Executive Summary

Executive Summary

Of the thousands of patients who receive hearing aids or cochlear implants, many continue to have trouble hearing in certain settings, especially those with background noise. After installing a device or implant, clinicians need a way to test how well their patients can hear in typical noisy settings. Tests can make a big difference for children, in particular, because early intervention can prevent or minimize educational deficits due to hearing loss.

Current tests are designed as pure tone tests and require a soundproof booth and audiometers to generate the tones. Although pure tone tests assess basic hearing loss, they do not evaluate how well a person can understand language and detect other sounds outside of the booth.

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Crown Medical proposes to spin off its auditory medical device offerings into a new auditory testing device business named Crown Auditory Testing. Crown has developed software that quickly and reliably tests hearing in environments where a patient lives and works and then adjusts the patient’s hearing device for optimal hearing.

Objectives

Crown Medical has four major objectives in creating a new auditory testing device company.

  • Management team
    • Hire people with skills and knowledge in medical auditory testing.
    • Establish a horizontal management structure to encourage collaboration.
  • Sales and marketing
  • Design and carry out a sales strategy.
  • Establish awareness of the new auditory testing product.
  • Product development
    • Use agile project management techniques to introduce the new product on time.
    • Create quality standards for testing and support.
  • Customer service
    • Train sales staff and clinicians on using the new testing device.
    • Use current customer relationship management software.

Company Background

2011: Crown Medical founded as a medical device company.

2019: Software division expands to develop proprietary testing engine.

2015: Crown Medical acquires AudioVeritt, a hearing aid manufacturer.

2014: Major universities become formal research partners of Crown Medical.

Start-Up Costs

The following table summarizes the start-up costs for the new company.

Expense Type Requested Funding

Total Amount

 
Conferences and travel $10,000 $14,000 Difference provided by owners
Insurance $5,000 $5,250
Legal $20,000 $25,000
Online presence $20,000 $25,000
Property and equipment $30,000 $32,000
Sales and marketing $30,000 $36,500
Software development $50,000 $55,000
Total Requested:      

 

Ownership

Crown Auditory Testing will be a privately held, limited liability corporation (LLC) with Dr. Lucille Greene as an owner. Anticipating that investors and talented managers will want to participate in ownership, Dr. Greene will own no more than 40 percent of the shares.

Roles and Shares

Owner Role Share
Barbara Daley Software developer 8.5%
Dr. Lucille Greene Chief scientific consultant 40%
Fred Khatri Software developer 7.5%
Michael Linde Marketing 5%
Natalia Cassini Operations manager 5%
Yuan Choi Marketing 10%

 

For More Information

Contact Michael Linde at m.linde@crown.cengage.com.

Number of words: 413