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Ideas and entrepeneurship

  1. Mar 7, 2009 #1
    As a junior and having switched my major from business to physics, I get the feeling that there are so many opportunities for businesses, by using physics and science. For example at http://www.sciencedaily.com/ you can see that every day there are what seems like hundreds of great ideas coming out daily, ideas which, if I had had them, I would try to turn them into a business. I mean if you look at the types of stupid business ideas that people regularly turn into billion dollar companies, selling useless products or turning some tiny tiny opportunity into a million dollar business, when I see all of the great ideas by scientists, which are actually ideas that will provide REAL economic benefits to those who use them, I cant help but wonder what happens to all of these ideas.

    Do academics often try to commercialize their ideas, and they actually do become rich, but we just never hear about it, or perhaps they are contacted by some company that buys out their idea, or do the companies just steal their ideas, or is it actually MUCH harder than I imagine to turn an experimentally proven idea into a economically viable idea? Why don't venture capitalists just rush over and invest with these ideas? If an academic wanted to turn one of their ideas into a business, would it be easy for them to do so, or is venture capital actually much harder to come by?

    Also, if you have personally ever tried to commercialize an idea, are there more challenges than you predicted?
     
  2. jcsd
  3. Mar 7, 2009 #2
    Recently, I came across this article:
    http://na.blackberry.com/eng/devjournals/resources/journals/aug_2008/working.jsp [Broken]
    It has some truth to it.
     
    Last edited by a moderator: May 4, 2017
  4. Mar 7, 2009 #3

    Ivan Seeking

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    1). It is cheaper to steal an idea than to develop it - lawyers are cheaper than R&D. The reality is that if you truly have a million+ dollar idea, others will try to steal it. One can spend decades in court defending ownership. Also, patent protection is limited. In most cases, introducing a small change to the design can effectively void patent protection.

    2). Sales is where the rubber hits the road - generally speaking, good ideas are a dime a dozen. An engineer or scientist can make a great product, but if it doesn't sell...

    3). Any venture involves risk. An idea may sound good, but when it comes to laying money on the table, it may not sound quite as good as it did in abstraction. Case in point: Even with my own inventions, I realized that I was willling to risk someone else's money, but I wasn't willing to put my home at risk. I know a guy who would finance a business venture - I could probably gain access to millions of dollars - but his first requirement is that I sign my house over. His feeling is that if someone is really so confident in success, then they should be willing to put everything at risk. And he requires nothing less.

    4). Most companies own products developed by employed engineers and scientists. Consider for example the torque wrench. It was developed by someone who worked for Craftsman. Craftsman claimed that he developed the product as a direct result of his employment, so they claimed ownership. Not to say that he developed the product at the factory, but his knowledge of the industry and tooling was a result of his employment. This goes back a ways, but IIRC, it was in court for something like thirty years. Also, I think he lost.

    For years I tried to develop products and get them on the market. While I did have a bit of success, it never paid off directly. I now make a living in part by developing new products for other companies that have deep pockets. And while I get paid every time, my customers may or may not get paid for their efforts.

    A good idea can lead to a good product that makes tons of money. Success can happen quickly, but far more often it may take many years or even decades. The level of commitment required for success can be staggering. An example of this would be the Moller flying car. He has been working on this for decades. It has cost him his family and everything he owns.

    One positive note: Last year I developed a product for the trucking industry that was evaluated by Toyota. They estimated that for every one sold, CO2 emissions will be reduced by about 10,000 pounds per year [through fuel savings]. I was paid well for my time and gladly hand it off to the salesmen. If they can now make millions, the more power to them. I have more interesting things to do than making sales or managing inventory. Also, how much do you want to bet that a competitive product emerges before the development costs are recovered by my customer?
     
    Last edited: Mar 7, 2009
  5. Mar 7, 2009 #4
    Moral of the story: think up the dumbest products imaginable so no one will ever think to steal them, and then get Billy Mays to market them. A millionaire is you!
     
