TEACHING & LEARNING
A lawyer and physicist
turned Wharton student find common ground in mentoring relationship
OUTREACH
More
Than a Pet Project
Plus: Follow up on 2002 WBP Competition winner
Plus: Learn more about the Grand Prize winning team, PAWS
Building Entrepreneurial Businesses
Faces of Wharton Entrepreneurship
RESEARCH
Venture Capital Syndication
Pays off — and not just for the VC
Newer Web Companies Aim to Change Consumer Buying Habits
Outreach
Changing Times: Wharton Business Plan
Competition Venture Fair Winner Eschews High Tech
A pet insurance company wins this years's Wharton Business Plan Competition Venture Fair, with a biotechnology firm coming in second, and an electronics firm, third.
Tabbies and terriers trumped technology at the 2003 Wharton Business Plan Competition Venture Fair.
PAWS, a pet-insurance company proposed by four Wharton MBA students, won Grand Prize at this year's competition (See accompanying article).
The victory comes with a $20,000 award. "We feel like winning really validated our idea," says Chris Ashton, one of the PAWS team members. "We'll use the money for startup costs for the business — trademarks, legal advice on setting up partnership agreements and to get our marketing materials together, maybe even to get a Website up and running." The four team members, who earned their Wharton MBAs this spring, all are working for the fledging firm.
The annual Venture Fair gives eight student teams a chance to present their business ideas to a distinguished panel of judges and audience of venture capitalists and others. It's the culmination of the Wharton Business Plan Competition (WBPC), and is open to any University of Pennsylvania student; 151 student teams participated in the Business Plan Competition this year.
At the fair, PAWS, which plans to design and market insurance policies for dogs and cats, edged out a biotechnology firm, Biogenomix, and a maker of battery-like devices called energy harvesters, Ferro Solutions. Second-place Biogenomex won $10,000; third-place Ferro Solutions won $5,000.
In addition, JMesh Technologies, a wireless-networking company, snagged the $5,000 Frederick H. Gloeckner Award for the highest ranking undergraduate team. Two teams that competed in earlier phases of the WBPC — Bridge Education International and Tantra Hill International College — split the University of Pennsylvania/The Goldman Sachs Foundation's $5,000 Entrepreneurship in Education award.
Unlike recent years, information-technology companies didn't dominate among the finalists. Besides JMesh, the "Great Eight" included only one other — Friar Tuck, proposed selling software for planning complex undertakings such as professional sports league schedules.
Going to the Dogs — and Cats
For PAWS, the process that culminated with the fair began in the fall of 2001 when a cat belonging to two of the team members — Chris Ashton and his wife, Natasha — got sick, and they found themselves shelling out $5,000 for veterinary care.
The Ashtons figured they should get pet insurance, which is widely used in England, their home country. But they discovered that American offerings didn't measure up to British ones. That gave birth to the idea for their company.
During their 10-minute
Venture Fair presentation, the Ashtons and teammates Laura Bennett
and Alex Krooglik argued that pet insurance would tap
a potentially hefty
market in the United States.
This country has 130 million pets but only 0.5 percent of them are
insured, compared with 10 percent in the United Kingdom. "If you
apply the U.K. penetration rate to the U.S. market, that's $2 billion
worth of premiums a year," Natasha
Ashton said.
What's more, demand for the insurance should grow on account of four factors:
- American consumers report the same bond with their pets that Brits do, with 80 percent referring to themselves as their pets' "mother or father."
- Veterinary care is getting more costly as it gets more sophisticated.
- Older people spend more on their pets, and the American population is aging.
- Premium pet-food companies are looking to partner with pet-insurance companies.
Platelet Power
Team member Philip Toh kicked off with an attention getter: "Drug delivery today just isn't good enough."
The trouble is that drugs aren't "intelligent enough to know exactly where they're supposed to go," he said. Instead, they just travel throughout the body and treat the troubled organ as they flow by. "But imagine a drug that could pinpoint where it needed to go."
Biogenomix would use blood platelets, which assist in clotting, as "cargo trains" to deliver drugs precisely where they're needed. Toh and team member Jason Kim — they're between their first and second years in Wharton's MBA program — found the technology through the University of Pennsylvania's Center for Technology Transfer. "They have all sorts of technology that they're trying to commercialize over there," Toh said. "They really welcomed us."
Both students had worked in healthcare startups before coming to Wharton and wanted to try to launch healthcare or biotechnology companies of their own upon graduation. Their third team member, Hari Sundram, is a physician who is doing his residency at the Hospital of the University of Pennsylvania.
Toh and Kim will devote this summer to "looking more in depth at markets where we can take the technology," Toh said. "We're looking to validate the idea with physicians and investors and then pursue raising capital. We've had a number of conversations with potential investors since the competition."
During their
Venture Fair presentation, one judge challenged the
team members with a question, "What's the
magic in the science here?"
"It's in transfecting the drug into the platelet," Sundram
said.
Shake It Up, Baby
Its industry is different, but Ferro Solutions' technology seems just as magical. It wants to pull energy out of thin air.
At least that's how it would seem. In reality, the company — it's already incorporated — owns the rights to a device that captures vibrations and converts them to usable energy.
Called an energy harvester, it's about an inch square and could produce enough power to run a low-power sensor such as those needed in large heating and air-conditioning systems. "They eliminate the need for wires and batteries," said team leader Kevin O'Handley, who earned his Wharton MBA this spring.
O'Handley's father, Robert, a senior research scientist at the Massachusetts Institute of Technology, invented the technology. "I grew up with dinner discussions of my dad's research on magnetic materials," O'Handley says.
Kevin started college as a physics major. But he didn't want to "spend the rest of my life in a lab," so he switched to human services and counseling. That led to a two-years stint a social worker. He then switched to business and soon enrolled at Wharton, hoping to run an entrepreneurial company when he graduated.
In the meantime, his father and a partner started Ferro Solutions in an effort to commercialize their research. Kevin approached his dad about taking over the business side. "He was pretty excited about our working together. And he knows there's a lot about running a business that he doesn't know."
Kevin intends to begin raising money at the end of June. Already, several potential investors have approached him, thanks to a story about the company that ran in the magazine Business 2.0.
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