B Y - P A U L - K A R R
our Terry College of Business students were sifting through a pile of research papers when they stumbled across a can't-miss idea.
They called the professor who had written the research paper. Did he want to team up? That man was veterinary medicine professor Richard Fayrer-Hosken, and he said yes.
Eight months later, the teammates--Mark Patterson (BBA '94, MBA '98), Kimberly Haynes (BBA '97, MBA '98), Tobias Groenen (MBA '98), and Jeff Mills (MBA '98)--stood in an Austin, Texas, lecture hall, presenting their business plan as part of an international competition pitting the best collegiate entrepreneurial minds against each other.
The students explained to the judges that their business, which they had named Bio-Pet Technologies, would market Fayrer-Hoskens' injectible spaying compound. Given in a three-shot regimen, the shots render female puppies infertile--no abdominal surgery necessary. With tens of millions of pet owners in the U.S. alone, the market is wide open. And at day's end, the news was clearly good: the team's Bio-Pet business plan had won first
"Everyone's a winner," says Mills, slipping into the sales pitch that helped sway the judges. "The vet wins because he saves time; the pet owner wins because he's spared the expense of surgery; and the pet wins because there's no pain and lower health risk."
UGA wins, too, because, in order to capture the Super Bowl of business-plan competition--known as MOOT CORP--Mills' Bio-Pet team had to outsmart no fewer than three other UGA contenders. That's right: four of the world's top 24 collegiate business plans came from Athens, and UGA won all four 'Grand Slam' business-plan competitions this year, racking up $40,000 in first-prize loot.
"This is the first time that's ever happened. It's incredible," says Gary Cadenhead, the University of Texas professor who runs the prestigious 15-year-old Austin competition. "It's the year of the Dawg!"
UGA's teams have been so successful, in fact, that MOOT CORP organizers have created what's being called the "Georgia Rule." From now on, only two teams per university will be invited. It wouldn't be fair to the rest of the world, goes the reasoning, if Georgia stacked the deck every year.
Move over, Gym Dogs. Here come the Whiz Kids!
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The BioPet team's success was based on an extremely marketable product: an animal contraceptive developed by a UGA vet med professor that would allow dog owners to spay their pets with a series of shots instead of abdominal surgery. The students' business plan was so strong, they won two competitions--and $25,000. |
embers of the four entrepreneurial teams are all students in UGA's nationally ranked MBA entrepreneurship program, but their secret weapon in these new venture contests is Charles Hofer, Regents professor of entrepreneurship and strategic management.
Hofer was lured away from Columbia during the 1980s, arriving with a reputation as a strategic management expert. Soon, however, he switched his focus to innovation and entrepreneurial studies--a move that paid quick dividends, as UGA rapidly became a national force in the newly-created format of the business-plan contest.
"I've never known a professor who was more dedicated to the learning process," says Paul Hammes (AB '92, MBA '98), who led another of UGA's prize-winning teams, Med-Dynamics. "He lives and breathes each project, gives 150 percent. I have heard him called 'the Bobby Knight of business-plan competition,' and it's an appropriate comparison."
Like the controversial Indiana University basketball coach, Hofer has a reputation as a brilliant strategist--and for drill-sergeant-style practice sessions. During rigorous test rounds in Athens throughout the fall, each team's presentation is scrutinized by panels of seasoned entrepreneurs that Hofer recruits for the task.
"He always does an amazing job of preparing his teams," says Cadenhead. "They come to these competitions thoroughly prepared because he has thought of every kind of question the judges are likely to ask--and has prepared them for it."
That's no easy task. Judges are actual venture capitalists, entrepreneurs, corporate accountants, and attorneys--and they don't miss a trick, scouring marketing plans for common pitfalls such as overly optimistic sales forecasts. They also thump the tires of the students' prototypes for hidden expenses, and rate the presentations on professionalism.
"A good idea alone won't sell, and just a slick team won't sell," says Cadenhead. "You've got to have a well-presented, intriguing idea, with prospects for creating profits and jobs."
This year's MOOT CORP finale included teams from England, Mexico, Germany, Thailand, and Australia, plus 10 teams from leading U.S. business schools like Northwestern, NYU, North Carolina, and Texas. They were hawking everything from organic soybeans to super-strong silk. But they were no match for the four UGA teams:
Bio-Pet
Bio-Pet had already won one of the four "Grand Slam" competitions by the time it reached MOOT CORP, sweeping to victory at the NASDAQ International Business Plan Competition in San Diego, where team members picked up $10,000 in first place money and invitations to Ernst & Young's Entrepreneur of the Year Institute--a great opportunity to network with investors. Bio-Pet also took care of business on its home court by winning the spring Georgia Bowl competition in Athens. Following the NASDAQ competition, judge John Moores, who owns the San Diego Padres and runs a California software firm, said: "We chose the Bio-Pet plan because we agreed with the team's assessment that there are few barriers to entry and that the market is so overwhelmingly large."
