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Business Plan Competitions at Ross: "As Real as it Gets"

3/2/2009 --

Michigan Business Challenge and DTE Clean Energy Prize inspire viable start-ups.

ANN ARBOR, Mich.—It's a cold winter day, but the competition inside Ross is getting heated. Jan Garfinkle, founder and managing director of Arboretum Ventures, and Pete Farner, managing director of TGap Ventures, sit at a table opposite four Ross School students. Erica Graham, Shally Madan, Siddharth Sinha, MBAs '09, and Elizabeth Uhlhorn, MBA/MS '10, make up Team Husk, a startup poised to convert agricultural waste into thin, high-grade insulation for the refrigeration industry.

It's the final round of the University-wide Michigan Business Challenge, and Garfinkle and Farner shoot questions at Team Husk. How long will it take to get their product to market? An estimated 18 months. How much funding do they need? $425,000 for the first round. Why is their insulation an improvement over what's already on the market? It's more energy efficient and can be produced at a competitive price.

Some questions have no easy answers. When those arise, a team spokesperson says, "Thank you, we'll look into that." And they do, says Graham. "That's the first thing we do."

Being diligent about follow-through is one of many reasons Husk has succeeded so far. The team took home the $15,000 Pryor-Hale Award for Best Business at the Michigan Business Challenge and was one of three teams to make it to the finals of the DTE Energy Clean Energy Prize Competition March 20, 2009. This was the first time business plan teams could compete simultaneously in the two competitions, and Husk took second place in the Clean Energy Prize. (A complete list of winners in both competitions follows.)

Husk team members point to mentorship from Ross faculty as a key factor in their plan's success to date. Professor Jim Price offered guidance throughout his New Venture Creation class, which tracked closely with competition deadlines and milestones. In addition, the team participated in workshops put on by the Zell-Lurie Institute for Entrepreneurial Studies (ZLI). They also benefited from constructive criticism offered by faculty judges, including Andy Lawlor, lecturer of entrepreneurship and strategy.

"We were able to speak with [Lawlor] and have him critique our plan," says Ian Dailey, MBA '09, the fifth member of Husk unable to attend the Michigan Business Challenge. "For people who have limited experience putting together a business plan, that's the type of stuff that's really helpful because you need to talk to somebody who's done it before."

The Michigan Business Challenge differs from other contests in that it draws out the rounds of competition over four months, giving teams time to make their plans increasingly viable. Round one took place in November 2008. Subsequent rounds required more detailed presentations, narrowing the field from 64 teams to just eight by the February finals.

"After one round of competition, the judges will say, 'Okay, in a month, we want to see more information about the market, more information about your competitors, and more information about the finance,'" says Dailey. "Eventually, if you make the cut, they want to see the whole business plan."

At the same time, Ross students can access additional monies by applying for Dare to Dream grants through ZLI. Dare to Dream encourages teams to undertake feasibility studies or move ventures closer to launch via funding.

Already winners of the Dow Sustainability Innovation Challenge, Team Husk is now mining every capital infusion it can find. Members next hope to win the $65,000 award offered by the Clean Energy Prize. The prize money would be helpful, as all five team members are devoted to the future of Husk. But they admit their plan might not be so robust if they had not been forced to enhance it throughout the competition.

"The more times you refine it and it gets torn apart, the better it gets," says Dailey.

Another team that came out on top in the Michigan Business Challenge was Audiallo, featuring Aaron Nelson, MBA '09, and Luis Calderon, MBA '10. Audiallo sets out to design biologically-inspired, audio-processing technology to target the hearing aid and high-end audio markets. The team scored $5,000 in winnings.

"This was probably one of the best educational experiences I've had; it's so applicable," says Calderon. "Any investor is going to have the same questions these judges had. This is as real as it gets."

Calderon and Nelson plan to work full-time for Audiallo upon graduation. They've already started raising $500,000 in start-up capital.

