Евгений Буфф: Инновации: поиск и коммерциализация

Personalized Innovation Management, Sustainable Growth & Value Creation

Innovation, Technologies,

Commercialization

Dr. Eugene Buff, CLP, RTTP

Statistics 6 in 1 Million ideas or concepts becomes a successful business or successful company

Bankruptcies occur for 60% of high tech companies that succeed in getting venture capital

Mergers and liquidations occur in 30% of start-up companies.

10% of start-ups that succeed compensate for the other 90% of the companies in the venture capitals investment portfolio.

Having a talented CEO greatly increases the chances of the success for the startup.

Portfolios are returning 4 or 5% on an average in the venture business, versus expectation of 100%

© Janet George, 2006

Fighting the Product Development Paradigm

Total Product Life Cycle Birth to Death Expenditures

1000 Ideas 100 Trials 10 Products 1 Success + Sales Curve Patent Filed

Licensees Profits Sought Idea 0 +

Reduction to Practice

Shutdown Costs Total Expenditure/Profit Curve

Pilot Plant Marketing Starts

10+ Years

Up to $100MM

1. Could we be more efficient?2. Could we move faster?3. Could we save (spend less!) money?

A Technology = A ProductTechnology – an applied science to solve a problem

Many steps required to make a product out of technology

-Further Development-Validation research-Prototype-Scalability-Regulatory approval-Partnership-Market Research-Initial sales…

Can require MANY YEARS and extensive resources

Make Deals & Build Up Businesses

Speed of Business

Moore’s Law – computing power roughly doubles every 18-24 months. Since the invention of integrated circuit, 1958 - ~27 times

Car speed illustration:Start at 5 mph – double every minute

(in the 3rd minute at 20pmh you would cover 1,760 feet)

At the 27th cycle … 671 million miles per hour!!!

(in the 28th minute you would cover 11 million miles. At that speed it would take just five minutes to get to Mars!)

About Innovation

Innovation =/= Creativity

Creativity – generation of new ideas

Innovation =/= R&D

Research – creation of new knowledge (question is known)

Development – application of knowledge (spec. is known)

Satisfycing, NOT Optimizing

I don’t Have To Be The Fastest, Just Faster Than You

Something fresh (new, original, improved)

Creates value

This is INNOVATION: - It is NOT about new products, NOT about new processes

or new ideas...- It IS about staying one step ahead of your competition.

“The probability does not work in real world; it is pay off that matters.” Nassim Taleb. Antifragility.

A PROCESS!vs EVENT – an invention ...

Models of Innovation

Linear: Research – Development – Production –Marketing.

Chain Link (Kline-Rosenberg):

Stephen J Kline and Nathan Rosenberg, “An Overview of Innovation,” The Positive Sum Strategy: HarnessingTechnology for Economic Growth, Ralph Landau and Nathan Rosenberg (eds.) (Washington, DC National AcademyPress, 1986), p 290

Reality Check

Technology Transfer Road Map

So what?

Technology Is Not Enough!

} Great innovations could fail:

◦ microwave oven – first in 1947 (Raytheon)

◦ PDA – first in 1992 (Newton by Apple)

Need to Address Needs and Communicate Value

Good, Patentable Science is Not Always Commercially Relevant

Lack of Market is a Deal-killer

Punch line:} Commercialization is a game of “what

does he need” vs of “what have I got”!

Blind Spot StoryÉdouard-Léon Scott de Martinville

On 26 January 1857, he delivered his design in asealed envelope to the French Academy. On 25March 1857, he received French patent#17,897/31,470 for his invention – phonautograph.

Edison – phonograph, 1877

Steven Johnson, How We Got to Now.

First time played back at the Lawrence Berkeley National Laboratory in 2008

Blind Spot Story (2)

http://www.firstsounds.org/sounds/scott.php

Original application?

Note taking

One more point. Who is this man?

Kane Kramer

Timing is important.

Make Deals & Build Up Businesses

Marketing. Why it is important?} All inventions/innovations are ‘genius’… Technical

people/ inventors can’t talk about them objectively.Я (имя)…, изобретатель, г. N-cк.

У меня есть изобретение «…». Патент RU №1234567. Аналогов в мире нет.Это лучшее изобретение 21 века в области механики. Моя технология вытеснит с рынкавсе ныне используемые технологии, как двигатель внутреннего сгорания вытеснил срынка паровой двигатель….

Сейчас в мире нет пионерных изобретателей в области механики. Я один. К томуже нет настоящих экспертов. Армия дипломированных специалистов, называемыхэкспертами, на практике только для отчётности. Помните о роли личности в истории. Через несколько лет меня признает Америка, а за ней другие страны лучшимизобретателем 21 века. Мне присвоят разные премии и награды, но у меня не будетправ на мои изобретения. Премии и награды это ничто по сравнению с правами наизобретение.

Россия будет внедрять мою технологию самой последней…

Если мне в США предоставят Конструкторское Бюро и Экспериментальную Базу, точерез год я предоставлю для США Эффективную систему ... Я допускаю, чтопереоцениваю свои способности. Время покажет.

