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Image of
open human head with various objects belongs to IPOwatchdog.com
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By
Kenneth Nwachinemelu David-Okafor
Welcome to the seventh installment of this
serialized post.
I am thrilled to put information at your
disposal which I did not have access to when I really needed it.
Information, by now you surely have
realized, is indeed a game-changer.
In this particular blog post I share stories
of experiences from overseas though pertaining to the last vestiges of checking
your idea for originality and for value.
For the prospective inventor, this is the stage, depending on the nature and form and technical composition of your idea, you move from low intensity-high research-technical knowledge gathering phase to the high intensity-higher research-high professional knowledge gathering phase.
Enjoy the following news feature:
Advice For Inventors: Turning Your Bright Idea Into A
Business — Kim
Thomas (The Guardian, UK)
The
journey from great idea to commercial product can be long and costly – but help
is available
It was 2008, when the late inventor John
Reid and entrepreneur Arpana Gandhi got talking at a fundraising event for
landmine victims. In a long career, Reid had invented, among other things, the
plastic security tag used to deter shoplifters.
Reid told Gandhi about the Dragon torch, a
product he had developed to disable landmines. Despite its promise, problems
such as a lack of raw materials meant it had never come to market. “I explained
that I’ve got a good track record and a commercial background, and that was one
of the things, unfortunately, that John was not very good at,” Gandhi says now.
The two decided to combine their strengths – and that is how Disarmco was born.
There are 120m landmines worldwide, and the
principal method of disposal is to blow them up. But that requires carrying
explosives across borders, which naturally attracts suspicion. “Because of
these conflicts in Libya, Iraq, Afghanistan, everybody is awfully twitchy,”
says Gandhi.
Reid – who, sadly, died in 2014 – was very
good, says Gandhi, at taking technology used in one area of life and applying
it to another. The Dragon torch works like a firework: it directs a very hot
flame at the munitions so that the landmine is burnt rather than exploded.
Both Gandhi and Reid had put money into the
company but needed more funding to test the product. Attempts to attract
venture capital failed, says Gandhi: “People are risk-averse, especially within
a sector that they don’t understand, and nobody is prepared to do the due
diligence to understand that we’re not going to be using this in a detrimental
way, we’re using it for a humanitarian purpose.”
So Disarmco used a very modern method of
raising funds: it put a request on crowdfunding platform Crowdcube and
within six months had raised just under £150,000 (£30,000 more than the
original target). The torch has been tested and should be commercially
available later this year – though the company also has other products on the
market.
Disarmco’s story demonstrates that the
journey between having a good idea and creating a commercially viable product
can be long, bumpy and costly: half of UK startups fail within five years, and
that is partly down to the difficulty of attracting investment.
Turning an invention into a commercial
product doesn’t always have to be expensive, however. Dr Martin Henery, an
enterprise academic lecturer at Manchester Enterprise Centre says he admires
the lean startup model, developed byentrepreneur Eric Ries, which involves bringing a new idea to market
without incurring the usual hefty startup costs.
It’s a model that has been made possible by
easy access to potential customers and investors on the web. “You research a
problem, read around it, find where the demand might be and get out there as
quickly as possible and test it with customers,” says Henery. That, he says,
enables inventors to make the necessary adjustments and gain greater customer
buy-in.
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‘Turning an invention
into a commercial product doesn’t always have to be expensive.’ Photograph:
Cultura/Marcel Weber/Getty Images
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There are, for example, a group of people
known as “presumers”: consumers who want to be early adopters and are willing
to pay for a new gadget and try it out. “It’s a great way of testing your ideas
and getting early funding,” says Henery. Once the inventor has established that
consumers like the product, they are more likely to attract investment from
more traditional sources.
As Disarmco found, crowdfunding platforms
can be a good way of raising funds for an idea that is too complicated or risky
for venture capitalists: they allow thousands of investors to make a small
investment, either out of generosity, or for a percentage share in the
business.
Some universities now offer help in testing
a product or creating a prototype, while the Fab Labs, set
up by the Manufacturing Institute in Manchester, London and elsewhere, provide
digital manufacturing technology – such as 3D printers – to help inventors to
develop and create prototypes at a low cost.
Sally Phillips’s invention was simple, yet
ingenious. She had been thinking about insulating her own house in Cockermouth,
Cumbria, and decided to tackle the common problem of heat disappearing up the
chimney. After some trial-and-error, she made a draught excluder using a thick wad
of felted Herdwick wool. “I then made my own handles from kitchen utensils and
cobbled something together that I could put in my own chimney and that worked,”
she says.
The next stage was to take the product –
now going by the name Chimneysheep – to Lancaster University’s product development unit, which
helped her develop a prototype. Phillips had to pay for the final design to be
completed commercially, however. “That was the biggest step of all,” she says,
because it was so expensive. “That was really a point of no return.”
Phillips wasn’t entitled to a bank loan,
because she hadn’t had the business account long enough, so put some of her own
savings in, borrowed £10,000 from her family and also borrowed the maximum
amount on her credit card. She was, however, awarded a grant of £7,000 from the Rural Development Programme for England, which gave her confidence that the idea
was a viable one. Liverpool University had already tested the product and found
that it would save about 4% a year, or £65, on the average household heating
bill.
The startup costs of the business, from
concept to launch, came to £50,000, but within five months of going on the
market in September 2012, the first 1,000 Chimney Sheep had been sold, with
prices starting at £12.50. More than two years later, business is flourishing:
during the winter months, Phillips sells a steady 1,000 a month and is looking
to market it abroad.
It hasn’t always been easy, says Phillips,
but she believes the key is to make use of the expertise available. “Have the
confidence to do it and have faith in your idea and in your product – but look
for help to do it. You don’t have to do it entirely on your own.”
The
above examples relate to work carried out in the United Kingdom. Nonetheless there
are a number of lessons and insights we can draw from the various experiences
described. In addition keep Dr Dayo Olakulehin’s story and experience in view.
REMEMBER,
DR DAYO OLAKULEHIN NEEDED HELP AND HE WENT BEYOND NIGERIA TO GET ASSISTANCE!
YOU,
TOO, CAN GET HELP, IF YOU NEED IT.
TO BE
CONTINUED
Featured story originally published in The Guardian UK
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