Top 5 tips for succeeding in a business plan competition

Guest post by Chris Rodde, CEO of SeniorHomes.com and 2012 UW Business Plan Competition judge

In April of 2012, I participated as a judge in the screening round for the University of Washington Business Plan Competition. I have never served as a judge before in this competition, nor do I have any personal start-up investing experience (as many judges do). However, as an experienced founder/CEO of a start-up, I have good experience to leverage as a judge. My start-up, SeniorHomes.com, is now in its fourth year. We’ve raised two rounds of financing from angels and institutional investors and now employ more than 25 people.  Based on my experience as a start-up founder and as a judge in this competition, I have a few tips for next year’s entrepreneurs.

My top 5 tips for entering a business plan competition:

    1. Don’t submit a plan until you have traction. My biggest surprise as a judge was the lack of traction demonstrated by many of the teams. Three of the six plans I judged didn’t even have a website. During the investment round of the UW competition, judges are asked to invest a hypothetical $1000. So the same mentality used by investors in the real world comes into play in the competition. Investors in the real world pick companies that have momentum and that demonstrate that they can execute. Execution is everything in a start-up and to stand out in a business plan competition, show more progress than your competitors. Simple things like having a website (even if it just says “coming soon”), a working prototype, a first pilot completed, or actual paying customers will go a long way to make you stand out. Customers using or paying for your product is particularly important as this will help eliminate unknowns and back up the assumptions in your business plan with real world data.
    2. Be complete. There are some critical things every business plan must cover. Make sure that you cover all of these things, even if briefly. There are tons of great sites out there with advice on what to include in a business plan so I won’t elaborate but only suggest that you find out who the current thought leaders are with regards to business plans and make sure you’ve covered everything. Two to three of the plans I read had critical elements missing.
    3. Write like a NY Times reporter. Write in clear, objective language and avoid unsupported claims. Investors pick teams in which they have developed trust. This trust begins with the words you put in your plan. Don’t sound like a playground braggart boasting about your future $1 billion business. Instead build your case piece by piece in an objective fashion using real data.  The key claims that you make in your plan should be well supported with evidence you’ve gathered through experimental learning or research.
    4. Market your team. Investors invest in people not plans. Several plans I read simply listed the names of the people involved, without any bio at all. This gave me no chance to get to know the team. Why should I invest in you? What makes you uniquely positioned for this opportunity? Showing personality is good.
    5. Find mentors to critique and edit your plan. There are two types of editors you should seek. First, and most importantly, find someone that has credibility in reviewing business plans and have them critique it for content and completeness. Find someone who won’t hold back on asking the hard questions. Judges will likely find these same weaknesses so knowing these in advance and doing something about them (even if you simply point the weakness out as a risk) will help inspire further trust that you have thought things fully through. Second, find someone who can help you with writing and tone (this being especially important for techie founders who may have floundered in English 101). A business plan is a marketing document for your business, so you need to ensure you are putting your best foot forward.

Good luck!

Former Schwab CMO and “mad woman” illuminates “talk to Chuck” case study in MBA advertising class

 
It’s Thursday afternoon, and in one of the University of Washington Foster School of Business classrooms, former Charles Schwab Chief Marketing Officer Becky Saeger was talking to MBA students about the experience of digging deep to revitalize a major brand. As the architect and marketing protagonist of the integrated “Talk to Chuck” campaign platform, Saeger had plenty to offer the students on this Harvard Schwab Case.
Former Schwab CMO Becky Saeger (middle) with Associate Dean Dan Turner and Senior Lecturer Elizabeth Stearns

She discussed the importance of the big picture marketing process. From there the focus was on the decision metrics, advertising strategy and execution, and ultimately how that contributed to Schwab’s overall brand objectives.

