MONETIZING THE BUSINESS MODEL MBA LITE FEBRUARY 17

MONETIZING THE BUSINESS MODEL MBA LITE FEBRUARY 17, 2014

DAN QUIGG BIO 25 Years Technology Executive � � � CEO - Public Insight Corporation � � Developers of 360 -Public Goal of transforming public data into insight Kent State University Adjunct Professor of Entrepreneurship Awards and Groups � � Founder & CEO, Public Insight Corporation President & CEO, RIS Logic acquired by Merge Healthcare Founder & CEO, Omni. Vista acquired by Best Software General Manager, Best Analytics (acquired by Sage) KPMG Small Systems Co-Founder Ernst & Young Entrepreneur of the Year Finalist Smart Magazine “Rising Star” Case Western Reserve Inaugural Leadership Award Leadership Cleveland Class of 2013 Follower of Jesus Christ

MY FAVORITE READS

BUSINESS MODEL FRAMEWORK Our Focus Source: Business Model Institute

GOAL: BUILD ENTERPRISE VALUE Value of an Organization Exit Value Functions: � � � Growth Rate Recur Revenue Scalability Margins Risk Mkt Potential Entrepreneur Decisions: � � � Capital vs. Bootstrapping Acceptable Cash “Burn” Founder Salaries

BEACHHEAD MARKET ENTRY “Paying” Customers Not “Fun With Spreadsheets” Innovative – Not “Me Too” Primary, then Secondary Go For the Beachhead!

THE CORE Adjacency Core Adjacency Zook – Profit from the Core Adjacency

WHAT IS A CORE? The Core is something that allows you to deliver the benefits your customers value with much greater effectiveness than any other competitor. * What it is Not? � � � IP First mover advantage Locking up suppliers Pivoting: � � � Typically a change in core Average successful pivots 1. 8 Not a change in primary market * Disciplined Entrepreneurship

SOURCES OF DIFFERENTIATION Portfolio management and finance M&A, JVs, and partnering Regulatory management BU strategy and driving priorities HR management and culture Supply chain and logistics Production and operations Development and innovation Go-to-market Customer relationships Scale Technology and IP Brand Tied customer network Tangible assets Must have at least three Zook – Repeatabillity

AVOID THESE TERMS

MINIMUM VIABLE BUSINESS PRODUCT (MVBP) 1. Customer Gets Value 2. Customer Pays for Value 3. Product is Sufficient to Start the Feedback Loop 4. Iterate Towards a Better Product

ECONOMIC ECOSYSTEM Source: Wide Lens

EXAMPLE Free 2 1 Segment Providers Consumers Those Who Care K-12 School Districts Parents and Students Media Service Centers Consultants Unions State Higher Education Colleges and Universities Parents Students K-12 Trade Associations Consultants Libraries Health Care Providers Insurance Companies Patients Non-Profits Libraries Trade Associations Consultants Government State and Local Entities Constituents State Media Planning Agencies Business/Labor Mkts General Public Libraries Economic Develop.

PRICING FRAMEWORK Goal of Lifetime Value Costs are Irrelevant Understand Value Pay Attention to Decision Process Understand Price Alternatives Different Types Will Pay Different Prices Be Flexible for Early Adopters and “Lighthouse Customers” It is Always Easier to Drop the Price Than Raise it

UNDERSTAND COSTS OF CUSTOMER ACQUISITION Time Horizons Source: Disciplined Entrepreneur Year 1 Years 2 and 3 Years 4 and 5

PIPELINE CONVERSION

SCENARIO PLANNING

METRIC DRIVEN REVENUE FORECASTING

CASH FLOW PLANNING

QUESTIONS CONTACT INFORMATION: Dan Quigg, CEO Dan. Quigg@publicinsightcorp. com Cell: 440 -317 -0117 561 Boston Mills Rd. , Suite 500 Hudson, OH 44236 www. publicinsightcorp. com