1 Business Model Canvas Venture Studio Entrepreneurs Bootcamp Von Allmen Center for Entrepreneurship September 15, 2016

2 A novel therapeutic approach to disorders of the central nervous system

3 Novoron Bioscience, Inc.Founded in 2013 Spin-out from UC San Diego Develop first regenerative therapy for spinal cord injury Raised >$1.25 MM in non-dilutive grants from NIH Selected to participate in the inaugural NIH

4 Business Model Method or process by which one receives appropriate compensation for providing value to a customer.

5 Business Model Method or process by which one receives appropriate compensation for providing value to a customer

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7 Front of the House

8 Back of the House Front of the House

9 Light Flexible Framework

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11 Heavy Rigid Wrong

12 A startup is not a large company in miniature.

13 “Everybody has a plan until they get punched in the face“Everybody has a plan until they get punched in the face.” – Mike Tyson

14 Entrepreneur Product Manager

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18 Technical Failure Market Failure

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20 Value Proposition NOT your product NOT your product’s featuresYour product/idea has NO intrinsic value Cultural concept

21 Value Proposition Better Faster Cheaper Culture

22 Molecule capable of antagonizing LRP1 and reducing RhoA activation in neuronal cell types after a traumatic injury to the spinal cord

23 Drug-like molecule Neuroregeneration

24 Drug-like molecule Neuroregeneration

25 Drug-like molecule Neuroregeneration Ability to walk Sphincter/bladder control Sensation

26 Drug-like molecule Neuroregeneration Ability to walk Sphincter/bladder control Sensation

27 Drug-like molecule Neuroregeneration Ability to walk Sphincter/bladder control Sensation BETTER Recovery CHEAPER Healthcare costs

28 Customer Segments Who is paying you for your value?Customers are human beings Three roles of a customer Decide Pay Use Be as specific as possible

29 BETTER Recovery Spinal cord injury patients CHEAPER Healthcare costs

30 BETTER Recovery Spinal cord injury patients Doctors CHEAPER Healthcare costs

31 BETTER Recovery Spinal cord injury patients Doctors CHEAPER Healthcare costs Insurance Co.

32 Get out of the building!

33 BETTER Recovery Spinal cord injury patients Doctors CHEAPER Healthcare costs Insurance Co.

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35 BETTER Recovery Spinal cord injury patients Doctors CHEAPER Healthcare costs Insurance Co.

36 Channels

37 Channels Direct IndirectFarmer’s market Trade expo Cold call Indirect Wholesale/Retail Own store Internet Affiliates/Partners Multi-sided market (local newspaper, Facebook)

38 BETTER Recovery Patients Doctors Insurance Co. CHEAPER Healthcare costs Advertising Direct

39 Customer RelationshipsHow do we interact with our customers to provide value (i.e. receive revenue)? Examples Transactional (automated?) Add-on Community Personal assistance

40 BETTER Recovery Personal Patients Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Advertising Direct

41 Key Activities What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships? Revenue Streams? Categories Production Creation Problem Solving

42 FDA approval BETTER Recovery Personal Patients Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Advertising Direct

43 FDA approval BETTER Recovery Personal Patients Phase 3 Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Advertising Direct

44 FDA approval BETTER Recovery Personal Patients Phase 3 Phase 2 Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Advertising Direct

45 FDA approval BETTER Recovery Personal Patients Phase 3 Phase 2 Doctors SCI Community Phase 1 Insurance Co. CHEAPER Healthcare costs Advertising Direct

46 FDA approval BETTER Recovery Personal Patients Phase 3 Phase 2 Doctors SCI Community Phase 1 Insurance Co. IND CHEAPER Healthcare costs Advertising Direct

47 FDA approval BETTER Recovery Personal Patients Phase 3 Phase 2 Doctors SCI Community Phase 1 Insurance Co. IND Toxicology CHEAPER Healthcare costs Manufacturing Advertising Direct

48 Key Resources What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships? Revenue Streams? Categories Physical Intellectual (brand, patents, data) Human Financial

