Strategy – Product Launch

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Venture Investors typically shape their strategy around:

I predict the future, and I change it.

My resources are constrained.

Some say that underfunding is a noble thing. An inventor, starting a company with a thousand dollars and growing it to make millions is laudable. This route is feasible for venturing smallish inventions.  If the invention is sizable, the capital requirements are greater.  A good strategy includes the costs of building the prototype and professionally launching the product.

By default, part of the business strategy is “pioneering”. Pioneering is introducing a new product to the market.  Typically, pioneering strategies include trials for the user.  In addition yo pioneering, the new venture has one of two strategies to pick. The venture inventor engages in skimming or penetration.  Skimming is for those with shallow pockets.  Deep pockets have a choice of skimming or penetration.

In addition yo pioneering, the new venture has one of two strategies to pick. The venture inventor engages in skimming or penetration.  Skimming is for those with shallow pockets.  Deep pockets have a choice of skimming or penetration. Skimming is fewer sales at the richest markets.  Penetration is all out marketing.

Skimming requires precision.

The inventor knows the market segments, has talked to the customers and is precisely targeting the invention to those that need it the most.  Lack of capital forces sales in the direction of low hanging fruit.  If the fancy version of the invention has a long lead time, the inventor may choose to market to those that need the simpler version (minimum viable product). Skimming comes in shades.  Some have next to no money and others have more resources.

Penetration is fine for seasoned manufacturers, deep pockets and finely engineered products. Since most venture inventors do not have the assets, savvy and skills required to perform and execute a penetration strategy, the default strategy is skimming.

To find the right market segment the inventor has to get out of the office, go see customers, call customers on the phone.  With rich information and a creative mind, the offering is crafted to match the customers.

Example: One invention, a device that adds gasses to industrial tanks to promote convection sounded great in the office.  The customers didn’t agree because the gasses meant that the cover had to open.  Open cover and the contents are “tampered”.  Tampered products and some not friendly emissions made the sale an up hill proposition.  Nimble focus on smaller users with less onerous restrictions made up the difference.

Calls are ok, but physically being there is better.  Seeing the body language, the plant, and generally, the environment offers richer information than phone calls.

 

 

 

 

Categories: Strategy

Work Product – Team Members

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Fortune smiles on team members because the work team members do is meaningful and critical.

An example assignment: Build the business case for a new venture invention and deliver it in 7 days.

If the assignment is well-made, it matches and stretches the capabilities of the team member(s). For example, consider the work of building a business case.
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Management reserves product definition, development plan, launch plan, operations, and budget items.  The relatively new associate or team member gets comparables, the size of the market, competition, risk assessment, product justification and a guess at the sales price.  The management and team members share talking to customers.

The team member guards time to avoid getting lost in the research by first reviewing the resources available to the work and coming forward with a thoughtful action plan.

One way to make a thoughtful action plan is to prepare a document outline with time estimates.  Use a template with a cover page.  Add a table of contents, a bibliography, and appendix.  Snip out the table of contents.  Ask for a minute to review with management.  Management can see the direction, the expected deliverable, and have a serious conversation about expectations. Talk about the sources you have found and expect to find. Offer to take on some of the work in the yellow boxes on the management side of the work too.  Set up the voice of the customer schedule and assume responsibility for the calendaring.

  1. Summary
    1. Voice of the Customer
    2. Product Launch Plan
    3. Sales Price
    4. Sales Plan
    5. Product Justification
    6. Product Definition
    7. Risk Assessment
  2. Research
    1. Competitive Analysis
    2. Size of Market
    3. Competition
  3. Appendix
    1. Operations Plan
    2. Detailed Development Plan
    3. Budget Numbers
    4. Bibliography

If management wants more, it has a choice: put in more resources or allow more time.  If management wants less (almost never the case), management can balance the workflow. Expectations about seven days work are realistic.  On the fifth day, give an update.  Describe accurately the “good, the bad and the ugly”.  Crunch time and the manager still has time to react and keep the project on track, or add depth and color to key, new points.  For example, you may find that a multinational is still using legacy equipment and particularly ripe for the new invention.  The more the associate keeps his head in the game, the better the presentation.  Result?  The manager’s performance works flawlessly, and the project funded. The associate contribution is high, noted and rewarded.

 

Categories: Team

Business Case

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Bottom line – if the invention venture is going to make a lot of money, the money to get started is easier to find with a business case in hand.

The thirteen elements to the business case: Voice of the customer, product definition, comparables, product launch plan, development plan, competition, gross sales / net income, product expansion or one off, operations plan, selling price, the size of the market, product justification, and risk assessment.

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The components interact and form a detailed business case.  The venturers know what is at stake, the cost and the rewards.

 

Categories: Funder, Inventor

Inventor’s Ideation

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Two paths for invention ideation.  One, incremental.  Two, new.

Incremental inventions include a better tire tread, a faster USB port, a better smartphone.  New inventions are first and they change things.  Dr. Cooper, in his book “Winning at New Products” studies bringing inventions to market, and his counterintuitive analysis shows that new products have a higher success rate than incremental products and earn more money.

Invent to a small need, a niche that no one cares about and the invention is of no or small impact.  Invent to a great need, to a robust market and the invention supplies income for the duration of the patent life and beyond.

 

 

The human mind can find inspiration from anything.  Three common sources for ideas that lead to inventions: a necessity, customers and macro problems. The statement “Necessity is the mother of invention” holds truth. Necessity ideation expresses itself when a user (typically the inventor) has a problem without a solution.  The inventor invents a solution. In the course of interaction, customers talk about their business problems.  Some of the problems are worth solving. Concerns about climate change, poor water, lack of internet, and housing spawn thousands of new ideas and inventions.

An inventor that is not inventing or ideating with useful ideas and inventions has something like “writer’s block”.  Unsurprisingly, the solutions for writers block work inventors too.

 

Categories: Uncategorized

Venture Inventor

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Two choices for an inventor:

Venture your invention or let someone else make it. The wise choice for most inventors is to let someone else make it. A few take the venture path and fewer still succeed.

 

Venturing an invention means that the inventor is in the business of making and selling the invention.

Inventing is a learned art, like music, sculpture, and writing.  Like art, it is not enough for the inventor to have good craft skills. The great inventors display talent, inspiration, and vision.

An invention without a business case is like the phone without service. The great invention turns into a brick.

Read: One of the best books for venturing new products is written by Robert G. Cooper and his team.   

“Cooper, R. G. (2011). Winning at New Products: Creating Value Through Innovation. New York: Basic Books a Member of the Perseus Books Group”.    

The business case includes thirteen elements: Voice of the Customer, product definition, comparables, launch plan, product plan, development plan, competition, numbers, product expansion line, operations plan, market analysis, preliminary sales price, the size of the market, product justification, and risk assessment.

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Planning involves resources, time, and money.  Sophisticated tools like open source Project Libre provide comprehensive planning opportunities, paid programs (Eg. Basecamp, Zoho) provide interesting, non-traditional, intuitive project planning.

Project Libre and other traditional project management tools (Eg. Microsoft Project) offer good communication with industry.  See the “user examples” from the Project Libre site.

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Development requires management skills.  The inventor conducts the music of the inventive process.  Disparately located teams test and make components of the invention without face to face interaction.  Mikogo and other screen sharing programs are vital to making communication of the inventor’s vision.  Real-time understanding of mechanical processes is available via Skype, Facetime, and other video software.

Sales work best with thoughtful product launches.  The twelve considerations of product launches:  website, boots on the ground, pricing, salespersons, creative deliverables, prospecting, social proof, directories, strategy, advertising, public relations and technical matters.

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Categories: Inventor