MedDynamics
The MedDynamics team marketed a product dreamed up by a male nurse at an Athens hospital: a silicone shield that prevents infections when catheters are inserted into the urethra--and also makes a painful procedure less uncomfortable. The team cruised to victory in the Bank of America/Motorola New Ventures Competition in Eugene, Oregon, where they captured the $10,000 first prize, then made a strong showing in Texas before losing out to Bio-Pet. In another year, this team might have won it all.
iTicket
Internet ventures are a hot new area of business-plan competitions, and the UGA team known as iTicket made a strong run. The team hopes to sell Georgia collegiate sports tickets via the Net. Despite a mid-season problem with its financial projections, the team recovered to win the $5,000 first prize in the Duncan Aviation Business Plan Competition in Lincoln, Neb.
American Golf Reservation Systems
A fourth UGA team, American Golf Reservation Systems, concocted a plan to reserve tee times at public courses in metro areas around the country via the Internet. Thanks to Georgia's year-long success, American Golf received an at-large bid to enter the MOOT CORP contest, but its plan found the bunker in Texas, finishing out of the money.
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Students liken entrepreneurial studies prof Charles Hofer to Indiana University basketball coach Bobby Knight because he's a brilliant strategist who runs drill-sergeant-like practice sessions. |
harles Hofer is quick to point out that even award-winning business plans don't necessarily translate into big bucks. "The statistics for new businesses are similar to those for marriages," he chuckles ruefully. "Roughly one in two sophisticated startups will fail."
Still, program alums point to their experiences in business-plan competitions as a springboard for future success in the business world. Sam Kellett (MBA '96) turned his plan into Attorneys-at-Work, an Atlanta firm that recruits legal personnel and places them in law firms nationwide via the Internet. The company projects revenues of $1.5 million for 1998.
"I acquired knowledge that I'll cherish for the rest of my life," says Kellett, 26, who credits Hofer with helping light the way. "He teaches you how to write a business plan the right way."
Several of UGA's current teams want to remain together after graduation, hoping to mimic Kellett's success in the real world--though it's not likely that Bio-Pet will be among them. Their marketing plan was terrific, says Hofer, but with 2 million female puppies born each year, projected revenues are extremely high--which means that an independent licensee will most likely take Fayrer-Hosken's breakthrough research into the marketplace.
Playing off its success in the Nebraska competition and a deal with UGA's athletics department to sell hoop tickets via the Internet next fall, iTicket will continue to seek funding sources while it runs the pilot program. The University of Virginia and University of North Carolina have expressed interest in arrangements with the company, says team leader Tony Gaines (MBA '98).
"If we can prove this program is successful, we'll see about signing contracts for all the sports," notes Gaines, a former Army captain who developed the idea while studying information systems. "There is nobody currently doing this for college sports. The usual way of ordering tickets to collegiate sports events is to call up the box office within certain restricted hours."
MedDynamics leader Hammes isn't too disappointed that his team lost out to Bio-Pet in Texas, because he's learned so much.
"It's been a tremendous experience, both the MBA program and the competitions," says Hammes, 31, an Athens native. "We have had the opportunity to network with real-world entrepreneurs, and to be in constant contact with attorneys, managers and capitalists."
During one of Hofer's grill sessions, Hammes learned his proposal capital structure was unrealistic--it requested too much money from investors before the prototype had been FDA-tested and approved.
"They said there was no way we could expect that kind of money up front," says Hammes. "So we went back to the drawing board and reworked the financing into a two-tier structure, part of the money coming up front and the rest kicking in after FDA approval."
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Other hits
Repeat Performers, a company that used divers to recover golf balls from water hazards, is one of many real-world ventures that got its start in Charles Hofer's MBA class. Others include United Cheerleading, an advanced training program for cheerleaders, which is about to open its third location; Greek Pride, a catalog company that markets college memorabilia to African American fraternities and sororities; and Attorneys-at-Work, which provides temporary legal personnel. |
ofer ticks off several reasons for the program's string of victories in the hotly contested international business-plan competitions, including the quality of UGA students and the Terry College of Business' strategy for growth--which during the 1980s began awarding faculty salary incentives for research productivity, and developing new areas of expertise other B-schools hadn't thought to teach. This approach has worked wonders, Hofer believes, by bringing in a fresh crop of star researchers from outside the Southeast.
"We've gotten very good at both the M.B.A. level and the Ph.D. level," says Hofer. "We have a world-class Ph.D. program in entrepreneurship, and knowledge is transferred immediately to the classroom. Normally, there's a five-year delay between new research and the time it hits textbooks. But here, the new knowledge is put into practice literally as it is being collected."
Hofer is fond of statistics, and this one is jaw-dropping:
UGA business students have won nine entrepreneurship dissertation awards--more than any other college or university in the world, and twice as many as the two second-place finishers (Harvard and Wharton, no less) combined.
Here's another one:
UGA has won eight of the 24 business-plan competitions since 1992, and finished in the top five all but three times--meaning the success of this year's whiz kids was no fluke.
"We've got great ideas and world-class research," Hofer concludes. "Bio-Pet took an A-plus innovation from Dr. Fayrer-Hosken and developed an A-plus business plan and presentation. That's what's possible here at the University of Georgia: Good ideas that will become profitable real-world ventures."