[0:02]Hello, and welcome to Formula Students Learn to Win 2020. This briefing pack will take you through what you need to know to compete in the business plan presentation event.
[0:17]My name's Mark Hassell and I'm the head judge for the BPP event. I'll be joined today at Learn to Win by my deputies Rob Wild and Rose Wesby.
[0:32]This presentation will take you through what you need to know for the 2021 BPP event, looking at the objective, the format, the rules, and the special condition.
[0:43]We'll then move on to how to build an effective proposal, and how to score marks.
[0:54]I'm sure you've all seen the television program Dragon's Den, where an inventor meets the dragons and hopes to secure funding to develop and market their idea.
[1:04]That's the objective of the business plan presentation. We're the dragons, you're the inventor.
[1:11]The rules state that you will need to develop and deliver a comprehensive business model which demonstrates your vehicle could become a rewarding business opportunity to a potential investor.
[1:22]To do this, you need a clear business proposal, a logical, structured assessment of the issues underpinning the proposal, a professional delivery, depth of supporting material, and we expect you to be in role play.
[1:36]Don't talk about Formula Student here. Oh, and you need to do all of this within 10 minutes.
[1:48]The BPP will be judged in two sections. Within the initial heats, all teams will present to one of a series of BPP judging panels.
[1:57]Due to the restrictions that may still be in place next year, we have taken the decision that this will be performed over a video link in advance of the dynamics competition.
[2:06]These sessions will be recorded by the judges for future reference.
[2:10]From the heats, up to five of the top teams will be taken forward to compete in the final, where they will be ranked again by a single panel of judges.
[2:20]We hope this will be a live final held at the dynamics event, but should this not be possible, the teams will be ranked using the videos from the initial heats.
[2:28]As a running car isn't required for the BPP, Formula Student and Concept Class teams compete directly head to head and are eligible to take part in the final.
[2:38]The FSAI competition is judged separately from these and don't compete in the final.
[2:47]Vital to all parts of the Formula Student competition is that you've read and understand the rules.
[2:53]Importantly, the BPP event is governed by the UK supplementary rules. Even if you've read them, read them again because there have been minor changes since last year.
[3:05]And don't forget to make use of the Formula Student questions database. Here you can see previous answers to questions and ask a new question of your own if you need clarification.
[3:21]Your business case must consider our special condition. This is unique to the UK event and is different every year. For the 2021 competition, the special condition is that the investor you are presenting to currently owns 20 carting circuits in the UK.
[3:36]They are looking to partner with a vehicle supplier that can manufacture formula style cars for use at these circuits. Your presentation must consider this condition.
[3:53]We're now going to move on to look at what you need to do to build an effective business proposal.
[4:03]Rather than tell you how to deliver your presentation, I'm going to pose a series of questions that the investors will want the answers to.
[4:10]These investors will want to know what the market is you're targeting, how your product fits into that market, how you're going to manufacture and sell your product, and what the business deal with them is.
[4:24]How you respond to these questions is your decision, but you need to make sure that the answers inspire confidence in you as a company.
[4:34]Okay, I'm sure you've heard about supply and demand. The simple point being, if there's no demand for a product, there's very little point trying to supply it.
[4:44]In this case, you need to explain what's the market for your car is. And that needs to consider who actually wants to buy your car and what do they want from a car.
[4:58]Also within this is that consideration of how the car would be used and what facilities may be needed for it.
[5:14]Having explained there is a market for the product and there is a demand, we now need to know how your car is going to meet those demands and fulfill the customer's requirements.
[5:25]Within this section, we're not looking for detailed technical breakdown of the car, but we need to know something about it.
[5:31]We need confidence that it exists and that it can be sold. So, key features maybe the powertrain, the speed, it's not to 60, what I refer to as the top trump features.
[5:43]But also need to consider, do you just sell one model? Are there upgrade packages? Don't forget, really important is, how much are you going to sell this car for?
