The
Zenie
Group
Entrepreneurship
Apply your engineering talent
to create your dream company.
But remember - starting a company
is easy, building a successful
business is hard!
[email protected]
www.zeniegroup.com
11 February 2009
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 1
The
Zenie
Group
StreetSmart Entrepreneuring
Frankly Speaking
Give me your email address – I’ll send ,pdf copy
Your Questions will influence the
Value of my Answers.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 2
The
Zenie
Group
Disclaimer
I have an Agenda! But, it’s not hidden.
Have you heard about the hammer
that thinks everything looks like a nail?
I’m an entrepreneur and I actually do believe
that “Entrepreneuring” leads to the best
solutions to most business problems!
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 3
The
Zenie
Group
My Advice to Engineers
Engineering, Technology and Science
are Entrepreneurial Tools
Customers, not technology, are its
foundation.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 4
The
Zenie
Group
What a change !
 In
the late 1950s, 1960s and 1970s, we tried to
instill “successful” big company practices into
emerging companies - probably destroying many.
 In
the 1980s and 1990s; Peter Drucker, Tom
Peters and others challenged this.
 Today,
I believe we should be instilling
entrepreneurial leadership into our largest
companies - maybe we can save them.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 5
The
Zenie
Group
OK – What is an entrepreneur?
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 6
The
Zenie
Group
What is an Entrepreneur?
Entrepreneurs BUILD BUSINESSES
through INNOVATIVE SOLUTIONS
to UNMET CUSTOMER NEEDS.
(Note: Entrepreneurs do exist in the public and non-profit sectors.)
“Above all, innovation is not invention.
It is a term of economics not technology.” *
Entrepreneurs create discontinuities –
They obsolete accepted practices and change
* Peter Drucker
behavior.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 7
The
Zenie
Group
Fast vs. Right
 Mature
Businesses “Right First Time”
 Entrepreneurial
Businesses “Fast First Time”
Is this true? Why?
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 8
The
Zenie
Group
The Changing World of Innovation
Courtesy of Daniel H. Pink
ATG
“A Whole New Mind”
Why Right Brainers Will Rule the Future
2005 - page 49
Conceptual Age
(creators and empathizers)
Information Age
(knowledge workers)
Affluence
Technology
Industrial Age
(factory workers)
Globalization
Agriculture Age
(farmers)
Maybe Walt Disney
and Steve Jobs
are our prototypes
18th Century - 19th Century - 20th Century - 21st Century
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 9
The
Zenie
Group
Frank’s Entrepreneurial Principles
The Fundamentals are Simple
 Vision
what you hope to achieve through this venture.
 Culture a set of underlying, shared values.
 Innovative Product/Market Strategy what you will sell and how you will sell it.
 Sound Business Model how you will earn a profit.
 Passionate Execution
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 10
The
Zenie
Group
Markets Don’t Exist
– Only Customers
The Entrepreneur’s Job is to:

