Wednesday, October 30, 2013

How do We Make New Steve Job Clones ?

Firstly of course we will never be able to recreate Steve Jobs in a clone which would behave as he did and succeed as he did!

However we have some lessons to learn from Apple, Invitrogen, Texas Instruments, Nike, Oracle and so on and so on, the great USA entrepreneurial companies who became corporate giants.

How much of their entrepreneurial spirit they retained is debatable, but they would have had no launch pad to Wall Street without years of being successful, nimble, customer orientated SMEs.

IN the UK and Europe also, many of the  technology companies so successful in the post war period came from the combination of innovation and entrepreneurship : by in large though outside Germany they seem to have waivered and been victims of take overs and mergers such that their soul is lost- the esprit de corps is destroyed, the collective organisational memory slowly erased.

The future of fighting against Samsung and LC, and the loss of manufacturing and design implementation jobs to the far east lies in the educational culture we are building today. Initiatives to expose undergraduates and university researchers to entrepreneurial skills and commericialisation programmes are in place, and the link between research funding and the application in the real world was established almost 30 years ago for the wider range of R&D at universities.

There are some mistakes being made though on both sides of the scale :

To take the last point in the preceding paragraph first - commercially directed research has two fatal flaws - science is a creative, inquisitive phenomenon which may pose some theories but used to follow research by pure interest and intellect: now researchers have to use inordinate energy to tailor the look and content of their work to match potential commercial applications..

Further more many university spin out companies who are IPR capsules are on the one hand an ego trip or rather nerd tourism into capitalism to do more of the research they want to do, just wrapping it up in a further commercial pretty paper. On the other hand they are on a "wing and a prayer" because in fact the analysts who support the investment really don't know enough about the market and the technology to do anything else than really be investing in an emerging "industry" or worse a "buzz word" like proteomics, which investors will buy when clad in graphs and figures.

Industry too has had some major failures in this respect, the biggest I can think of is actually the vast investments made in combinatorial chemistry and high content screening- this all looked great on paper and early lab research however the return on investment was inversely proportional and most companies have moved to a more directed approach in researching disease cause, sites of molecular interaction and "pharmaphore" based chemical entity drug candidates. Then come Pfizer with Viagra and earlier, Leo with Dovonex for psoriasis, both areas poorly provided for in the market and both drugs developed from the side effects of previous entities used as medicines! Alexander Flemming made the greatest discovery of the 20th century in medical science by accident.

On the other hand grandoise  pure research programmes like the human (and other species) genome project have actually destroyed many potential spin out companies by making patenting in some areas harder to achieve by the work being more accessible and more published around.

What is lacking here is the pursuit of excellence as a purely intellectual exercise: in fact being able to define that you are pursuing excellence should actually be an exclusion criteria - basically you are a nerd and you love what you do, and you are good at what you do.

Now we come full circle to who the next great Western hope of Steve Jobs clones will be: well they are nerds who choose to commercialise, and make that decision based upon technology they know customers want not investors, not business models and not in the first instance filing patents.  They will take with them other nerds who cannot do the entrepreneurial bit but can convert the science into commericalisable technologies. The stage away from this is then people who can "productise" these commercialisable prototypes and then those again who can make a profitable production line or contract out to one.

We need to get back to more pure science while at the same time educating people about how their related industry works and how to be entrepreneurs to make trading businesses work.

IT is a particular branch where the industry was previously pretty close to academia and academic research could find commericialisation a rapid route. Biotech, or rather bio-pharma, has always been seen as a long way to trading, but that need not be the case as you can sell your IPR as a service as much as you can as a license from a patent, and thereby add value and retain industrial secrecy around the little bit of magic which earns you a 60% gross margin.

I am going too fast and a little too disjointed for you dear reader: let me close the loop on what I mean here as a good academic spin out environment for technology and start up SMEs:

There are two cultures we need to nurture: the idea of centres of excellence or what you could more innocently call nerd centres where the best, most committed minds gather to do what they find interesting. There needs to be less directive funding of science! More room for creativity and results based on original discovery, scrutiny of others work, theoritisation.

The other stream is to build a culture for entrepreneurialism at all universities: this includes the nerd population as its main source of candidates, not also ran business students: great some business students will get rich on some washing and cleaning, or trite consumer web service but they will never be the next Steve Jobs because they have so little science, so little real technology. Scientists can and do make the greatest entrepreneurs. A nerd with a passion for their subject is maybe immersed in that for nine years at University and given the right social skills to become an entrepreneur they will make a journey into business that the business graduate will never be able to make into leading a technology new enterprise.

I actually would recommend that universities look to what the trade off in having these non trading IPR companies and patent licensing versus getting more funding for the core science and developing a culture where trading companies spin out with their technologist researchers. That is to say avoid making these bubble companies who need feeding with soft capital all the way until they get inevitably bought out or go bust. Also patenting and commercialising can slow down research in a specific area or actually quite a wide area of science if everyone is trying to patent, because that locks away publication and some degree of progress in the field which could have lead to several nearer market, entrepreneurial companies estbalishing themselves in the area as competitors or each with their own niche or particular product or service offering to the industry.

There is the little crux of the matter: entrepreneurs see the near time money, sometimes they need soft capital and eventually VC to get there, but they see the business in terms of customers, selling, income and profit in that order. Commercialising academics see a new source of funding for science, access to a higher or sustained salary and a feather bed of other people's money and other people being in-touch-with-industry.

There is there in a case then for graduates and post docs to work in industry on a sabbatical nature - or part time - in order to be more in touch with technologies and production methods for those, which are the application in practice for their science to supply benefits in the real world -- no matter how esoteric they may seem to you and I for that industry!

Major corporates have centres for entrepreneurship and also in licensing,  A&R departments if you like, and it would be interesting to gauge more about the success of these versus standard R&D and versus buying out SMEs who have run either as trading companies which I prefer or in the established model for IPR based companies to "exit" by being acquired.

The next "Steve Jobs" will be a leader of nerds and not a followers of business gurus that is for sure.

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