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Success in business: What every new venture needs to do

Success in business: What every new venture needs to do
We New Zealanders have an entrepreneurial streak, but the same can't always be said of our commercialisation savvy. We chat to IP and commercialisation expert Paul Adams, the chief executive of EverEdge IP, about the basic ingredients of a viable venture.

We New Zealanders have an entrepreneurial streak, but the same can't always be said of our commercialisation savvy. We chat to IP and commercialisation expert Paul Adams, the chief executive of EverEdge IP, about the basic ingredients of a viable venture.

Where do New Zealand ventures tend to fall down?

There are three core ingredients to even start a venture: it must have a viable technology, it must a viable market and it must have a viable legal and intellectual property position.

In New Zealand you typically find that ventures focus a lot on technology development. We tend to overemphasise getting the technology just perfect. We tend to spend too little time on the next circle: the market – which is the value proposition. Does someone want it? Is it economic to solve this need?

But where we really fall down is that there is virtually no time spent on the third circle: legal and intellectual property. The questions here are things like: am I legally able to make this? Some products are outright illegal to manufacture. Or you might require regulatory approvals ie. pharmaceutical compounds. Or you might be restricted in terms of your ability to practice the technology, i.e. you're infringing somebody else's IP. Or might be able to make the product but your intellectual property position is very weak. In this case you’re in a catch-22: if you're not successful nobody copies you, but if you are successful everybody copies you because you have no IP to protect yourself.

They are all equally important but we tend to place too much on the product, not enough on the market and virtually no consideration on the importance of IP.

If IP is important at what point do you look at it as a factor?

You need to have a product and some concept of the market then you can look at that third Legal and IP circle. You don't have to have gone very far:once you've determined that the technology is feasible and there appears to be a market and that market is likely to be economic – at that point we say the technology has crystallised. This is the point when you look into the Legal and IP circle.

You want to get into that third circle as early as possible because it gives you very valuable insight and market intelligence very early... if you research the legal and IP side and find that no-one whatsoever is developing this technology, then maybe your feasibility analysis is wrong or you’ll find what you thought was normal is really at the edge of the research field. This would be a good time to ask 'is there really a market for this?' There might or might not be but now you’re asking the right questions. You might find that what you thought was really new and innovative has been done hundreds of times before and is protected by dozens of patents – that might cause you to change some R&D, IP protection and spending decisions right?

Is IP all about patents?

No, not at all. There’s a big misconception out there that “IP = patents”, it’s simply not true. Most of the value and volume of IP in most businesses is in things like confidential information, know how, copyright and trade secrets.

That’s not to say that patents are unimportant - they can be very important and extremely valuable but it can be difficult to tell a good patent from a bad one. The problem is, most people who have something new go to their patent attorney and ask: “can I get a patent?” That’s like asking your barber “do I need a haircut?” You need to either make that decision yourself or work with someone independent who can assess the IP, the technology and figure out what the best way to really protect and commercialise it is. If at that point you conclude that you do need a patent then you go to the patent attorney.

In your view, are there any industries crying out for innovation right now?

There are opportunities absolutely everywhere. We see between 10-11 new ideas a week. I'm constantly amazed by the stuff that walks in our front door. The breadth covers the entire spectrum, from pharmaceutical compounds to mechanical devices to media to pure internet plays. It's quite extraordinary.