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A look of disbelief and elation spread across the faces of four MBA students from Mannheim Business School, Germany, when it was announced they were the winners of the 20th European Business Plan of the Year competition.
The four, Alistair Bruce, Moritz Hertler, Stefan Reuter and Christian Uhrich, donned matching shirts sporting the company logo “Spotted” as they posed for photographs at London Business School, this year’s host.
Their business plan – a mobile app that aims to put the face-to-face interaction back into social networking – earned them the top prize of €3,000. They intend to invest the prize money in their start-up. Spotted aims to help people with similar interests in a specific geographical area to network more effectively and set up meetings – at a graduate recruitment fair or a party, for example.
Users of the app can create online profiles of themselves, by extracting information from social media sites such as LinkedIn. After viewing profiles of other Spotted users in the nearby vicinity, users can then target selected people of interest via a messaging feature and suggest a meeting.
“Spotted is basically aimed at reducing the element of chance that is inherent in professional networking,” says Mr Reuter.
Mr Bruce came up with the idea for the app at the beginning of his MBA. During a class discussion about MP3 players he realised that people use their mobile devices at the expense of face-to-face interaction. He wondered about a tool that could help people connect with others around them and saw the potential of a smartphone in helping people to meet each other.
“Since the smartphone now performs many functions, it was a natural place to start, creating a mobile application that could help break the ice between strangers and leverage the information that is contained within our online social networks,” says Mr Bruce.
At the school’s entrepreneurship club, he pitched the idea to others: “Over the next week we formed teams around the ideas we felt strongest about, this is the point when the four of us came together.”
Mr Uhrich says that the club has brought the four members of Spotted in contact with many successful entrepreneurs who “shared their experiences, positive and negative, with us and have been a great support.”
The annual European Business Plan competition is designed to encourage entrepreneurship teaching, the development of new ventures and to enable students to gain experience of raising capital. The competition is an independent foundation that is jointly governed by all its participating schools.
This year 15 business schools from 10 countries took part. Participants must submit a detailed business plan containing the rationale behind their venture, plus their marketing and financial strategies. Participants pitch their ideas to competitors and a panel of judges, The best six teams are then selected to present their business plans a second time and answer questions from the jury.
The Spotted team incorporated feedback from the judges to deliver a more focused pitch on the final day.
“We believe this flexibility, openness to criticism and speed in delivering quality results under the immense time pressure demonstrated many of our core team strengths and may have been a big factor in our success,” explains Mr Bruce.
The team are now working with a German company to develop the design and the hosting for the prototype, with the intention of demonstrating a prototype to a business angels conference later this month in Mannheim.
Mr Bruce says that business angel investment is one of a few options being pursued for financing of the project post MBA.
“We also have options with some government sponsorship opportunities…but we are looking in quite some detail at the trade off between maintaining complete ownership and gaining external financing and which of the two options will put the company in the best shape in the future.”
The team is also keeping an eye open for the right external partnerships, he adds.
A former venture capitalist and chair of applied business science and business informatics faculty at Mannheim, Armin Heinzl, is supervising the team’s application for a grant from the German government.
The €94,000 grant is specifically for start-ups to help them develop their business plan into a venture that will generate revenue within the first year of operation. If the grant application is successful Prof Heinzl, who has considerable experience in the field of technology start-ups, will become the team’s project supervisor.
The four founders of Spotted have already handed in their thesis which is based on their business plan. They are referencing Eric Ries’ book The Lean Startup as a handbook to help them reduce waste in the development process; the book suggests producing a device with a minimum of features so that changes and additional features can then be added based on customer feedback.
After graduation this month the team is also planning to work with Mannheim Business School to help promote and foster entrepreneurship within the school.
Over the coming year we will follow the fortunes of the Spotted team as the four founders make funding decisions, decide on their business strategy and bring their product to market.