[5:53]We also need to know where your car fits into the market. You're not the only car retailer out there, so why should should somebody buy your car compared to one of your competitors?
[6:09]Having designed your car, you need to be able to manufacture it. We need to have confidence that you'll be able to establish a manufacturing facility that is capable of supplying cars in line with the market demand at the cost that makes you a profit.
[6:23]The facilities and equipment you'll require and the cost of establishing these will depend on your manufacturing strategy in relation to which parts you'll buy compared to which parts you'll make.
[6:35]What will be your process flow and does this impact how much stock you'll need to hold at any one time? The location of your factory is also worth considering, both in relation to your suppliers and your customers.
[6:48]But also, are there any locations that offers grants or incentives to help establish companies? And don't forget, you may have already told us how much you'll sell your car for, but we also want to know how much it costs to make it and therefore what the profit margin is.
[7:07]Unless people know that your car is available to buy, they're not going to buy it. So, how are you going to tell people? How are you going to get market exposure?
[7:18]For your car, what's going to be your interfaces? And are you going to start off small and grow or are you going to try and hit the market as a single big bang?
[7:31]And also, once somebody has bought the car, what level of support do they get afterwards and do they get anything else in addition to simply buying a car?
[7:40]So, maybe there's other opportunities there. And cars over time will need spares, repairs, servicing, upgrades and even disposal at the end of life. So, is there an opportunity there that for you as a business?
[7:58]You're only making your sales pitch because you want the investors to give you money. They'll want to know how much money you want and what you intend to spend it on.
[8:06]They'll need to know if what you're asking is reasonable and realistic. For example, if your company is valued at 500,000 pounds, is it reasonable to ask somebody to invest 20 million pounds in it?
[8:18]It's also unlikely that this investment will be your only source of funding. So, explain who where else money is coming from, such as a bank loan or a stake owned by the management.
[8:29]It's also worth considering what your intellectual property is worth and if there's a value assigned to this.
[8:38]An investor will only give you money if they think they'll make more money. Make sure it's clear how much money they'll make and when they'll receive it.
[8:45]You'll need to consider what happens if your sales are better or worse than expected and what impact this has on their return. Your proposal needs to show that the reward of to the investor is worth the risk they're taking.
[8:58]Their money's currently sitting in a bank account and it's safe, but giving it to your business and taking a risk, should increase that bank balance in the long run.
[9:07]You'll also need to outline what the commercial arrangement is. Will you simply repay their investment with some return after a fixed period of time, or is it going to be an ongoing relationship where they own a share of the company?
[9:19]Also, assuming there are other investors, how do the returns compare to each other? Or is somebody going to be much better or worse off than the rest?
[9:34]So, having looked at what some of the content of the presentation needs to be, we're going to look at how you can deliver this in such a way that you can score points.
[9:49]We don't release the mark scheme for the BPP. It is kept confidential. But we will tell you it's split into four main categories: content, visual aids, delivery, and questions and answers.
[10:00]40% of the marks go towards the content, with the remaining 60% spread across visual aids delivery and Q&A. We're now going to look at each of those sections in a bit more detail.
[10:19]The content section covers what was actually in your presentation and any supporting documentation. And we consider this in terms of the coverage and the quality.
[10:29]The coverage is about what information you presented and how many of the questions that we posed earlier in this presentation, have you covered and the areas have been addressed.
[10:40]The quality is all about how well have you answered those questions. It's very easy to say, yes, you've answered it, but if we've been left confused or unsure, then it wasn't a quality response.
[10:54]Your presentation needs to convey the information to the audience in a clear and concise manner, whilst also being engaging and interesting.
[11:02]But make sure you don't go too far and make it too flashy or include too much information, such that this message gets lost or the audience gets distracted.
[11:11]You'll be judged on the variety of visual aids you've used in conjunction with how effectively you've used them. This applies to both your slide pack and any supporting information.
[11:20]And now I'd like to look at how visual aids can be used to portray the information in different ways.
