TEST with PDF

1. Defining the opportunity
Innovation, Entrepreneurship
& Design Toolbox
© Imperial College Business School

2. What? – Why? – How? – Example – Conclusion
The origins of a business idea
Broadly, business ideas have two sources:
1. ”Demand-Pull Idea” based on an observed market
opportunity
2. ”Knowledge-Push Idea” based on a new technology or
capability
© Imperial College Business School

3. What? – Why? – How? – Example – Conclusion
1. Demand-Pull Idea
• An entrepreneur spots a problem that is currently
unsolved. It could be:
• a problem encountered in personal experience
• encountered through friends’ or relatives’ experiences
• Observed in the news or in current trends
...Often referred to as ‘customer pain’ or an unmet demand
• The entrepreneur studies the reasons behind the problem
then conceives and develops a product/service to solve it.
• The solution might incorporate technology, but the
technology solution is created and tailored specifically for
the problem.
© Imperial College Business School

4. What? – Why? – How? – Example – Conclusion
2. Knowledge-Push Idea
• A scientist/inventor makes a new discovery or develops a
new technical capability, which could have many possible
applications
 Also known as a ‘platform technology’
• She then needs to identify a suitable commercial
application
 Find the most compelling industry market likely to need or adopt
the new technology at an early date – find a problem to solve!
• And develop the raw technology further so it can deliver
the applications envisioned
 develop for “Market readiness”
© Imperial College Business School

5. What? – Why? – How? – Example – Conclusion
...Knowledge-Push, continued
• Once the technology is sufficiently developed, the
inventor/entrepreneur start-up can either:
1. Manufacture its own products using the technology, and sell
them to customers;
2. License the protected tech to other companies, which will
develop and sell their own products using the technology;
OR
3. Sell the start-up company, with its Intellectual Property and its
highly specialised managers and staff (‘human capital’), to
another (usually larger) company.
© Imperial College Business School

6. What? – Why? – How? – Example – Conclusion
Looking ahead: Market for Products or Technology
Demand-pull ideas usually go into the Market for Products
 Make products/services and sell directly to customers
Knowledge-push ideas may end up in either
 The Market for products (option 1 on last slide)
 Or the Market for Technology (options 2 and 3, last slide)
© Imperial College Business School

7. What? – Why? – How? – Example – Conclusion
Demand-pull example: eCourier.com
Entrepreneur Tom Allason noticed that courier services are
tremendously unreliable and inefficient.
After studying the problem and its causes, he got the idea to develop
a software system that could
 track the progress and whereabouts of each courier using GPS, thus
assigning delivery jobs to couriers intelligently
 Reduce operating overheads by using a web interface with the
customer, employing less call centre staff and paying a better wage to
bike couriers
He found a logistics expert who could plan and supervise the
building of this software and founded eCourier.co.uk
Further observations about ‘customer pain’ led to a second start-
up, Shutl. (full story in Ch. 1 of The Smart Entrepreneur)
© Imperial College Business School

8. What? – Why? – How? – Example – Conclusion
Knowledge-push example
Prof. Colin Caro of Imperial College discovered that blood vessels
are helically shaped, helping blood to flow more efficiently by
swirling, avoiding stagnation or slowdown
This discovery could lead to several ‘Biomimicry’ applications in
situations where fluid flow is important, such as
• Medical stents
• Oil and gas industry, risers, pipelines, etc.
Two companies were formed:
• Veryan Medical – designs and develops stents
• Heliswirl – develops engineering solutions to increase fluid flow
efficiency for industrial processes, increase yield and reduce cost.
(Full story in Ch. 1 of The Smart Entrepreneur)
© Imperial College Business School

9. What? – Why? – How? – Example – Conclusion
Suggested next steps...
If you have a demand-pull idea
Go to ‘Idea generation and evaluation’ exercise in the
IE&D Toolbox
• benchmark your idea against other solutions
• Improve your idea
If you have a knowledge-push idea
Go to the ‘Technology/Application Matrix’ in the IE&D Toolbox
• Compare and evaluate commercial applications
Afterwards you can further reality-test your assumptions and
conclusions using Entrepreneurial Market Research and Value
Chain/Value Network analysis.
© Imperial College Business School

10. What? – Why? – How? – Example – Conclusion
Two possible journeys...
Your Idea/Project
Did you start with a problem or a technology/capability?
Demand-pull case Knowledge push case
Idea Generation and evaluation Technology/Application matrix
Evaluate, improve Evaluate, choose
Entrepreneurial Market Research
Reconsider? Value Chain/Network analysis Reconsider?
Reality -test
© Imperial College Business School

11. Further reading
Clarysse, B. and Kiefer, S. (2011): The Smart Entrepreneur.
London, Elliot & Thompson.
Chapter 1: “Understanding the fit between Opportunities and
Ideas”
© Imperial College Business School