ISOM 5480 Information and Entrepreneurship Management[Spring 2014] <<Project Nano>>Anti-Counterfeit using Nanoparticles

Albert Hui Ben Mak Johnny ChowJoseph Man Safiya Yu Sam Fu

http://bambooinnovator.com/2013/12/30/some-shops-and-atms-in-hong-kong-started-to-refuse-hk1000-us130-banknotes-after-police-found-several-counterfeit-notes-and-arrested-suspects/

Fake Currency

❖ Will you now take a BOC $1000 note?

http://paper.wenweipo.com/2014/04/03/HK1404030028.htm

Fake Designer Bags, Branded Watch, Drugs, etc...

❖ How will you verify the famous branded products when shopping?

HK Government has prosecuted over 1 thousands fake products in April 2014, including bags, watches, sun-glasses, phone accessories. The affected brands including COACH, CHANNEL, LV, PRADA, ROLEX, etc, and listed price ranges from $10Ks to $100Ks. The target customer group would be mainly tourist.

Existing Anti-Counterfeiting Technologies

At Apr 2014, MIT discovered...

http://newsoffice.mit.edu/2014/tiny-particles-could-help-verify-goods

Periodic Table

❖ ytterbium❖ gadolinium

How Our Manufacturing Process Work ?

Sources : http://www.fi.tartu.ee/~jevgenis/Articles/Continuous-flow%20lithography%20for%20high-throughput%20microparticle%20synthesis.pdf

The technological strengths...

❖ Consumer Usability (via special lens integrated with smart phone)

❖ Imitation Prevention(proprietary technology)

❖ Invisibility(only be visible under near infrared environment)

❖ Massive Encoding Capacity(can have up to 1 million colour combinations)

There could be huge demand...

ONE Solution for ALL

Potential Business Opportunities Comes

● Hand Bags / Luxury Goods● Pharmaceutical / Drugs● Currency / Bank Notes● Credit Cards● Passports● Art Pieces / Antiques

Market Analysis - Pharmaceutical / Drugs

Source: Bloomberg Finance 2014, from Symphony Health Solutions

Market Analysis - Luxury Goods

Source: Bloomberg Finance 2014

Market Analysis － Credit Cards

sources: Nelson Report / The US Censes Bureau / The Federal Reserves/HKMA/China Bank Association

Market Analysis - Passports

Sources : U.S. Department of Stateccc

How to drive the demand initially?

Multi-sided Platform

What will be the margin?

Material Costs

Source: Alibaba.com and Team Analyis

Cost of Production

✓ Manufacturing Cost is unexpectedly low

Team Analysis base on a real P&L of a manufacturing company

Monthly Fixed Cost

Monthly Variable Cost, assuming 20 machines, producing 5 per min (low efficiency) at start

Monthly Variable Cost, assuming 20 machines, producing 20 per min (improved efficiency) at later stage

Price and Profit

✓ Huge Margin is generated

Team Analysis base on a real P&L of a manufacturing company

Assume giving away 200 lense per month, extra cost of $6.4K which may not be affecting the profit much.

Initial Investment & Payback

✓ Payback is quick

Team Analysis base on a real P&L of a manufacturing company

Any Operation Challenge?

Inconvenience

● Need to improve the size of the lense before product can be popular for consumers.

Operation Improvement

● Operation Process Improvement○ Increase margin (Reduce Operation Cost)○ Maintain Production Capacity Utilization ○ Increase Production Efficiency

● Production Efficiency○ Due to economy of scale

● Quality Assurance/Control○ Reduce defects/scrap

● Explore Markets and Grow Demands○ Potential Marketing Research○ Product Promotion○ Consumer Education

Business Sustainability

● Value-added encoding feature● Target one segment before expansion● License Patent ● Partnership for Global Business

Q&A