What is the business model? Specifically, what are the expected sources of revenues for this business? 2. What value are customers expected to perceive? 3. Would you invest in the deal? ( email me individually a yeso answer with no explanation, PRIOR TO CLASS, regardless of your group answer) 4. What are possible sources of finance for the $250,000? 5. What value would you place on the company? You may assume that this industry commands a P/E of 15. 6. Would you offer shares to Ryan to induce him to join your firm? 7. If you were Ryan, what would motivate you to leave your job for a startup position? 8. How would you reward the top team at Feed?

From Athlete to Entrepreneur: The History of Shane Eten Shane Eten was bom in Philadelphia and lived in a number of places while his father attended medical school. The family eventually settled in Cape Cod, Massachusetts where his father and mother started a family owned medical practice. Living near the sea inspired Shane's father. My father built a sailboat in our back yard. He started when I was in sixth grade. He told me he was going to build a sailboat and sail it around the world. He was probably a little crazy, but he actually built a thirty-six foot trimaran. For as long as Shane could remember, his father had a dream of building the sailboat. He would wake Shane up early in the morning on weekends and make him help work on the boat sometimes working twelve-hour days. After several years of effort, they successfully launched it and saw it sail Although at the time I really hated working on that boat, looking back I realize that it was a very important part of my childhood because it taught me the importance of hard work and taking a dream you have and making it reality Like many boys, Shane was more interested in playing sports than school. He always enjoyed the team aspect and the competitive nature that came with athletics. His goal was to play Division I basketball in college. Hampered by knee injuries but still wanting to pursue his dream of playing college basketball, Shane chose to attend Trinity College, a Division III school and play ball there. Unfortunately, his knees never fully recovered from a series of knee surgeries, so Shane never had a chance to play in college At Trinity, Shane majored in psychology and graduated in 2000. Although he enjoyed studying psychology, Shane didn't want to pursue a career in the field, but he didn't know exactly what he wanted I really didn't enjoy school and to continue down the psychology career path would require me going back to school almost immediately. I like getting out there and getting my hands dirty with real work. In the field of psychology, I would have been doing a lot of research and theoretical education based work. 1 wasn't ready for that. I wanted to get out in the world and make something happen. After graduating from Trinity, Shane went on many interviews and eventually found a job working for an up and coming computer company, Angstrom Microsystems. Angstrom Microsystems built super computers from off-the-shelf components and Linux software. Shane loved working for this fast growing entrepreneurial company because his job was never the same day-to-day. He had the opportunity to work with many different aspects of the business. His original job was working with vendors. Then, he moved his way up to product development and finally he settled in customer account management. While Shane was with Angstrom, the company grew from $500,000 to $15 million in sales in his first 8 months. With the hands-on experience he gained and the opportunity of being able to see how so many aspects of a company worked Shane realizer Entrepreneurship is fun and, most importantly, competitive. There's a real science to starting a company. It was at this time that I first started thinking about building my own company. Unfortunately, Angstrom's success was short-lived as the market took a tum for the worse when one of Angstrom's largest customers stopped growing. The CFO of Angstrom left for a position at a candle company. He called Shane and convinced him to come along for the ride. The position that Shane had been offered was 180 degrees different from his job at Angstrom and an opportunity to test his abilities in a new way. Although Shane liked the tech industry, he decided to give it a shot. So at age 24 he started as a manager of a candle manufacturing plant. It was a drastic change. Laurence Candle Company was a sixty-year-old, third generation company, and I was managing people mostly older than me, some who had been working there for thirty years. He was forced to get on the floor and get dirty leaming the process of making candles. The Laurence Candle Company was struggling because its product was very similar to another established brand, Yankee Candle. The company needed new ideas so Shane raised his hand and asked if they would give him a shot at designing a new line of candles. After doing a bunch of market research and going to trade shows to see what was out there, he launched a new line of candles made from a new type of wax made out of soy. Soy wax was environmentally friendly because the wax was made from an all-natural crop, it was considered renewable and therefore sustainable. The soy wax candle line took off. Not only was soy cheaper than traditional paraffin wax, it could be sold as all-natural for 30-40% more than traditional candles Sales jumped instantly. It saved the company. There was a new consumer emerging at this time and if you could say that it was all-natural then you could say that it was sustainable or noble. This new brand of customer was willing to pay a premium for environmentally friendly products, Shane put in 60-70 hour work weeks developing the line of soy candies. He also started research on adding biodegradable plastic wrappers to the candles. It was at this point that Shane knew if he was going to put in this much time and effort toward an idea, the next time it would be for himself and his own company. Working for small companies, Shane had learned a lot about how the business world worked, but he knew that he needed a stronger foundation in accounting and working with numbers. If he was going to be successful in starting and managing his own ventures he was going to have to go back for an MBA. At 28 years of age, he decided it was time to go back to school. Soon after he applied, Shane was accepted to Babson College The CleanTech Industry Shane entered Babson with a goal of finding an idea to launch his own business. He was intrigued with opportunities in the Clean Technology space, especially around combating global warming. Investment and growth in the CleanTech industry exploded in 2007 passing the record set in 2006 in the first three quarters. Figure 1 shows an explosive upward investment trend. Figure 1 Annual CleanTech investment over the years 3000 2500 2000 1500 investment in millions 1000 Soo 0 2000 2001 2002 2005 2006 2007 2003 2004 year Sure National Venture Capital Association The increased growth and investment in the CleanTech industry has not only been brought on by the large price increases in gas and other fossil fuels, but also in the raised awareness of global warming by prominent figures such as former Vice President, Al Gore. Gore's work with the United Nations Intergovernmental Panel on Climate Change, his winning the Nobel Peace Prize, and his involvement in the Academy Award winning documentary, An Inconvenient Truth, have brought to light the serious issues of climate change and global warming These works have also brought legitimacy and an increased interest in the CleanTech industry Taken at face value, the surprisingly entertaining "An Inconvenient Truth" provides an idealistic, persuasive and compelling dissection of the perils of global warming Frightening and timely, the smartly organized documentary is an urgent plea for responsibility and action as well as an impassioned call to heed the ominous warnings of science Gore's words resonated with Shane. As Gore stated: But along with the danger we face from global warming, this crisis also brings unprecedented opportunities. What are the opportunities such a crisis also offers? They include not just new jobs and new profits, though there will be plenty of both, we can build clean engines, we can hamess the sun and the wind, we can stop wasting energy, we can use our planet's plentiful coal resources without heating the planet The procrastinators and deniers would have us believe this will be expensive. But in recent years, dozens of companies have cut emissions of heat-trapping gases while saving money. Some of the world's largest companies are moving aggressively to capture the enormous economic opportunities offered by a clean energy future. But there's something even more precious to be gained if we do the right thing The climate crisis also offers us the chance to experience what very few generations in history have had the privilege of knowing a generational mission: the exhilaration of a compelling moral purpose, a shared and unifying cause; the thrill of being forced by circumstances to put aside the pettiness and conflict that so often stifle the restless human need for transcendence, the opportunity to rise. Consumers and the public in general are expecting companies to be more eco-friendly they want to see real efforts made toward carbon reduction and recycling. This has encouraged companies to race toward new technologies in order to capture a piece of this new market. One example of the efforts that mainstream companies are making is Google's recent pledge to become a carbon neutral company. Google today announced a new strategie initiative to develop electricity from renewable energy sources that will be cheaper than electricity produced from coal. The newly created initiative, known as RE