Pathway to a Powerful Business: Find Intellectual Property From PhDs
A while back when I was out job hunting, I managed to come across an affluent head of a SaaS (Software-as-a-service) incubator program that gives out funding to business in this sector. While I was chatting with him, he expressed his frustrations with building up a product from scratch.
There’s a well tested, but difficult lean mentality of iterating your fresh product back to it’s benefactors, and refining a novel product that way but it’s very difficult.
He went on and explained the patenting complications with software and the web, and how fast it is for products on the web without serious IP to be replicated, hijacked, cloned, and being dubbed competitors. This made me remember the legal barriers that startups indeed have to be on top of before they have any hope of shutting down competitors.
He mentioned that he was actually looking at some universities (Waterloo and Queen’s in his case) and looking to partner with a PhD student who has intellectual property and help them build a business.
Why Was He Looking at PhD’s?
This site has a great visual of the reasons.
Imagine a circle that contains all of human knowledge:
With a bachelor’s degree, you gain a specialty:
Reading research papers takes you to the edge of human knowledge, and once you’re at the boundary, you focus:
You push at the boundary for a few years until one day, the boundary gives way and that dent you’ve made is called a Ph.D.:
Capitalize on Domain Dominance
As PhD’s go on and become masters of their domain, it is still a very narrow domain. If the research paper of domain is highly technical and can be seen as something that can redo, undo, change, or revolutionize something that is used by many people or things in the world, the potential for monetization becomes apparent. Some doctorates are overly theoretical, and perhaps ahead of their time to applicability. Others in many arts domains are intriguing by some people but still feign how important it is to people as a product that could be capitalized on. There is a sliver of PhD IP and research papers that create new technology, processes, ideas, and concepts that are easily capitalisable.
Knowing the narrow domain PhD’s work in, they would often seek a business development team (with obviously some sort of technical background), who can understand the basics of the product and sell it. There are some (such as the Google founders), who managed to do it all, but knowing the commitment it takes to be a CEO, and given that the potential success of turning a research paper into IP doesn’t always work out, I have seen business programs in various universities that pair PhD IP with business developers and entrepreneurs (albeit, with some contracts to you can’t just take the entire cut which is a potential downfall).
I’m not speaking of companies that were started by younger bachelors computer science students, I’m talking about the cases where doctoral theses birthed companies. Google’s Pagerank algorithm (basically Google’s “secret sauce”) was in a thesis paper.
Rather than the traction a young second year student gets on their higher risk business, the foundation of a unique and solid discovery of a research paper paves a straight pathway to capitalization by either creating the business, selling the idea to affiliates, and much more.
Black Boxes = Treasure Troves
A black box is a part of a system that essentially nobody but a special few individuals understand. For example, if you have a car without knowing how it’s engine works, you can still use it, drive it, and that’s all. You don’t understand the inner workings and this prevents you from making repairs yourself. You must go to a specialist, (i.e., a mechanic or dealership), to fix the “black box”.
You know how to create a business with the blackbox, how to modify it to a very basic level, how to market, pitch, replicate, and move the black box. But if it’s a blackbox to you, you simply aren’t well equipped to fully understand it. Heck, you can even hire people who understand it, but you yourself don’t. Can you grow and understand it one day? Can you intelligently talk about what the blackbox is? Maybe one day.
What is more important to the entrepreneur is knowing the problem it solves in the market, knowing the value proposition, and taking advantage of a product that is protected by IP (intellectual property), which gives it a solid and competitive place in which ever startup market it’s in. Not to mention, IP is extremely attractive to low risk investors, particularly those with a hardware/engineering background. Another positive thing is that there’s a lower level of stress due to already having IP to implement and scale rather than create from ground zero.
Become a “T-Shaped” Person Later
T-shaped people are the masters in one domain, but still have a grasp over the more narrow technical aspects of their product by having a general sense of the importance of the business, the marketing, sales, interpersonal skills, and creative skills. Strive to be this person in the long run as you chase your IP fuelled business.
The less IP dependant the startup becomes, the more “prongs” CEOs tend to have on their “T”s…
As hard as it is to state, it become clearer how people with a narrow special skill set often end up working for those with a broader set. Luckily some PhD’s have managed to branch out and become CEO’s on their own right.
How Do I Find This IP and These Research Papers?
I will tell in another story you when I figure this out. For now, make lots of PhD friends!
A great book, Academic Entrepreneurship, goes into a bit more into this topic.
Want to Apply this Knowledge?
I’m freely giving out a hefty package of notes from Silicon Valley CEOs, to MBA’s on how to start a startup.
Over 50 Docs of Notes! (How to Market, Pitch and More in 50+documents)
Author: Natu Myers (Website: Natumyers.com)
Natu is a cryptocurrency investor and current software developer who is experienced in building large scale applications. He built Innovator.Supply, an HR recruiting software for VR, AR, and chatbot enthusiasts. This was followed his other service, Hypetroop Market.
He has a fitness page on Instagram. Stemming from his time at Queen’s, he was a defensive lineman on the Queen’s Gaels football team. He balanced academics and entrepreneurship with an intensive football training commitment as well as launching his own album on iTunes. He stays up to date industry-penetrating software startups.
