Enabling a Different Perspective for Potential Entrepreneurs Emel Bulat Gordon-CenSSIS/ALERT –Industry & Government Liaison President – MySkin Technologies 04/12/13 ACW Workshop, Chicago, IL

Agenda  NSF I-Corp,  Why is I-Corps Important?  Biz Plans, Adjacent Markets  Other sources of funding  SBIR, AIR & SECO  Discussions  Recommendations

“The National Science Foundation (NSF) has established a new opportunity to assess the readiness of emerging technology concepts for transitioning into valuable new products through a public-private partnership. The NSF Innovation Corps (I-Corps) program will bring together the technological, entrepreneurial, and business know-how to bring discoveries ripe for innovation out of the university lab”  Takes academics out of their comfort zone & “out of the building”  Brings different people together enabling interdisciplinary collaboration  Funds only “Biz Plan” & “Voice of the Customer” activities I-Corps Intro

I-Corps Tools  Great “Team” concept  Great books  “Business Model Generation,” Alexander Osterwalder, Yves Piguer; Wiley Press  “Canvas” for understanding nuances of market, value proposition, supply chain, etc.  Makes for a better SBIR, etc.

High-End (prestige) Cosmetics In-Home Cosmetics (Avon, Mary Kay, Arbonne) Exclusive Spas More accurate Melanin measurement Low cost Higher quality matching of skin care products to customers Database of skin tones to better target products Direct OEM IP Marketing Brand Product Development Correlating measurements with OEM cosmetics Train OEM COGS = $200 / Instrument Integration with OEM product Manufacturer Exclusive Spas- Beta sites B2B Long-term OEM Sales Service & Calibration Contracts Cosmetic companies Reduce returns B2B2C Over the counter (CVS, Walgreen) Consistent results Human Resources Leasing In-Home Sales Cosmetic R&D Advertising & Marketing

Canvas  Forces team to look from many different perspectives – “Voice of the Customer” rather than “my invention is the best thing since sliced bread” – Value Proposition-Is your assumption valid? – Is there something you missed? – Can you Pivot? – Economics; Adjacent Markets – Competition – Channels-overlooked by many start-ups

Teaming with MBA’s & Mentors a Must 7 MySkinTone purchases product from contract mfg Product received from manufacturer MySkinTone delivers to cosmetic firms MySkinTone receives payment from cosmetic firms Cosmetic firms place MySkinTone product into department stores or leases it to regional sales reps Department store sells cosmetics to consumer, increase sales MySkinTone Product Money Cosmetics Cosmetic Money Contract Manufacturer Cosmetics Firm or Spas / Salons MySkinTone Department OEM or Sales Reps Consumer $200 unit $500 - $1K unit $250 Year Increased Sales Diagram of Payment Flows

Linking Other Programs  SBIR I & II, (IB & IIB) – Great next step after I-Corps – Requirements could be more in-line with the momentum created from the I-Corps  STTR  SECO – Currently there are two Options: Option I for new start-ups teamed with ERCs Option II for active SBIR II teamed with ERCs  State Funding  Angels, VCs

Discussion Topics  Making sure the technology is robust  Getting high quality mentors who are willing to donate their time  Having the “right team”  Networking with start-ups in similar markets  Positioning for other funding opportunities

Recommendations  I-Corps is unique for the “.gov” community  Focusing founding teams on “Biz Plan & Mkts”  Developing more interactions with potential customers  Funding agencies providing more one-on-one access with the private sector