Commercialization Flashcards
What are the steps in forming a spin-out company?
1) Get an idea
2) Protect the intellectual property
3) Talk to expert
4) Find some management
5) Write a business plan
6) Raise the money
What are the advantages of starting an enterprise?
- To improve health care, quality of life, environment etc.
- To assist other businesses and organisations
- To create new employment
- To make money
- To rise to a challenge and to enjoy it!
What are the disadvantages of starting an enterprise?
- Hard work
- Risky (financially, relationships etc)
What is the idea behind the business?
- Innovation
OR
- Using an established technology/process
What are the advantages of innovation?
- Something new brought to the market
- Rewards are high
What are the disadvantages of innovation?
- Risky
- Time-consuming
- Expensive
What are the advantages of an established technology/process?
- Can be brought to the market quickly
What are the disadvantages of an established technology/process?
- May have to pay for a licence or use intellectual property that you don’t own/control
- Competitors may be able to copy your business
- Success is dependent upon providing products/services faster/cheaper than competitors
What are service companies?
- Usually based on ‘know how.’
(e. g growing and supplying stem cells) - Technology often generic or incremental.
- Relatively low risk (low returns)
- Creates employment.
- Fast to profitability
How do service companies get funding?
Self-funded
Bank loan.
Government/local grants possible.
Growth equity/public funding at a later stage.
Not Venture Capital.
What are biotechnology companies?
- Based on a new transformative idea.
- OR based on existing high risk assets
- Long time (>5 years) to profitability.
- High risk
(high returns). - Funding reflects risk.
What are venture capitals?
- Fund biotechnology companies
- Managers of a group of specialist investors
- Raise money from investors and invest in new companies
- Own the company
- Put in proper company management
What are the exit strategies of a business?
1) Initial Public Offering
- Sell shares to public
2) Merger
- Merge with similar company
3) Acquisition
- Can a larger company buy you out
What are alternatives to venture funding?
1) Angel funding
- Rich individuals with money to spare
2) Public funds
What must the idea be for a business?
- Original
- Potentially transforming
- Protectable
How you protect your business idea?
- Patents
- Copyright
- Design right
What does copyright protect?
- The original expression of ideas
- NOT the underlying ideas themselves
What is a patent?
A right to exclude others from;
- Making
- Using
- Offering for sale
- Selling or Importing
What is a patient NOT?
1) A right to perform the invention
- Somebody else could hold the right to stop you making the product
2) A monopoly in the marketplace
What is a ‘monopoly’?
- Exclusive control of a commodity
- Control which makes it possible to manipulate prices
What can be patented?
- Process
- Machine
- Article of manufacture
- Composition of matter
- Improvement of any of the above
What can NOT be patented?
- Laws of nature
- Physical phenomena
- Abstract ideas
- Literacy, musical, artisic works
- Unethical procedures (eg. cloning)
Why is it so difficult to commericialise stem cell research?
- Have to get through all the stages whilst compiling with regulations
- Burning through money whilst making no money
- Investment (5-7 years)
- Return (7-10 years)
