Helping university research count

It is always a pleasure when you have the opportunity to go out and share some of the experiences and learnings, you have had, to an audience who need the insights in order to improve their odds of turning ideas into successful startups.

I had such an opportunity the other day, when I visited the Panum Institute at the Faculty of Health and Medical Sciences at University of Copenhagen to talk about how to de-risk your business idea to a group of 60 Nordic researchers and ph.d.-students.

I thoroughly enjoy hanging out with researchers. One of the reasons is that I am deeply fascinated by what they do, how they work and how brilliant they are at coming up with novel discoveries. Part of my fascination is probably also that I know that I will never be in their league, and what is beyond reach somehow fascinates me.

But then there are – luckily – other things I think I am quite knowledgable about. One of those crucial areas is how to bridge the gap from the lab to the market, i.e. how to bring great research to life in the form of products and services that meet a real demand and can thus form the basis for a great business.

Getting in front of researchers to share that knowledge is key, I believe, because there is so much potential in ensuring that top class research gets a real life after the lab.

Today a lot of great research ends up in big corporations, and as such that is fine, because it ensures that the technology gets out there and gets used. But you have to ask yourself, what could happen if more of that research became spinouts in their own right creating new opportunities, new jobs and contributing to economic growth in society? That, to me, is the really exciting part.

For this to happen researchers need help. And a lot of it. When I meet young spinouts as part of the Danish Open Entrepreneurship programme, the spinouts fall into a couple of different buckets.

There are those that are really specialized, deeply techie and so niche, you just know it’s never going to be a company in itself but will most likely be acquired by some bigger corporate as a tech/IP acquisition.

And then there are those, where you immediately get a sense of how it could become a company in its own right with a product speaking clearly to a significant future customer base and with that the opportunity to actually create an impact and solving a problem.

Those are the interesting ones to me. And thus this is where I start to look deeper into the team. And what I see here is most often:

Deeply brilliant and experienced researchers with a big wish to see their research reach the market but with very little realistic idea about how to actually make that happen. Simply because they have never done it before, it’s not what they feel, they should be spending their time on, and – basically – it’s not what they should spend their time on.

This actually produces an interesting paradox. Because I would argue that when we talk about de-risking an idea for a startup, the process and structure you apply to that is actually very akin to the process you use, when you do research: You define a hypothesis, you test it using experiments, and you capture your learnings. And then you repeat, repeat and repeat until you have – hopefully – reached the intended outcome.

So you would argue that of all people, researchers are actually very well equipped to do de-risking for their own startups. Yet, a lot of the researchers struggle with this process. The reasons may wary, but I believe it has a lot to do with the fear of getting a ‘No’; the fear that what you have worked so hard on and been so committed to, will not get the anticipated reaction when you go outside the lab.

For the very same reason this is exactly where its great to get help from someone, who is not only more experienced about doing market research and de-risking but who is also not so personally attached to the research and technology in question. By admitting your own limitations and partnering up with someone to drive the external facing side of the emerging spinout, you may actually get very far with very little.

Why is that? Because the researcher already understands the mechanisms in de-risking, and you thus don’t have to spend time talking through the process and explain the mechanics. You can focus on getting the most critical hypothesis defined, design the experiments and capture the learnings. It can actually become quite an efficient process, and you could argue that only a little more than sheer mentoring for the researcher(s) could get you a long way.

However, mentoring is not enough. An equal commercial partner is needed for the researcher to increase the chances of ultimate startup success. And while getting help on the market de-risking in itself is a huge plus, the right people also bring a few other benefits that are equally important to the chances of success:

First of all, researchers need someone outside their research circle to help determine, when research and technology is ‘good enough’ to start testing. I seldom meet researchers who have a pragmatic view on this – the tendency is always to stay a bit longer in the lab, run yet another experiment, optimize the technology even further etc. In a worst case scenario what that essentially means is you can stay in the lab forever and never get the technology out to use.

Second – and a bit connected to the point above – researchers need someone to help them establish and secure a sense of urgency. While this is not the same thing as wanting to rush things through, it is about helping researchers figuring out how to get to market as quick as possible in order to both gather feedback and learnings from the market but also show investors that the case is on track to be viable.

Of course there are limitations as to what you can launch early, if you fx operate within a regulated industry, but the point is that there are always things you can do to start putting the spinout on the map, and researchers generally need help doing that.

Finally, a partner can help researchers deal with the very real issue that the envisioned outcome is by no means the same as the journey to get there. Too many researchers have the notion that the complex part of turning their research into a product that can be marketed is the actual research.

In fact, it often turns out that getting the product to market and commercializing it is every bit as complex, rocky and bumpy a journey as the research. Partners with experience in taking things to market know this because they have the battle scars themselves to prove it. Researchers don’t – by and large – have this and would thus be well advised to add this experience and expertise to their team early on. If for nothing else then at least for sparring them the pain of experiencing these hardships themselves. And potentially see their startup become an unnecessary casualty in the process.

So in summary, there is a lot of things, ‘business people’ can do to help researchers realize the full potential of their research. The right commercial people are just as important and valuable as materials needed in the lab to perform the actual research. They are each others yin and yang, and together they can achieve the outcome great researchers with a passion for affecting change have:

Making the research count where it’s needed.

(Photo by Diana Polekhina on Unsplash)

The (continued) case for higher ed

The only problem with colleges and universities is that they have become profit machines essentially barring students of limited means from attending.

The core of what colleges and universities do have probably never been more important.

I fully understand that there is a lot of talk about certification for specific skills being the future of higher education. But let’s just start with agreeing that one of the main reasons for that is what i mention in the first sentence:

The old model has become too expensive. It’s not broken per se. It’s just too damn expensive for most people.

