sen. enzi’s inventors conference april 21, 2006

Taking Today’s Technologies into Tomorrow’s Markets

Sen. Enzi’s Inventors Conference

April 21, 2006

From Your Garage to the Assembly Line: It’s a Long Way!

Cliff Brown

ADA Technologies, Inc. - Proprietary

Topics

• Introduction to ADA• Business Model• Example that involves

manufacturing• Some of the challenges


What’s the Game?

• Why are we in business??

– To WIN!!

• Winning is creating realizable value from technology

• Focus on winning as early as possible

• It is a “TEAM SPORT”

Begin with the end in mind! --S. Covey


Who are we?

20 years old

$40M contract research

28 patents issued & pending

35 staff – 6 PhDs

Demonstrated Commercial

Successes

Littleton

Laramie


6 Year Trends -- ADA

CAGR = 24% / five years

Revenue Trend

0

1000000

2000000

3000000

4000000

5000000

6000000

2001 2002 2003 2004 2005 Est 2006


What do we do?


Business Concept is Focused on Value Creation

$Marketing

IPProduct Development

Planning

Spin-off

Joint Venture

License

Infrastructure

Sell


The ADA Model

• Focus is on “THE PROCESS” of commercializing early stage technologies

• “THE PROCESS” is invariant to the technology (about 80-90%)

• Corporate value and return to shareholders results from successful commercialization

• Plan for succession/exit of primary shareholders in 5 years +/-

• Try to do only what your are good at!!

• When a technology is mature it is transferred to a separate entity


Focus on the Hand-off from Product Development to Manufacturing

• ADA will not be a manufacturer but we must prepare for the handoff

You Get What You Order!


Example

• WeatherPod product, now in production, started in 1999 through an Army Phase I SBIR

• Received Phase II, Phase II+ and Phase III funding from the DOD

• Phase III funding of c.a. $1.5M to transition from prototype to product

• Will be set up as a separate entity to enable generation of shareholder value and groom for sale


The Essence of the Challenge: Culture Shift

• R&D Culture

– Academic

– Creative

– Free flowing; schedule not critical

– Not typically driven by a product specification

– Soft Deliverables

– Make one and celebrate!


• Product Development / Manufacturing Culture

Big difference between Invention and Product Development!

– Customer expects product to meet their specification & work more than once

– Set delivery date

– Should be able to replicate production

– Typically fixed price ∴ increased risk

– Fix it when it breaks; provide support ie customer service

– Requires A-R attention to detail

The Essence of the Challenge: Culture Shift


Lessons Learned (We learned A LOT!)

• Management, Leadership, Control and Communication

– In the beginning

• Spend the time to accurately estimate the work required; get independent assessments

• Be realistic --- no success oriented schedules• Include detailed testing requirements• Plan work down to weekly “mini-milestones”• $$ cannot be customer driven• If invention is required factor in risk (many more $$)• Management resources must be planned in

– During Project• No leadership by committee; need single POC• Be realistic about capabilities of personnel• When there is a problem, promptly fix it• Have weekly meetings to assess progress and compare to plan

– Be realistic– Financial review 1/month


Lessons Learned (Development Processes Required)

• Establish and Follow Processes– Enforce all

processes: No exceptions!

• The processes are foreign to typical R&D

• We started with the null set with regard to processes

• Processes must be documented

Part numbers RMA system

Problem tracking

Incoming parts receiving

Engineering changes

Transfer of parts to vendor

Revision control

Equipment loan to manufacturer

Change Control Board

Testing

Release Software development

Sales quote Inventory control


Lessons Learned -- Miscellaneous

• Don’t start manufacturing until the design is complete

• Allow plenty of time and money for testing

• Consider an external test group

• Minimize function creep

• Vendor selection is critical

– Multiple quotes

– Check references/perform due diligence

– Match background to project

• Design for manufacturing to the extent possible

(remember you get what you order!)


From Garage to Manufacturing: Long trip but possible!

• Realize up front that there are significant challenges

• Acknowledge cultural difference

• Enlist the right help early on

• Develop and implement the right processes then follow them!

• Plan, Lead, Organize and Control


Contact Information

ADA Technologies, Inc.8100 Shaffer Parkway, Suite 130Littleton, CO 80127

---AND---

Wyoming Technology Business Center1000 E. University AveLaramie, WY 82071-2000

[email protected] (303) 792-5615 www.adatech.com

sen. enzi’s inventors conference april 21, 2006

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