You’re at the cusp of starting a technology startup. Congratulations!
There are a few things that you need to keep in mind when you begin this journey. We consider two options regarding your background and provide a view regarding your box. Based on this, you’ll realise how to think outside it. It is only when you realise that technology people think very differently from business people or investors that you can have a balanced judgements.
The first option is that you’re a scientist and from the world of research. You’ve been working on the technology for a few years, and have likely discovered or invented something that’s the first in the world. Excellent! The question now is how do you commercialise?
One of the things to keep in mind is that commercialisation is different from inventing something. Inventing involves going to lab and trying to do something different every day, in the hope that one of your results will convert lead into gold, rather than blowing the place up. Commercialisation, on the other hand, implies being able to do the same thing again and again, a million times, a hundred million times a year. Year after year.
An important element of starting a technology company is trying to figure out the market you’ll address. If your answer is that your technology can address several markets, including (but now only limited to) healthcare, mobile telecom, education and security, you’re very deep inside the tech box. Getting out of this box will be challenging and imperative, to commercialise successfully.
An important consideration towards successful commercialisation is how much customisation is required. This is not only for the solution, but for the machinery required to make the solution. As a tech person, your answer is likely that this is trivial. As a matter of fact, it is precisely due to this reason that tech startups slip up on their milestones.
In addition to custom machinery that may be required to produce the solution, another question to address is that the process may need to be designed from scratch. This is far from trivial, and almost always results in significant delays.
The second option is that you’re from the world of business and see a market opportunity for which you see a technology that fits. Here, your key advantage is that you have clarity regarding the market and the gap, as well as the potential value that the given technology can bring.
One of the most important considerations is that technology with the technology team is seldom of any value. The only exception is when large companies buy portfolios of thousands of patents, and this is for an entirely different reason, the FTO. This will be covered in a subsequent post.
At the same time, one of the biggest liabilities with technologies is that they do sometimes come with the tech team in tow. This is not a problem for any other reason but for the fact that tech people think very differently. For example, tech teams cannot often relate to profit or time-to-revenue. Cash flow, the holy grail of any startup, is one of those things. As an extreme example, you could be faced with tech founders asking for an exit as soon as investors invest. But we’re not there yet, and will cover this in more detail when we discuss investors.
In summary, to start a technology company, you need clarity regarding the market that the tech will address, the gap that potential customers perceive that the tech will fill and the time to commercialisation. The level of customisation of the machines required to make the solution and the process that needs to be designed will also determine the timeline to market.
Send your questions on your challenges in your own entrepreneurial journey and I’ll try and answer them.
I wish you the very best for your own entrepreneurial journey.