1. Today (2/11) Class schedule update & Presentation Forums (10’) Corporate Technology Commercialization- Dr. Thomas Lindner (40’) Developing timelines and resource requirements (30’) Team work time- Milestones and resource requirements(30’) Assignment: Prepare an 8’ presentation on commercialization milestones and resource requirements for class Mon (2/16). A written version is due Tues (2/17), and should be brought to meeting with JT on that date or e-mailed prior to the meeting Monday (2/16) Group Presentations- milestones and resource requirements (60’) Work Sessions with Mentors- milestones and resources

2. Tue (2/17) Each team has a 45’ scheduled meeting with John T Wed (2/18) Preparing revenue estimates (40’) Group work session- Revenue estimates and preparation for Bill Newman conference (60’)

3. Schedule Update Only 8 more class meetings till presentations and competition!! Teams schedule a time to meet with John T on Tues, Feb 17 th (Sign up today) Teams meet with Bill Newman on Mon, Feb 23 rd Teams meet with Paul Gulick Mon, March 2 nd In class presentations Wed, March 4 th Portland Business Round Table panel on Wed, March 11 th Deadline for Business Plan Competition - Mon, March 16 st ($$$) Written commercialization plans due- Wed, March 18 th

4. Technology Commercialization Checklist 1. Patent or IP selection 2. Understanding of IP scope, status, limitations 3. First Pass Market Survey 4. Customer Value Proposition 5. Commercialization option brainstorming 6. Product form and commercialization approach selection 7. Timeline, Staffing & Costs- Additional research needed 8. Revenue Projections 9. Cash Flow, Funding Needs, and Break even point 10. Funding Strategy 11. Next Steps and Outstanding Issues

5. Before you continue… From your work to date, spend 10’ in your group discussing these aspects of your commercialization plan. If you don’t yet agree, plan follow up work or research to get answers before moving ahead The exact form of the product or service you will sell Your exact position in the value chain and your competitors Why your product or service is superior to your competitors Your choice of a start-up or licensing approach and why If multiple products are planned, which will be pursued first and why Your exact customer profile (consumer or business) Specify the problem solved that your customer will pay for Estimate how much your customer will pay for this product or service and why

6. Next Step in Commercialization Plans: Estimating Start Up Costs and Revenues The following assumes that information has been collected and decisions have been made on a) Overall commercialization approach, b) Market research and product positioning c) Product or service definition, and potential customer cost d) Position in the value chain- suppliers and customers are known

7. Identify Milestones One of the most important steps in developing a commercialization plan is identifying key milestones. These will be critical in developing a schedule and budget for your venture Typical milestones include Proof of concept demonstrated Prototype developed First product(s) ready for customer testing Beta testing complete- customer feedback available Cycles of learning complete Product design frozen First customer orders received Manufacturing startup Manufacturing ramp to volume initiated With help from your mentor or other sources, estimate the time, staffing and resources for each step

8. Resource Needs and Expense Projections Achieving each of these milestones will typically require resources in each of the following areas. Staffing- Determine skills needed for step, and associated staffing costs (including benefits) Capital Equipment- Large ticket items for fabrication, testing, etc. Identify any necessary equipment and the cost to buy or lease it Operating expenses- Office equipment, lab or manufacturing supplies, tax, insurance, licenses, and any other expendables Material Costs – costs for raw materials or components used in manufacturing Facility Costs- Include rent, utilities, etc Contractors/ Consultants- specialized skills you’ll need (e.g. legal assistance, design work, etc), but are not covered by your full time staff Outsourcing/Distribution Costs- Longer term you may want to outsource aspects of manufacturing, especially as higher volumes are required. You may also need to find a distributor to move your product to the customer

9. Development and Start Up Costs- Example Nano-reactor Systems has developed a “bench top” microchannel reactor but needs lab space, additional staff, materials, and outside services to develop a customer- ready system to show to prospective customers Here are some of the detailed development costs to develop a this system in the first year Materials- $500K Operating supplies- $20K/mo Wages: 2 development engineers@$75K/yr, CEO@$80K/yr Rent/Utilities: $1000/month Taxes, Insurance, Licenses: $5000/yr Outside design services: $100K In the latter part of the year, they must also begin a sales and advertising effort with the following costs Travel- $20K Wages: Salesperson@$60K/yr What would the development and start-up costs look like over the year?

10. Manufacturing Costs- Example Once orders are received, Nano-reactor Systems believes they can manufacture up to 3 reactors per year with their present staff for the following additional costs per reactor Materials and components- $200K Shipping and transportation- $15K Machining and design services- $20K Licenses- $15K Operating supplies- $30K In addition to the costs above, for each additional 3 reactors per year, Nano- reactor Systems must increase its staffing and space with the following additional costs One additional manufacturing engineer@$70K One manufacturing technician@ $40K/yr For a sales projection of 15 reactors per year, how would you calculate manufacturing costs?

11. Team Work Session and Assignment #5 Develop a set of milestones and schedule Identify key steps in commercializing your technology Working with your mentors or other resources, estimate the approximate duration of each Estimate resources and costs to achieve each milestone Identify expenses in each of the areas listed (staffing, capital equipment, operating expenses, material costs, facility costs, contractors/consultants, outsourcing/distribution costs) This will require additional research and interviews