Funding

SECTION I: ESTIMATION OF COSTS

 

1 Taking into account the rest of the cost evaluation please provide an overall estimation of the total costs for full deployment/production of the R & D result.
… in terms of IPR protection
It will be necessary to apply for international patent protection valid on the world market, which is estimated at 10,000 Euro. 

 

 

…in terms of product development
The product needs development into an integrated product with a good user interface.  Therefore, it is assumed that the whole software will have to be redeveloped; it should work as a stand alone software and also in a client server environment, compliant with modern computing standards and also accepting all standardized image and document formats.  Further, a graphical user interface will have to be redeveloped. 

To achieve all this, an effort of 5 person years is estimated, along with consulting from the technical university of Sofia.

 

 

…in terms of mass production
There is no mass production, the completed software will be licensed. 

 

 

 

… in terms of marketing
Marketing effort will be necessary to establish distribution channels and find customers.

 

 

 

2 Based on the above assessment as well as the marketing information please provide the correct estimation of the price for R&D product in correlation with costs
Year 1 Year 2 Year 3 Year 4 Year 5
Fixed costs 5000 2500 2000 2000 2000
Personnel 500,000 100,000 5000 5000 5000
Other running costs 15,000 2000 2000 2000 2000
Marketing costs 70,000 50,000 30,000 30,000 25,000
TOTAL EXPECTED COSTS 590,000 157,500 39,000 39,000 34,000
Price per Unit 1000 1000 1000 1000 1000
Type of Unit Software license
Number of Units 0 5 200 500 500
TOTAL Expected Revenues 0 2000 200,000 500,000 500,000
CASH FLOW REQUIRED (REVENUES-COSTS) -590,000 -155,500 161,000 461,000 466,000
TOTAL CAPITAL required for five years Profit: 342,500 Euro

 

 

SECTION 2: QUALITATIVE FACTORS

 

3 Dimension of identified target groups
Detailed comment 

The product is aimed at all organizations that archive and distribute documents in image formats.  The product is aimed at the mass user. The size of the target market is practically unlimited. Specific target groups are:

  • Users that archive documents and images and need also the content protection (mass user).
  • Hospitals and research centres dealing with medical image databases with hierarchical access.
  • Crime pursuit, police.
  • Distance learning providers and teachers.
  • Cultural heritage protection, where documents will have to be archived.
  • Producers of photo cameras

 

4 Evaluation of financial Risks for R&D result
There are products on the market that offer partial functionality but these functions are not integrated.  In this respect, this is really a totally new product and does not exist yet. 

The risk is that the market would very slow accept this new product, which could be reduced by a lower price.  It could happen if the unique sales proposition is not strong enough to convince users to accept this new software.  However, the price inserted in the financial tables is low enough that this could be really be an obstacle.

 

 

 

SECTION 3: IDENTIFICATION OF FINANCING SOURCES

After evaluating all the above mentioned criteria, please tick the best financing source for the achievement of R&D result (i.e. own capitals, banking credits, venture capital, business angels, etc)

 

1. European Funding 

Define relevance of the product with the following potential funding sources and comment

1. This is not a development that could be funded with European funds. 

2.

3.

4.

 

2. National Funding
1. There could be national funding in the sense of supporting national competitiveness but in view of the quick ROI, this would likely not be applicable. 

2.

3.

 

3. Private funding
1. This is a typical case for venture capital funding.  If a sound business plan is developed, it would be possible to acquire venture capital financing that could be attracted with a good exit strategy. 

2. …It could also be that the idea is sold to a major software provider that already offers imaging or archiving products such as Adobe or others.

3. …

 

4. Other

SECTION 3: FINAL EVALUATION

It is requested a final evaluation considering the funding opportunities you believe most suitable for the exploitation of the R&D result, considering the possibility of the creation of a spin-off, further research, in particular, a cost/benefit analysis and a financial projection for the R&D result, type of collaboration identified (i.e. Licensing Agreement, Technical Cooperation, Joint Venture, Manufacturing Agreement, Commercial Agreement with Technical Assistance, Creation of a spin-off, Joint further development)…
In order to develop this product, it is recommended to create a new company such as a spin off of the technical university of Sofia that has developed the first prototype.  In view of the promise of this product, it would be realistic to expect venture capital funding and the company could be sold with a high profit after 5 – 8 years.  The other possibility to be pursued is to convince a major vendor to buy the product. 

However, it will be necessary to develop a detailed, sound and convincing business plan.

 

 

 

 

Decision of evaluation (Please keep only the appropriate)

  • The R&D result needs minor revisions
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