What to expect
Creating a new startup company is a substantial undertaking. The decision to form one will have a profound impact on your life.
Creating a startup is a challenging and sometimes stressful activity that may distract you from your research work. It will require you to face down new problems, gather a range of resources, find mentors and management and test yourself against trying times.
This may sound like a daunting list of reasons not to try. But it’s important that you understand that building a startup is difficult. You won’t be alone, though. Substantial support exists within the Imperial ecosystem for entrepreneurs, including from the Startup Team.
Your commitment to the startup
If you are the technology inventor, you will almost certainly be an initial shareholder in your startup and may be deeply involved in it at the outset. You don’t necessarily need to be involved full-time at the start, but in the short-term it may be desirable for you or one of your students or postdocs to be seconded into the business to facilitate the transfer of the technology.
Though you may initially commit a substantial amount of time to the startup, this may reduce over time. You will almost certainly find it more efficient to identify the management, marketing, sales and financial skills in other people than to learn everything yourself. Though some researchers choose to leave the College and take full time positions in a startup company, it is more likely that you will take a position on a scientific advisory board or acting as a consultant. This will allow you to maintain your commitment to the College while still playing an integral role in the startup. You may also take a non-executive board position, taking on responsibility for ‘big picture’ and strategy development.
- To create an impact on society
- To transfer knowledge into practice
- To become an academic entrepreneur
- To contribution to the global knowledge economy
- To improve the UK’s economic profile
- To enhance the College's reputation worldwide
- To attract investment to your startup or your research group
- To create wealth for yourself, your department and for the College
- To experience considerable personal satisfaction
What do startups require?
- Intellectual property: a strong and differentiated IP position is often essential for a startup company
- A clear market opportunity or unmet need: no matter how incredible or technically brilliant your technology is – if no one wants to buy it at the price you can offer it, your startup will fail.
- Management: investors in your business will expect it to be led by a team with proven and relevant management experience.
- Money: very few businesses can start and generate enough cash to cover running costs rapidly. Most need funding of some sort – whether it’s from friends and family, angel investors, venture capital, loans or translational funding.
- You and your co-founders: you invented the technology and you know it inside out. You are fundamental to the success of your startup and your continued support of the management and research staff is essential.
The journey you are likely to experience
- You may need to adapt to a changing role. In the early days you could have a hands-on role that converts into membership of a scientific advisory board or consultancy position.
- The company may change direction rapidly and frequently based on research of outside factors such as customers and the market – you should be prepared for this to happen
- Startups that begin with a novel, well-protected idea with a clear market become successful through ambition, persistence, marketing skills and successful management. If you’re still carrying out duties for the College you may need to bring in other people to handle these tasks, so be open to meeting people and engaging talented staff.
- The people you bring into the startup may come from diverse backgrounds – some will be scientists, some will be business people. They may not always understand or be patient about your wider research goals, instead they will focus on the startup and its goals.
- If your business is going to raise money (which most will) then your initial shareholding will be reduced. This may sound daunting, but the new money coming into the business should give it a better chance of success, therefore making your holding much more valuable.
- You will also share in royalties due under Imperial’s rewards to inventors scheme.
- You should be prepared to fail. No matter how much work you put in, no matter if you’ve done the most meticulous market research, nailed down your IP, efficiently targeted customers and generated mountains of investor cash, the company could still fall down. More than half of all startups fail in their first year.
- The most important thing to remember is that once you form the company, you stop being a team of University researchers. You’re now a serious business with directors, shareholders and responsibilities. Some founders struggle with their perceived loss of control and you should consider closely how you think about this.
Imperial’s Startup Team can help you navigate this journey. We focus on preparing you from the start.