MANAGING THE PATHWAY FROM INVENTION TO COMMERCIAL REALITY.

Before you embark on taking your idea and spending your hard-earned funds on trying to develop your idea into a product/service that has the potential to, when developed, evolve into something that people will want to buy, you need to “Stress Test” your idea to see if it stacks up on the right side of the commercial reality equation.

 Most new ideas are invented by the inventor to solve a problem that they have encountered, and they believe that if they can find a solution to this problem other people also experiencing this problem will pay money to buy their solution.

 Commercialisation is not quite as simple as that – if people are going to spend money buying your solution it means the money they spend cannot be spent on something else. After all, irrespective of whether you are an average wage earner or a multi-millionaire at some point your “pie” will be fully consumed. Money spent by the end-user on one thing cannot be spent twice.

 Before you do anything else (and you need to be brutally honest with yourself) ask yourself these 3 questions:

 (1) Can the customer do without your solution – does the problem have to be solved?

(2) Can the customer defer the purchase – do they have to have it now?

(3) Can the customer solve the problem that your product does by buying a different product or by buying a product from another supplier?

 Have someone (or several people) not in your circle (who are not ‘emotionally’ involved in your idea) answer the same questions and compare notes – be objective and dispassionate.

 You should seek professional advice after “Stress Testing” your idea from someone who has broad experience and the skill set to advise you on the various ways you can commercialise your invention. License Agreements, Capital Raising by Crowd Funding or Government Grants, Franchising or Outright or Part Equity Sale, and other methods are all ways of ‘capitalising’ on your idea. It depends on your preferred ‘end game’ as to which model is the most suitable to fit in with your preferred lifestyle.

 In essence, there are many ways to skin a cat and Stress Testing can often point to the best way for you to move forward. It stimulates discussion with your advisor and can result in issues that may evolve during your journey being addressed up front, making the path forward more efficient and rewarding.

 Experts estimate that only one out of every five thousand inventions undergo successful product launches to the extent they result in a great return for their inventor. Consensus suggests that the actual idea itself is only 10% of the process. The remainder encompasses the disciplines of manufacturing, testing, marketing, capital raising and business management skills to get the product out there. Successful inventors don’t always have the best ideas, or the necessary skill sets to ‘go all the way’ but they tend to form the best habits, to keep them on track and disciplined. Here’s some attributes you need to have or develop to ultimately be successful with your project.  

1) Develop Persistence So many first-time inventors have a romantic notion that they can think up a fabulous idea the first time, yet give up the ghost if they get even the slightest hint that something similar is out there. Rather than feeling deflated, successful inventors take a continually optimistic approach to probe deeper, and if they feel they might be able to create some clever feature that offers a unique benefit, they often design around what someone else has done. Successful inventors continue the habit of persistence in all areas, doing whatever it takes to get their product to market. If you are now, or are thinking of embarking on your own journey of invention in the future, start by looking in your environment for what may not exist, but also consider what might benefit from improvement.

2) Identify how your Invention solves a problem that people need and why they will pay a Premium for your solution. At the core of your mindset should be a detailed understanding of the problem you are trying to solve that people would be willing to pay a premium for. Otherwise, you could be spending your time fixing a problem that may not exist in terms of commercial reality only to end up broke. The need to make money sounds like the wrong footing from which to start a project, but really it is the only sensible way to approach it. The truth is, genuinely successful inventors who are willing to push through the barriers at each stage of the process, often end up running businesses and are paying patent fees, staff wages and/or Advisors fees – this money must come from somewhere – business development is an undeniably expensive cycle.

3) Develop ‘on point’ Time Management skills   Once you have your idea for a solution to a problem, you should aim to prove its viability before you apply for a provisional patent, and at least get one working proto-type completed before you apply for your provisional patent - this simply means that you have a full 12 months to raise capital, create a video showcasing your invention and getting independent feedback as to the commercial viability of your project. “Stress Testing” of your invention is essential.  Many of the best ideas never see the light of day simply because so many inventors fail to manage their time during the critical first 12 months of the invention pathway and run into cashflow shortfalls. 

