In addition to the Summer Workshop Series and pairing teams with mentors, the CCTO group also set up some business clinics. The business clinics are meant to give the CCTO finalists one-on-one time with various corporate specialists such as lawyers, accountants, and marketing specialists. All of the specialists are volunteers, and many of them are from large Bay Area firms such as Wilson Sonsini and Ernst & Young. The clinic was held at Wilson Sonsini in the same location as the workshops. Nate and I had three session on August 9 and we also met with our mentor, Ed, while we were at the Wilson Sonsini offices.

Our fist Business Clinic session was with a financial specialist, Margie Bell, from Accretive Solutions. Margie answered a lot of questions we had regarding setting up our corporation from a financial perspective. For example, she recommended we create a pool of equity and split it among the founders. We can include a pool set aside for early employees, but don’t bother with leaving something for investors. The investors would likely want to shape how their share looks anyway. We talked about basic accounting ideas, and Margie strongly recommends doing your books right from the beginning using QuickBooks and perhaps a professional accountant. The theory being it is less expensive to do it right than it is to fix incorrectly done books later. The first things we need to do are incorporate, open a bank account and get a federal ID number. She also gave us some pointed on Venture Capital valuations, employee costs, and tax issues (such as R&D tax credits).

After our financial session, we met up wit our mentor, Ed. Since our fist meeting he has had a chance to read our executive summary, so we talked about that a bit. He thinks our main focus in the short term needs to be on improving our value proposition. Nate and I had come to a similar conclusion ourselves, and had already started down a path of a new business model. Ed also gave us some tools for helping with planning: one for market segmentation and the other for benefit/detriment analysis (to help determine our value proposition. His stance is that once we have a good set of benefits our value should really jump out at us.

For our second clinic session we met with Robin Tucker, a corporate lawyer from WSGR. We talked with her a little about intellectual property issues, but she deferred some of our questions to a patent attorney. We spent most of our session talking about the incorporation process. Firms like WSGR have packages for start-ups that include setting up the corporation, setting up stock, and providing a basic set of common legal agreements. This package can be pretty common, although some firms will work with deferred payments or for equity.

Our final clinic session was with Jeff Schox, a patent attorney. We talked to Jeff a bit our the process of licensing patents from UC Berkeley relating to Nate’s research there. He also introduced us to the concept of provisional patents, which allow you to hold you place on a patent for up to 12 months by filing a much simpler disclosure of invention. It’s a much cheaper and easier application to file, and when you later file a full patent, you can reference the date from any related provisional patents you have filed. This could come in handy.

It was a pretty full day, and probably the most productive of all the CCTO sessions so far (aside from the Technology Matching Event, which is where I met Nate to begin with). Now we have a better idea of all the daunting tasks we have ahead of us.