In case anyone is interested in following the development (or total catastroflunk) of this project, I'll keep posting updates here.
Executive Summary is fleshed out. I wasn't able to meet with VCs this past Friday due to not being able to take off from work, so will try again next Friday. I fully expect costs ("especially in this economy") will be the main barrier to fight against to get this started. Hopefully I can get the university interested enough without giving up too many patent rights. The sad thing is, the actual inventor of this system is in pretty severe stages of Alzheimer and cancer, and will probably not survive the rest of this year, so one of my main goals also involves getting someone else involved in this well enough that they can understand and continue to develop this system. Although the basic construction and design are simple, the math involved is very complex and specialized, and it would be a tragedy if this system disappears from our collective knowledge for decades until someone rebuilds it from (admittedly badly) written instructions.
In the meantime, here's the finished Executive Summary:
The Pitch.
The internet is a great way to deliver digital goods, bouncing data along wires from hub to hub. Wouldn’t it be great if we had a similar system for physical goods? Turns out we already have the hubs – Wal-Mart’s distribution centers are an automated technological wonder – but the “wires” connecting these centers are slow, inefficient roads manned by cumbersome, expensive trucks. Our ultra-high-speed transport system will connect the already established distribution centers, with direct, fully automated, efficient, and cheap to operate lines.
Product.
Currently, to transport goods to distribution centers, trucks have to drive from one to the other by roads and highways. This method is slow, and susceptible to traffic issues, driver fatigue, and high costs of maintenance, fuel, and taxes. We (Tozoni AMLEV) propose to design and build customized high-speed transport lines between distribution centers. The system will consist of small, fully-automated cargo platforms, only big enough to carry a large refrigerator or a 3,000lb aircraft shipping container. The platforms will be gliding on the track using magnetic levitation technology, flying at 350 miles per hour, completely automatically. Once reaching their destination distribution centers, the cargo will be automatically offloaded and routed through the distribution center’s internal conveyor system to its next destination. Once multiple distribution centers are connected, the cargo will be able to bounce from center to center, being transported over vast distances cheaply, very quickly and completely automatically.
Value Proposition.
Tozoni AMLEV system is cheap to design due to using analytical calculations for all of its components (all aspects can be fully simulated on computers instead of on physical models). The system is also light and cheap to build, due to it being fully automated by design, as opposed to relying on complex control systems. Since the cargo platforms do not touch the track, and very few moving components are involved, there is very little maintenance required for the system. The system is also very energy efficient, using only electricity for propulsion, without friction, of small light platforms. Since the platforms can reach speeds of 350mph and beyond, it makes it possible to quickly ship only products that are needed, instead of waiting for a large truck to load up on everything that may be necessary in the direction it is going. Using smaller cargo platforms also means it is possible to use much lighter and cheaper track construction, including possibility of stacking tracks to reduce the land footprint.
Competitive Advantage.
Tozoni AMLEV system, including both suspension and propulsion components, is fully patented. Dr. Tozoni has many years of experience in mechanical and electrical engineering, was the Head of the Department of Electrodynamics at the Cybernetics Institute of the Academy of Science, USSR, and has published many books on mathematics and electromagnetics. The Tozoni AMLEV levitation system differs from all other levitation systems in that it is based on attractive force of permanent magnets, that all aspects of it can be fully analytically calculated and designed, as opposed to relying on trial and error, and is suspended automatically, without need for monitoring and control systems. The system is also fairly well known, and has a team of scientists and engineers very interested in being involved with or helping with its construction.
The Marketing Plan.
The Immediate goal is to build a single transport line between two distribution centers separated by desert or farm land (to keep the costs of land down). (Example: Wal-Mart distribution Center in Chyenne, Wyoming to one in North Platte, Nebraska, 200 miles down center of highway). Our target segment is any market interested in transporting small to medium physical goods. Initially, the system will target retail distribution centers, allowing the first two connected centers to operate as one. This means cargo trucks will only be required to deliver their goods to the distribution center closest to their point of origin, instead of having to go to both centers. Eventually, once we connect more distribution centers, the interconnected automated network should be able to support delivery of all of the retail goods among the centers, and the center operator should be able to take on outside business, such as mail and parcel delivery, or any delivery of physical goods.
We believe that despite the high initial cost of construction, the finished product, with its very high speed and extremely low operating cost, will be able to easily compete with existing delivery methods, and make up the cost of construction through high profit margins.
The Financial Plan.
Tozoni AMLEV will need approximately $400,000 to build the initial proof-of-concept test model within 6 months of initial funding. The system design and parameters have already been analytically calculated, and the initial funding will go to consulting services for Dr. Friedman of Drexel University (he is a student, of a student, of Dr. Tozoni), and for engineering and manufacturing of the test model by Oceaneering Inc., a local MD engineering firm familiar with the project. Once the physical test model verifies the analytical calculation results, a further $500,000 will be required to design and engineer the platforms themselves. During that period, we will scout locations of potential distribution centers 100+ miles apart, secure required land, and negotiate deals with the distribution center operators. In the first half of 2013 we will build a 2 mile test track, preferably on the location where the final track will be used. The system costs approximately $4MM per mile of track, and approximately $90,000 per platform, although we think we may be able to reduce costs by using cheaper support materials (estimates are based on a 30ton cargo container system requiring heavy concrete support). During that time, funding will also be needed for final design tests, which should be completed by the end of 2013 or earlier. Construction of the finished line should be completed by mid-to-end of 2015. At initial launch of the system, the system is expected to be used at near capacity, working as both a bridge between two distribution centers, and a bridge between two parts of the country (trucks can save money by dropping goods off at one center, and have them be picked up by another truck at the next center, even if the final destination for the goods isn’t one of the two centers). After proof of concept and a strong positive revenue stream, a portion of the revenues will be used to secure and develop lines between other distribution centers.
Dingman resources will be used, along with Maryland Technology Commercialization funding, to set up a lab at the University of Maryland, where students will participate in further developing the system, including building the initial test model. Part of the funding for the main project will be raised from the government’s technology research and green initiative programs, and the rest through private funding. We also expect to get local government tax subsidies for providing a system that will ease traffic on their roads.