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Identify potential customers
Understand their unmet needs, business economics,
constraints & priorities
Create innovative, high value-added solutions to these needs
Define new MARKET segments which enable you to
communicate your benefits effectively!
Leverage your market segmentation for differentiation &
strategic advantage – dominate a niche and build from
there.
This is not an analytical or statistical exercise, rather its a
face to face, creative and interactive customer experience.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 11
The
Zenie
Group
What would you prefer?
You have a business with $10 million annual
sales serving a $1 billion market. Choose 1:
 1%
market share spread across the entire
market,
or
 100% of a $10 million niche within the broad
market.
Why?
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 12
Entrepreneurial vs. Traditional
Market Perspectives
The
Zenie
Group
Traditional Market Definition
For example - 1960s Traditional US car manufacturers.
Big, powerful & inefficient.
Today Prius
& Hybrids
Toyota mid 1960s
Lexus - 1989
Small, fuel efficient & Low Cost
followed by variety of new models
One Luxury Model, LS400
followed by variety of new models
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 13
The
Zenie
Group
Intellectual Property
Market Power (MP) TRUMPS Intellectual Power (IP)
The more successful you become,
the more competition you will attract.
How many great products were sustained monopolies?
Likely response to your intellectual property:
 Respect your patent and invent an equivalent or superior alternative.
 Respect your patent and purchase a license from you.
 Respect your patent and abandon the market.
 Ignore your patent and reverse engineer and copy your product.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 14
The
Zenie
Group
MP Trumps IP
True Story - One of my companies files a patent suit
against a much large competitor for patent infringement.
Monopoly
 It took 9 years from filing suit to damage
determination.
 Legal expenses reached $2 million.
 Management distraction - huge opportunity cost.
 Jury determined patent was valid and the competing
product infringed.
 Judge confirmed infringement, but no willful act
by infringer.
 Final damages $50,000 + interest for 9 years.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 15
The
Zenie
Group
A Real Example
 Founded in January 1999
All founders from Zymark Corporation
Ken Rapp, NEU ‘84 President & CEO
FHZ co-founder & Chairman
 Headquartered
in Hopkinton, MA
 Website – www.velquest.com
 Some of today’s customers:
Pfizer, Glaxo SmithKline, Bristol-Myers Squibb
AstraZeneca, Eli Lilly, Johnson & Johnson
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 16
The
Zenie
Group
Our Founding Process
Who is our customer? - From our prior experience,
we decided to serve laboratories in the
pharmaceutical, biotech and related industries.
 We wanted to create Primary Demand rather than
compete with existing products.
 “Customer Research” - Using our contacts, we
visited 50 companies to discover their unmet needs.
 The CEO attended every meeting accompanied by
at least one other founder.

StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 17
The
Zenie
Group



Customer Research – How We Do It
Find thoughtful, objective people.
Go to them – face-to-face. Bring a colleague.
Look and Listen Very Carefully




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

Briefly explain your objective
Best Question:
Confirm host’s time constraints
What keeps you
Promise to share your findings
up at night?
Ask open-ended questions
Follow-up with clarifying questions
Observe body language
Never ask what they want. Inquire about problems and current solutions.
Customers will ask for incremental improvements to current solutions.
 Your job is to create a far better solution – discontinuities.

Send thank you note and ask if you can come back to
share your findings and clarify and additional questions.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 18
The
Zenie
Group
What We Found
 Customers reported resource constraints because increasing work
loads and tighter time constraints.
 Digging deeper; in manual paper-based systems the FDA requires
layers of redundant checking to claim data integrity.
 As regulations increased, more resources were diverted
from doing to checking and documenting.
 We discovered that 70% of their total laboratory resources were
committed to compliance.
Analyst/Chemists
Data Creation, Investigations
and Documentation
QA/Regulatory
Inspections and Audits
Supervisors & Data Reviewers
Review, Checking and Approval
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 19
The
Zenie
Group
The FDA
The FDA regulates US food and drug businesses.
 While it’s a US agency, it’s a strong model for Europe
and Japan. Many regulations are being globally
harmonized because pharma is rapidly moving to
global organizations.
 Most FDA regulations for development and
manufacturing are called Good Manufacturing
Practices (GMP) and Good Laboratory Practices
(GLP) – they are quite similar. We use GMP to
describe the family of regulations.
 Redundant Checking vs. Computer Validation

StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 20
The
Zenie
Group
VelQuest’s Niche
 We
created a new segment “GMP Electronic Notebooks”
 We are not a LIMS, ERP, Document
Management System or many others - we make
them more valuable.
 If Microsoft is desktop, VelQuest is benchtop.
 We replace “paper notebooks” with fully
validated electronic data acquisition,
documentation and quality verification.
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 21
The
Zenie
Group
Thanks
Questions and Discussion
StreetSmart Entrepreneuring
www.zeniegroup.com
FHZ 22