Karl Lapan, CEO of The Northeast Indiana Innovation Center, discusses the role of innovation in the marketplace, and demonstrates that the path to innovation is rarely a straight line.
Talk given at Purdue University Fort Wayne on February 17, 2020
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Innovation Potential & Pathways
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Karl R. LaPan
The Northeast Indiana Innovation Center, Inc.
February 17, 2020
www.niic.net
Innovation Potential & Pathways
2. 2
Today’s Agenda & Approach
Talk about innovation, its potential and promise
Share commercialization models
Discover ways to unleash entrepreneurial energy
Reimagine how we fuel innovation @ PFW
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The Big Idea –
Imagine that PFW was a catalyst for
regional innovation and entrepreneurship
bringing together students, faculty, and
business/ industry partners to provide the
creative fuel for research that leads to
industrial innovation.
What would
that look like?
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Innovation takes more than just an idea1
(.03%)
Purdue – last six
years
• 2,000 disclosures
• 1,150 patents
• 250 start-ups
(150 based on
licensing tech)
• 350 jobs
• $390 MM in
start-up funding
6. 6
Understand Diverge Decide Prototype Validate
• Who are the users
• What are their needs
• What is the context
• Competitor review
• Formulate strategy
• Envision
• Develop lots
of solutions
• Ideate
• Choose the
best idea
• Storyboard
the idea
• Build something
quick and dirty to
show to users
• Focus on usability
not making it
beautiful
• Show the
prototype to real
users outside
the organization
• Learn what
doesn’t work
Design thinking…the right way to get started
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• Can you build and deliver a product / service that satisfies the
customer problem or need?
• Do the product / service features deliver value (alleviate pain,
create gain) for the customer?
Product – Market Fit
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Exploiting market opportunities…a path to market
Many start-ups die before they generate enough
revenue to survive due to “Market Launch Barriers”
Technology
Development
Business Model
Commercial
Product
Investment Create value to
avoid “Market
Launch Barriers”
Revenue
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How does the process work?
University researcher
discovers new invention
and submits disclosure
Company makes
new products
OTT patents
invention
OTT licenses invention to company
OR decides to create start-up
(completely different path)
Company pays royalties
to University
Additional
research money
Federal and industry
research money
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Traditional university-industry technology transfer model
Research results
from lab
Start-up companies
and large corporations
New products
in marketplace
• Students
• Publications
• Faculty consulting
• Industry sponsored research
• Industrial affiliate programs
• Intellectual property
licensing
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Typical conversion process
~5-8 disclosures
received per week
•~25-40% of disclosures are
filed as patent applications
•Potentially licensable as
copyright, trademark,
biological materials, etc.
•Abandoned
20-25% disclosures, including
those patented are licensed
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Components of commercialization
Education ClustersGuidanceResourcesAssetsMentorsCommercialized
Products/Services
Innovators
Source: Chuck Wolfe, President, Claggett Wolfe Associates, Auburn, CA
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Technical
Assessment
A portfolio of essential commercialization services
Product
Development
Market
Assessment
Business
Development
Commercialization Services
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Business incubation support…
Active Engagement, Customer-Centric, and Advisory
Coaches + Mentors + Service Providers + Networks + Community
Getting
Started
•Protecting IP
•Prototyping
•Business Planning
•Experimentation
(Testing Assumptions)
•Seed Funding
Proof of
Relevance
•Product Scaling
•Financial Margins
•Market Testing
•Validated Learning
Company
Building
•Opening Market Channels
•Manufacturing Assistance
•Marketing & Distribution
•Management Team
Building
•Venture/Debt Funding
Source: Chuck Wolfe, President, Claggett Wolfe Associates, Auburn, CA
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Simple customer development model:
Right Action, Right Time
Source: Steve Blank, The Startup Company Handbook
Do I have a problem
worth solving?
FIT:
Product to
Solution
Have I built something
people want?
FIT:
Product to
Market
How do I
accelerate growth?
SCALE:
Product to
Growth
Raise money HERE
Focus: Validated Learning and Pivots Focus: Growth and Optimization
Proof of Relevance vs. Proof of Concept
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3-Stage Structured Acceleration Process:
From Concept to Stable Business
Present your concept
Stage 1
• Market-validated
go-to-market plan
• Investor presentation
• Product soft model
Develop your product
and systems
Stage 2
• Developed product, with
additional market feedback
• Production and business
systems in place
Launch and grow your
product & business
Stage 3
• Delivered product
• Growth and continuous
improvement plans in place
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Open Innovation
• Sourcing ideas outside the organization not just inside -access new ways of doing things, new knowledge
• More distributed, more participatory, more decentralized (Chesbrough)
• Pros: Faster, Broader pool of ideas, attract investors/non-tradional partners
• Cons: Cost, Intellectual Property, cultural change
Closed vs. open innovation. Source: Research Gate
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Our (somewhat methodical) process
Execute the
Business
Model. Launch,
Grow, Scale
Commercialization Process
Start-up Company
Come up with
business idea
(great or not
or crazy)
Define (Guess)
all the parts of
the Business
Model
Validate all
the parts of
the Business
Model
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The “Right Way” (remember there is no ONE way)
Customer
Discovery
The Pivot
Business Model
Search
Business Model
Execute
Initial Business
Model ”Guess”
Customer development
Customer
Validation
Customer
Creation
Company
Building
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The goal is to turn those guesses into facts through
Customer Discovery, verifying every hypothesis.
Customer
Discovery
The Pivot
Business Model
Search
Business Model
Execute
Initial Business
Model ”Guess”
Process: Customer Discovery
Customer
Validation
Customer
Creation
Company
Building
IMPORTANT: Founders run a Customer Development
Team (no sales, marketing or business development)
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Create a Minimum Viable Product based on your CUSTOMER DISCOVER and
VALIDATE than people REALLY want it by selling it to them. If not, pivot, and
revise the Business Model and do it again.
Customer
Discovery
The Pivot
Business Model
Search
Business Model
Execute
Initial Business
Model ”Guess”
Process: Customer Validation
Customer
Validation
Customer
Creation
Company
Building
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The VALIDATION occurs when you have successful
repeatable sales and the product is buildable…
Customer
Discovery
The Pivot
Business Model
Search
Initial Business
Model ”Guess”
Process: Customer Validation
Customer
Validation SALES!
That’s called
PRODUCT-MARKET
FIT
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Where does this fit?
Execute the
Business
Model. Launch,
Grow, Scale
Start-up Company
Come up with
business idea
(great or not
or crazy)
Define (Guess)
all the parts of
the Business
Model
Validate all
the parts of
the Business
Model
Customer
Discovery
The Pivot
Initial Business
Model ”Guess”
Customer
Validation
Customer
Creation
Company
Building
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Remember that…innovation
Takes more than just an idea
Comes in all shapes and sizes
Carries challenges and risks
Requires change
Is about running experiments
Needs execution to be successful
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