Saeger’s also great in her capacity as guest lecturer, which was her role in Marketing 540, taught by Elizabeth Stearns, senior lecturer. Saeger brings to life the lay of the land at Schwab. The year was 2004 and the CEO who hired her was replaced by Charles “Chuck” Schwab himself, reclaiming his role as CEO of the $4.2 billion company he founded in 1971. Saeger reinforced the problem as described in the Harvard case, on the potential for losses and eroding customer loyalty, as the company struggles to fulfill its promise to the individual investor.

Following Professor Stearns’ lead, Saeger asked as many questions as she answered. One interesting aspect of this class is that Stearns does not play the role of professor—but rather that of a marketing client. Students have formed teams acting as advertising agencies vying for Stearns’ business. There’s very little handholding – and that’s good, because as any marketing agency veteran will attest, clients expect initiative and brilliance. The students demonstrated considerable chutzpah—one memorable moment occurring when a student agency, Drapers’ Disciples, turned down Saeger’s request for an additional $50 million budget with their excellent ROI analysis.

In the end Saeger won out with exceptional rationale; moreover, she proved success.

This teaching model brings intense realism into the classroom, as do guests like Becky Saeger.  There was an exhilarating quality to the session, and an overwhelming sense that Foster MBAs are getting the best of rigor where it intersects relevance to their futures.

As a side note, there was some irony that the ‘agency’ challenging Saeger’s budget request was “Draper’s Disciples.” As it turns out, she began her career at Ogilvy & Mather in NY, where she made a name for herself with global brand campaigns for American Express, among other clients. A true Madison Avenue prodigy.

UW environmental innovation wows judges

Judges were supposed to walk into the Seattle Center Exhibition Hall on March 29, pick up their folders and grab a seat. But the 23 prototypes were simply irresistible.

They caught your eye the minute you walked into the room for the 2012 University of Washington Environmental Innovation Challenge. A bicycle with the electric assist that could transport up to 200 pounds of cargo. Solar windows that would continue to operate even if cracked or broken. The new cooking surface that was nonstick and nontoxic with no coating at all. A tiny helicopter drone that could be used to inspect remote wind turbines. The highway jersey barrier made of recycled tires that were not only cheaper to produce but could also lessen the impact of a direct automotive hit. The earth-bag house that can be built quickly and safely after a natural disaster—and still withstand a category 4 hurricane.

The Environmental Innovation Challenge, managed by the Foster School Center for Innovation and Entrepreneurship (in partnership with the UW colleges of engineering and environment), is focused on student-led solutions to environmental problems. More than 120 judges from Seattle’s environmental and entrepreneurial communities evaluated student teams from colleges and universities across Washington on three criteria:

  • a working prototype, designed and built by the team
  • an investor pitch, paired with a solid understanding of the  market opportunity
  • the solution’s potential for impact

Judge Kelly Ogilvie, former president and CEO of Blue Marble Energy, was impressed by the creativity. “People are worried about the economy, but look around. This is cool stuff, and a lot of these concepts have legs.” David Allen, executive VP of McKinstry, agreed. “Every one of these ideas is pushing the green innovation needle forward,” he said. Seattle entrepreneur and Concur CEO Steve Singh was more impressed by how robust the prototypes were. “This is amazing,” he said. “Not one of these teams spent more than $3,000.”

The $10,000 grand-prize-winning team was Green Innovation Safety Technologies (GIST), which has one goal in mind: to eliminate the vast number of auto and truck tires plugging up US landfills. GIST’s jersey barriers use the equivalent of 240 tires (5,000 pounds of rubber mulch) each and have the added benefit, in comparison with concrete barriers, of increasing safety, reducing noise and enhancing water run-off. The team is composed of UW business and engineering undergraduate and PhD students.

See full list of all 5 winning teams and videos.

Learn more about the world of start-ups via the Center for Innovation and Entrepreneurship at the University of Washington Foster School of Business.

For loyalty’s sake: follow the smartphone

How do you convince coffee shop and pizza parlor owners that it’s time to ditch the paper punch card and move to a digital customer loyalty app? Educate them in the ways of today’s savvy smartphone users.

