CS 638 Starting a Software Company AlphaTech Counsel, S.C. - - PowerPoint PPT Presentation

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CS 638 Starting a Software Company AlphaTech Counsel, S.C. - - PowerPoint PPT Presentation

Jun 29, 2023 157 likes •667 views

CS 638 Starting a Software Company AlphaTech Counsel, S.C. American Family Insurance Who Are We? American Family Insurance (AmFam) Marty Buchheim, Business Development Director Peter Gunder, Chief Investment Officer Dawn

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CS 638 Starting a Software Company

AlphaTech Counsel, S.C. American Family Insurance

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Who Are We?

  • American Family Insurance (AmFam)

– Marty Buchheim, Business Development Director – Peter Gunder, Chief Investment Officer – Dawn Mortimer, Innovation Director – Dan Reed, Business Development Director – Jose Rivera, Web Experience Manager

  • AlphaTech

– Matt Storms, Founder

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Today’s Discussion

  • Why are we here?
  • What does our business look like today?
  • What could our business look like tomorrow?
  • Why do we want you to “disrupt” our business

with amazing software?

  • How big is this opportunity?
  • How can we help you be successful starting

your own software company?

  • What’s in it for you?

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Why Are We Here?

  • Identify the market opportunity
  • Innovate quickly
  • Disrupt our businesses ahead of the

competition

  • Show we support SaaS
  • Empower your successful software startup

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What is American Family Insurance?

  • Founded in 1927
  • Top 10 US “personal lines” insurer (home,

auto, life)

  • Fortune 358 rank
  • Revenue 2011: $6.2 Billion
  • GAAP Net Worth 9/30/2012: $5.9 Billion
  • $15 billion investment portfolio
  • Policies in force: 8.42 million

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Where do we currently sell insurance?

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  • Exclusive Agency Force: ~4,100
  • Employees: 7,230
  • National Headquarters – Madison
  • Mutual legal form

How many people work at AmFam?

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5 10 15 20 25 30 35 40 45 50 Billions

$250 Billion Annual US Personal Lines Premiums

#10

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What is Insurance?

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  • Insurance is transferring risk in

exchange for $$

  • Hedging your bets
  • Confusing terminology
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What is the Insurance Value Chain?

Customer Acquisition Multi- Channel Distribution Risk Pricing

People & Risk

Policy Service

Billing & Changes

Claim Service

  • Agent
  • Web &

Mobile

  • Call

Center

  • Retail
  • $ for

covering people

  • $ for

covering things (i.e. cars, computers, homes)

Payment

  • Paying

the bill

  • People,

product and coverage changes

  • Auto
  • Home

Promise Keeping Moment: Restoring to Right

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  • Goals of our Digital Footprint
  • Increase Online Presence
  • Enhance experiences based
  • n needs
  • Drive User Traffic and Engagement
  • Provide Educational Tools
  • Increase Purchase Online Activity
  • Influence Service Funnel
  • Coordinate Support Options
  • Promote All channels Online, track

attribution

  • Monitor, Adjust, Refine and Execute

The never ending cycle of marketing optimization

Amfam.com Amfamlatino.com

Personalization Mobile Technology

Brand Awareness Content Tools Account Mgmt. Sales Support Engagement

Segmentation Search & Email Marketing Analytics Social Media

Digital Marketing Today

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Research Customer Needs User insights will drive feature set. Activities should include competitive analysis and direct customer feedback Give Utility & Value – 7 dimensions of value Monetary, Content, Access, Service, Experience, Premium, Societal

DIGITAL MARKETING STRATEGY Insights Drive Digital Marketing Tactics and Deliverables

LINE OF TECHNOLOGY DELIVERABLES

Web Content Social Media SEM User Engagement Application Cross- Channel

Activation – Call to action, what's in it for the user and the company? KBO’s – Understand the business objectives Awareness? Increase purchase consideration? Growth? Retention? Audience – Does it exist? If not, how to build it. Develop pre-production tactics. Streamline to increase message/opportunity accuracy.

Digital Marketing Tactics and Amfam.com?

KPI’s – How will the KBO’s be tracked? Identify the metrics that influence adjustment and yield success

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Overview of TeenSafe Driver ProgramSM

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Teen Driving: The Problem

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  • One in six teens are in an accident during their first year of

driving.

  • More than 6,000 teens died in car crashes in the United States

in 2003, and more than 500,000 suffered life-altering injuries. Car crashes are by far the #1 cause of death among American teenagers.

