By Andrew Maxwell
Everything you wanted to know about technology entrepreneurship but were afraid to ask!
In a recent meeting on campus at the University of Toronto, a colleague exclaimed that my “insights” into the differences between entrepreneurial success and failure were nothing new. He mentioned several academic papers, which were at least twenty years old, and had made similar observations. He questioned why entrepreneurs would not already be aware of these insights. I suggested that very few people involved in starting a business had the time to read such papers, which were often difficult to understand as they were targeted at an academic audience. This provided my motivation for this blog…to provide technology entrepreneurs with an improved understanding of the venture creation process and insights into the causes of success and failure based on my and others research. This with the intent of providing entrepreneurs ideas they can readily apply to their businesses.
Given the number of excellent blogs on technology entrepreneurship available from practitioners, this approach allows me to provide some unique insights, based on my own observations in ventures in which I have participated. This is a role, for which I am well suited – as both entrepreneur and academic (with teaching and research experience). I am currently a partner in new venture that takes innovative technology to market (www.stratebrand.com), teach in the MBiotech program at the University of Toronto (www.mbiotech.ca) and am completing a Ph.D. in the management of technology at the University of Waterloo (www.innovationcentre.ca).
I will start with an overview of the venture creation process, and describe it in terms that are familiar to academics – but maybe novel for practioners. Venture creation is seen as an evolutionary process, where the successful entrepreneur develops his or her venture through a number of unique stages. Each stage is characterized by a range of different activities, with success a consequence of the right choices being made, at each stage. This is seen as an evolutionary process because only a limited number of the most promising ventures make the transition to subsequent stages in the process. An entrepreneur engaged in navigating his or her venture through the process often finds it difficult to navigate this evolutionary process. Consequently, he or she, will benefit from a better understanding of the specific factors of importance at a specific stage, which can affect the likelihood of the venture progressing to subsequent stages. Improved process understanding will help the entrepreneur facing a number of challenges, focus his or her attention on those that are the most critical and discourage them from becoming distracted by less critical issues or those that should be considered at later stages in the process.
I focus on the issues facing technology entrepreneurs, as they are significantly more complex than those faced by non- technology entrepreneurs, who do not have to become involved with technology development issues. Technology entrepreneurs not only have to identify and understand an initial market opportunity and build an organization to exploit it, they also have to understand the technology development process, either to develop it, or to exploit it in a new application. The need to develop technology creates a different set of requirements for success, often related to the need to expend initial resources on the technology itself, and to expend such resources in advance of revenues. Consequently, one of the key roles of the technology entrepreneur is to attract requisite partners for success, in advance of their ability to deliver solutions for customers. This requires them to develop a clear vision of the venture and share it with potential partners (employees, suppliers, investors and customers) in order to move the venture from the idea stage, to the point at which the concept becomes a business.
In my next blog, I will provide specific insights into six of these critical factors that entrepreneurs need to address in order to convince potential partners of the viability of the proposed venture. In the meantime, should you have a specific question about a challenge you face in your venture, and you think that the answer may be of general interest, I will be happy to try and answer it. Please email me at: amaxwell@innovationcentre.ca.