Make Deals & Build Up Businesses

Successfulproject

Technology• Identifiable assets - patents, trade secrets, know how • Proof of concept - reduction to practice, prototypes• Identifiable applications within the scope of our rights

Market• A business proposition that meets a market

need • Strong technology - market match• Competitive advantage over alternative

technologies• Technology in use: “Proven value”• Large, growing markets for licensable uses

People• A technology champion • Prior business analyses from a

business and/or technology team• Scientists to give industry

presentations• Technical publications supporting the

concept

What’s Needed to “Sell”?

Make Deals & Build Up Businesses

Formula for Success} W – what – understand your technology

} W – why – what is the value proposition, why would anybody care…

} W – where – “where” are the companies who care are –markets, applications, value chain

} H – how – reaching out and delivering the three “W” message

What sells?Three key dimensions:

Value proposition? How does this technology outperforms current best-in-class?? What are the key markets?

Development status / transferability? What was the highest stage of development?

? Can you support the transfer with samples? Data? People?

Intellectual Property? How broad, defensible, and detectable are the patent rights?

? What are the existing licenses / encumbrances?

Make Deals & Build Up Businesses

Types of Intellectual Property• Copyright • Geographical indication • Industrial design rights • IP cores used in electronic design • Moral rights • Patent • Personality rights • Plant breeders' rights • Plant variety protection • Trade dress • Trademark • Trade secret • Traditional knowledge • Domain Name

PatentRequirements:• Utility• Novelty• Inventorship• Non-obviousness

• Possession (written description)• Enabling disclosure• Best mode

Extracting Value

The United States Patent & Trademark Office estimates that only 3% of patents ever return more money to the owners than was invested in their development and prosecution. The statistics are as follows:

For every 100 ideas:5 are patentable

2.5 will become patents

.1875 will return a profit

Commodity Trap

Manufacturing and business process knowledge are widely distributed. Hard to differentiate products and sustain the differentiation.

Manufacturing is moving to global. In the areas with very low cost. Pressure to produce and sell on the basis of cost, not value.

Shrinking product life.

“What cost $5 million in 2000 can now be achieved for $5 thousand”.

H. Chesbrough ©

Open Innovation – a new realityOld model (“closed” innovation): • Companies must generate their own ideas, then develop, manufacture, market, distribute and service those ideas themselves. • Spectacular successes of central R&D such as Bell Labs.

Open Innovation: • Useful knowledge is widely disseminated, and ideas must be used with alacrity. If not, they will be lost. Role of R&D extends far beyond the boundaries of the enterprise. • Companies must now harness outside ideas to advance their own businesses while leveraging their internal ideas outside their current operations.

Open Innovation: The New Imperative for Creating and Profiting from Technology, Henry Chesbrough

Disruptive Innovation

Disruption Theory

Sustaining•Better than existing products in market, independent of price

Incumbent (3 of 4)Same product, same value prop, same customer, same channel

Succeed

New Entrant Fail

Disruptive• Compete against non-consumption

• Lower cost and worse

Incumbent Fail w/o autonomy

New Entrant Succeed

Disruption = A strategic choice

*Paraphrased from Christensen & Raynor, The Innovator’s Solution, Harvard Business School Press (2003)

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Practice

Markets

Focus on large markets! It is as easy to create a solution for large market as for the small one...

Find a niche. It is easier to enter and expand from there if possible

Don’t be greedy = be realistic. 2% of large market is usually better than 80% of a small and irrelevant one.

Create dynamic models to adapt for change.

Power of Collaboration in Commercialization

“Art is I, Science is We”Claude Bernard

Innovation Ecosystems = Collaborations and Interdependencies

Innovation Success!!!!!

Co-innovation

R&D, Product Development, Execution

Value chain, development chain

Make Deals & Build Up Businesses

Idea Without a Use

Idea With Intent (Business Plan)

Commercial Product/Service

Timeline of an Idea

Need help with transition

Moving Through Stages of Technology Development

Is There a Solution

Need personalized, individual approach to businesses and technologies. No “one size fits all”!

Can only come from experience

Craft, not an exact science

Repeatable, reproducible track record of success

Mission Statement

To help businesses stay healthy and grow organically – this is fundamentally different path.

Value AddConnectivity

Deep reach into corporate technical staffs

Access to key gatekeepers (tech transfer & tech acquisition)

Relationships with venture capital, Universities and SMEs

ConfidentialityOpportunity screening and initial discussions

Protect client name and application

ExpertiseEvaluation and communication methods

Market and buy-side knowledge

Business formation and commercialization skills

External perspectiveUnbiased evaluation and critical thinking

Servicing Two Sides of Open Innovation

Buy Side

Innovation management

External Business development

Technology Scouting

Training

Investment &/or Acquisition Targets

Sell Side

Market AssessmentStrategy AdvisementCommercialization AssistanceValue Proposition & Market ValidationFacilitation of Licensing and Partnerships

Open Innovation Tool Box

We are a one-stop shop for all your strategic needs.

o Proprietary databases

o On-line portals and marketplaces

o IP experts

o Valuation experts

o Local and market specific search partners

o Subject matter experts from industry and academia

Contact InfoEugene Buff, MD, PhDCertified Licensing Professional (CLP)Registered Technology Transfer Practitioner (RTTP)

Primary Care Innovation ConsultingUsTech Discovery LLC

E-mail: eugene.buff@gmail.comPh.: +1 617-331-1982Skype: eugenebuff

https://www.linkedin.com/in/eugenebuff