Title: Market Feasibility Study VitalSign: Wireless Heartbeat and Respiration Detector
1Market Feasibility Study VitalSignWireless
Heartbeat and Respiration Detector
2Presentation Outline
- Technology Description
- Potential Markets
- Target Market
- Financial Analysis
- Conclusions
3Technology Description
- Developed by Dr. Jenshan Lin and his colleagues
at the University of Florida - VitalSign utilizes a modified Doppler radar to
wirelessly monitor heart and respiration rates
4Technology Description
- The small portable device employs low power radio
waves to determine vital signs without attaching
sensors to the body - The system monitors chest motion to determine
heart and breathing rates - Proven accurate within 3 meter range
- Patent Pending
5Technology Description
- Next generation working prototype the size of a
scientific calculator has been developed - Goal is to integrate the technology into a single
chip
6Potential Markets
- Technology applicable in various markets
- Conducted market research in the following three
potential markets - Healthcare
- National Defense
- Cardiovascular exercise equipment
7Potential Markets - Healthcare
- By 2011, the first of the 76 million baby-boomer
generation will turn 65 years old - Increasing demand on the healthcare system
- Opportunities for cost effective healthcare
solutions allowing doctors to function more
efficiently
8Potential Markets - Healthcare
- Telemedicine - use of electronic information and
communication technologies to provide health
services when participants are geographically
separated - Remote patient monitoring is a key component of
telemedicine - Allows healthcare providers access to important
information regarding a patients medical status
between doctor visits
9Potential Markets - Healthcare
- VitalSign provides additional convenience
- Easily monitor patients with severe burns or
contagious diseases - Provides method to monitor babies without the
potential danger of wires
10Potential Markets - Healthcare
- Barriers to Entry
- Only measures two important vital signs
- FDA pre-market requirements for groundbreaking
(Class III) medical technologies cover every
aspect of product development - FDA validation process will take up to 5 years
and cost at least 15 million
11Potential Markets National Defense
- Department of Defense (DOD) budget for 2006 is
over 500 billion - VitalSign may fill the militarys need to provide
troops, conducting urban warfare operations with
personnel detection devices - Allows detection through barriers such as wood
and concrete when looking for enemy combatants
12Potential Markets National Defense
- Additional military detection applications
include - Military search and rescue on the battlefield or
during a natural disaster - Detection after biological exposure
13Potential Markets National Defense
- Barriers to Entry
- Notable challenges dealing with government
acquisitions bureaucracy - Competition from large defense contractors
developing technology that can provide more data
to the soldier than VitalSign
14Potential Markets Cardiovascular Exercise
Equipment
- Cardiovascular disease (CVD) is the number one
killer of men and women in the United States - Increased awareness of the importance of proper
diet and exercise - Has created exceptional growth in the exercise
and fitness industry
15Potential Markets Cardiovascular Exercise
Equipment
16Potential Markets Cardiovascular Exercise
Equipment
- Approximately 4.4 million treadmills were sold in
2003 totaling 2.7 billion - Elliptical cross trainers experienced growth of
41 in 2003. - Increasing popularity of heart rate monitoring
during cardiovascular exercise to a target heart
rate zone allowing for maximum exercise efficiency
17Potential Markets Cardiovascular Exercise
Equipment
- Competitive Analysis
- Two primary products currently measure heart rate
while exercising - Handgrip Sensors
- Telemetric Chest Strap
- VitalSign has significant advantages over the two
currently available technologies
18Target Market - Cardiovascular Exercise Equipment
- Low barriers to entry
- Ability to provide a revenue stream quickly
- Technology can be integrated into the next
generation of cardiovascular exercise equipment,
providing convenient monitoring of heart and
respiration rates
19Financial Analysis Startup and Operation Costs
- Investment of 2 million over the next 2 years is
estimated for research and development with zero
estimated revenue - RD is reduced to 250,000 in year 3 and beyond
- Marketing is budgeted at 1 million in the first
year of sales, which is then reduced to 250,000
in the following years
20Financial Analysis Revenue Forecast
- Conservative forecast is to sell 200,000 units
during year three at a price of 8 each - Forecast sales to increase by 100 each year for
the next three years while the price will be
reduced by 10 each year - Equates to sales beginning in year three at
200,000 units and increasing to 1.6 million units
by end of year six - Revenue is projected to increase from 1.6
million to 9.2 million during the same period.
21Financial Analysis - Price and Income Elasticity
- The market for all cardiovascular disease (CVD)
monitoring equipment is generally price elastic - Since VitalSign is a complementary product it is
more elastic to the price of the complementary
product - Large increases in the price of cardiovascular
exercise equipment will severely impact the sales
of our product - Demand is income elastic
22Financial Analysis Break-Even Analysis
- Operational Costs during the first year of
commercial availability (2008) are estimated at
670,000 - The 6 year (2006-2012) total cost of product
development, operational expenses will be
approximately 12.7 million with revenue totaling
19.7 million - Resulting in six year net profit of approximately
5.3 million
23Break-Even Analysis
24Pro Forma Financial Data
25Conclusions
- Numerous Possibilities for VitalSign
- Fitness Equipment Industry is most viable
- Technology needs only minor changes.
- Industry is growing
- Nothing exists that can compare.
- Technology is definitely feasible
26Questions