Maximizing Innovation Impact: from Startups to Horizon Europe  

Maximizing Innovation Impact: from Startups to Horizon Europe  


 

 

 

 

 

By  Nicos G. Sykas, Strategy, Communication and Innovation Consultant

The vast majority of Startups are not successful. The “Valley of Death” is the critical stage between proof of concept, product launch, commercialization and the success of the new product; the difficulty of covering the negative cash flow in the early stages of a startup, before their new product or service is bringing in revenue from real customers.

Organizations face multiple, unprecedented challenges in a changing landscape characterized by intensifying competition, fluidity, uncertainty, complexity, interdependencies, volatility, asymmetries and catastrophic risks. You cannot tackle 2020 and 2030 dynamic challenges with 1970 and 1980 static tools and techniques. This is the age of black swans. New strategic tools and polyparametric approaches to innovation are needed.

The new Integrated Innovation System I have developed: a) Helps Public Sector and Businesses generate more and better innovations and b) allows organizations to innovate with real-time information by leveraging Artificial Intelligence, the potential of the Internet of Things and Big Data Analytics to find statistical regularities, uncover and analyze more patterns, extract practical, actionable, value-creating insights, assess a variety of scenarios, create multiple options and select the optimal innovation strategy. It is the first dynamic cross-cutting tool which can be applied in practically every domain and at all sizes / scales (startups, large corporations, smart cities, social and cultural innovation, cyclical economy, public sector reform, risk management, education and entertainment, game development etc.).

This pioneering method follows a multi-stakeholder, co-creation approach which among others identifies the following stages and steps to building sustainable innovations / startups:

  1. Good product; quality. Most startups fail because they have the wrong product.
  2. Real solution to a real problem. Does it solve a painful problem, meet a need or create customer value? Is there a gap in the market?
  3. Creative excellence: Τhe idea should be original, unique, authentic, inspiring, singular and impactful.
  4. The concept should be distinctive, simple and instantly understandable, contextually relevant and engaging / likeable.
  5. Configurable, adaptable. Agile design, modularization, elasticity.
  6. The idea must be realizable; ease of implementation, practicality.
  7. Customer metrics. The closer you can define your target market and customer profiles, the better you can integrate this data into your sales forecast.
  8. Test and validate the ideas with customers.
  9. Iterate your way to product / market fit. Continually developing your product and business model to ensure the widest and deepest possible growth in terms of users.
  10. Timing; customer readiness.
  11. Differentiated branding and positioning, product / market fit and successful advertising during both launch and growth phases help startups / spinoffs bridge the “Valley of Death”.
  12. Validate the business plan.
  13. Realistic and well-documented assumptions; a complete value chain model.
  14. Does it provide a sustainable competitive advantage?
  15. Value proposition vs competition.
  16. Danger of being outcompeted.
  17. Innovation is inherently uncertain. In a startup we need to increase exploration, randomness and variability.
  18. Strategic planning and risk assessment; mitigation measures.
  19. Strong team. Growing the human resources and decision-making capacity of your firm: Ensuring that your talent and governance structures are continually evolving to meet growth requirements.
  20. Securing finance – make sure you have the financial resources to grow, either using organic cash flow or external financing.
  21. Avoid capital-heavy investments (like property); invest in market share and market growth.
  22. Friendly business ecosystem. Culture of creativity and innovation. Regulatory framework that promotes innovation.
  23. Entrepreneurial Infrastructure – Incubators, Accelerators, Innovation Hubs, Co-working Spaces.
  24. Expected results and impacts; direct and indirect, short- and long-term impact; have potential for longevity.
  25. Value-creating insight.
  26. Added value – local, regional, European impact.
  27. Scalability with global outlook; expand and diversify.
  28. Does the New Innovation / Business Model synergistically create economic, social and environmental value?
  29. Transferability in other policy areas, disciplines and purposes. Metaphors and analogies as creative mechanisms for transforming and transferring innovative ideas from one context and situation to another.
  30. Funding
  31. a) Invest before: Friends & Family, University.
  32. b) Invest after product and traction: Accelerator, Angels, Seed Money, Funding Agencies, Venture Capital, Private Equity, IPO.
  33. c) Alternative Tools and Types of Funding: Co-investment facilities, Crowdfunding.
  34. Identify and overcome cognitive and emotional biases and eliminate prediction errors in order to improve intuitive judgement and decision making on behalf of startupers and potential investors (Thinking Fast and Slow by Daniel Kahneman).
  35. Create ‘antifragile’ innovations. The design / structure of an innovation should be such that it exploits and benefits from volatility, variability, randomness, uncertainty and time by minimizing exposure and harm from negative (unfavorable) asymmetries and maximizing exposure and benefit from positive (favorable) asymmetries (more upside than downside from volatility and randomness). Exposure can be modified through: creative rebranding, strategic repositioning, differentiation, diversification, adaptability, adjustment, agile design, modularization, scale up and down etc.
  36. You cannot guarantee the success of an innovation. But you can increase your innovation success rate by ensuring that your business model links market needs with emerging and exponential technologies. This is where positive black swans can usually be spotted e.g. Business Models that create all three forms of value: Cost Value, Experience Value and Platform Value (e.g. Uber, Airbnb).

Connectivity and combinatorial capability are at the heart of the new Innovation Paradigm presented very briefly above and which can be implemented with the help of an analytical Toolkit (a step-by-step practical Guide) I have prepared.

 

 

 

 

 

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