

Goal is to get the Interview to Give the Pitch

What Do Judges/Investors Really Look For?

The 3 Whys

Why This?

Why Now? Why This Team?

The 4th Why:

Why Wont This Work/Succeed?


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Joe Hadzima

Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012

BUSINESS PLAN BASICS

The Business Plan -A SUPPORTED VISION

Tec

hno

logy

Intellec

tua

l

Property

Marke

t

Ana

lys

is

Compe

titive

Ana

lys

is

Sa

lesan

d

Distribu

tion

Team

Financ

ial

Pro

jec

tions

DetailedSupport/Foundation

Full Business Plan

PowerPoint Presentation

Executive Summary

Elevator Speech

Mission/Vision Statement 1 paragraph30 seconds

2-5 pages

10slides/20minutes/30pt

20-30 pages


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Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012


An Executive Summary is

NOT an introduction NOT a preface

NOT a random collection of highl ights

An Executive Summary IS the BusinessPlan in miniature


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Nuts andBolts of

Executive

Summaryand Pitch

Apri l 2012


Size

Two pages (preferable) to five pages (max) The Executive Summary must be

Logical

Clear

Interesting/Exciting

The Executive Summary is like a RESUME If it gets the readers attention, the rest getsread

The Elevator Speech is to the Exec Summaryas the Exec Summary is to the Full Plan


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Nuts andBolts of

ExecutiveSummaryand Pitch

Apri l 2012


The Executive Summary tells What the Market/Opportunity is

How Big Is It or Wil l It Be? Who You Are What your strategy/vision is

What you are doing and/or propose to do How many $$$$ do you need and what will you do

with them What yourSUSTAINABLE COMPETITIVE

ADVANTAGE is

When the reader is finished he or she should be able totell someone what you are up to.


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Ideally: The Executive Summary Should

Contain: Description of the Business Concept and theBusiness

The Opportunity and Strategy

The Target Market and Projections The Competitive Advantages The Economics, Profitabili ty and Harvest Potential The Team


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EXECUTIVE SUMMARY: ELECTRONIC COMPONENTS, INC.

Electronic Components, Inc. is a start up company that will make a variety ofelectronic components, beginning with a new type of aluminum-based capacitor.This unique product, coupled with excessive demand for capacitor devices, willprovide us with an ample share of the capacitor market and numerous opportunitiesfor expansion into related electronic components.

The founders are dedicated and determined to make the venture a successfuland profitable entity. Technical expertise is provided by James F. Lynch, who hasbeen involved in designing capacitors for 11 years. He obtained a Bachelor ofScience degree in electronic engineering from the Massachusetts Institute ofTechnology.

Technology for capacitors is changing rapidly. Electronic Components, Inc.has an opportunity to capitalize on a major technological change by getting off to a

quick start and expanding quickly.

This proposal pertains to two additional phases of required financing. Thefirst phase, consisting of about $150,000 for pilot plant start-up, has been completedfrom the personal funds of the principals. The remaining financing is for thefollowing:

Phase Two: Obtain $750,000 capital for: Hiring and training production personnel;

Purchasing additional equipment necessary for appropriateproductivity;

Develop the market;

Complete the sales rep network;

Explore new markets.

Phase Three: Increase Production and Sales

Computerize manufacturing to triple output with minimal increase inlabor;


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EXECUTIVE SUMMARY: PEOPLE EXPRESS

The Eastern seaboard of the United States is ripe for the entry of a new,

superefficient, low-cost air carrier to provide quick, reliable inter-city air

transportation. Such an entity would bring to the Northeast the same benefits that

have accrued to other areas of the United States. Chief among these are:

Frequent jet commuter service between major cit ies

Prices competitive with private automobiles

Fulfil lment of the congressional goals in enacting the Airline Deregulation

Act of 1978 to have better service at lower fares.

The new company will be able to achieve these goals for the following reasons:

Aggressive, innovative management that has been tested in the field andbeen on the leading edge of innovation in air transportation marketingand systems

Equipment and facil ities designed specifically for the low-cost productionof air transportation

Manpower selected, trained, and motivated to be efficient and profitoriented

New systems to be applied to the entire business of air transportation tominimize investment in manpower and machines

All of these, when applied to the new entity, wi ll result in considerable economies

vis--vis existing air carriers.


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Nuts andBolts of


Apri l 2012

The Pitch

My Thanks to Stephen Pearse For the Inspiration for These Slides


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Nuts andBolts of


Apri l 2012

The Pitch - Getting Money VC Noise

Get Introduced

Memorize Elevator Pitch Forwho are dissatisfied with, is a that provides. Unlike a, we have assembled .*

One Shot

Induce Greed* Geoffrey Moore, Crossing the Chasm


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The Pitch: KISS *Really* Simple!

Hook Target Audience

Lowest Common Denominator Keep It Short (10slides/20minutes/30ptFont)

Pictures! Answer detail/curveballs quickly

Passion! Engage! Confidence!


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The Hook Pain or Huge Market Opportunity

7 Seconds Imagine a safe rubber coating that conducts

electricity

Have you ever felt threatened?

Our box is 10x smaller, faster, cheaper

Do you get poor cell phone reception at home orwork?


