Innovation Process for Scientists and Engineers



ENG 599– CleanTech Entrepreneurship

COURSE NUMBER: ENG 599 Instructors: Peter Adriaens, Ph.D., P.E.

Winter 2008 Phone: (734) 763-8032

TTh 3:30 – 5:00 PM E-mail: adriaens@umich.edu

1180 Duderstadt Center

Tim Faley, Ph.D., M.B.A.

Phone: (734) 615-4425

E-mail: faley@umich.edu

Overview

In 2006, CleanTech became the third-largest sector for venture investment ($2.9 Bn), indicating the potential for economic growth in this technology innovation space. The growth in this area is primarily driven by investments in Energy, with lesser investment in Water, Transportation, Advanced Materials, Manufacturing and Agriculture. Clean technologies have the opportunity to deliver dramatic improvements in resource efficiency and productivity, creating more economic value with less energy and materials, or less waste and toxicity.

The economic impact potential is huge: 1,500 CleanTech start-ups operate worldwide; 4,093 U.S. patents focused on CleanTech were issued; IPO value was up 156% in Q3 2007, driven by solar and biofuels. CleanTech Entrepreneurship will focus on value creation in this space, with emphasis on how strategic business drivers (e.g. regulation, subsidy, and market valuation) influence innovation and investment, and how this may impact research hypotheses and needs.

CleanTech Entrepreneurship is a 3-credit, semester, graduate-level elective, though seniors will be considered. The class format is highly interactive and will vary from session to session. You should expect to encounter:

• Content-specific presentations with guest lectures on various cleantech sectors.

• Full-class application discussions based on case-studies: both written cases and guest-speaker provided presentations/experiences.

• A team-based project focused on applying and integrating strategic, finance, and marketing tools to assess and formulate entrepreneurial business opportunities from CleanTech inventions. The interdisciplinary teams will consist of graduate students from engineering and business.

The perspective provided in this course will be valuable for students that are both looking to form or join startup companies as well as for those that are looking to create corporate value via industrial research.

Students will learn to develop business strategies along the value chain of this nascent growth opportunity. They will be provided strategy, financial and marketing tools to screen cleantech ideas/ventures and formulate a testable business hypothesis (revenue capturing model).

Eligibility

This semester course is open to graduate (though seniors will be considered following approval by the instructors) science and engineering students without a background in business fundamentals. This course is part of a broader curriculum between the COE and Ross on entrepreneurship and venture opportunity assessment.

ENG 599 CleanTech Entrepreneurship

Course Materials

This course will use a book, the CleanTech Revolution (Pernick and Wilder, 2007), in addition to a select number of engaging and informative readings as well as business cases. Additional materials can be accessed via CTools. The cases and relevant papers will be available at Harvard Business OnLine (instructions for access to be sent later).

Course Websites

Course materials will be posted on CTools (). A wiki will also be used as a course management tool. Students are encouraged to contribute questions, answers, notes and links to the wiki. It can also be used for basic team project management. The link to the wiki is . Contributions to the wiki will be considered as part of the participation grade. The password for making edits is venture.

GRADING STRUCTURE

The grading will be based on the following metrics:

Homeworks (including in class assignments and ’10 to watch’ assessments): 10%

Class participation (including contributions to the wiki, and case discussions): 20%

Midterm and final project report: 40%

Project presentation(s): 30%

Peter Adriaens, Ph.D., P.E.

Dr. Adriaens is a professor in Civil and Environmental Engineering - Program of Environmental and Water Resources Engineering. He currently is appointed in the Zell-Lurie Institute for Entrepreneurial Studies in the Ross School of Business to focus on educational and research program development. His research on ‘flask-to-field’ multidisciplinary technology development projects and consulting experience emphasizes industrial sustainability issues, including site remediation pollution prevention, and corporate value creation along the water-energy nexus.

Tim Faley, Ph.D., MBA

Dr. Faley is the managing director of the Zell Lurie Institute for Entrepreneurial Studies and managing director of the Wolverine Venture Fund (instructor for ES701 – WVF). He was formerly the director of technology transfer for UM’s College of Engineering. Prior to his arrival at UM, he spent 15 years with the Dow Chemical Company, his last assignments being in technology licensing and corporate venturing.

SYLLABUS

Th 1/3 Course Introduction

T 1/7 The Value Creation Paradigm

Topics:

Entrepreneurship Overview

New Business Creation Overview

Corporate Entrepreneurship: Comparison with the startup environment

Readings:

Faley, Timothy L., “The Process of Business Creation ,” Inc. Magazine (on-line), August 23, 2005.