[11:35]This slide shows how you could display the difference in costs between manufacturing 50 and 100 cars per year. Both of these are equally important methods if used in the correct context.
[11:46]The graph shows the relative breakdown of fixed and variable costs in a way that can be quickly digested but contains limited details.
[12:00]As such, I'd say the graph is more suitable for inclusion in a slide pack where a summary of the information needs to be conveyed quickly with the table and the detail included in it being ideal for use in supplementary supporting information.
[12:19]I'm sure you've been told previously, it's not just what you say, but it's how you say it, and your delivery is very important.
[12:27]You're presenting as a representative of a company seeking investment. Don't mention Formula Student and remember, first impressions are critical.
[12:35]Make sure you've practiced your presentation and can confidently deliver it without having to read a script.
[12:41]If only because you'll be delivering over a video link, and to really engage with the judges, it will be best if you can look directly into the camera.
[12:49]You're there to secure funding. So, make sure you're enthusiastic about your car and your company, because if you don't believe in it, why should the investors?
[12:57]And of course, you need to deliver all of this in 10 minutes.
[13:09]The final section on the mark scheme is questions and answers. And at the end of your presentation, the judges will ask you up to about five minutes of questions.
[13:19]And we expect good quality answers from you. The purpose of asking the questions is to try to understand, do you only know what is on the slides and what you've rehearsed, or do you also have further information and background understanding of what you are actually presenting?
[13:36]It's not unusual for teams to have some backup slides available to help expand on questions, and we need you to manage that Q&A session. So, invite questions from the judges.
[13:46]And potentially have different people about to answer different types of questions. Would your engineer answer a finance question and your accountant answer a technical question? Just think about it.
[13:58]And it's surprising how many teams will stand there and argue about what the answer to a question is amongst themselves.
[14:07]Remember, all the way through this, you need to be in giving us confidence that you know what you're talking about.
[14:19]Having told you how to gain marks, it's only fair that we tell you how you can lose marks as well. And the mark scheme does contain penalties, but we only apply penalties if you don't comply with the rules.
[14:32]So, we state that any supporting material is limited to eight sides of A4 paper. For every additional page, we will take some marks off.
[14:43]We also request an electronic copy of your presentation is submitted in advance. The exact date of this will be confirmed closer to the time. And there's the timing. If you've turned up 11 minutes late for your presentation, we don't have time to score it, so you score zero.
[15:00]And your presentation is supposed to be 10 minutes. If you're under or over, there's a sliding scale of penalties.
[15:15]So, to summarize, your presentation is supposed to secure you funding to take your car from being a prototype into a production model that's on sale.
[15:23]You'll need to inspire confidence that you've identified a gap in the market, have designed a car to fill that gap, that you can manufacture it, market it and sell it for a profit.
[15:33]The investor will want to know what you want from them, and equally, what they will get in return. If possible, seek advice from your university's business school or a sponsor as they've probably had to do something like this for real.
[15:53]It doesn't matter how good your business opportunity is, if you don't sell it well. Make sure you address all the questions in the presentation with good quality answers and use visual aids effectively to help convey your message and not disguise it.
[16:07]Practice your presentation so you sound confident and professional when you deliver it, and of course, don't be careless and throw away marks by not complying with the rules.
[16:23]So, finally, a few simple top tips. This video should be accessible shortly via the Formula Student YouTube channel. So, make sure you go back and watch it or download it and use it to inform and develop your presentation.
[16:37]If you've got any doubts, keep your proposal and your presentation simple and make it clear. The previous finals will be on the YouTube channel. So, why not spend some time watching them and see what they did to get to the final, but please remember that the rules may be different from what you're using.
[16:54]And just because you think you know those rules, there's no harm in going back and re-reading them. And if you've got any questions, please use the Formula Student questions database, it's there to help you.
[17:12]All that's left for me to say is, thank you for listening. I hope you found this useful and good luck with the rest of the competition.
