From IP Watchdog
As my colleague, Carla Pavone, has described well in previous posts, bridging the chasm from invention to commercialization is a challenging adventure that all too often fails to result in successful new ventures. While risk is inherent in innovation and entrepreneurship, we can mitigate the risks and increase our probability of success--or at minimum reduce the amount of valuable time and resources we devote to ideas that won’t succeed. For STEM innovators, success begins with the recognition that crossing this chasm is a “different game” than discovery and invention.
Basic research focuses on the discovery of new knowledge without thought of practical ends. Translational and applied research represents the first step toward identifying practical applications of scientific discovery and knowledge to solve problems or unmet needs outside the laboratory. And finally as we move to the right across the chasm, commercialization involves translating new ideas or IP into customer solutions that generate social and economic value.
Successfully navigating this chasm from invention to commercialization requires a broader mindset, tool set, skill set and network than we typically develop as inventors. In other words, we need to become “T-shaped” professionals with BOTH depth and breadth: deep technical expertise in 1-2 disciplines AND working knowledge of other disciplines that enable us to “know what we don’t know” about the many variables beyond technical feasibility that will make or break success for a commercial venture.
MindsetAs illustrated in the “innovation sweet spot” model below, technical feasibility is necessary but not sufficient for commercial success. A commercially viable idea also must be desirable to the target customers we hope to serve and be perceived as better than the existing alternatives at a reasonable cost. Additionally there must be an attractive market that is robust enough to make commercial success viable. This helps explain why the best technology does not always win (a common inventor mindset). Just because a technology is superior does not mean mainstream customers will be willing to adopt it or that the market is large enough to justify the required investments in developing, manufacturing, distributing and servicing it.
By recognizing the critical impact of these additional arenas on commercial success, we broaden our research “lens.” This enables us to AIM for success by (1) Anticipating a broader set of questions and issues to explore, (2) Investigating the opportunities and risks present in each arena, and (3) taking deliberate action to Manage our way through these realities.
The business model canvas is one essential tool that serves as a “blueprint” for building a commercialization bridge. The central task of the entrepreneur is to identify, test and validate a viable business model to translate an idea or IP into a customer solution that generates economic value. As illustrated below, there are nine building blocks that comprise a viable business model. By making “hypotheses” or assumptions in each of the building blocks, we can then test the assumptions with key stakeholders to either validate or change them. Through an iterative process of making and testing business model assumptions and adapting as needed, we systematically test and refine the feasibility, desirability and viability of our commercial idea. The canvas also requires us to explore a viable revenue model and cost structure as well as key partnerships and resources that will critical for a successful venture. As renowned innovation thought leader, Clayton Christensen of Harvard, has noted, few technologies are intrinsically disruptive in nature; it is the strategy and business model that creates the disruptive impact.
Skill Set + Network
In addition to the technical expertise, critical thinking and research skills required for discovery, commercialization requires additional “breadth” in terms of knowledge and personal as well as collaborative capabilities. The Kauffman Institute suggests that are six essential skills of extraordinary entrepreneurs they call the “creator’s code.” Let’s look briefly at three of the six.
“Find the gap” refers to the innovator’s ability to spot an application opportunity in the market that is “ripe” in terms of customer demand and freedom to operate—both in terms of IP strategy and competitive advantage. Inventors tend to believe the best technology always wins and “if we can build it, they will come.” Innovators and entrepreneurs recognize that technical feasibility is a prerequisite not a determinant for success and they must find a gap or “innovation sweet spot” in which customers are willing to pay for their solution and the market is viable.
“Fail wisely” is the ability to accept that failure is not the opposite of success, but part of success AND that we must manage an iterative, adaptive process of making and testing assumptions knowing that many will be wrong in the early stages of the commercialization journey. Especially for STEM researchers whose discovery is governed largely by laws of science and math where there are objectively right and wrong answers, failing wisely can be difficult to accept as a success factor. In the “game” of commercialization, unlike in the STEM lab, there are myriad of both objective and subjective factors that will influence if not determine success. We can’t “know” with certainty what business model assumptions will work and which won’t until we test them, learn, and adapt accordingly. The key to failing wisely is to test our assumptions early and often in order to adapt these assumptions and business model design BEFORE we waste time and resources and ultimately risk the success of the venture overall.
“Network minds” is the ability to recognize the many variables beyond technical feasibility that will make or break commercial success and proactively develop a network of colleagues who have needed experience and expertise you don’t. As a researcher, you probably don’t have experience doing market research, building an IP picket fence, or developing an effective revenue model. What is essential is that you recognize these as critical success factors and develop a team of collaborators or partners who can help you learn what you need to know while you are testing your potential business model design.
This commercialization journey across the chasm may sound daunting, and it would be if you had to go it alone. Fortunately, across the U of M we have expertise and experience in all facets of the commercialization process. There are many resources available to support you in exploring the commercial potential of your ideas and IP. A good place to start is with MIN-Corps where our mission is to help talented researchers navigate the chasm from invention to commercialization. Let us know how we can help!