| Background |
| A small, privately owned, highly innovative company had built a prototype for
a revolutionary, eco-friendly, hybrid aircraft known as the Dynalifter®*.
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The prototype had been tested and had achieved FAA** certification [2006]. Over the course of the design, development, and build,
the co-founders and their invention had attracted considerable attention from the press and media, both locally and internationally.
Notably, National Geographic had published an article on the Dynalifter®, and Popular Science had published a front-page feature.
In addition, the co-founders had protected their unique design by patenting the technology.
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It had taken seven years, constant focus, relentless drive and effort, and significant financial investment
from their family and friends to bring their invention to this stage of development, and now the money had run out. The publicity
engendered over the past few years had recently attracted offers from large conglomerates interested in the technology, but these
were for outright purchase and therefore not what the pair had in mind. The co-founders wanted to continue playing a major role in
the strategic decisions affecting the use and deployment of the Dynalifter® and the growth of the company.
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Therefore, with the aim of attracting suitable potential investors, the co-founders decided to bring in a business
strategist to help them resolve their dilemma.
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| Achievements |
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It was determined that given the target markets and potential customer sales, there would be a requirement very early on to
develop production facilities abroad.
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All of the challenges were addressed. A business plan was developed together with the fully integrated financial model, enabling
financial simulations to be performed. Phased funding requirements were determined based on the given assumptions.
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The consultant also helped promote the brand, find suitable potential investors, and obtain valuable feedback for refining the
business plan. It took four months from the time when the business plan was finalised to achieve these results. The initial
investment is for approximately $2M USD, to strengthen the company, to be followed by a second round of funding to establish
international production facilities and produce the aircraft. The gaps in the management team are being addressed to strengthen
the board. A significant number of investors have showed interest, several of which have engaged in negotiations.
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| Challenges |
| The aeronautical business is far from simple, so what appeared to be a simple request to develop a
business plan soon became more complex by reason of context. Whilst some of the information needed to develop a financial
model was readily available, a large number of gaps remained. |
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| Approach |
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Prior to being able to develop the business plan and financial model, the James Lambert Consultant first needed to:
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Clarify the vision;
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Understand the constraints;
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Define the intended growth strategy to determine the number of production facilities required and the associated infrastructure costs;
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Determine the gaps in the management team and define how these would be addressed;
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Define an organisational model for the company to get a clearer understanding of people costs;
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Understand the operational model for manufacturing the Dynalifter®, particularly the specificities of the procurement process in the aeronautical industry, to get a clearer understanding of cash flows;
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Identify the key risks and define how these would be overcome or mitigated;
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Agree the potential funding alternatives and exit strategy.
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To find the answers to these questions, in addition to conducting research the consultant worked closely with the co-founders
and one of the company non-executive directors, an aeronautical engineer who had a long career as an executive and consultant
in the industry.
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| Benefits |
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The phased funding resulted in much more favourable terms for the owners than those originally envisaged.
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| What the Client Says: |
“We were impressed by the ease with which the consultant was able to translate our vision into language that lets the typical
businessman, who has no knowledge of hybrid aircraft, understand what we’re trying to achieve. She also enabled us to gain a
better understanding of how we would operate the production environment, and focused our attention on potential risks and how
to minimise them. The business plan has enabled us to engage in discussions with major potential investors, and we are now
making progress in this direction. We couldn’t have done this without her.”
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R.L.Rist, Founder & Co-Chairman
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[printed with client’s permission]
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* A cross between a traditional airplane and an airship, the augmented lift provided
by helium cells means the Dynalifter® is highly fuel-efficient, and has the ability to
land on relatively short, unprepared surfaces. In other words, it eliminates the need
for traditional billion dollar transport infrastructures such as runways.
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** The FAA, or Federal Aviation Administration, is the United States Department of Transportation
agency which regulates and oversees all aspects of civil aviation in the U.S.
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