Connections and marketing can mean money

IN research and development, necessity is truly the mother of invention. It isn’t enough to have a great or cool idea. Customers won’t part with their money just because you have something new.

In advertising they teach an important rule concerning the practice of selling – people aren’t interested in a product per se, just how it will benefit them. The most successful ventures aren’t just great ideas – they solve problems.

“Marketability” is the response given by Peter Why, chief executive of Zernike Australia, when asked what an inventor/engineer/program-mer (IEP) should think about before anything else.

“Look at the market. What are you doing? Is it a solution to a problem? Is it a breakthrough technology? And then work back,” he said.

Critical to the success of any R&D venture, then, (in some ways as important as the invention itself) is marketing. Not so much the promotion that comes after your product or service hits the shelves (or airwaves), but market research – producing something that will make people’s lives easier or better, rather than just a nifty gadget.

And don’t just research your market – know it. Brian Kasten, general manager of R&D outfit KDC Systems, spent time with the people he’d be servicing, finding out what they wanted and identifying their needs.

“You’ve got to know what their problems are to solve their problems,” he said.

p Production

While a typical IEP will have created his/her own product or service, the entrepreneurial spirit doesn’t always strike the technically gifted, and you might need outside help to develop your prototype.

As there’s no 10-point plan for commercialising an R&D project, the first steps of production might not be obvious. The agreed ideal from all sectors of the industry is to get networked – decent seed/venture capitalists or other mentor-type investors will have the contacts you need.

But not many people invest in an idea.

“You have to bring it close to fruition,” Brian Kasten says.

“You’ve got to have a product that people can see, feel or use. Ideas are hard to sell.”

So where do you go to make your idea a reality? Pieter Struijk, Entrepreneurs In Residence, says that, at first, universities are good for further research.

“Secondly, semi-government organisations like Software Engin-eering Australia WA have their own pre-incubator and can help people meet the first challenges,” he says. “In the last phase, when you come to the point of real production and commercialisation of the product, the reliability of a commercial operation is essential.”

Stories of Internet-connected soft drink vending machines and robotics abound from our university sector. Students are busy building, organising and programming, and by the time many hit the workforce they’re already armed with formidable industry knowledge in technology-related fields that can be ideal for IT development. As EIR’s Rob Newman says: “Unis are good for core technologies.”

The other choice facing IEPs of technology is when (if at all) to sell or license. If it’s a labour of love, you and your investor(s) might wear the management hats long-term (although as many venture capitalists cautioned, inventors are good at inventing but not at forming business plans or running companies).

Alternatively you could bring your R&D project to the cusp of market realisation and attract a big player with the resources and funding to make it a commercial success. As industry leaders well know, the great ideas come from the backyard sheds and home PCs of the world – those who cement market dominance in the IT sector simply buy it.

But wherever you are in the process, make sure you’ve taken care of the fine print. If your investors are worth their salt they’ll be connected with legal or intellectual property resources. If you’re going it alone, invest in an intellectual property solicitor.

Don’t patent too early – renewing patents can be very costly – but protect your intellectual capital. The historical picture of Thomas Edison as one of the founding fathers of modern technology, working for the good of the people, is the Hollywood version. In reality he was a voracious marketing manager, having lodged almost 1,100 US patents over a 50-year career.

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