General Strategies as a Scientist for Interacting with Business People

Here are some tips to help smooth the interaction between investigators and business people. There is more detail on each below:

• Have an "elevator pitch"
• Ask others if they have worked with this person in the past
• Respond promptly
• Don't be afraid to talk to people

More Detail:

Have an "elevator pitch"

Develop an "elevator pitch" for yourself and your technology. Successful business people are extremely busy and if they are investors or entrepreneurs, then they probably talk to hundreds of researchers each week. If you can communicate quickly (1-2 minutes) and precisely, the area of your expertise and the application and advantages of your technology then you will rise above 90% of researchers who tend to go into far too much detail too quickly. Communicate what makes your technology special and who it is that will care about these special features. Then allow them to ask questions.

TEMPLATE

1st sentence: State the problem
2nd sentence: State your solution
3rd sentence: Who you are, why you’re the one to solve the problem
3rd sentence: State the value proposition
4th sentence: Call to action (what the audience or recipient should do next)

A successful elevator pitch:

1. Convinces the "target person" to schedule a longer meeting with you, and to be receptive to doing business with you and your company.
2. Empowers and enables the "target person" also to convince other appropriate people to become interested in your company.
3. Resonates; demonstrates sincerity.
4. Communicates a sense of value, empathy, and urgency. Quantifies the value proposition clearly.
5. Combines thorough Sales and Market Research.
6. Requires no more than 1-2 minutes

Examples are here.

*Credits to Ken Morse and the MIT Entrepreneurship Center

Ask others if they have worked with this person in the past

You should ask for references and talk to as many people in the industry or investors as you can to get a sense for the entrepreneur's reputation. The responses that you hear should be glowing and extremely positive. If not, then move on to the next person. Only work with the very highest quality people possible. Business and commercialization is a game based on trust and reputation. It's perfectly acceptable to ask your other colleagues and anyone else in the industry if they have interacted with someone you're considering doing business with. Former students of yours who have gone into industry might be a great source for information.

Respond promptly

Respond to any requests for information or to meet in person quickly and as succinctly as possible.

Don't be afraid to talk to people

From the business person's perspective, researchers are often much too afraid and hesitant about disclosing information than they should be. To get a technology commercialized, you just have to talk to a lot of people about it. There is no other way. Business people typically will not need to know the technical details so it is fine to gloss over them initially if you are worried about someone stealing the idea. However, such stealing of ideas almost never happens. Far more often, scientists fail to talk to enough people to get anything commercialized.

Having the appropriate set of expectations coming into the commercialization process can help immensely.

The business world is a very different culture from the academic world and those frictions can be eased to the extent that each side understands how the other expects to interact.

The rest of this page covers expectations with respect to:

• Technology Licensing Offices
• Business People
• Business Entrepreneurs / Co-founders
• Timelines
• Investors

As a researcher who has an invention created while at a university or medical center, your first obligations are to the expectation of the institution's technology licensing office (TLO).

The TLO officers will expect you to:

1. Talk with them first (preferably before publishing a manuscript)
2. File an invention disclosure
3. Keep them updated on upcoming publications and interactions with companies related to the IP that you have.
4. Respond to them in a timely manner and possibly help with analyzing the market and competitive technologies.

In return, you can expect that the TLO officers will be efficient with your time and, while they have many cases to manage, they will actively move your IP through the process.

Business people (Investors and Entrepreneurs)

Business people will initially expect you to have an "elevator pitch" where you can explain the problem your technology solves, how big the market is and who you are in the span of about 60-90 seconds. The purpose is to convince the listener to schedule a longer meeting later. Business people do not want too much technical detail too early. In general, they will believe you that the technology does what you say, but will have many other concerns either about the market or about competition and IP. Resources for creating an elevator pitch have been assembled here.

Business Entrepreneurs/Co-founders

Although you may be the technical entrepreneur, to be successful you will eventually need to team up with an entrepreneur with a business/sales & marketing background. This co-founder will expect your involvement as a true partner in the business. Finding co-founders and bringing them on as partners in the business is a little like dating and then getting married. From the first time that you meet an entrepreneur, he or she will be evaluating not only your ideas and technology, but also what it will be like to have you as a partner and co-founder. They will expect you to be open and honest about your goals and about what the technology can and can't do, flexible and practical, and they will expect you to be responsive and willing to invest time and energy into the start-up in the form of meeting with investors, continuing to play a role in R&D, and recruiting technical talent (possibly your former graduate students) and scientific advisory board members. In return, you should expect the same things of them. They should have a good network, a great reputation and prior experience in related start-ups.

Timeline

Starting a business is a long process, taking almost a year on average to raise significant funding, and often 5-10 years to successfully start the business and to sell it to a larger company or go through an Initial Public Offering (IPO).

Investors

Investors will again expect you to have a short elevator pitch about the idea. They will expect you to be timely and responsive with their inquiries and questions about the technology and about drawbacks of the technology that they may be hearing about from asking other researchers with different views. The start-up world revolves around trust, so the more that you are responsive and demonstrate yourself to be trustworthy, the more comfortable investors will be risking their funds in your ideas.

Investors will also expect you to be knowledgeable about other technical approaches to solving the problem you are attempting to solve and the various advantages and drawbacks. The quicker and easier you can explain the technical merits (as well as admit the risky areas) of your idea (as well as the other approaches they may be hearing about) to them, the better and the more you will reassure their fears of the risks involved.

Entrepreneurs and investors will both expect you to be willing to put a significant amount of your time into the start-up. Investors may ask what percentage of your time you will be devoting and will be disappointed to hear anything less than perhaps 15%. There is no one right answer to that question, but in general, they want to hear that you are very dedicated to the success of the start-up. However, investors and entrepreneurs will also expect you to be willing to share the equity in the company with them. Especially if it is your first start-up, you should expect that your ownership percentage in the company will drop with each co-founder you add and with each round of funding. In the end, you may only own a few percentage points of the company, but remember, it is far better to own a small portion of something big than all of something that is valued at zero. A professor at Harvard Business School has done research on this very issue and shows that there is a trade-off between maintaining control and growing the company. He calls it "Rich vs. King" and you can choose one or the other.