Sunday, May 18, 2014

Avoiding the Business "Plan 9 From Outer Space!"

          by Chuck Black

Poster c/o Wikipedia.
As first noted in the July 7th, 2013 post "Resources for the Canadian Space Entrepreneur," US investors have known for the last few years of the money to be made from space technology. But now, even their slow moving Canadian companions are picking up on the potential.

Of course, there's always a learning curve when it comes to getting up to speed on any new business venture - and the potential for commercial disaster is always a possibility, no matter how good the original idea might seem.

Here's a few of the more interesting places to begin the research and build your plan.

The Alberta Space Program - A listing of Alberta space imaging, science and business activities "attracting international investment" at the University of Alberta Institute for Space Science, Exploration and Technology (ISSET). Contains links to the Alberta government website on the provincial aerospace and defense industry which "contributes $1.3 billion in revenue annually to the provincial economy, is home to 170 aerospace and aviation companies, and employs over 6,000 highly skilled Albertans."

The Canadian Aerospace Industries Capability Database - A comprehensive listing of 60,000 Canadian aerospace businesses tracked by capabilities and expertise begun about ten years ago with input from a variety of provincial and federal aerospace associations in cooperation with Industry Canada. The database was endorsed by the 2005 Canadian Aerospace Partnership (CAP) which led almost immediately to the National Aerospace and Defence Framework and was eventually superseded by the 2012 Aerospace Review, although the database remains.

The Canadian Association of Business Incubation (CABI) – Dedicated to the development of new enterprises and supporting the growth of new and emerging businesses, this organization has access to over 60+ Canadian business incubators and accelerators with a broad range of expertise. 

The Canadian Commercial Corporation (CCC) – Established in 1946, the CCC is a federal Crown corporation mandated to promote and facilitate international trade on behalf of Canadian industry, particularly within government markets. The Corporation’s two business lines are structured to support Canadian companies contracting into the defense sector, primarily with the United States, and Canadian exporters contracting into emerging and developing country markets.

The Canadian Foundation for Innovation – Set up by the Government of Canada in 1997 to build Canada’s capacity to undertake world-class research and technology development to benefit Canadians. The infrastructure funded by the CFI includes the state-of-the-art equipment, laboratories, databases, specimens, scientific collections, computer hardware and software, communications linkages and buildings necessary to conduct leading-edge research.

The Canadian Space Commerce Association (CSCA) – A registered Canadian not-for-profit industry organization existing to advance the economic, legal and political environment for space and aerospace focused companies. Organizes and publicizes intimate bi-monthly meetings and larger national events for entrepreneurs.

The Canadian Start-up Financing Landscape – An annual assessment from start-up marketer Marc Evans, on where to go to get funding and support for your Canadian start-up. The list is divided up into angel investors, business incubators and accelerators, plus seed, series A and series B funding sources. 

The Canadian Venture Capital & Private Equity Association (CVCA) – With over 2000 members with over $105 billion in capital under management, the CVCA represents the majority of private equity companies in Canada. Focused on venture capital (investment in early stage, mostly technology based companies), mezzanine financing (subordinated debt or preferred stock with an equity kicker) and buyout funding (risk investment in established private or publicly listed firms that are undergoing a fundamental change in operations or strategy).

The Center for Space Entrepreneurship (eSpace) – A Boulder, CO based 501(c)(3) non-profit organization that supports the creation and development of entrepreneurial space companies, the commercialization of the technologies they create, and the workforce to fuel their growth.

The Commercial SpaceFlight Federation (CSF) – Although not a Canadian example, the 40 businesses and organizations who are members of the CSF are a comprehensive snapshot of the emerging international NewSpace industry. Canadian members include MacDonald Dettwiler (MDA). 

The Consortium for Aerospace Research and Innovation in Canada (CARIC) – It doesn't yet have a website or a lot of documentation to back up the April 17th, 2014 press release "The Consortium for Aerospace Research and Innovation in Canada (CARIC) Launches Today," but CARIC, a joint initiative of the Aerospace Industries Association of Canada (AIAC) and the Consortium for Research and Innovation in Aerospace in Québec (CRIAQ), has been pitched as "a national research and technology network that unites stakeholders from industry, universities, colleges and research institutions" across Canada. The organization, should it ever become more than a press release, is expected to use the CRIAQ, funding and collaborative model. 

Deltion Innovations – Billed as "Sudbury's first aerospace company" and focused on the design and fabrication of terrestrial and space mining systems, the organization also helps to organize the annual Planetary and Terrestrial Mining Sciences Symposium. Originally part of the Northern Centre for Advanced Technology (NORCAT).

The various European Space Agency (ESA) Business Incubation Centres (ESI) and the European Space Incubators Network (ESINET) – The work done by the ESA through these two organizations is useful and well worth looking at for lessons learned. 

The Intellectual Property Institute of Canada (IPEC) – A national association comprised of over 1,700 members from Canada and abroad composed of patent agents, trade-mark agents and lawyers specializing in intellectual property.

Kentucky Space – Ambitious, US based non-profit consortium between the University of KentuckyMorehead State University; the NASA Kentucky Space Grant Consortium and EPSCoR Programs and Belcan Corporation focused on research and development of small entrepreneurial and commercial space solutions. Managed by the Kentucky Science and Technology Corporation.