  6. Mar 7, 2009 #5

    Ivan Seeking

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    I tend to think one is far more likely to get rich developing "pet rocks" than "flying cars".

    petrock.jpg
     
  7. Mar 7, 2009 #6

    Ivan Seeking

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    One more thought. Last year I was also working closely with a well known motor company to develop a custom motor for a ridiculously demanding application. I later learned that if successful, my customer fully intended to run to a Chinese manufacturer and have the design copied. They had no intention of allowing the motor company to recoup its investment in the design and tooling. To say the least, this put me in a very difficult situation as the motor company and I were working together in good faith. They had bent over backwards to make this happen, but my customer fully intended to steal the design.
     
  8. Mar 8, 2009 #7
    What did you end up doing about it?
     
  9. Mar 8, 2009 #8

    Ivan Seeking

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    I made it clear to the motor company that like any R&D product, one needs to carefully consider the minimum order size. Also, that as a reasonable precaution, they may want to limit access for testing until an order is secured. At that point I hoped that I had said enough.

    It is tough though because the end user wants absolute confirmation of success before placing an order. They demand that weeks of testing be done on-site before releasing a PO. The project is still hanging but may be dead because we couldn't get the unit price low enough.

    On the up side, I learned a lot about motors. I had no idea how many different kinds of motor technology exist... and I've been working in industry [more or less] for thirty years now! The other interesting thing to learn was the scale of production for some motor technologies. There were places that wouldn't even talk about production runs of less than 100,000 units. And these are VERY expensive motors.
     
    Last edited: Mar 8, 2009
  10. Mar 9, 2009 #9

    Ivan Seeking

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    I should mention that everything said here is taken from general principles that I have learned over the years. Obviously there are ranges of applicability, and there are always exceptions to the rule. The guys who developed YouTube come to mind as one of the greatest success stories of all time.

    http://en.wikipedia.org/wiki/YouTube
     
  11. Mar 11, 2009 #10

    OmCheeto

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    That's good to know. I came up with an idea a few years ago, and am so confident in it's sales potential that I recently applied for a home equity line of credit to pay just for the patent. The line of credit is only for about 5% of the value of the house, but most of my friends tell me I'm insane to extract even that amount.

    But these are the same people who yell at me for wasting my time trying to "save the world", and insist I come over, drink beer, and watch them push buttons for 6 hours to demonstrate how cool their new 257" flat screen TV's are.

    I think I will proceed with the plan.

    Thank you Ivan. I'll send you a small consulting fee payment for the information you've provided(~1%), once I make my first $10 billion. :rolleyes:

    ps. I spent 6 hours studying the patent process last weekend, so I'm a bit familiar with the timelines, lawyers, fees, more lawyers, more fees, etc. etc.
     
  12. Mar 11, 2009 #11
    Making millions out of 1.50$! I think that was just luck. Sometimes targeting poor population (particularly in these times) can be a really good move.

    http://news.bbc.co.uk/1/hi/world/south_asia/7932979.stm
     
  13. Mar 11, 2009 #12

    Ivan Seeking

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    How are you going to market the product?
     
  14. Mar 11, 2009 #13

    OmCheeto

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    Build one. Make sure it works. Give it to a friend. Wait till he craps his pants.

    Marketing problem over.

    You know he'll tell his friends.

    :smile:
     
  15. Mar 11, 2009 #14

    Ivan Seeking

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    That's a dream, not a marketing plan. :biggrin:
     
  16. Mar 11, 2009 #15
    You better hope he doesn't tell his friends that your product made him crap his pants, I don't think they'll buy it.
     
  17. Mar 11, 2009 #16

    OmCheeto

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    Then you don't know cars, nor young men, young man.

    Call it viral, or virile, marketing.
     
  18. Mar 11, 2009 #17
    unless they are suffering from constipation!
     
  19. Mar 11, 2009 #18

    Ivan Seeking

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    Is there anything that prevents or demotivates people from just copying your idea for their own use? Note that patents don't protect you from this.
     
  20. Mar 11, 2009 #19

    OmCheeto

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    I hope they copy the idea. If it's a viable design then everyone will benefit. My primary concern is not that I'm not going to profit, it's that the idea will be squelched. I'd like to see my design used on no fewer than 100 million vehicles.
     
    Last edited: Mar 12, 2009
  21. Mar 12, 2009 #20

    Ivan Seeking

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    Why did you apply for a patent?
     
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