Applying for patents and trademarks is expensive and is an upfront cost that must be funded before you start showcasing your invention – lest you want someone to steal it! Once your ‘provisional patent’ is filed in your local country you then have 12 months to execute a PCT patent giving you patent security in other jurisdictions internationally. This can be very expensive, so you need to decide in this period if your invention has the “legs” to eventually go international or not. Most of the successful inventors who move forward are acutely aware of the 12month patent clock ticking away, and realise that unless they create a time frame around everything they do, their dream to change the world and their own life will be replaced by lost opportunity and the worry of an impending fiscal cliff.

4) Make your product look professionally presented. It’s a simple fact, no one will consider paying premium prices for your product if it doesn’t look slick, highly polished, or professionally presented. Look no further than the super cool and colourful range of iPhone or the dynamic array of Dyson vacuum cleaners, imagine these products looking dull, with no colour and with a basic design, yes, they might still function the same, but who would buy them? Perceived value is key and helps a product stand out from the competition. Don’t stop at making the product slick or sexy, do the same with the packaging, and everything that follows.

5) Come to terms with embracing failure Most inventors do their best to avoid failure, whilst successful inventors embrace it. Every failure or dead-end idea is an important and essential step to finding the solution they are seeking. It might sound crazy, but finding out what doesn’t work is a very good thing. By making mistakes and failing, really, you’ve narrowed down your options and you’re one step closer to knowing what does work. This information is vital for any inventor, so you should also document the steps you take along the way, successful or otherwise. There might be some “failures” you reject, that may not get you the optimum result you desire. But they might still be better than what’s in the market – so run it by a Commercialisation Expert and/or a Patent Lawyer and consider if it would be wise to include them in your patent, simply to avoid someone using them later.

A Roadmap Of the Pathway to Success. Going from an idea for a new product or innovative service is a step by step process centering on  “building blocks” as you progress.  In broad terms development of your concept may involve some or all of these steps:

(1)  Industrial Design development (2)  Prototype Development (3)  Marketing collateral development (4)  Patent and Trademark protection (5)  Capital Raising “free money” by way of a Crowd Funding Campaign/s (6)  Capital Raising “free money” by way of Government Grants. (7)  Strategic Entity Re Structuring (8)  Equity Capital Raising (9)  Manufacture & Distribution etc.

 Clearly, if you do not have expertise in these areas you will need to bring in others in to fill the gaps.  Selecting the right people to ensure that your team is made of ‘square pegs’ fitting in square holes, not round pegs trying to fit in square holes. Getting this critical infrastructure right involves an entirely different set of skills so qualified Project Management across all of these aspects becomes critical from the first steps that you take to the exit strategy you use when it’s time to cash out and reap the rewards of your labor.

 We advocate that you hire a professional Advisor (a Project Management Partner if you will) who can demonstrate expert knowledge across all these areas.

 You will have to front some “Up Front Fees” but beware of Advisors who charge high “Up Front Fees” without a breakdown of their ‘fee for service’ deliverables. Some advisors charge lower up-front fees but include a % of fees raised in any Capital Raising campaign – i.e. Results-driven Remuneration. Results based Remuneration gives the incentive to strive.

 Before you engage any advisor you should get a written Engagement Agreement from them outlining your costs, the terms of the engagement (scope of work etc.) and a start and end date. Investigate their background on sites like LinkedIn etc. for their level of experience and start your assessment with a phone call to see if they could be a good fit for you.

For an initial 1 hour “FEE FREE” Phone/Zoom consultation in strict confidence, please contact: Paul Nielsen, Managing Director, Avantia Corporate Services Pty Ltd, Level 7, 320 Adelaide Street, BRISBANE QLD 4000 Ph: +61 7 3010 9711   Fax: +61 7 3800 5989 Mbl: +61 408824122 Email: [email protected] WWW: Https://www.avantiacorp.com.au