Technology Push Vs. Market Pull

A recent post on the Technology Transfer Tactics website cited a survey of tech transfer professionals.  There was only one survey question: "What are the top three reasons for failure of university startup companies?"  There were the typical reasons you might expect like management failure and lack of capital; and there were some reasons related to culture and policy in the international entrepreneurial stage.  But there was one that was either tied directly or indirectly to several of the others, and that was "Innovation does not meet a commercial need."  (Link to the website post: http://www.technologytransfertactics.com/content/2010/07/14/survey-suggests-top-10-reasons-university-start-ups-fail/) 

Perhaps it should have said Technology rather than Innovation in that one could argue the very definition of innovation is the application of an idea or technology to solve a problem in a market. Semantics aside, there is a strong and vital point being made here that gets to the very heart of entrepreneurship.  There are two failure modes in the commercialization of technology that result from a common root cause.  The first is the self proclaimed entrepreneur who wants to license a technology and start a company.  The individual is convinced that the research institution is sitting on technology that is ready to sell as a finished product to customers that are ready to buy.  The second failure mode is the researcher who has lived with the technology development from grant proposal to research project to invention disclosure. The researcher now wants to start the company that will make them millions as a part time CEO while they retain their position at the research institution.  The root cause for both these failure modes is focus on the technology in the belief that is has intrensic value to a customer.

Comments

[William Milam]

This makes a lot of sense to me. I would rather have a well-defined customer base with a recognized need than some high-tech solution looking for a problem. As an engineer, coming up with a solution is easier than finding the problem, figuring who is willing to pay to solve it and how much that solution is worth.