Early Presentation of Master’sThesis Supervisor: Alain Wegmann lamswww.epfl.ch Thursday, 28 th April 2005 Rolf Lindbäck

Overview The subject Action plan The work so far Future work

The Subject 3 parts: –Comparison & integration of SEAM and EBMF –Applicability of analysis frameworks for VCs –Development for a CAD tool for quantitative analysis

Action Plan Intro Personal motivation Introduction to SEAM and EBMF √ Apply Case Study on GBA with SEAM and EBMF√ Explain cons and pros of both methods√ Evaluate them against the case study√ Explain what VCs are looking for√ Compare this to SEAM and EBMF Make a merger between models with focus on VC Make an automatically generated model of this merger This model will probably be based on the SEAM tool which is yet developed Conclusion

The work so far (1) Apply Case Study on GBA with SEAM and EBMF –Observations: EBMF based on Balanced Scorecard. It is created in order to describe a business model SEAM based on Porter’s Value System. It is created in order to understand a “business idea” It is possible to find every notion of the EBMF in the SEAM’s SAR section –Intermediate conclusion: Even if SEAM is conceived in order to highlight the relations between the actors, EBMF describes them better

The work so far (2) Comments on SEAM: –SEAM does not present the best structure in order to model every kind of companies –We have discovered that the SAR should be split into 2 parts –One part for the SVN and an other one for the AVN –This is due to matter of fact that the company in question can be present in both systems…

What are VCs looking for? Pre-screening: –Apparent deal quality mentioned by whom? Quality of business plan, other investors, accounting firms? –Investment Compatibility Does the company fit geographically-, personal- and portfolio-wise? Management: –Quality of management team Past success/failures, commitment, good enough skills, motivation –Board of advisers Business Opportunity: –Potential of the product Alsop’s formula: Quality+Innovation+Smarts+Money-Pain2 = Success –Business Plan Markets and customers Products and services Distribution channel Finance –Competitive strategy Existing and future Competitors Proprietary Advantage Market share and First-Mover Advantage Competitive positioning Intangibles –Timing –Investors Gut Feeling Legal –Company Business form –Intellectual property protection –Financial structure –Protection mechanism for fair treatment Covenants, share conversion, voting rights Financial –Valuation of the company Three different ways: Market comparables, DCF, Venture Method –Its robustness –Probability of success To be present in final business model

The future work Create a merge between EBMF and SEAM, based on SEAM in order to be able to use the CAD software Add what is missing into the model – finance, valuation, management, vision, assumptions, different years Apply it on case studies Present to Venture Capitalists Get feed-back and adjust