In 2010, Olga Pawluczyk was confident her technology was the best in its field. The Waterloo-based engineer developed the most advanced spectrometer of its kind – an instrument that uses light to analyze chemicals and fluids quickly and cost-effectively. But as a boot-strapping startup with only four engineers to run the business, getting to market presented a challenge, and with minimal resources and runway, the clock was ticking for P&P Optica and this first-time entrepreneur. It prompted one of the most important decisions she ever made.
Drawing on early-stage government funding, she embedded a full-time senior executive in her firm as it was getting off the ground. This industry veteran brought horsepower where it was needed most: business development. According to the engineer-turned-president, this strategic and timely ‘recruit’ was instrumental in acceleraterating the growth of her company. Not only did P&P Optica triple its sales in 2011, but it’s on track to triple them again in 2012. With a growing list of clients in Singapore, Japan, Germany, the United Stated, China, Russia and Canada, it has catapulted from four to 22 employees in less than two years.
This raises an important question: what could other Canadian technology-based startups achieve with an injection of similar business talent during the earliest stages of development?
In those fledgling days, emerging firms struggle to find the right executive talent – let alone afford such a leader. And it’s not every day you find a readymade Bill Gates stepping out of the garage and into the CEO chair. It takes more than great technology to bring a great product to market. It takes business savvy and expertise right from the start – not several years down the road. These high potential innovations and companies risk getting lost with so many others that failed to hit the right market and customer.
Studies continue to show that Canada lags other developed countries when it comes to commercialization. If you ask an entrepreneur, lack of capital is almost always the first issue and as a former venture capitalist, I can attest to this challenge: cash is king. I can also tell you that all the investments in the world can’t help a company succeed if the right management is not in place. Money doesn’t establish the business strategy, identify the best markets and win customers – people do. This is the role of the business executive. And when time and money are most scarce, the right executive is critical. . Every decision counts and in the early days of a company, these decisions can make or break a business.
All too often, promising companies adopt the wrong product focus or have no focus at all; invest everything in technology and next to nothing in business development; and fail to secure a first customer that generates first revenues. These decisions don’t land every few days, but every hour. A part-time mentor cannot fulfill this role. Success requires dedicated leadership and effort. Yet all too often, part-time advisers are all emerging companies can afford -- if they are fortunate enough to find a seasoned executive at all. Does this sound like winning formula?
It’s time to help early-stage Canadian firms acquire the management talent required to grow and succeed. There is no substitute for a full-time experienced executive who can educate an entrepreneur on how to build a company from the ground up – and learn from past mistakes. We can help companies strengthen their management capacity by:
· Increasing public funding for commercially-oriented activities such as the recruitment of executive talent and business functions such as product management, customer acquisition, marketing and sales
· Enabling technology entrepreneurs to focus on the business of commercialization the moment an idea is conceived – not at the end of the innovation process
· Moving from part-time business advisers to full-time embedded executives who perform leadership roles for at least six months to achieve critical milestones
· Developing innovation policies and incentives to recruit and retain experienced entrepreneurs from around the world, further building Canada’s pool of executive talent
The graveyard of companies with great technologies is overrun. It’s time to achieve greater balance between public funding of R&D and business activities, enabling firms to build critical management and business capacity. The right executive at the right time can help transform a technology into a market-ready product and a startup into a profitable company. Just ask Olga Pawluczyk.
Dr. Mario Thomas is the managing director of the federally-funded Centre for Commercialization of Research (CCR) which accelerates the commercialization of publically funded research andbuilds more robust, globally competitive Canadian entrepreneurs and firmsacross Canada. He also serves as senior vice president of the Ontario Centres of Excellence (OCE) and founding chairman of the International Commercialization Alliance (ICA).