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Nuts andBolts of


Apri l 2012

NO Geek Speak WRONG:

Our technology is the first integrated and automatic bookscanner that will scan and digitize bound documents at aspeed of 1,200 PPM at a fraction of the cost of existing

solutions based on a disruptive digital imaging technologyinitially developed at Bell Labs and protected by 12patents.

RIGHT:

We enable sharing knowledge massively by

digitizing physical libraries at a very low cost.


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Nuts andBolts of


Apri l 2012

Focus of Pitch Customer Benefits NOT Tech Benefits

Tech Benefits- **SO WHAT?** Improved Network Utilization

Scalable, Adaptable Secure integration

Seamless Integration

Business Benefits- Pain Reduction!

Increase Revenues by 60%

34% cost reduction in 12 months


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Nuts andBolts of


Apri l 2012

Style Use best presenter

Have egghead in room Give firm answers (or none)

Look at everyone in room Do your homework

Pull Questions


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Basic Pitch Anatomy

Hook - Summary (Problem or Opportunity)

Your Solution Business Model Technical Advantage Competition Sales & Marketing Strategy

The Team Financials Road Map

The Offer


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Apri l 2012

Slide 1 - Summary

Introduce the project

Why is it important Timeline and key milestones

Expected business & financial results Funding requested (total amount)


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Slide 2 The Business Problem

State the problem in business terms

Business problems: production, cost, competitiveness,product, service, delivery etc

Define the market opportunity

No. buyers in the first 18-24 months, value in sales Name/identify target customers

May be teams company partner or other customers

Why the customers care


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Slide 3 The Solution

How you solve the problem for the customers

perspective

The specific value in your proposition

Specific benefits to the customer (non financial)

Financial benefits (estimates) to the customer


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Slide 4 Business Model

How will money be made or saved? How will the science team earn income?

How will the company team earn income?

What is the margin, profit, or savings?

Is the company-partner the end-user? Manufacturer?Seller?

How will the product/service be delivered to the

customer(s)? Will the product/service be sold through other companies ordirectly to end-users?

Product or service? Sold by contract?


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Apri l 2012

Slide 5 Technical Advantage

State the special or key aspect of technology in

translated into common terms What are the intellectual property plans (if any)? What stage of development is the technology currently in

(again in common terms such as early, mid, late)? How much time and funding is needed to finish the

technology?

THIS IS THE ONLY TECHNOLOGY SLIDE Only the key technology element that relates directly to

the key business advantage matters!


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Nuts andBolts of

ExecutiveSummary

and Pitch

Apri l 2012

Slide 6 - Competition

What alternatives exist to your solution?

Including do nothing (low risk, cost estimate) Who else is trying to solve the problem?

Current competitors and substitutes How large/profitable are they?

Are they ahead or behind?

Matrix of features and value

NEVER SAY There is no competition


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Nuts andBolts of

ExecutiveSummary

and Pitch

Apri l 2012

Slide 7 Sales & Marketing

How will your team (or company partner) reach thecustomer?

How long will each sale take to close (the salescycle)?

What is the role of 3rd

party partners in marketing,distributing, and selling?

Will you sell directly, through others, or both?

How will your team inexpensively inform customers(promotion, advertising)? By word of mouth, call them, advertise (where?, how much

cost?)


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Nuts andBolts of

ExecutiveSummary

and Pitch

Apri l 2012

Slide 8 The Team

(Company team) Experience in the industry withcustomers, manufacturers, distributors, retailers

(Science team) Experience in technology field Management and operations

Company team: production, delivery

Science team: project management, technologydevelopment

Sales & marketing experience

Industry partners and resources Outside partners needed

Okay if you dont have them yet; important to state gaps)


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Nuts andBolts of

ExecutiveSummary

and Pitch

Apri l 2012

Slide 9 - Financials

Simple budget table for project

Simple budget table for marketing & sales (ifapplicable)

Key metrics People, revenues, gross profit (margin), expenses,

number of customers, average selling price, etc.

When (how fast) will you spend and earnmoney?


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Nuts andBolts of

ExecutiveSummary

and Pitch

Apri l 2012

Slide 10 Road Map

(Where you have been and where you are going)

Accomplishments to date Major accomplishments planned and when

Technology development Business (production, sales, marketing, distribution)


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Nuts andBolts of

ExecutiveSummary

and Pitch

Apri l 2012

Wrap Up Slide or Statement

Why This Why Now

Why Our Team Thank You


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Joe Hadzima

Nuts andBolts of

ExecutiveSummary

and Pitch

Apri l 2012

SESSION 1: BUSINESS PLAN BASICS

The Business Plan -A SUPPORTED VISION

Tec

hno

logy

Intellec

tual

Property

Marke

t

Ana

lys

is

Compe

titive

Ana

lys

is

Sa

lesan

d

Distribu

tion

Team

Financ

ial

Pro

jec

tions

Full Business Plan

PowerPoint Presentation

Executive Summary

Elevator Speech

Mission Statement 1 paragraph30 seconds

2-5 pages

10-15 minutes

20-30 pages

DetailedSupport/Foundation

Documents

459_GIST - Executive Summary and Pitch - Jakarta Hadzima -Handout