The MaRS Discovery District – A Toronto business incubator focused on the medical and IT industries but open to new ideas. Maintains the MaRS Funding Sources Directory, a listing of provincial, national and international funding sources suitable for Ontario companies in both the public and private sectors.

The National Angel Capital Organization (NACO) – An organization of Canadian angel capital investors.

NewSpace Global – Provides accurate and critical information on international NewSpace opportunities. Subscribers include Fortune 500s, universities, government agencies, small and large corporations, and investors. NSG publishes a variety of items including the always up to date NewSpace Watch online news service, the Thruster monthly market tracking report (which includes the Point-to-Point Canada column, written by Commercial Space blog editor Chuck Black) and the Observer company database tracking the top 400 international NewSpace companies. 

The Ontario Network of Entrepreneurs (ONE) – Part of the Ontario Centres of Excellence, ONE is a collaborative network of organizations across Ontario, designed to help entrepreneurs, businesses and researchers commercialize their ideas by providing useful programs and services across the full commercialization continuum from idea to market. One of the better provincial government offerings in this area.

The Space Angels Network – an American based network of angel investors that also accepts investors and clients from Canada and Europe. Sponsored by Spaceflight Services (a one stop shop for manifests, certification and integration of small satellites into a network of established and emerging launch and space transportation vehicles), the Morrison Foerster and Jones Day law firms, the Wills and Associates public relations firm and the Habif, Arogetti and Wynne accounting firm. The network is also a member of the Angel Capital Association (ACA).

The Space Business Blog – Useful case studies of the economics of space based businesses, written by a Lockheed Martin financial analyst.

Space Canada – A not-for-profit organization dedicated to the promotion of solar energy from space. Organized the 2009 Symposium on Solar Energy from Space. Space Canada president and CEO George Dietrich has a long history of supporting US and Canadian NewSpace activities.  

The International Space Directory – Compiled by Space News, this publication bills itself as "the only publication that space professionals throughout the world turn to first for the news that affects their jobs." The site lists most of the major international space manufacturers, products and services.

Space Works Commercial – A US based aerospace engineering and design incubator focused on next-generation space transportation systems, future technologies, human and robotic exploration of space, emerging space markets and their applications.

Start-Up Canada – Entrepreneur led, national movement to enhance the nation’s competitiveness and prosperity by supporting and celebrating Canadian entrepreneurship. – An online community of over 17,000 CEOs, Founders and entrepreneurs to discuss fundraising, review investors and compare strategies to grow a start-up business.

The United States Office of Space Commercialization – Documentation from the US Department of Commerce relating to commercial space activities, including general policy activities affecting all areas of space commerce and documents related to the US National Space Policy.

1 comment:

  1. Brian Feeney on the 1 Page Business Plan

    A good list Chuck... Business Plan 101 traditionally includes several key criteria that should be in the plan; keep it 25 pages or less (15 pages more recently) with no more than a 3 page Executive Summary, and so on. I’m seeing from a few very successful California based entrepreneur's - now investors - they will only look at a 1 page Business Plan!! To paraphrase, "If you can't say what your business / product is, who are the 3 or 4 key people and why, how it will be successful against the competition in one page, with a few lines for a brief P&L, investment needed and ROI, investor offer - then don't bother".

    I initially thought, impossible. On further reflection though, it makes sense. Everyone, not just investors are inundated with daily mass data. Your great new business (Plan), of which they know nothing about, is way down the priority tree until you somehow peak their interest.

    This one page Business Plan wonder is not just a shorter Executive Summary; it's an end to end sizing up of the entire business, key people and investment ROI. The writing, choice of words, pitch is more like a 15 to 30 second TV ad, which is about as much time as they will take to skim / read your wonder BP. I like it.

    If you dissect things a little I think you will see that what "they" are looking for is to make a decision of interest with an obviously shorter (but not lesser) amount of key information, than is contained in the normal ES / BP. The supporting doc should they wish to dig deeper is the Marketing Program Plan or if even earlier stage, Product Develop Program Plan either or both of which (depending on your stage of the business) you should have.

    A traditional BP usually contains summaries of both these, or if the product is already developed, further development and enhancement R&D to maintain competitiveness. They are two of the three main key's to the business and should be fully developed in writing at the time of financing. More detail on people, the first key ingredient, can be added to either.

    In short, and yes this blog post is longer than it should be to convey the approach - for Executive Summary, see Business Plan. If interested, for more detail, let's meet and discuss it over our detailed (most important) Execution Plans namely Marketing and or Product Development.

    And if you either disagree or can't see how you can pull things off in a single page, remember, you are selling to the investor, you have milliseconds to create initial excitement with your title, you are showing them a great preview to a movie that they don't want to take their eyes off of. You want them to yell into the other room, "come in and see this".

    Still not convinced. Multi hundred million dollar movies (any budget size) have a presentation treatment of as little as 3 pages to make a go no go $ decision. The script and evolution of the execution material all follows... One of the people who shares and practices this view is as indicated, a successful Cal. based entrepreneur and investor in Space amongst other areas.


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