FHZ 1 The Zenie Group StreetSmart Entrepreneuring Entrepreneurship Apply your engineering talent to create your dream company. But remember

FHZ 1

TheZenieGroup

StreetSmart Entrepreneuringwww.zeniegroup.com

EntrepreneurshipEntrepreneurship

Apply your engineering talentto create your dream

company.But remember - starting a

companyis easy, building a successful

business is [email protected]

11 February 2009

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TheZenieGroup


StreetSmart EntrepreneuringStreetSmart Entrepreneuring

Frankly SpeakingFrankly Speaking

Give me your email address – I’ll send ,pdf copyGive me your email address – I’ll send ,pdf copy

Your Questions will influence theYour Questions will influence theValue of my Answers.Value of my Answers.

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DisclaimerI have an Agenda! But, it’s not hidden.

DisclaimerI have an Agenda! But, it’s not hidden.

Have you heard about the hammer that thinks everything looks like a nail?

I’m an entrepreneur and I actually do believe that “Entrepreneuring” leads to the best

solutions to most business problems!

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My Advice to EngineersMy Advice to Engineers

Engineering, Technology and Scienceare Entrepreneurial Tools

Customers, not technology, are its foundation.

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What a change !What a change !

In the late 1950s, 1960s and 1970s, we tried to instill “successful” big company practices into emerging companies - probably destroying many.

In the 1980s and 1990s; Peter Drucker, Tom Peters and others challenged this.

Today, I believe we should be instilling entrepreneurial leadership into our largest companies - maybe we can save them.

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OK – What is an entrepreneur?

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What is an Entrepreneur?What is an Entrepreneur?

Entrepreneurs BUILD BUSINESSES through INNOVATIVE SOLUTIONS

to UNMET CUSTOMER NEEDS.(Note: Entrepreneurs do exist in the public and non-profit sectors.)

“Above all, innovation is not invention. It is a term of economics not technology.” *

Entrepreneurs create discontinuities – They obsolete accepted practices and change

behavior.* Peter Drucker

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Fast vs. RightFast vs. Right

Mature Businesses -

“Right First Time”

Entrepreneurial Businesses -

“Fast First Time”

Is this true? Why?

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The Changing World of InnovationThe Changing World of Innovation

18th Century - 19th Century - 20th Century - 21st Century

ATG

Affluence

Technology

Globalization

Agriculture Age(farmers)

Industrial Age(factory workers)

Information Age(knowledge workers)

Conceptual Age(creators and empathizers)

Courtesy of Daniel H. Pink

“A Whole New Mind” Why Right Brainers Will Rule the Future

2005 - page 49

Maybe Walt Disneyand Steve Jobs

are our prototypes

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Frank’s Entrepreneurial PrinciplesThe Fundamentals are Simple

Frank’s Entrepreneurial PrinciplesThe Fundamentals are Simple

Vision - what you hope to achieve through this venture.

Culture - a set of underlying, shared values.

Innovative Product/Market Strategy -what you will sell and how you will sell it.

Sound Business Model -how you will earn a profit.

Passionate Execution

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Markets Don’t Exist Markets Don’t Exist – Only Customers– Only Customers

Markets Don’t Exist Markets Don’t Exist – Only Customers– Only Customers

The Entrepreneur’s Job is to: Identify potential customers Understand their unmet needs, business economics, constraints

& priorities Create innovative, high value-added solutions to these needs Define new MARKET segments which enable you to

communicate your benefits effectively! Leverage your market segmentation for differentiation &

strategic advantage – dominate a niche and build from there.This is not an analytical or statistical exercise, rather its a face to face, creative and interactive customer experience.

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What would you prefer?What would you prefer?

You have a business with $10 million annual sales serving a $1 billion market. Choose 1:

1% market share spread across the entire market,

or 100% of a $10 million niche within the broad

market.

Why?

