Q: I have a technology platform on paper that can make active telecom components smaller, faster, and cheaper. How do I start?
A: The lesson we've learned from the "bubble" is that ultimately any business pursuit must address efficiency—in this case, efficiency in the use of capital. In today's funding environment, unless you can find incubating investors who have industry insider insights to estimate the risks/reward on their own, you are not likely to get VCs interested in what might appear to be a "science project." So you have to carry your idea to a point at which the technical risks are quantifiable, and also have a pretty credible estimate of the potential revenue and the total investment required to get there. Then you will be able to figure out a deal that offers an attractive ROI from their perspective. So, as a first step you may want to figure out a way to, in the most cost-effective way, incubate the technology without spending a lot of investor money. Approaches such as getting contract support to prove feasibility in an academic research environment still makes sense.
Q: I devised a scheme to improve the performance of an infrared imager but do not know the market size or who needs it outside of the Department of Defense. How do I go about raising a few hundred thousand dollars to prove feasibility?
A: I encourage you to go through the rigor of writing a business plan to force yourself to answer a few basic questions, such as how big is the market, how defensible are your competitive advantages, and an estimate of how much total investment is needed to bring your product into the marketplace. Unless you are well prepared, you will not appear to be committed to your idea; why should any investor commit his money to support a pursuit no one is committed to? Another simple truth in investment is that unless you clearly understand how investors can get a good return, you are not likely to succeed in raising money. The worst thing that can happen to you is, in fact, to get several hundred thousand dollars from unsophisticated angel investors, and then find yourself unable to raise serious VC funding. So my recommendation is to do a lot of homework up front before you even think about raising money.
Q: I have been unsuccessful in hiring a good operations manager to run my optical-filter business. Should I try trade journals or local newspapers to avoid expensive headhunting fees?
A: I am not sure there is one good answer because each has its downside. Trade journals are a good way to reach the perfect pool but it takes 30 to 45 or more days to appear. Ads in local papers yield local candidates to avoid relocation costs, but you are likely to be swamped with unqualified applicants who do not have the specific skills you need. You may also be surprised by the cumulative ad placement costs. So you may consider posting the opening on technical societies' websites, and also job fairs at technical conferences. OSA comes to mind first, SPIE, and LEOS, too. The latter (www.i-LEOS.org) will give you exposure to 375,000 IEEE members to broaden the search. Don't forget to ask the people you know, especially at the many networking opportunities offered by technical conferences like CLEO and local chapter meetings. Once you start asking, you may just have "viral marketing" going for you to get to prequalified candidates.
Hiring is always a game of hit and miss. The trick is to specifically define the qualities you need before talking to any candidates. Usually hiring mistakes are made because we instinctively want to hire people we like, and then wind up hiring that individual because we hate to turn down people we like. There is a sidebar on the techniques of hiring in an article I wrote for Organization; you can download the article from the New Focus and Incubic websites.
