Moot Corp Lesson: Even the Best Plans Change

Tim Berry has a great post, Moot Corp Lesson: Even the Best Plans Change. It highlights the level of competence in some of the top business plan competitions and also makes clear the value in these exercises.

Tim writes,

One of the judges commented that what was on the slide was different from what he saw in the business plan. The entrepreneur immediately answered “no, of course not, that was an earlier iteration.”

That favorite moment wasn’t part of the flawless finals session of the winner. It was in the finals, though, as a Carnegie Mellon team presented a technology to monitor glucose levels using contact lenses. What I liked about that quick answer was the underlying assumption that plans change. New information matters. There was no reason to keep the numbers from last week after new information this week suggested they should change.

If the projections today don’t match those from two weeks ago, no apology is necessary.

The winner, BiologicsMD, also won the Rice University competition a few weeks ago. If you get a chance to see the video of their performance, both with their pitch and their business and their answers to judges’ question, take it. That’s the best I’ve ever seen. The company, one of two finalists from the University of Arkansas, has developed a new medicine to treat osteoporosis. It included a PhD researcher, an MD researcher, and two business executives. The panel of judges, three of the four of them with backgrounds related to medical technology and FDA approval and such, asked an amazing array of detailed industry-specific questions. And they were presented with an even more amazing array of straight-on answers. That was as good as it gets.

I recently read an article decrying business plans, their static nature, and business plan competitions. (Steve Blank is new to me, but I am reading some of his stuff). I will share some of his thoughts in a separate post later this week. Tim and others clearly articulate the importance of change in the business plan process.

But Tim’s example highlights that importance of the act of writing plans and defending them to those with critical lenses.  That even holds true for in-class  competitions where part-time undergrads are subjected to questions about their “used jean retailers” by judges of adjunct faculty members and local bankers.

Berry’s Moot Corp example and my undergrad retailer example exist at different points on the business plan and competition spectrum, but provide important value to society and the economy — from viable, potentially high-impact firms to a generation of college grads who understand the importance and role of small businesses and entrepreneurs.

McComb’s School of Business Birthed uShip

Good piece highlighting another high impact company that was founded on campus by students. These student entrepreneurs  hail from University of Texas McCombs School of Business (home of the fabled Moot Corp) and they created an online shipping platform called uShip. From the article by Stacey Higginbotham:

Six years ago I attended a business plan competition where I watched a couple of guys explain how they wanted to streamline the process of shipping bulky items across the country by linking folks up via the Internet. The social Web was starting to heat up, but I liked how these guys and their company, uShip, were trying to take the Web and use it to bring people together, not to swap songs or photos but to take advantage of empty space in moving vans.

UShip, a matching service that connects people who want to send things across the country and those who happen to have space in their vehicles as they drive across country (and that also offers an alternate revenue stream for professional shippers) is now profitable, thanks to commissions the company takes when it matches shippers and shippees. The Austin (Tex.) company brought in between $5 million and $7 million in sales during 2009, double that of the previous year.

UShip has raised $7 million in outside capital from Benchmark and DAG Ventures and has helped broker more than $140 million in shipping contracts—with about 85% of those occurring during the past two years. Last week it received its one-millionth listing on the site.

From a March 2004 Moot Corp Newsletter highlighting uShip’s performance in the San Diego State University Business Plan Competition:

The uShip team is composed of four second-year students–Matt Chasen, Jay Manickam, Mickey Millsap and Todd Parsapour-whose start-up is uShip, a company that offers “ridesharing for your stuff.” That is, it matches cargo with drivers who have excess capacity on routes all around the country via patent-pending route deviation search technology.

uShip (www.uship.com) made its official launch March 1 and the early results have exceeded their wildest expectations. With limited marketing, they already have over 550 members, 60+ shipments listed, and have completed 12 transactions. uShip initially expected their model to be limited to lower cost in a limited geographic area, but their very first transaction was a $900 shipment of three beds and a dresser from Texas to Pennsylvania. uShip is looking to close a 500K round by May to scale their marketing and technology infrastructure.

What an impressive job by uShip and its founders. As we can, see they found seed funding through a variety of business plan competitions and have really been able to scale their firm; creating wealth for investors and entrepreneurs as well as jobs for residents of Austin and freight transporters. Pretty cool. Congrats to the team and McCombs for such a great success.

Austin’s uShip Profits from Slow Growth – BusinessWeek.

QCUE Wins Moot Corp @ U of Texas

Moot Corp was the first business plan competition. It was started by two University of Texas MBA students that wanted something comparable to the Moot Court that was/is offered to law school students. That was 1984. Today Moot Corp is the most prestigious of the ‘open’ business plan contests where people from a variety of schools compete.

This year’s winner, qcue llc, was just announced. A little bit about qcue llc From Moot Corp’s website,

Accurately pricing event tickets is difficult due to unknown and fluctuating consumer demand and the risks of overpricing. Scalpers have taken advantage of this arbitrage opportunity to create a multi-billion dollar secondary market While primary sellers fail to capture the mark-ups that result when tickets are underpriced, they face the consequences of poor attendance from overpriced tickets. qcue exploits the synergies between the primary and secondary markets by integrating elements of airline pricing and NASDAQ trading into current selling platforms, providing primary sellers the ability to dynamically price-to-market. The qcue team members include Barry Kahn, PhD Economics 2007; Jitendra Dalvi, MBA 2007, and Andrew Mills, PhD Computer Science 2008.