Business plan competitions: worth it?

16 01 2008

Last week I attended an information session for the 2008 Burton D. Morgan Entrepreneurial Competition. It’s basically a business plan competition for Purdue students, faculty and staff. The annual event is open to everyone, and the prize money is nothing to sneeze at.

Place
Gold Division
Black Division
1st
$40,000
$20,000
2nd
$12,000
$7,000
3rd
$8,000
$5,000
4th
$3,500
$2,500
5th
$1,500
$1,000
Subtotals:
$65,000
$35,000

The money, of course, was one of the first slides in the overview presentation. The two divisions above serve to separate undergraduate students from graduate students and faculty. Undergrads comprise the Black Division, and everyone else affiliated with Purdue participates in the Gold Division. If memory serves me right, the presenters said that last year there were somewhere in the neighborhood of 50 entries in each division.

At first I was definitely intrigued by the idea of the competition, and somewhat excited about it. Now that I’ve had a few days to think about it, however, I’m not so sure that I’ll enter. Here are the main reasons…

  • Priorities – Day by day I’m getting closer to having the first release of ClimbPoint ready for sale. If there are a few gyms that buy the software, it would nearly offset the winnings were I to come in 4th or 5th in the competition (and I think I’m being generous even giving myself a shot at those spots).
  • Intellectual Property – It makes me a little uneasy that none of the judges (nor anyone else attending the competition) will be required to sign any kind of non-disclosure agreement. NDAs in business plan competitions are pretty rare anyway though, as most participants have already filed patents on their ideas prior to competing. There is zero chance that I’ll file a patent before the competition (or ever), so I’m reluctant to show off my idea to random people who have the money and resources to do something with it if they choose.
  • Time – This one is related to #1. Were I to make the first cut, I would be required to submit a 30 page (or so) business plan describing all aspects of the market, the competition, and my plan for entering the market. This exercise would be beneficial, but at this point (especially with having to write the final report for my Masters project) I don’t think there’s time to do it, or do it well.

There are a few reasons I can think of to try it. The presenters at the info session stated that all “rejects” will get some feedback on their executive summaries or business plans. The guidelines for the executive summary and business plan are fairly extensive, and much of the research that I’d need to do to complete them would probably be helpful (my market research and marketing plan have been mostly theoretical to this point).

So here’s a question for all 4 of you who are following this blog…Am I overlooking anything? Is there value in entering this contest? Would writing a business plan really be a waste of time? There are some good comments over at wsj on the waste of time issue, but I’d like to hear some other thoughts…

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3 responses

17 01 2008
Bob Myers

I think I would tend to focus on the realities before me, rather than enter a competition and a very time consuming one at that. You appear to be close to actually launching a business and that process would seem to me to be a much better use of your time and energy. And you best know what other tasks need to be accomplished before the end of the school year. Plus your initial contacts with prospective clients and their feedback has been positive. I think it best to focus on what appears to be budding, rather than try to sprout another cutting of the same plant. Most businesses are born from servicing needs and not from executive summaries and well thought out business plans.

23 01 2008
Barrett Myers

Yeah after thinking about it some more and talking to a few other people about it as well, I do think the best bet is to move forward with the software development.

I’m going to keep moving forward with getting the next version of ClimbPoint out for now — I think I should have it done by the end of January. The executive summary for the competition isn’t due until February 8, so I’ll still have some time to jump in later if I decide to do so. Most of what I’d need to submit for the summary has already been thought through anyway.

25 01 2008
Growing organically: who needs startup capital? « Another Startup

[…] outside investments to grow too quickly. The timing of the article was great considering my recent option of entering a business plan competition. As a side note, I’ve decided to defer on that option […]

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