What is the venture development process?

To create a startup company around a licensed university technology is referred to as venture development. A venture development firm can assist entrepreneurs in identifying and developing a prospective commercialization strategy, be an incubator, test target market assumptions, recruit university and non-university innovative resources and talented team members, and obtain early-stage finance. Commercialization grants, internal and external small business owners, governmental and local finance systems, and private funds are all possible sources of funding. This activity, when combined with strong intellectual property resources, accelerates early commercialization efforts and better prepares university-affiliated business owners for other types of funding.

Influence of university innovations and technology on the entrepreneurial ecosystem

When a university wants to commercialize a technology it has produced, it initially looks to license it to an established business structure, as this is usually the quickest route to market as a startup founder. Successful entrepreneurs bring a wealth of resources to the table, including research and development financing, advanced technology, subject matter experience in the product market, industry knowledge, current clients' strategy, and logistics providers. Finding a well-established investor to option or license a university technology, on the other hand, is not always possible. University technologies are typically in the early stages of new venture development and can be innovative, and there isn't always enough data for risk-taking the technology or market concept for licensing. Forming a startup firm to market the invention is a realistic option in the real world.

University invention or breakthrough

Getting a startup firm to the point where it may be purchased or go public with an initial public offering can be tremendously lucrative for the founders if they are successful, but it is a high-risk, high-reward undertaking for these social entrepreneurs. Because established companies are wary of licensing technological innovations that could jeopardize their existing infrastructure investments, devices, people, and patents, there are times when remarkable technologies are available from universities for which an appropriate licensee cannot be identified or found. A new venture development or a startup firm may be the greatest approach to getting a revolutionary technology to market.

Aspects of venture development

Team and venture structure

A problem is identified leading to its solution ideation. The team members engage in innovation and entrepreneurship to structure the business model. A clear business structure arises as they move forward with their entrepreneurship program process. They acquire their first round of capital, also called the pre-seed round, build out their venture concept, and begin hiring after registering and finalizing share divides as a sole proprietorship. 

Technology innovation

During working through the new venture process, the entrepreneurs come up with a business plan and begin prototyping right away. They put the business idea through its paces in the lab and work with the target market to develop product standards. 

Intellectual property

The team is prompted to swiftly file a trademark application during the hands-on work on their new ideas which would be later granted to the new business. As they continue to generate new intellectual property, the team consults with legal counsel regularly.

Intended stakeholders

Although the team begins by working with end customers, there is a period of adjustment in terms of supply chains and recognizing the incubators. Moving forward, they study consumer research and do product trial experiments.

Business model

The team knows since the beginning that they wish to license or promote their goods. After understanding the supply chain, evaluating cost assumptions, and modifying pricing, they created a sales process for their business plan. Their social entrepreneurship service is then available for purchase, and the for-profit startup is working to establish a predictable sales plan.

Venture development process

For a business plan to commercialize, the venture development process has the following specific process:

1. Market identification - It is the discovery of why a client would choose to purchase from you. It includes segmenting the total market based on mutual qualities, and selecting the most practicable, lucrative product category or divisions as the intended audience for your promotion mix are all part of market identification.
2. Validating market segment - It is to avoid superfluous supply chain channels, segmentation is related to the tangible or logical isolation of components of the network.
3. Entrepreneurial model development - An entrepreneurial model development is a theoretical framework for describing how a nonprofit organization, venture, or non-profit generates, acquires, and distributes revenue.
4. Early investment attraction - Getting investors to invest in the company is a crucial step in supporting expansion through new initiatives or revenue streams. There are tax benefits provided to create an acquisition in the company more appealing to stakeholders.
5. Early growth stage with market perforation - Early-stage companies usually have a concept or business design that has been tested, as well as a business plan. Although the firm may be producing income in its early stages, it may not yet be profitable. Organizations in the growth stage are up and running, with a good amount of traction and current consumers.

Context and Applications

This subject is useful to individuals owning businesses, people looking for self-employment, and students who have an interest in earning. This topic is taught in courses like:

• Bachelors of Arts in Social Entrepreneurship
• Masters of Science in Innovation and Entrepreneurship
• Bachelors of Science in Business Entrepreneurship

Practice Problems

Q1. Which of the following individuals identify a clinical problem and create a business model to solve it?

1. Women entrepreneurs
2. Entrepreneurs
3. Managers
4. New York city

Answer: Option b

Explanation: An entrepreneur is someone who sets up a new business to solve market problems and earns revenue from its sale.

Q2. Which is of the following is known to be the swiftest route to market positioning?

1. Get commercialized by an established business
2. Get famous on TikTok
3. Have a strong entrepreneurship mindset
4. None of the above

Answer: option a

Explanation: When a university wants to commercialize a technology it has produced, it initially looks to license it to an established business structure, as this is usually the quickest route to market as a startup founder

Q3. Which aspect of venture development deals with hypothesizing a clinical problem?

1. Technology innovation
2. Intended stakeholders meeting with Ketanji
3. Covid-19
4. Team and venture structure

Answer: Option d

Explanation: In the entrepreneurial activity stage, a problem is identified leading to its solution ideation. The team members engage in innovation and entrepreneurship to structure the business model.

Q4. Which of the following reasons justify a startup licensing a university innovation?

1. It has the potential to be highly-lucrative
2. It saves the startup time to come up with new ideas
3. It leads to low gas prices in Covid-19
4. All of the above

Answer: Option a

Explanation: Getting a startup firm to the point where it may be purchased or go public with an initial public offering can be tremendously lucrative for the founders if they are successful.

Q5. At what point in venture development does the venture start gaining investment traction?

1. Market identification
2. Early investment attraction
3. Validating market segment in Russia-Ukraine
4. All of the above

Answer: Option b

Explanation: Getting investors to invest in the company is a crucial step in supporting expansion through new initiatives or revenue streams. 

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