With increased government funding for start-up companies and commercialising innovative ideas, the influx of consultants vying to help inventors and entrepreneurs could make you feel you’re being swept along in a torrent instead of keeping buoyant.
Recently we posted 10 questions to quiz a prospective innovation advisor. Now here’s another 10 to pose to a potential commercialisation consultant, if you’re planning to take the start-up route.
How many start-up companies have you formed?
You generally want someone who has learned from their mistakes or failures – and if there haven’t been any, run!
An experienced commercialisation advisor, i.e., involved in forming at least three start-up companies from scratch (concept to seed funding), will have the scars to prove they know where the common pitfalls can be encountered.
What are the key lessons you learnt from establishing these companies (what worked well and what didn’t)?
Experienced commercialisation consultants don’t need to rub those scars to remember the lessons learnt – their answers will be easily articulated, and because they know the value of failing, they won’t be embarrassed to admit it.
What IP protection strategies did you implement for each company?
This doesn’t have to be patents – you want to know they can help you with strategies that relate to the type of technology you want to commercialise.
Where did you raise capital? (and what was the process, what was the time-frame, and how was the pre-money valuation determined?)
Knowing their reach for capital raising (if this is what you want to do) will help you understand how best and when to involve them in the process.
How many start-up ventures have you invested in personally?
Practitioners who back themselves, either in cash or in-kind, appreciate what it means to put skin in the game. If they are inclined to give in-kind support, find out what they expect in return for shares (getting shares for limited value-added inputs should trigger alarm bells).
Which start-up companies have you managed as the CEO or COO?
A consultant who has been a start-up CEO or COO can help you enormously. They have trod the path, tripped up, stumbled forward, survived and probably succeeded!
What roles have you had or do you have on start-up boards?
Likewise, a consultant who has been on boards and can clearly outline their roles and responsibilities knows about the governance required, what to expect, and how best to help you.
At what stage do you get involved with each start-up: pre-formation; formation to proof of concept; proof of concept to first sales; after first sales?
Not all consultants have experience at every stage of commercialisation. Check to make sure their experience aligns with where your idea or company is up to and heading.
How does your fee structure help support our commercialisation efforts?
Be wary of fees that don’t align with value. If you’re not sure, work on a rolling scope basis, i.e., develop a specific scope of work, complete it, and then develop a new scope of work.
When would your support stop (or when do you generally stop providing support)?
Find out how the consultant determines when their inputs end. This again should be very easy for a good consultant to answer – listen for “when I am no longer adding the value that you need”.
A final note:
You’ll need different skills at different stages. Make sure that you get the right ones at the right time. And if you can work with one consultancy from go to whoa, you’re more likely to sail than flail.
Need a co-captain on your commercialisation voyage, or just someone to help you chart the course? Please cast these questions our way too.
– Brian Ruddle, Managing Director