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On the chin friendly advice to would-be entrepreneurs
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Links.. |
There is a first time for everything.
This short commentary is primarily intended for those intrepid, would-be entrepreneurs who have no prior industrial or entrepreneurial experience. The following is conversational in style, but it is seriously meant to convey to you some of the ground truths about new product development. As far as I know, a universal recipe for project success does not exist. In my experience, every new project is different. However, there are some things you need to be aware of at the outset and for many of you, the first of these is an awareness that you may actually be getting into something which is somewhat bigger and more difficult than you had imagined… |
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Does this describe you? |
You have an idea for a new device or system. You can’t stop dreaming about it. You are driven to try to make it a reality and start a business selling it. You are ready to put your heart and energy into it.. BUT you don’t have the resources to start out and to make it happen all by yourself. Moreover you are not entirely sure how best to go about acquiring those resources and making it happen.
In short, you lack relevant experience. If you have absolutely no relevant experience whatsoever then the odds of achieving success are even more heavily stacked against you and you should carefully consider saving yourself the time, trouble and a cartload of money by not pursuing it. You are probably wondering why I would say that when every late night get-rich-quick TV show says something like the way to success is to not give up. Although that is partly true, the problem is that you will almost certainly need a bit more than just sheer determination in order to succeed. |
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The realities: |
v Let’s start with the idea itself and ask the question is the idea practical? What assumptions have you made? Is there a market and would it actually sell into that market? Can the device or product concept actually be made and put into practice or have you assumed something in error? Have you overestimated or underestimated anything. Lots of detailed questions need to be restated and answered or evaluated. Do not depend solely on your own vision. Every aspect of your concept needs to be clearly defined and backed up wherever possible by independent facts and analyses. If such analyses clearly do not support your assumptions, then you will need to rethink or abandon your idea.
v Next, let’s think about the money you will need. If your idea cannot be put into practice using off-the-shelf technology, then it will involve research and development. The first R&D step will be to estimate and then actually demonstrate feasibility. If successful at that stage then the project can continue with the development of a pre-production prototype. Based on my own professional experience, in the case of a new sensor technology, this will probably cost you somewhere between the cost of a new car and the cost of a new house. In other words, you will need a substantial amount of money, which for most individuals means investors, for others it can mean grants, and so on. If the money runs out before the project is completed you may wind up with nothing to show for it but a pile of R&D reports. You must therefore also be careful not to underestimate the cost and thereby under fund your project. v If you shake your head disdainfully after reading the next point, then it probably applies to you, because you also need to have the right type of personality! In my experience, this is a huge success factor. Part of it has to do with how consistently level-headed you are, particularly under pressure. The rest is hard to define, but there is one surprisingly common, serious potential pitfall you absolutely must try to avoid..
v About half of all would-be entrepreneurs I have come across have an ego the size of Australia and will tend to ignore or even get annoyed if they hear advice or opinions which are inconvenient or contradict their own. As a result, they are poorly suited to managing the project because they are also not personally sufficiently well qualified in the various areas encompassed by the project. Such people should be prepared for any or all of the following: o most people either won’t want to or won’t enjoy working with them. o they will have a tendency not to follow good advice from experienced and trustworthy people or even listen to other people’s ideas and will therefore incur additional, unnecessary project costs when that good (ignored) advice proves itself to be true in hindsight each time. o they will probably eventually consider firing everyone for mistakes they are in fact responsible for and thereby slow the project down, or even risk sabotaging the project if they actually go through with it. o they may demonstrate an annoying recurring tendency to change the objectives out-of-the-blue causing endless disruptions to the project plan, with ensuing delays and confusion and potentially making it ultimately impossible for anyone to ever complete the project. o they will almost certainly eventually fail or be forced to give up when the money runs out.
v What are the risks of failure and chances of success? The truth is that no matter how well you proceed, although success can and does happen, it is never guaranteed. New product development is inherently risky. At best, the world does not stand still. Unforeseens happen. The majority of well conducted new product development projects throughout industry do in fact culminate in new technology but they do not always culminate in commercial success. (reference my own experience regarding technical and commercial success and documented, independent US academic studies regarding overall new product development project successes by best practice companies). In short, never ever bet the farm or the family jewels on the success of a single project. |
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Are there less costly, less risky alternatives? |
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It’s hard to generalize, but if you have a mind to turn to ‘invention companies’ please be careful. I hear that some are apparently a bit shady. I think the USPTO has checked out a few of these and may have information to help steer you. In some cases, your idea by itself might be worth something. If that really is the case and you really have thought it through well, then you might want to consider patenting the invention now and then seeing if you can license it. But bear in mind that the granting of a US patent, although usually a step in the right direction, does not by itself guarantee or represent novelty, and owning a patent will not necessarily protect you from infringement by others. You will usually need lawyers and deep pockets to help you with those types of things should they arise.
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Copyright 2007 Sensors Research Consulting, Inc, All rights reserved. |
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