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Entrepreneurial vs. Traditional Market Perspectives

Entrepreneurial vs. Traditional Market Perspectives

Traditional Market DefinitionFor example - 1960s Traditional US car manufacturers.

Big, powerful & inefficient.

Toyota mid 1960sSmall, fuel efficient & Low Costfollowed by variety of new models

Lexus - 1989One Luxury Model, LS400followed by variety of new models

Today Prius & Hybrids

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Intellectual PropertyIntellectual Property

Market Power (MP) TRUMPS Intellectual Power (IP)

The more successful you become, the more competition you will attract.

How many great products were sustained monopolies?

Likely response to your intellectual property: Respect your patent and invent an equivalent or superior alternative. Respect your patent and purchase a license from you. Respect your patent and abandon the market. Ignore your patent and reverse engineer and copy your product.

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MP Trumps IPMP Trumps IP

Monopoly

True Story - One of my companies files a patent suit against a much large competitor for patent infringement.

It took 9 years from filing suit to damage determination. Legal expenses reached $2 million. Management distraction - huge opportunity cost. Jury determined patent was valid and the competingproduct infringed. Judge confirmed infringement, but no willful act by infringer. Final damages $50,000 + interest for 9 years.

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A Real ExampleA Real Example

Founded in January 1999 All founders from Zymark Corporation Ken Rapp, NEU ‘84 President & CEO FHZ co-founder & Chairman

Headquartered in Hopkinton, MA Website – www.velquest.com Some of today’s customers:

Pfizer, Glaxo SmithKline, Bristol-Myers SquibbAstraZeneca, Eli Lilly, Johnson & Johnson

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Our Founding ProcessOur Founding Process

Who is our customer? - From our prior experience, we decided to serve laboratories in the pharmaceutical, biotech and related industries.

We wanted to create Primary Demand rather than compete with existing products.

“Customer Research” - Using our contacts, we visited 50 companies to discover their unmet needs.

The CEO attended every meeting accompanied by at least one other founder.

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Customer Research – How We Do ItCustomer Research – How We Do It

Find thoughtful, objective people. Go to them – face-to-face. Bring a colleague. Look and Listen Very Carefully

Briefly explain your objective Confirm host’s time constraints Promise to share your findings Ask open-ended questions Follow-up with clarifying questions Observe body language Never ask what they want. Inquire about problems and current solutions. Customers

will ask for incremental improvements to current solutions. Your job is to create a far better solution – discontinuities.

Send thank you note and ask if you can come back to share your findings and clarify and additional questions.

Best Question:What keeps you

up at night?

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What We FoundWhat We Found

Analyst/ChemistsData Creation, Investigations

and Documentation

QA/RegulatoryInspections and Audits

Supervisors & Data ReviewersReview, Checking and Approval

Customers reported resource constraints because increasing work loads and tighter time constraints.

Digging deeper; in manual paper-based systems the FDA requires layers of redundant checking to claim data integrity.

As regulations increased, more resources were diverted from doing to checking and documenting.

We discovered that 70% of their total laboratory resources were committed to compliance.

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The FDAThe FDA

The FDA regulates US food and drug businesses. While it’s a US agency, it’s a strong model for Europe

and Japan. Many regulations are being globally harmonized because pharma is rapidly moving to global organizations.

Most FDA regulations for development and manufacturing are called Good Manufacturing Practices (GMP) and Good Laboratory Practices (GLP) – they are quite similar. We use GMP to describe the family of regulations.

Redundant Checking vs. Computer Validation

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VelQuest’s NicheVelQuest’s Niche

We created a new segment - “GMP Electronic Notebooks”

We are not a LIMS, ERP, Document Management System or many others - we make them more valuable.

If Microsoft is desktop, VelQuest is benchtop. We replace “paper notebooks” with fully

validated electronic data acquisition, documentation and quality verification.

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Thanks

Questions and Discussion

Documents

FHZ 1 The Zenie Group StreetSmart Entrepreneuring Entrepreneurship Apply your engineering talent to create your dream company. But remember