Punchkeeper, an app developed by Seattle University MBA Val Trask and her friends, programmer Jon Ohrt and developer Matty Mitchell, does just that. By providing a simple alternative to the old-fashioned paper punch card for businesses like cafes and salons, Punchkeeper ups customer loyalty and downplays wallet space. But wait, there’s more. In the course of any transaction, the app is also collecting valuable market data, performing target marketing through phone notifications, and using geo-locational technology to create social media buzz. What’s not to like?

It is no surprise that early-adopting university students in urban locations are exactly the customers to convince small businesses of Punchkeeper’s benefits.  Once store owners learn how simple it is for a smartphone owner to scan a QR code and transmit their data, Punchkeeper becomes an obvious solution. Josh Losinger, the owner of Seattle’s Lunchbox Laboratory, only had to observe his lunch-time customers. “We figured that since most people these days are glued to their phones even while chomping down on our crazy burgers, they may as well get value out of it,” he said. “Punchkeeper is the future of loyalty recognition.”

Since participating in the 2011 UW Business Plan Competition, the Punchkeeper team is now seeking Series A funding to scale and add features. The company currently serves merchants in Washington, Texas and Colorado, and is starting to work with retailers in Oregon and on the East Coast. Punchkeeper has 3,000 users. The team expects that number to grow rapidly with the launch of the University of Washington Housing and Food Services program later this spring.

The biggest lesson Trask and her team have learned? Be scrappy. “At the Business Plan Competition we were the team with the homemade sign, the logo-shaped cookies, the cool borrowed props and the donated giveaways,” explains Trask. “It started us on a path of scrappiness and creativity that translated into successful bootstrapping in the real world.”

Learn more about the world of start-ups via the Center for Innovation and Entrepreneurship at the University of Washington Foster School of Business.

Community is the new equity at SURF

Seaton Gras  is a certifiable start-up junkie who has been forming incubators and launching meet-up groups since before those terms became technospeak. Whether it was his upbringing in a 1950s-era cooperative in the woods of Massachusetts or just pure passion for entrepreneurship, collaboration is clearly in Gras’s blood. Even Wizzymouse, the “wiki for kids” business he entered into the 2007 UW Business Plan Competition, was a form of community-building.

So is SURF, Seaton Gras’ newest effort to provide a safe landing spot and creative environment for early-stage entrepreneurs. SURF (Start Up Really Fast) sprang into existence to “help an idea grow into a series of milestones,” Gras says, “because each stage needs different resources. Talent clusters and re-clusters, depending on the need.”

Early SURF member Donald Rule, the founder of Translational Software adds,  “Even before its official opening, the SURF Incubator linked me with people that have offered insights, encouragement and most importantly connections that have accelerated my progress. Combine that with the energy created by associating with dynamic and optimistic start-ups, and you have a really compelling environment for incubating a business.”

Functioning for three years as an incubator without walls in random pizza joints and donated spaces, Gras recently landed the perfect physical space for SURF in Seattle’s historic Exchange building. With over 15,000-square feet already designed for the previous tenant’s tech workers, the incubator is fully outfitted to serve as many as 100 entrepreneurs with a variety of desk space and conference room configurations. Night owl entrepreneurs can even rent a desk just for the early morning hours.

By mid-March 2012, the lease was signed and both Geekwire and TechFlash, among others, had run stories. With 19 companies already signed on, Gras has also fielded calls from the mayor of London (yes, in the UK) and interested parties in Denver looking to replicate the SURF model.

What Gras gains from launching the SURF Incubator may not earn him equity in the traditional sense, and he’s just fine with that. Instead, he values a whole different kind of ROI. “I’m driven by the experience and talent and re-clustering of teams,” he says. “I’m in a community of people like me.”

Learn more about the world of start-ups via the Center for Innovation and Entrepreneurship at the University of Washington Foster School of Business.