Is My Idea Feasible?

Presented by Scott Visser9 May 2013

15 Questions to ask yourself to validate your idea.

Adding Value to Your Idea

These questions are valuable because...

Wild West Mouse Trap - Wyatt Earp – US Patent Issued in 1882

1. Not all ideas or inventions will be successful 2. They can save your money

Have you conducted any research to ensure that you are not ‘reinventing the wheel’ or infringing on other’s intellectual property (IP) rights?

o Has it been done before or is somebody researching it now?

o Have you searched for existing or similar products or services

(IP databases for registered patents, trademarks or designs, the WWW)

o Can you operate without infringing on someone else's IP?

(Freedom to Operate)

Question 1

Do you have documents to clearly prove that you own or have rights to commercialise your idea?

Examples of proof of ownership

o laboratory notes

o working papers such as a journal

o employment or business contracts that captures and assigns ownership

o a licensing agreement to use another’s idea

If somebody had challenged Wyatt Earp over the ownership of his design such as the trigger mechanism, could he prove it?

Failure to produce validated documentation can potentially lead to disputes over the intellectual property rights and rights to commercialise.

Question 2

Have you protected your idea through obtaining a patent, trademark, registered design, copyright or other recognised process?

Why protect your idea?o Gives you a seat at the table (stronger bargaining power)

o Keeps competitors away from your market

o It becomes an asset that can gain value and be traded or sold

Does having a patent guarantee success?

Wyatt Earp did patent his idea, was it successful?

Question 3

Have you made sure that your idea has been kept confidential when demonstrating, discussing or presenting it to external parties?

What not to doo Tell your friends or relatives

o Post your information onto forums

o Tell a reporter for the local news

o Meet a potential business partner without an Confidentiality Agreement in place

Collaborating with others will allow your idea to grow but without suitable diligence and protection, you may not be able to patent or protect your idea.

Question 4

Can your idea be commercialised without relying, to any great extent on any other IP or products?

Reliance on other people’s Intellectual Property may mean that you are not able to control development of the opportunity.

In our Wyatt Earp example, Wyatt may have designed and built the trap but did he own the designs or have the ability to manufacture the gun?

Did Wyatt have;o Freedom to Operate?

o Reliance on others?

Question 5

Can you prove that the idea works and can be reproduced?

Being able to demonstrate your idea works will; o add value to your intellectual property

o provides a stronger bargaining position (credibility)

o Allows for design improvement

o catch any unforseen design problems

Demonstrating the idea works may include;o built a working prototype

o have an independent validation conducted

o do some preliminary product testing

o conduct full scale trials

It is better for the prototype to fail and facilitate a new design approach than to proceed with commercial operations only to have it fail on a grand scale.

Question 6

Have you made sure that your idea meets the relevant laws, industry standards and regulations that apply to it?

For example, does it meet requirements for public safety, environmental and construction standards?

What approvals need to be gained and how long will it take?

Poor design may mean that the product may not be approved by authorities, which is a significant barrier to development and entry into your identified market

It is important that all laws, standards and regulatory requirements are clearly identified and plans are implemented to minimize that risk

Could Wyatt Earp sell his mouse trap in Australia?

Question 7

Have you conducted some research to help you understand the industry that your idea applies to?

Before starting a new venture, it is important to understand the basic characteristics of the industry you will be working in. Each industry is different and you need to determine how to best enter the market and/or determine whether it is feasible to do so.

Every industry is different and you should consider;

o the current trends

o product life cycles

o market gaps

o how big is the industry

o it is growing or declining

o barriers of entry

Question 8

Have you identified who the potential customers are for your idea?

The entire population of the world is not your target market!

Market segmentation involves dividing a broad target market into subsets of consumers who have common needs. Different segments have different needs

If the product does not generate a demand that fulfils the need or wants of a customer, there is a risk it won’t be purchased.

Should Wyatt Earp sell his mouse trap to;

a) Farms

b) Domestic households

c) His enemies

Question 9

Do you have valid information about what the target customers’ needs are and how they would value your idea?

Does your idea satisfy a need or a want in the market place?

Does your idea solve a problem?

Does your idea meet all the requirements to sell into the desired market?

Why would they buy it?

It is easier to sell a needed solution than push a product or service to market.

It is ok to change your idea for different market types, especially if it satisfies different market needs

In Wyatt’s case, did the local community need a new mouse trap if they already had cats and spring based traps?

Question 10

Have you obtained information about products that are similar to your idea or that could be substituted for it?

EVERYONE HAS COMPETITORS!

Using the information gained from your market research, work out how you differ from your competitors in your chosen market.

If you don’t differ enough, it’s unlikely that you will succeed against established competitors.

Inexpensive ways to develop a competitive edge:

o Offer quality serviceo Be flexibleo Personalise serviceo Offer value for moneyo Develop your image (brand)

Question 11

Have you identified barriers to entry?

Typical Barriers to market entry include;o Legislation and regulations

o Change of government

o Long negotiation times

o Tariffs

o Foreign exchange rates

o Culture – Social, Religious and Racial norms are the most common

o Logistics

o Payment policies (30, 60, 90 or 120 day terms)

o Weather

Each of these and many more may offer a significant barrier to future success. It is therefore important to assess these risks by taking a full environmental review to develop a plan to manage these risks where possible.

Question 12

Have you developed relationships with the people or firms that you need to work with to commercialise your idea?

o For example, a technical contributor, manufacturer or distributor

o New relationships take time to build.

o Potential Partners can add value to your idea as they have established knowledge and practices

What to look for;

• Passive or active

• Industry knowledge

• Track record

• Trustworthy/ referrals

• Contacts and network

• Long term relationship

• Capacity for funding

Question 13

Have you established a team with defined roles and responsibilities?

Task and role management play an important part in the development of any idea. Do you have the skills or can draw on someone else with the skills to achieve the desired outcomes?

o Operations

o Business Development and networking skills

o Commercialisation and R&D skills

o Strategic IP Management

o Entrepreneurial skills – calculated risk

o Marketing & strategic relationship building

o Accounting and legal advice capability

o Manufacturing capability

Question 14

Have you got the required funds to take your idea to the next stage of development and/or to market?

The Million Dollar Question! Your current financial position will challenge your ideal business model.

Types of funding;o Grants

o Banks

o Investors

o Partners

o Personal funds

Question 15

For all categories apart from the personal funds, you will need to address all of these presented questions before you engage them, be ready!

o Considering the information presented will provide you with the tools to create a stronger opportunity or to realise an idea is not worth pursuing.

o Doing your research will find your potential markets, your potential partners, your potential competitors and open doors to new opportunities.

o The internet is a great and cost effective way to conduct research.

o It takes many ideas to have a good idea.

o Don’t be afraid to collaborate with others, just protect yourself first.

o Understand your market and how your idea can solve a need. It is easier to sell a needed solution than to push an idea the market does not need.

Final Thoughts

The Inventor Service can help you…

• Understand the steps involved in taking your idea to market

• Objectively assess your idea or opportunity before you invest time and money in it

• Plan your next steps

• Access more than 30 useful guides and templates to help you along the way

• Learn from case studies

• Find out what other assistance is available

AIC Inventor Service

AIC Inventor Servicewww.inventorservice.com.au

Ideas2Market Seminar | 14 May 2013 | Gold Coastwww.ausicom.com/ideas2market

“All achievement, all earned riches have their beginning in an idea”– Napoleon Hill

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