49 FDA approval BETTER Recovery Personal Patients Clinical Trial IND Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Lab Space Advertising Direct

50 FDA approval BETTER Recovery Personal Patients Clinical Trial IND Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Lab Space Advertising ClinDev Team Direct Pre-Clin Team

51 FDA approval BETTER Recovery Personal Patients Clinical Trial IND Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Lab Space Advertising ClinDev Team Direct Pre-Clin Team Money

52 FDA approval BETTER Recovery Personal Patients Clinical Trial IND Doctors SCI Community Insurance Co. CHEAPER Healthcare costs Lab Space Advertising ClinDev Team Direct Pre-Clin Team Money Patents Data

53 Key Partners Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners? Which Key Activities do partners perform?

54 FDA approval Patent Law BETTER Recovery Personal Patients Clinical Trial Consultants IND Doctors CRO SCI Community Insurance Co. CMO FIPCO CHEAPER Healthcare costs Lab Space Advertising Team Direct Money IP

55 FDA approval Patent Law BETTER Recovery Personal Patients Clinical Trial Consultants IND Doctors CRO SCI Community Insurance Co. CMO FIPCO CHEAPER Healthcare costs Lab Space Advertising Team Direct Money IP

56 FDA approval Patent Law BETTER Recovery Personal Patients Clinical Trial Consultants IND Doctors CRO SCI Community Insurance Co. CMO FIPCO CHEAPER Healthcare costs Lab Space Advertising Team Direct Money IP

57 FDA approval Patent Law BETTER Recovery Personal Patients Clinical Trial Consultants IND Doctors CRO SCI Community Insurance Co. CMO FIPCO CHEAPER Healthcare costs Lab Space Advertising Team Direct Money IP

58 BETTER Recovery FIPCO CHEAPER Healthcare costs

59 BETTER Recovery FIPCO Biogen Sanofi AbbVie CHEAPER Healthcare costs GSK

60 BETTER Drug Candidate FIPCO Biogen Sanofi AbbVie GSK

61 BETTER Drug Candidate Personal FIPCO Biogen Sanofi AbbVie GSK Direct

62 IND BETTER Drug Candidate Personal FIPCO Toxicology Biogen Manufacturing Sanofi PK/PD AbbVie GSK Lab Space Direct Team Money IP

63 Patent Law IND BETTER Drug Candidate Personal FIPCO Consultants Toxicology Biogen CRO Manufacturing Sanofi CMO PK/PD AbbVie GSK Lab Space Direct Team Money IP

64 Cost Structure Value Driven (or Cost-Based Pricing)1970’s GM Cost Driven (or Price-Based Costing) 1970’s Toyota Easier to identify than revenue Industry specific metrics Cost per user Cost per unit Cost per per available room

65 Patent Law IND BETTER Drug Candidate Personal FIPCO Consultants Toxicology Biogen CRO Manufacturing Sanofi CMO PK/PD AbbVie GSK Lab Space Direct Team Money IP Pay for activities and resources

66 Revenue Streams

67 Patent Law IND BETTER Drug Candidate Personal FIPCO Consultants Toxicology Biogen CRO Manufacturing Sanofi CMO PK/PD AbbVie GSK Lab Space Direct Team Money IP Licensing Fees Up front Milestone Royalty Pay for activities and resources

68 BMC – Next Steps Put together a draft of your BMCTalk to your first customer Talk to your next 5 customers Edit your draft BMC Talk to 10 more “customers” Present your draft BMC next week Confidence intervals

69 “If everything seems under control,you're not going fast enough.” - Mario Andretti

70 “… [N]o plan of operations extends with any certainty beyond the first contact with the main hostile force.” - Helmuth von moltke

71 “… [N]o plan of operations extends with any certainty beyond the first contact with the main hostile force.” - Helmuth von moltke

72 “… [N]o plan of operations extends with any certainty beyond the first contact with the main hostile force.” - Helmuth von moltke customers