Faley, Timothy L., “Is your Business Idea Feasible?,” Inc. Magazine (on-line), October 4, 2005.

Faley, Timothy L. & Kirsch, P.S., “Creating Your Business Plan,” Inc. Magazine (on-line), November 3, 2005.

Faley, Timothy L., “Growing Your New Venture,” Inc. Magazine (on-line), February 21, 206.

Faley, Timothy L., & Porter, T.S., “Making Your Exit,” Inc. Magazine (on-line), March 15, 2005.

Th 1/10 Strategy

Topics:

• Introduction to corporate strategy

o Core competencies

o Discipline of market leaders

o Porter’s five forces

• Entrepreneurial Business Strategies

o Positioning your company

o Leveraging your intellectual property

Readings:

Porter, Michael. “What is Strategy?” HBR reprint 96608 (1996).

Corporate Case II: Intel Corp.--1968-2003 (HBR Product#: 703427)

Churchill, Neil & Lewis, Virginia. “The Five Stages of Small Business Growth.” Harvard Business Review Reprint 83301 (1983)

T 1/14 Strategy Continued

Th 1/17 Intellectual Property

Guest Lecturer: Jeffrey Schox, Patent Attorney, Schox, PLC

Readings:

Hart, Myra & Zaharoff, Howard. “The Protection of Intellectual Property in the United States.” HBS #9-897-049 (2000).

T 1/21 Value Chain Analysis

Th 1/24 & T 1/28 Marketing

Topics:

• Corporate Marketing Elements

o Introduction to Marketing

o Basic Quantitative Analysis for Marketing

o The Marketing Mix

o Pricing

• Entrepreneurial Marketing Elements

o Market identification and strategy

o Product adoption process

o Value Chain

Readings:

Shapiro, Benson. “An Introduction to Marketing.” HBS 9-584-124 (1986).

Levitt, Theodore. “Marketing Myopia.” HBR Reprint R040L (1960).

Corporate Case IV: Inside Intel Inside (HBR Product#: 292106)

Moore, Geoffrey A. Crossing the Chasm (Harper Business, 1991).

Bygrave, William & Zacharakis, Andrew. The Portable MBA in Entrepreneurship (John Wiley & Sons, 2004): Chap. 3, “Entrepreneurial Marketing” (pp. 71-106).

Th 1/30 Formulating a New Business

Topics:

• The Innovation Process

o Opportunity Identification

▪ Exploring technological needs/opportunities

▪ Exploring customer needs/opportunities

o Framing the Business Proposition

▪ Business Hypothesis

▪ Business Models

• The funding landscape for early stage technology development

Readings:

Cooper, Alan. The Inmates Are Running the Asylum: Why High Tech Products Drive Us Crazy and How to Restore the Sanity (Sams, 1999): Chap. 9, “Designing for Pleasure” (pp. 123-148).

Chesbrough, Henry W. Open Innovation (Harvard Business School Press, 2003): Chap. 4, “The Business Model” (pp. 63-91).

Corporate Case I: Intel 2006: Rising to the Graphics Challenge (HBR Product#: 607136)

T 2/5 & Th 2/7 Finance

Topics:

• Elements of Financial Statements

• Cash Flow

• Ratio Analysis

• Valuation

Readings:

Corey, E. Raymone. “Note on Pricing.” HBS 9-580-091 (1984).

“Note on Financial Forecasting,” HBS 9-206-048 (1983).

Finance for Managers (Harvard Business School Press, 2006): Chap. 1, “Financial Statements: The Elements of Managerial Finance” (pp. 1-20). Reprint 5788BC.

Corporate Case III: Intel Corp.--1992 (HBR Product#: 502083)

Zider, Bob. “How Venture Capital Works” Harvard Business Review (Nov. – Dec. 1998); pp. 131-139 (Reprint #98611).

Weiser, Mark. Venture Capital: A Primer for Understanding Seed and Mid-Stage Funds (Unpublished); April 2000.

T 2/12 Business Fundamentals Recap & Midterm

Th 2/14 Global Entrepreneurship

Topics:

• Corporate vs. entrepreneurial

• Myths/realities

• Developed and undeveloped markets

Readings:

“The New Titans—A survey of the world economy,” The Economist, September 16, 2006 (pp. 3-30).

