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More school not the answer to academic entrepreneurship

September 18, 2009

Many of those lamenting the lack of innovation in Canada point to the disparity between academic research and innovative entrepreneurship. Despite our great success at publicly-funded research, we don’t produce related spin-off industries. The recent Science Day in Canada summary echoes the solution suggested by others: “Our institutions must train researchers to be entrepreneurs, not employees”.

It sounds great on paper, but the way forward isn’t clear. Encouraging graduate students to take a few courses in business as part of their training is likely to yield little actual success. Programs like NSERC’s Collaborative Research and Training Experience (CREATE) program sound good on paper – get teams of researchers to put together programs that combine research training with marketplace preparation – but as Maryse points out in an insightful analysis at her blog Frogheart, “how does a graduate student learn to be entrepreneurial from a senior researcher who’s a tenured professor in an academic environment? Where did the senior researcher get their experience?”

Furthermore, entrepreneurial spirit isn’t something you can easily teach. It takes immense personal drive and a commitment to seeing an idea through, to working long hours against long odds, and to overcoming frustrating roadblocks with innovative thinking (never mind the ability to live on meagre income….). Encouragingly, these are the same skills successful graduate students earn during their research training.

Maybe more importantly, academic researchers and entrepreneurs share the same basic motivation -the joys of autonomy and independence and the reward of personal goals achieved. Graduate students and academics are a great potential pool of entrepreneurs, they just need to be shown the way.

This challenge isn’t unique to academics. First-time entrepreneurs from all backgrounds lack knowledge and face challenges, so how to figure it out?

This challenge has led to the creation of dynamic communities of entrepreneurs across the country whose networks are both great learning spaces and sources for corporate collaboration. These communities of entrepreneurs are unstructured and grassroots, but enthusiastic and active, with regular events to facilitate meeting people and online forums/blogs/etc to encourage discussion. I’ve spent some time in these communities, and think they’re perfectly suited to young researchers without much business experience who are thinking about commercializing their products.

Right now, these networks are made up almost entirely of tech and software entrepreneurs. Twenty years ago, these innovators would have been working on R&D or support for big tech companies – the path to entrepreneurship was unclear. Researchers in most academic fields find themselves in a similar position today, and there’s no reason that in twenty years we can’t have thriving communities of entrepreneurs in other industries.

Young, energetic researchers can find advice, connections, and possible collaborations with entrepreneurs in their own neighbourhoods. These communities already exist, and are – in my experience – eager in their acceptance of new people with bright ideas. By attending social events, joining online groups, reading relevant blogs, chemists, biologists, and engineers have access to expertise and a supportive local network of entrepreneurs.

Any researchers interested in running their own business, but without an idea of the way forward, would do well to communicate with their local community and get involved. It’s likely to be a lot more relevant and inspiring than taking some extra non-credit business courses.

Here are a few links to communities in OttawaVancouverMontrealToronto.

5 Comments leave one →
  1. September 18, 2009 15:44

    Hi Rob! thanks for the shout out and for the link to Tech Vibes … I wasn’t too impressed with those folks when they first started up but they’ve really developed the site … I agree, there’s been great success with software and technology start up companies (ICT in particular) but I’m curious about your take on a phenomenon whereby they build the company and then sell it … there’s no intention to grow the business much beyond a few millions in revenue before selling … Don Matrick did it with his games company (it’s part of EA), Creo Products was acquired by Kodak, NCompass was acquired by Microsoft, Crystal Software which was taken over a few times before being finally munched up by Business Objects and the list goes on and on … KPMG used to produce a BC technology company map that was temporal more than geographic … it started in the 1890s and the last version I saw was published in 2003 (I think) … the thing is, it’s a stunning visual representation of the takeover business model in action in BC’s technology community … I confess, I have some fuzzy wuzzy thoughts on the matter but no solutions …

    • Rob Annan permalink*
      September 21, 2009 07:06

      Hey Maryse,

      you raise an interesting and challenging point about the selling of Canadian companies. I admit, my personal experience is limited to the smaller startups that haven’t yet attracted big money attention, so my perspective is probably limited. Nonetheless, my impression is that most of the entrepreneurs I know in the tech startup community aren’t really interested in creating a company simply to attract a big money buyout. In fact, I’m not sure how these entrepreneurs could really commit themselves so completely to their dreams if they were simply looking to sell their company off to the highest bidder. I really think they are committed to building viable, exciting companies that will grow in influence and renown.

      Unfortunately, these companies smack up against the inevitable challenge of a lack of capital. In the early days, bootstrapping can help fund the small-scale development work. As the company grows and needs to hire a couple of employees, make an increasing number of sales, etc., the company needs money – in a very real and immediate way. I know several entrepreneurs at this stage who spend all their waking hours thinking about how to raise capital. They look longingly at the American VC community, where funds are large enough to take some risks on small startups. Here, the VC community is smaller, and therefore more conservative – these funds only have so much capital to invest in these small companies, and tend to spend the money they have on surer bets – companies with already fairly attractive bottom lines.

      So we have great little companies that are desperate for funds – enter big industry and their strategy of acquisition. These startups have great products and no customers. The big companies have customers, but need new products. It’s tough to resist. Among the smaller companies, at least, I think there’s also an exhaustion and desperation in the search for capital so that when a buyout is proposed, it’s practically a lifeboat for the harried entrepreneur.

      If there was some way to inject actual cash – instead of refundable tax credits, etc – these companies may well be more resistant to selling out to large, hungry corporations. As small startups mature into more stable, mid-sized corporations, I’m sure they face a new set of challenges with which I’m not familiar.

      Thanks – interesting food for thought.

      • September 21, 2009 12:52

        Hi Rob! Thanks for that cogent analysis and, serendipitously, there was an opinion piece (by Nicole Poirier, Why BC’s biotech industry is falling behind) in one of our local papers (Vancouver Sun) on Friday, Sept. 18, 2009, which mentions briefly some of what you’ve mentioned here, albeit her perspective is very BC-centric. BTW, I meant to mention that the parallels you drew between graduate students and entrepreneurs were striking and had not occurred to me. Bravo!


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