From whom do insights come?
Przemysław Szleter, Founder and CEO of DAC.digital, is a member of the Forbes Technology Council, an exclusive community for top-tier technology executives. In this role, he will share insights on DeepTech, Emerging Technologies, and Research and Development on the Forbes website. With over two decades of experience, Przemek has been instrumental in advancing emerging technologies and establishing DAC.digital as a leading DeepTech company in Europe. His profile on Forbes will regularly feature updates on building R&D-focused companies, particularly emphasizing DeepTech solutions for real-world problems. Stay tuned for more updates from Przemek in the tech space.
This article originate from forbes.com.
Przemek’s role in Forbes
Building An R&D-Focused Company From The Ground Up: Seven Things We Did Right
The global market for information technology (IT) services outsourcing stood at $440.41 billion in 2022 and is projected to cross $1,065 billion by 2030. This market primarily denotes opportunities for businesses that work with existing technologies. On the other hand, global investments in R&D-focused businesses stood at ca. $2,476 billion in 2022 and are projected to grow somewhere between 4% and 5% each year. So, it is a good time for businesses not focusing on their R&D to rethink their business strategy.
The DNA of innovation is also changing. Most companies invest in R&D through third parties, which gives ample scope for new deep tech and R&D-focused businesses to make inroads into the market. My team and I had prioritized R&D and innovation even before I co-founded the company. We got some things right and learned from everything that didn’t go so right. Through this article, I am sharing what we learned that, if implemented, could benefit you in building an R&D-focused business from the ground up.
Carry out market research.
Understanding the market takes quite a lot of effort. Even though we started with precise insights from the market, we experienced much resistance regarding the change our first innovative solution brought about. Assessing your customers’ demands and your competitors’ offers is quite imperative. Additionally, it is worth noting that creating a new segment or bringing about a change in a specific sector requires a high level of patience to succeed. Hence, market research requires both extrospection and introspection.
Employ a core team of specialists.
A significant hurdle that R&D-focused businesses face is building a good team of specialists. Several reports and my experience conclude that more quality researchers and engineers are needed. However, I have also experienced getting the core team of specialists together and building the teams further with them as the base works well. Sometimes it would be necessary to seek candidates with advanced degrees and R&D experience—and support them in developing a business perspective.
Develop a one-of-a-kind R&D process
Create a culture that supports creativity, collaboration, and experimentation inside your business to generate innovation. This involves encouraging your team to think outside the box and develop novel ideas. A one-of-a-kind R&D process would consider the needs and perspectives of employees, customers, and other stakeholders. It’s also essential to prioritize efficiency, cost-effectiveness and high-quality outcomes in your innovation efforts. To maximize the outcomes of innovative ideas and achieve business success, consider streamlining processes, optimizing resources and continually improving/adapting.
Develop collaborations and partnerships.
Collaborating with academia, research institutions, and other R&D-focused businesses add several success dimension for your business. From getting public funding to talent acquisition to technical know-how and expertise academia is found to be one of the best partners. Collaboration and partnership also help in avoiding bias towards technology development. The R&D department, for example, may be prejudiced toward their own advances, which may affect their judgment of other technology. To circumvent this, independent specialists in the form of external collaborators and partners can give neutral assessments of technological solutions.
Get the funds flowing in
While the market is quite hot, with many investors, big corporations and venture capital firms looking to invest in R&D-focused startups, my team and I decided to take the bootstrapping route. It gave us complete control over maintaining our vision without pressure from any investor to meet their financial expectations or scale quickly. It aided in creating long-term sustainable growth for our business, saving on costs and dilution, and made us more resilient and resourceful. As an R&D-focused business that has built good collaborations and partnerships, we also generated funding through various channels, including public-funded projects and R&D activities conducted on behalf of our partners.
Emphasis on intellectual property
To be a successful R&D-focused business, you must know firsthand how to protect your innovation and have your intellectual property (IR) strategy closely integrated with the business plan. With an effective IP portfolio, the company may maintain its competitive position and defer competitors’ entry, allowing it to establish itself in the market. To begin with, I would recommend reading this guide by the World Intellectual Property Organization. Further, gaining in-depth knowledge about the IP laws of your target market(s) and collaborating with legal professionals to register and defend intellectual property is vital.
Keep up with technological evolution.
The pace of technological evolution is unfathomable in the current era. Recently, with the speed at which ChatGPT was succeeded by GPT-4, some of the industry experts could not keep pace with it. However, my team and I got our predictions right on target, and as an R&D-focused business, you would also need to be a step ahead of the technological evolution or at least keep up with it. It requires a simple framework where the staff is encouraged to enrich their skills, knowledge and competencies through regular training. Participation in conferences, seminars and workshops should also be a norm within the organization.
Building an R&D-focused business from scratch requires effort, patience and dedication. The seven factors elaborated on above took me over a decade to get right, even though we were doing relatively well all along. I highly recommend digging deeper in to each one of these points, keeping your vision and mission at the core of your efforts.
Przemek contribution to Forbes!