So what’s good about college and (to some extend) university? Essentially what many people claim is bad (apart from the costs):

Generalization.

There is a lot of chatter that generalists are on their way out because specialists are all we need.

I think it’s a mix.

Yes, we need specialists. More so than ever. If for nothing else due to the sheer complexity of many specialities.

But we also need these specialties to be built upon a solid foundation; a more generalist approach and experience that serves as a guidance for how the specialty comes to fruition on a more practical level.

Being a generalist is a big part of how we are equipped to think, decide and act in various situations. Cutting that away generally leaves us with a hammer without necessarily understanding how to identify and pin point the right nail.

It makes us smaller contributors, not bigger.

Thus we’re back at the outset and the real problem:

The solution to the higher education problem is not discarding education and replace it with certification alone. It is making sure that higher education is accessible to talent, so that we can reap the rewards. Both as individuals and as society.

Higher education profit maximization is essentially choosing short term optimization at the expense of longer term profit for all.

It’s actually pretty stupid, when you think about it.

Via Futurist Speaker

(Photo: Pixabay.com)

Short term joy, long term agony

One of the things that I have been spending a lot of time on these last couple of years is the subject of university research and how to transform the best of it into viable spinouts that can go on to solve real problems in the world.

There is no doubt that the potential within this space is huge. There is a lot of very good research coming out of universities, and there sure are enough big problems to creatively deploy that research towards.

However, there are various pitfalls that make it hard to create spinouts that are truly viable and have the potential to conquer the market and solve the problems that were envisioned at founding.

In a series of posts, I will be trying to address these, based on my experience. And what better way than to start out with one of the real kickers:

Ownership. Now and in the future.

Whenever you start a company, who gets what is always a solid discussion and potential point of contention. And it is no different when it comes to building spinouts.

Often the research team will have a pretty strong idea about what their research is worth, and of course that value assessment is going to skyrocket the more breakthrough the innovation is.

This self-valuation also leads to outsize demands on ownership, and you can argue it is a valid point. I mean, if a team has spent years doing great research, and outsiders only come in to take it to market, shouldn’t the original team get the brunt of the equity?

That depends.

If the goal just is to create a spinout, get it registered and give it a go, sure. But if the goal is to build a viable company that will be here for long term, grow and deliver on the mission, it is by no means a sure thing.

Basically the reason for that is that you need ressources to grow and succeed. Ressources come in two main shapes and forms: People and funding.

People – great people you need to build your spinout and make it successful – will only join if they’re incentivized to do so. Especially if they are to have a key role in the early team. That means for founders – ie researchers – that they need to reallocate up front a sizeable portion of their equity for incentives, ex a warrant programme.

Failure to do so will leave you with a spinout that will have nothing but the original team, lack muscle and knowhow for important tasks and never go anywhere.

The other type of ressource is funding. And it is tied to the talent doing the actual work that will ultimately ensure commercial success and deliver the investors a sizeable return on the risk, they’re taking by investing.

If investors – especially sizable ones who can deliver the size of checks needed to make it big – see that early team members, ie researchers, are insisting on sitting on equity for doing nothing in the day-to-day business, while those who are supposed to do the work either get to little or get nothing at all and thus won’t join, it is a walk-away.

The result?

The spinouts run into a wall. It will be absent of needed talent and absent of funding. And its changes of converting promising, potentially breakthrough, research into market success and ultimate contribute to solving the core problem, the company was founded on, will be slim to none.

And it will be primarily because the founding team – predominantly the researchers – confused short term success with long term success.

The lesson here?

Think about the long term and think about what is needed to get to the success that you envision. Think about the things you will have to do to ensure you get to that point and make a decision:

Am I in this for the long haul to affect a change where my research solves a big problem? Or am I in this purely for myself and my own retirement?

(And yes, I know it can be a combo, but that’s beside the point here).

If the answer is the latter, be aware that you will struggle and – most likely – fail before you get to where you want to be.

If the answer is the former, come to peace with the fact that you have to sacrifice something to get a bigger reward.

Not only will your equity be worth something rather than nothing (in the above example). You will also be far better positioned to achieve success because you enable those factors that are absolutely necessary for you to succeed.

(Photo: Pixabay.com)

The WFH degree

Today Danish applicants for higher education get a letter saying whether they got into the education and institution of their dreams. Or not.

I don’t envy them.

Back when I studied at the Danish School of Journalism it was good times. No need for a grade point average; a grueling Saturday test decided who got in, and who did not. On average 15 percent got the nod. The rest didn’t. Once in it was good fun and super interesting – and an enormous opportunity to meet and engage will all kinds of fellow students from all walks of life.

Today, what is there to look forward to?

Endless Zoom classes? Lack of a social life with fellow students? Inability to feel the environment and get the most out of the network, the other students and the opportunities that present themselves once you get engulfed by it?

It sucks, right?

And it sounds an awful lot like the ‘Working From Home’ (WHF) concept, doesn’t it?

It does.

And it is so ironic, it’s beyond words.

What the students are already complaining about now – having to be all remote, suspect quality of the classes being taught via video, a lack of the university experience and fellow students – are essentially the same things we’re so busy hyping as the next big thing about WFH.

Studying is work.

Work is also studying.

If we say that we understand and are sympathetic to the complaints of the students about the quality of the education they are about to embark on due to these new circumstances, we should also – as a MINIMUM – put serious question marks on the impacts on quality, innovation and such on a WFH future, before we just jump right in as headless chicken.

I have little doubt, we will fail to make that calculation. And that companies and the ability to innovate will suffer because of it.

(Photo: Pixabay.com)