The other two teams to compete in the final round of the challenge were Caliente, a Mexican fast food chain to be franchised in Poland, and Innovet Technologies, which develops products and services to treat small animal veterinary needs. Caliente consists of MBAs '09 Yuri Haverman, Jaime Olaiz, Rene Torres, and Marcin Wojtczak. Innovet is made up of Rohan Mendoza, MBA '09, and Aniebet-Abasi Udofia, MBA '10.

Innovet Technologies took home $2,000 in prize money for Best Written Plan and Team Caliente won $2,000 for Outstanding Presentation.

Besides the opportunity to develop a sound business plan and collect the prize money, the student competitors cite the rewards that come from working with MBA peers.

"When you get together every day, you learn something new," says Dailey. "And every time you learn that piece of new information, it revolutionizes your way of thinking about it."

Graham adds, "I didn't come to school thinking I was going to do insulation. I'm just in awe every day that we have such a smart team and it makes us work that much harder. We'll make everything work because we want to succeed."

—Leah Sipher-Mann

Michigan Business Challenge winners:

Pryor-Hale Award for Best Business: $15,000
Husk: Ian Dailey, Erica Graham, Shally Madan, Siddharth Sinha (MBA '09), and Elizabeth Uhlhorn (MBA/MS '10)
Converts agricultural waste into thin, high-grade insulation for the refrigeration industry that delivers a significant improvement over conventional, petroleum-based insulation.

Runner-up Award for Best Business: $5,000
Audiallo: Aaron Nelson (MBA '09)
Designs biologically-inspired, audio-processing technology which targets the hearing aid and high-end audio markets.

Erb Award for Sustainability: $5,000
Algal Scientific: Jeff LeBrun (MBA/MS '08), Robert Levine (PhD '11), and John Rice (MBA/MS '09)
Manufactures and operates turn-key water treatment systems that combine wastewater treatment with biofuel production using algal growth bioreactors and proprietary processing technology

Williamson Award for Cross-Functional Teams: $5,000
Ikanos Power: Steven Edmund (PhD '12), Tom Gilbert (PhD '09), Sameer Parvathikar (PhD '12), Jason Townsend (MBA 10), and Richard Wood (MBA '09)
Develops and manufactures flexible fuel electricity generation products for use in military, trucking, and distributed power markets.

Undergraduate Award: $2,500
Project Freestyle: Aly Juma (BS 09), Chris Mwakasisi (BS '11), Tom McCurdy (BBA '11), Michael Parke (BBA '08), and Alexander Wozniak (BBA '11)
Designs, develops, and sells online tools for managing team sports.

Best Written Plan: $2,000
Innovet Technologies: Rohan Mendonza (MBA '09) and Aniebet-Abasi Udofia (MBA '10)
Is developing products and services to treat painful conditions ranging from minor fractures to joint replacements for small animal veterinary needs.

Outstanding Presentations: $2,000
Caliente: Yuri Haverman, Jaime Olaiz, Rene Torres, and Marcin Wojtczak (MBAs '09)
Will launch the first national chain in Poland serving Mexican fast food.

Roomations: Lakshmi Bhargave, Jessica Goldberg (MBA '09), and Katie Miller (MBA/MArch '10)
Operates an online design and construction consultation for do-it-yourself home improvement

Clean Energy Prize winners:

First Place: $65,000
Algal Scientific: Jeff LeBrun (MBA/MS '08), Robert Levine (PhD '11), and John Rice (MBA/MS '09)

Second Place: $21,000
Husk: Ian Dailey, Erica Graham, Shally Madan, Siddharth Sinha (MBA '09), and Elizabeth Uhlhorn (MBA/MS '10)

Runner-Ups: $3,400
Ikanos Power: Steven Edmund (PhD '12), Tom Gilbert (PhD '09), Sameer Parvathikar (PhD '12), Jason Townsend (MBA '10), and Richard Wood (MBA '09)

SITumbra: James Bucher (PhD '09), Mark Leo (MBA '10), Mary Martin (MS '09)
Proposes a rigid solar shading window system configured to respond to seasonal variations with optimal energy efficiency.



For more information, contact:
Bernie DeGroat, (734) 936-1015 or 647-1847, bernied@umich.edu