24 May, 2016
This blog is the fourth of a special Shell
LiveWIRE blog series aimed at celebrating and demystifying student
entrepreneurship. In this blog, entrepreneur Sam Etherington talks through
some of the reasons why you should turn your university project into a business.
Transforming a new project into a great product is a tricky business, and most certainly not a task for the faint hearted. However, the journey is an extremely rewarding one, so this article aims to highlight how you can, and why you should, be turning your innovative university projects into finished products.
Keep the costs low. A project invariably requires research and development to enable you to develop that killer unique selling point. However, research and development costs are one of the most expensive processes that any business, regardless of size, will encounter. Undertaking these costly tasks whilst at university can save you or your team, literally, a small fortune. Whilst at university, a vast array of resources, materials, machines, and technical knowledge surrounds you, so make the most of it. Use your time at university to get a head start on developing your groundbreaking idea, because once you are out of the university system, it can be extremely expensive to re-access those same world class facilities.Minimal input for maximal output.
Inevitably at university there will be a million and one things that you think you should be doing, other than setting up a business based around your project, so you have to be efficient with your time. Try and make your project part of your course. For instance, you might be able to use a part of your project to fulfil a course module.
Do not underestimate the value of personal projects whilst at university. It is important to be realistic and consider that so many individuals now have a degree, so how can you stand out? Setting up a company and developing a project whilst at university possesses huge benefits. Firstly, you are both developing your project, and learning how to set up and run a business. In the instance that your idea doesn't work out, the process of founding your own business is a hugely credible accolade. It certainly provides that extra 'something' above and beyond your fellow students, if you need to get a job to make ends meet. Secondly, it could be a great success! There is nothing to lose by applying yourself slightly more to a project you may already be doing as part of your degree, just be smart about how you use your time and effort.
Intellectual Property. The likelihood is, if you are developing a project, there will be intellectual property within it somewhere. It may or may not be patentable, but there will be technical knowhow that has value. It is important to be aware of your worth and value. It ultimately cost me the chance to commercialise an award winning design, due to exposure removing the opportunity for a patent. My advice would be to seek support in this area at an early stage.
Everything you are generating whilst developing your project has value. Be careful with regards to who you show what, because as soon as you disclose your idea to anyone without a signed non-disclosure agreement (NDA) or patent protection, your idea cannot be patented, and that's final. If you do need to show someone your idea, then either make sure you have a patent pending, or have NDAs in place. Additionally, you must seek support from your university's IP department to avoid patent issues further down the line.
What's the plan? If you are serious about trying to create a product out of your project, you need a business plan. Failing to recognise the importance of formulating a clear business plan early on, can lead to a lack of direction, a lack of market understanding, and most commonly, a lack of identification of who the end user will be, or if they even exist. Take the time to consider what your plan is. Devising a coherent plan will make you more efficient with your time, add strength and support to the decisions being made, and ultimately provide you and your idea with the greatest opportunity for commercialisation.
As you develop your idea, you may require further finance to commercialise it. Any bank or investor will most certainly want to see a business plan, and it is important to adapt your plan in parallel with your project and its' ongoing changes over time. Your business plan is your framework and compiles your projections of how you think things are going to pan out. It is important to be realistic in your plan. Do not overestimate, but by the same token, do not underestimate. Be as realistic as possible, as investors will give you credit for being level headed and honest in your assumptions.
Setting up a business. Do not let the daunting paperwork and legal information put you off founding your own company, because in reality it is a surprisingly straight-forward and fast process to initially set up. Take the time to understand the different types of businesses out there, such as LTD, LLP, PLC etc, as this choice could have knock on effects in the future. Do not shy away from seeking legal advice about the most appropriate company structure for your project.
Finance. So, you have your killer idea, you are being vigilant with the IP, and you have setup a business. Things are looking good. However, the next topic is the biggest reason why so many start-ups fail, they simply run out of cash. Do not be led into a false sense of security by being at a university and surrounded by its free resources, because as soon as you graduate they will be gone. Make good use of them while you can, but ensure your business does not rely on them further down the line.
In terms of what I would have done differently, I look back and wish I had applied for grant funding before I had graduated. Applying for grants often takes a significant amount of time, and the period of time before application results are released can also be lengthy. This may ultimately slow the rate of your developments. There are a number of grants available for makers and developers of projects, which are not available to other sectors, and to some extent puts developers in a fortunate position. A few places to try for grant applications might be: Shell LiveWIRE, Innovate UK’s innovation voucher, internal university grants, and regional growth grants, among others.
Trial and error. Although only short, I am aware that this blog may make it sound as if setting up a project and business is plain sailing and things often fall into place of their own accord. However, this is not the case and as I have found, you don't always get everything right first time. Most of the knowledge I have gained regarding how to develop a project, and run a business, has been through trial and error.
I hear and read a lot of stories of how people set-up companies and turn over millions within their first year. Some stories may be true, but for the majority success doesn't happen overnight, so don't let initial obstacles get you down. Every successful entrepreneur has had to deal with the setbacks, the failures, the issues, the legalities, and the financial worries. However, if you do follow this path, then what you are about to embark on is both the most exciting and daunting challenge that you will ever undertake. I do not doubt that you will have massive lows and massive highs on this journey, but I can guarantee that you will gain huge satisfaction in return, particularly as it came from entirely your own doing.
Be relentless in your efforts and realistic in your projections, and most importantly, just do it; ultimately you have nothing to lose and everything to gain.
About Sam Etherington (Founder of Aqua Power Technologies)
Aqua Power Technologies is developing an innovative, financially feasible, and mechanically sound solution to convert wave energy into electricity. The wave energy convertors, designed and fabricated by Aqua Power Technologies, are deployed within the offshore environment, anchored and left to generate energy from the natural power of the waves. The multi-axis nature of the design is its unique selling point and key novel design invention. The structure’s ability to absorb all the forces being applied to it not only increases its power generating potential, but also helps to provide a longer duration in service, due to the lack of stress being applied to the structure.
You can follow Aqua Power Technologies on Twitter.