FITT Toolbox: Business Model Decision


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At Imperial Innovation, the decision regarding the business model is taken by the technology transfer officers. The reason is that researchers often lack market knowledge and commercial skills and are therefore not always able to see the full potential of a certain technology. To enhance the commercial skills of researchers, Imperial College London has set up the Innovation, Entrepreneurship and Design program. The program gives students and researchers the opportunity to follow an entrepreneurial journey that provide them with insights into the challenge of introducing novel products and services to market.

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FITT Toolbox: Business Model Decision

  1. 1. Business Model Decision FITT– Fostering Interregional Exchange in ICT Technology Transfer – www.FITT-for-Innovation.euExcept where otherwise noted, this work is licensed under a Creative Commons Attribution 3.0 License.
  2. 2. Business Model Decision: The essence Business model decision = full responsibility of the TTO’s @ Imperial Innovations The TTO’s work out the business model during & after the invention disclosure by engaging with the researchers The TTO will use his industrial relations to find interesting applications for the technology, considering unmet needs & upcoming trends OR he will contact Commercial Services2 | 03.2011 Business Model Decision
  3. 3. Business Model Decision: The essence Work out the business model in an invention disclosure • Specific solution license to company with particular problem • Platform technology build business model around it “…It might be easier to capture a large chunk of a small market that a tiny chunk of a mass market …” Three possible models, usually combined: Services Model Product Model Solution Model3 | 03.2011 Business Model Decision
  4. 4. Business Model Decision: The essence Time Frame Pricing policy Perpetual Per user/CPU Annual Per transaction/login/ connection Rental Per click Subscriptions Pay as you go Pay after use4 | 03.2011 Business Model Decision
  5. 5. Business Model Decision: Tool ? When it is difficult to see which business model can be employed to commercialize an invention, Imperial Innovations sometimes rely on the IED-program IED stands for ‘Innovation, Entrepreneurship and Design A specific program to screen ideas and formulate a suitable business model around them5 | 03.2011 Business Model Decision
  6. 6. IED: What ? The programme gives organisations the opportunity to join students on an entrepreneurial journey designed to provide them with insights into the challenge of introducing novel products and services to market. The initiative is aimed at a diverse community of participants who are planning on starting, entering or leading both small and large organisations in the private and public sector. It is particularly interesting for those who have, or need, a business innovation strategy The IED students become part of a multi-disciplinary team in which they intensively interact with key researchers as well as practitioners6 | 03.2011 Business Model Decision
  7. 7. IED: What ? The business idea comes from the students themselves, OR from Imperial Innovations’ partners (< public/private) The postgraduates are taught and coached by leading faculty and practitioners. The IED program uses an integrated web based application, called the IED dashboard, which supports the entire process from idea to investor ready business plan. This tool provides a comprehensive breakdown of the stages and activities one should go through when starting a business and provides resources and advice on how to proceed7 | 03.2011 Business Model Decision
  8. 8. IED: What ? 4 pillars of the IED dashboard, corresponding to 4 phases of the IED programme: • 1st stage “Business Idea”: putting together the founding team, analysing current trends, generating ideas, draw up a technology/application matrix and do a novelty assessment; • 2nd stage “Value Proposition”: determining the value chain or value network, making a competitive analysis, checking appropriability, doing entrepreneurial market research and instigating the development of the business model • 3rd stage “Market testing”: building the prototype, identifying potential lead users, organizing focus groups and doing in-market testing • 4th stage “Business Case”: designing technical roadmap, drawing up the financial plan, covering the valuation and looking for sources of finance8 | 03.2011 Business Model Decision
  9. 9. IED: When ? Organized for the first time in 2008 Timeline IED-Program:9 | 03.2011 Business Model Decision
  10. 10. IED: Who ? TTO’s: They make the final business model decision; the program was designed to lift some weight of their shoulders; it saves TTO’s a lot of work, time, effort, energy Participants of the IED program: a diverse community of postgraduates who anticipate starting, entering or leading both small and large organisations in the private and public sectors with particular relevance to those who have, or need, a business innovation strategy10 | 03.2011 Business Model Decision
  11. 11. IED: Where ? The IED program is organized at the premises of Imperial College London (ICL) Even if there are industrial project partners involved, the workshops are still given in an auditorium or a meeting room of the university This seems logic as the initiative is specifically aimed at postgraduate students of ICL11 | 03.2011 Business Model Decision
  12. 12. Pro’s & Cons Pro’s • Students who are entrepreneurially minded get the chance to write a business plan and think of a suitable business model in a facilitating environment ; • new light on the interpretation of business models • Nonlinear approach towards business planning ; Con’s • Participating students and technology transfer officers might have a difference of opinion on how to develop the business model12 | 03.2011 Business Model Decision
  13. 13. Why ? Rationale IED Make the TTO’s’ task easier: Although this group is rather large – the entire team exists of 15 persons in total – the human capital can still be described as limited. Even more so, the rationality of these people – as with any other individual – is bounded. The IED program allows them to draw upon more resources to define the business models. Foster creativity with respect to business models: If the same people are always in charge of thinking about business strategies, this may hamper the creation of new ideas. Therefore, the IED program may offer the possibility of new ideas, alternatives; next to the strong connections with the industry which keeps them informed about new trends.13 | 03.2011 Business Model Decision
  14. 14. Why ? Impact IED The IED program was included in the part around business models because technology transfer officers often experience difficulties in defining and developing it. The IED entrepreneurial journey is one of the tools that can be used to facilitate the business model definition process.14 | 03.2011 Business Model Decision
  15. 15. Outcome of IED: plans for the future The program was only launched last year, so it’s a fairly new initiative It’s still too early too soon to come up with impressive figures about the impact of this program In general: the first impressions are very optimistic!15 | 03.2011 Business Model Decision
  16. 16. Lessons LearnedLooking back now, what would you … This type of program – in which entrepreneurially minded people with a technical background, like engineering students, university researchers, and doctoral students get the chance to learn about how to develop a business model – is highly recommended to other institutes ! 16 | 03.2011 Business Model Decision
  17. 17. Suggested Readings Link to bibliography Link to code book Business model Business plan Link to related websites | 03.2011 Business Model Decision