  • In 2002, the estimated economic cost of police-reported

crashes (both fatal and non-fatal) involving drivers ages 15 to 20 was $40.8 billion3.

Sources: University of Iowa , U.S. Center for Disease Control, National Highway Traffic Safety Administration, Insurance Institute for Highway Safety

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Teen Driving: The Problem

17 Source: National Highway Traffic Safety Administration

1 2 3 4 5 15 16 17 18 20 25 30 35 40 45 50 55 60 65 70 75 80 85 NUMBER OF ACCIDENTS PER MILLION MILES DRIVEN (NHTSA)

Teens are much more likely to be involved in an accident than their parents.

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Technology: Event Data Recorders

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FRONT VIEW SIDE VIEW

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Feedback Process

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How big is the market for “re-imagining” insurance?

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We are investing to re-imagine AmFam.

  • Just announced $239

million purchase of “The General” – 4th largest provider

  • f online quotes

behind GEICO, Progressive, Esurance [Allstate].

  • Keeping separate

brand

  • Expected to close

December 2012

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http://www.youtube.com/watch?NR=1&v=vjTw sgXGmYQ&feature=endscreen

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We are investing to re-imagine AmFam.

  • Private Accelerator

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http://www.gener8tor.com/

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Biz-Dev Objective: Disruptive Innovation

  • Ubiquitous

Connectivity

– Home – Auto

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1 Cisco, 2011; Tata Consulting Services, 2012

Growth in sensors and devices: Estimates of as many as 15B connected devices by 2015, growing to as many as 200B by 20201

Source: Ericsson

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We are nearing a transition point in the “Connectivity” marketplace

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Source: Harbor Research

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What is the “Connected Home?”

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  • Many big players: Comcast, Verizon, AT&T, Time-Warner, etc.
  • Small, emerging players too: Twine…

http://www.youtube.com/watch?v=ckb6MaQI4GE

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Why is American Family interested?

  • Reduce $100’s millions of dollars in losses for our

customers that could be either prevented or reduced in severity via Connected Home technology

  • Top loss categories:

– Wind / Hail – Fire – Water / freezing damage – Theft – Sewer Backup – Lightning

  • Sensors could alert consumers of potential loss (fire,

water, theft) or help insurers rapidly mobilize resources to respond to losses (wind, hail, lightning)

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Why is this confluence – insurance and Connected Home – an opportunity for you?

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Source: IBM

Connected Home Value Chain

Insurance is currently the “ignored step-child” of the Connected Home value chain

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What is the “Connected Car?”

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The Evolving Connected Car

The changing phases of car technology

Telematics “The vehicle speaks” Context- Sensitive Automation “The vehicle responds” Vehicle-to-Vehicle /Vehicle-to- Environment Communication “The environment responds” Automated Vehicle “The vehicle controls all.”

Today 2015 2025 2035? 2050?

  • Big players:

GM, Ford, Garmin, Verizon, etc.

  • Smaller players as

well: Waze Crowd sourced traffic management: http://www.youtu be.com/watch?v= GdxsBx_FzKI

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The Role of Perceptual and Cognitive Filters in Observed Behavior," Human Behavior in Traffic Safety, eds. L. Evans and R. Schwing, Plenum Press, 1985

Vehicle Driver Roadway

27% 3% 1% 3% 2% 6% 57% 94%

Why is American Family interested?

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Leading Causes of Accidents

  • Reduce losses and

injuries / loss-of- life for our customers (and the general public)

  • Leverage systems

that provide automation, alerts, guidance, coaching

  • r other

information to drivers to make travel safer

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Telematics Consumer Trial

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Why is this confluence – insurance and Connected Car – an opportunity for you?

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  • The car is an Internet

“White Space”

  • pportunity: 52

minutes per day spent in cars by 144M Americans (76% of them alone)1

1: US Census Bureau

  • Opportunities for new protection-related products

and services that leverage this connectivity as well as social, mobile, cloud, or Big Data

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Who is AlphaTech Counsel?

  • A law firm focused on entrepreneurs and their

emerging companies

– We don’t represent investors, conglomerates, individuals, American Family, UW/WARF, etc. – The companies we work with have technology-oriented, scalable business models--e.g., software/Internet, life sciences, medical device, advanced materials

  • Rely heavily on technology for routine matters
  • Maintaining a high level of practice sophistication,

knowledge of market terms, and network contacts are important parts of what we offer

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Why is AlphaTech Here?

