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Kellogg Cup winners, from left, Ryan Kaiser, Aaron Schweifler, Jill Zeldin, David Hegarty and Scott Orn (all '07) were awarded the grand prize in the 2007 Kellogg business plan competition.

Health drink a hit at annual Kellogg Cup contest

Action learning showcase reveals challenges of new venture process

By Adrienne Murrill

6/22/2007 - Capitalizing on another experiential learning opportunity at Kellogg, a student team developed a business plan that whet the appetites of judges at this year’s Kellogg Cup.

A branded beverage proposed by David Hegarty, Ryan Kaiser, Scott Orn, Aaron Schweifler and Jill Zeldin (all ’07) won a grand prize of $7,000 at the Kellogg School’s premier business plan competition, held May 30 at the James L. Allen Center.

The beverage, called “Crux,” is designed as a restorative that combats dehydration and other effects associated with alcohol consumption. Formulated with vitamins and extracts whose benefits are supported by medical research, Crux will compete in a $400 million subset of the $3.5 billion market for hydration, Hegarty said during the presentation. The team’s research shows that 25- to 35-year-olds are most likely to use the product — and indeed are already receptive to similar offerings.

“The easiest thing to market is something that people are already doing,” Hegarty said. By finding a consumer habit and substantiating the benefits of that behavior with medical research, he said a product can quickly gain momentum.

Hegarty and his teammates, like most participants in the Kellogg Cup, were enrolled in the school’s Entrepreneurship and New Venture Formulation course. Scott Whitaker, associate director of the Larry and Carol Levy Institute for Entrepreneurial Practice, said the classroom lessons were key for participants.

“Over 10 weeks, the students go through the preparation, synthesis, presentation and organization of their materials,” said Whitaker. “The coursework leads to a level of excellence and helps to create a foundation for entrepreneurs.”

Hegarty said the course helped the team to develop and expand its plan several times, refining the idea. Another class, Introduction of New Products and Services, also provided a foundation for the team’s ideas. “The class really made us think about the actual consumer need we were trying to address,” said Hegarty.

Hegarty and his peers are considering whether to launch the business this summer. The team already has received an outpouring of potential financial support to bring Crux to the market, he said.

Three other business plans earned distinction, each winning a prize of $1,000. These were Cheezy’s, a specialty grilled cheese restaurant in Chicago’s Loop proposed by Jennie Logan ’07; Precision BioSciences, developed by Todd Melby ’07 to market and produce customized proteins for precise genetic alterations in DNA sequences; and enabLink, a volunteer management solution for churches that amplifies the network and social impact of their members, designed and presented by Matt Brady ’07, Jake Barton ’07, Kimberly Harrison-Senter ’08, Helmut Domagalski ’08 and Dan Douglas ’08.

This year’s judges were Christine Long, CFO of Miami Corp.; Malcolm Lotzof, founder and CEO of InXpo; James Reynolds ’82, co-founder, chairman and CEO of Loop Capital Markets, co-sponsor of the Kellogg Cup; and Scott Wald, president and CEO of Romar Services.

Established in 2005, the Kellogg Cup is presented by the Levy Center and the student-run Private Equity and Entrepreneurship at Kellogg (PEEK) Club.