Innovation and Product Development

The TeamJakob A. Bejbro Andersenjaban@mek.dtu.dk

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“Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark”

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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Why the team is important• Well, why write a business plan?

– To get an overview of what to do when.– To show how to get the most out of your idea.– To describe how to create sales.– To estimate when you will start earning money.– ...

• Yes, but the business plan (and the pitch) has a hidden and very real added purpose:

– To show that the team is up for the task

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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Why is the team important II• No matter how well you do, there is always going to be a big

difference between:– Your plan for the business.– And the actual rollout.

• So what does the investor want to know?

– Is the team able to respondto the changes in prerequisites that are bound to occur?

B

A (current context/market)

Changed

context/market

Changed

context/market

Changed

context/market

Bnew

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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What the team needs to show• Following the established logic...• ...You should be good at:

– (Re-) analysing the market.– (Re-) evaluating the business plan.– (Re-) prioritising your focus.– Killing your darlings– Quickly adapting.

• This requires a team that...– Has competencies within relevant fields.– Has clear codes of conduct.– Has a clear distribution of responsobilities.– Is strongly committed.

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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The psychology of an investment meeting• Covering all bases is not as important as being concise.

– Details can always be added.

• Remember the ”lingo” (ROI, Risk mitigation, EBIT etc.)– Most investors speak that language and only a few are willing/able to

translate your engineering nonsense.

• Investors will typically say things like:– ”We feel that you should look closer at the Japanese market”

• ...Actually, this means: – ”We are giving your team an assignment to

see if you can solve it properly”

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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Building the team I: Setting expectations• An idea typically emerges

through the interaction of somewhere between 1-5 inventors.

• The business is built around the inventors who are willing to put in the effort (hobby or full time?)

• This business is likelier to succeed if the inventors realise their shortcomings and recruit relevant competencies*. * ”Surround yourself with people who are

smarter than you” – D. Trump (?)

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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For each group:

Pre - Group example.

1 - Spend 1 minute thinking about this question:

What will my role be in relation to my group’s idea 6 months from now?

2 - Then spend 1 minute each (5 mins total) telling your group what your answer is.

3 - Summarize (1 minute): How many are willing to continue working on the idea after the course ends?

4 - Share the result with the class!

Exercise 1:

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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Building the team 2: Ownership• The roles and commitment levels of team members need to be

reflected in the distribution of shares and rights in the company.– Discuss division of shares now – not later– You need ”Bakers”, not ”Eaters”.

• Proposed framework for dividing shares*:– Start out with a hundred shares each, then... (for each person)

• You got the idea (5% extra - relatively)• You did the initial validation work (5-25%)• You are CEO (5%)• You commit to full time (200%)• Reputation (super-entrepreneur) (50-500%)• You invest (% depending on investment and valuation)

*http://www.geekwire.com/2011/wrong-answer-5050-calculating-cofounder-equity-split/

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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Building the team 3: Decision making• The number of shares does not necessarily reflect the amount of

power held by each shareholder.• Depending on the type of company, decisions are made by a

board or by the management.– Board:

• Strategic decisions.• Large investments.• Management hirings / terminations.• Loan commitments.• Financing / budget approval.

– Management (CEO):• Daily operations.• Low-medium sized investments.• Staff hirings.• Choice of suppliers and partners.

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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Building the team 3: Distribute roles

• To perform efficiently, clear roles need to be defined• Prepare to become:

– CEO– Sales manager– R&D manager– ...

• At the same time, the team should be comprised of ”T-shaped” persons:

Competence Business 1 Business 2 Business 3 Tech 1 Tech 2 Tech 3 Project 1

Proficiency level 1

Proficiency level 2

Proficiency level 3

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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Now introducing: Connect DK• Even before you set up you company, you will have to

start working on a network.• Connect DK is a network organisation that links innovative

startups with growth potential to relevant persons and organisations.

• Jens Christian Foged (Team Leader) will now introduce the services of Connect DK.

• See more on: http://www.connectdenmark.dk/

2012Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product Development Department of Mechanical Engineering, The Technical University of Denmark

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