An Operational Guide to Bringing Your Invention to Market
- Monday, 25 December 2006
The last of a four-part series on converting your invention into a revenue-generating business, this month’s article describes, from an operational viewpoint, the critical steps that an inventor needs to understand to raise investment money and convert their invention into a viable business.
By now you have defined your product benefits, your competitive differentiation, and projected your financials. What you really need in order to take the next step is money and people.
Now, what do you tell someone when you are looking for money? If you are an engineer like me, for years I worked with numbers that had at least three digits to the right of the decimal point, and almost never had a $ sign in front of them.
You are about to learn the art of selling. Sales often has had a poor image with many engineers. We are about to change that. In short, selling is the process of establishing a mutual benefit exchange. In your case, you are exchanging money for an expectation of a return for the person who loans you the money. So let’s put together the presentation you’ll use to establish that “mutually beneficial exchange.”
Now that you have an estimate of the costs from our exercise in last month’s article, we’ll put together the presentation that you’ll use to help you sell. This will help you talk to people who don’t understand your technology, who are not engineers, and who are worried about the following risks to their return: the market, the product, the people, and competitors. So, your presentation must answer the following questions:
- Is there a market?
- How do customers solve this problem today?
- Who are your competitors?
- Who will help you convert the invention into a product and bring it to market?
- How much money do you need?
- When will investors get their return?
Notice that you have answered all of these questions in your work in exercises from our earlier articles. This work “packages” your answers into a presentation that is expected by anyone who will consider loaning you money. Let’s walk through each of these topics to build your presentation, slide by slide.
Slide 1 is the title of your presentation, name of your company, your name, the date, and what you are offering to the market (your value proposition or slogan). One hypothetical example of a slogan might be “Wireless night lighting for senior citizens; easy to reach for safety and security.”
Slide 2 is a summary or overview, all on one page. You’ll define the market size and a few key characteristics. Next, state what you offer customers. On the next line, list what revenue you think you’ll achieve in the first one to three years in growth — which you generated in the spreadsheet from last month’s article — and finally, list your estimate of the amount of money that you need to get through that same time period, which you also generated in the spreadsheet. Next, we’ll cover each of these in more detail on the following slides.
Slide 3 is a market description. List the same size and characteristics as you did on the summary slide. Now, add a target list of customers. Next, in one to three lines, describe how customers solve this problem today, what the need is, and how the market is changing (if it is). This last point should set up why your solution is needed.
Slide 4 is how your technology/product meets the need. This is the one technical slide in your presentation. Describe how the technology works in one to three lines, and the quantifiable benefit to the customer expressed in at least one of the following:
- Less resources required
- Lower cost
- Fewer people required
- Less maintenance or lifecycle cost
- More customer satisfaction
- More customer revenue
- Less time to do the task
- Less risk for the customer
Most of this slide should focus on the benefits achieved, not the technical aspects. You’ll want to have a separate slide deck that discusses the technology in detail if an investor wants to go through it.