Case. Spotfire – Managing an International Startup (HBR #899-078)

T 2/19 Business Roundtable and Venture Finance

Topics:

• Living cases in entrepreneurship; getting started

• Strategic product development and exit strategies

•

Th 2/21 Midterm Feedback and Transition to CleanTech Ventures

SPRING BREAK

T 3/4 Situating CleanTech Venture Investment

Topics:

Discussion of investment drivers in startup and corporate ventures

Class project – team formation

Readings

Aurora Energy podcast/DTE webcast

The Economist: CleanTech VC in US & China

Th 3/6 CleanTech Opportunity

Topics:

Difference between CleanTech and other technology domains

CleanTech Drivers

Venture investment objectives: Government, Corporate, Venture Capital

Readings:

CleanTech p 1-29

The Economist: Business and Climate Change

The CleanTech Report: Chapters 1 and 2

T 3/11 Value Creation in the CleanTech space

Topics:

Overview of the value-creation perspective

Innovation, Strategy, Finance, Marketing

Readings:

Mullins, John W. The New Business Road Test: What entrepreneurs and executives should do before writing a business plan (Prentice Hall 2003): Chap. 1, "My Opportunity: why will or won’t this work?" (pp. 2-23).

Porter, Michael. “What is Strategy?” HBR reprint 96608 (1996).

Living Case:

WOW Energies (with comments by Mario Romero, CEO) or Fortune Minerals (with comments by Robin Goad, CEO)

T 3/13 Venture Investment Strategies in CleanTech

Topics:

Types of investors

Timing of investments

Exit strategies

Readings:

Zider, Bob. “How Venture Capital Works” Harvard Business Review (Nov. – Dec. 1998); pp. 131-139 (Reprint #98611).

Case: FortuPower Cell

Th 3/18 Solar Energy: Technology, Drivers, Challenges

Topics:

Technology basics and alternatives

Technology and strategic drivers

Challenges and investment momentum

Readings:

Pernick and Wilder, pp. 29-59

Economist Biotech and Solar Tech Quarterly pp. 14-17

Relevant Weblinks:

American Solar Energy Association:

Department of Energy:

Case: ‘Ten To Watch’ (Pernick/Wilder)

T 3/20 Wind Power: Technology, Drivers, Challenges

Topics:

Technology basics and alternatives

Technology and strategic drivers

Challenge and investment momentum

Readings:

Pernick and Wilder, pp. 59-83

Wind Power Outlook 207

Relevant weblinks:

American Wind Energy Association

Case: Wind To Energy (Ivey)

Th 3/25 Intellectual Property in Clean Tech

Guest Lecturer: Jeffrey Schox, Patent Attorney, Schox, PLC

Readings:

Hart, Myra & Zaharoff, Howard. “The Protection of Intellectual Property in the United States.” HBS #9-897-049 (2000).

T 3/27 Biofuels: Technology, Drivers, Challenges

Topics:

Technology basics and alternatives

Technology and strategic drivers

Challenge and investment momentum

Readings:

Pernick and Wilder, pp. 83-115

Economist: Biofuel and Solar Tech – p 10-11

Case:

Aurora Revisited (Videolink with Jim Long, Gabriel Ventures, CA)

Th 4/1 Transportation: Ultra-Efficient, Low-Emissions, High Performance

Topics:

Technology basics and alternatives

Technology and strategic drivers

Challenge and investment momentum

Readings:

Pernick and Wilder, pp. 141-167

A technical note on ethanol as motor fuel

Case:

Fuel Cells; The Hydrogen Revolution (HBR #804144), or

The Future of Hybrid Electric Vehicles (HBR #502025)

T 4/3 Green Buildings

Topics:

Technology basics and alternatives

Technology and strategic drivers

Challenge and investment momentum

Readings:

Pernick and Wilder, pp. 115-141

National trends – green buildings

Living Case:

SITUMBRA (Dr. Harry Giles)

Th 4/8 Water Treatment

Topics:

Technology basics and alternatives

Technology and strategic drivers

Challenge and investment momentum

Readings:

Pernick and Wilder, pp. 213-237

Case:

Glegg Water Co and the ECell (HBR case)

T 4/10 CleanTech Marketing

Topics:

Technology adoption: Crossing the Gap

Five key lessons

Readings:

Pernick & Wilder, pp. 261-285

CleanTech Report 2007, Chapters 3/4

T 4/15 CleanTech Venture Opportunity Recap

Th 4/17-Tue 4/24 Presentations

................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download