  • Support entrepreneurial efforts
  • Demystify basic legal issues associated with

starting a software company

  • Provide overview of certain software company

startup issues

– When to form a company – Basic founder issues – Top IP issues for software company startups – Resources

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AlphaTech: When to Form a Company

  • More than one creator of technology, code, etc. and at

least one person wants to start a company

  • Hiring or engaging an employee, consultant, or

contractor

  • Creating or acquiring significant intellectual property
  • Need to enter into agreement (e.g., nondisclosure

agreement, material transfer agreement, lease, license)

  • Acquiring investor money
  • Grants, tax credits, business expenses
  • Credibility
  • Limited liability

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AlphaTech: Basic Founder Issues (1 of 2)

  • Most successful companies have at least two

founders

  • Characteristics of good co-founder(s)

– Personality fit – Prior experience working together – Complimentary skill set necessary for success – Good communications up front – Common vision, priorities, and timelines

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AlphaTech: Basic Founder Issues (2 of 2)

  • Allocating founder’s pie

– Rarely is even split “appropriate” – Common considerations are mostly forward-looking:

  • Relevant domain expertise
  • Future contributions most linked to success or failure of company
  • Future financial and time contributions
  • Main contributors of business plan, technology, and ideas
  • Responsibilities
  • Vesting of founder shares
  • Miscellaneous “small” issues: titles, board

composition, control, decision making process, common vision

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AlphaTech: Top IP Issues for Software Startups (1 of 2)

  • Not owning underlying intellectual property

– General rule is whoever creates IP, owns it. Common exceptions:

  • Works made for hire
  • Contractual assignment

– Failure of founders and early contributors to assign IP rights to company – Prior employer owning an interest – Failure to obtain contractual assignment of IP from contracted developers – Bayh Dole issues

  • Joint ownership (having it and not understanding

implications)

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AlphaTech: Top IP Issues for Software Startups (2 of 2)

  • Not sufficiently understanding applicable Free and

Open Source Software license obligations before using

  • r integrating
  • Not reading the fine print associated with NDAs,

Consulting Agreements, and other “boilerplate” agreements

  • “Borrowing” another company’s terms of service,

privacy policy, clickwrap agreement, etc. without making applicable changes

  • Selecting trade or product names relying primarily on

domain name and corporate name availability

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AlphaTech: Legal and Other Resources

  • Wisconsin Sample Incorporation Documents for Emerging Technology

Company: http://alphatechcounsel.com/blog/2012/wisconsin- incorporation-documents/

  • Orrick’s Startup Forms Library (for CA and DE entities):

http://www.orrick.com/practices/corporate/emergingCompanies/startup/ forms_index.asp

  • Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist:

http://tinyurl.com/3dds8cm

  • Friends and Family Financing Round

http://wistechnology.com/articles/6318/

  • Getting the Right Introductions:

http://alphatechcounsel.com/blog/2009/differentiating-introductions/

  • Bridge Financing Documents

http://alphatechcounsel.com/blog/2010/bridge-financing-documents/

  • Standard Angel Financing Transaction Documents

http://wistechnology.com/articles/7301/

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The American Family “Disruptive Innovation Challenge”

– Competition judged by AmFam BizDev/Innovation Directors – Winning Criteria

  • Working alpha version
  • Maximum disruptive scalable potential
  • Audacious business model

– Winner awarded next spring - April 2013.

  • $10,000, paid by AmFam.
  • Mentor commitment for calendar 2013.
  • Priority consideration for accelerators.
  • Eligible for bigger competition

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Who is this man?

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Hint: His name is Ron Wayne.

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Ron Wayne

  • He worked with Steve Jobs at Atari before he,

Jobs, and Wozniak founded Apple Computer

  • n April 1, 1976.
  • Serving as the venture's "adult supervision",

Wayne drew the first Apple logo, wrote the three men's original partnership agreement.

  • Wayne received a 10% stake in Apple but

relinquished his stock for $800 less than two weeks later, on April 13, 1976.

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The American Family “Disruptive Innovation Challenge”

– Competition judged by AmFam BizDev/Innovation Directors – Winning Criteria

  • Working alpha version
  • Maximum disruptive scalable potential
  • Audacious business model

– Winner awarded next spring - April 2013.

  • $10,000, paid by AmFam.
  • Mentor commitment for calendar 2013.
  • Priority consideration for accelerators.
  • Eligible for bigger competition

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Questions?

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