Innovation is definitely ‘in’. From apps to IoT and cars to wearables, we are seeing an incredible number of new ideas being brought into fruition, mainly due to the relatively new phenomenon of ‘crowdfunding.’
Wikipedia defines crowdfunding as “the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the internet. The crowdfunding model is fueled by three types of actors: the project initiator who proposes the idea and/or project to be funded; individuals or groups who support the idea; and a moderating organization (the ‘platform’) that brings the parties together to launch the idea.”
Where innovative startups once had to ‘jump through hoops’ to convince institutional and venture capital investors of the worth of an idea, they can now offer it direct to the very people that will probably be its final purchasers.
Nothing defines the potential success of any idea than the willingness of ordinary people to back it with their own hard-earned dollars because they actually see value in the product and want to be an early adopter. It’s like having live market research in real-life conditions.
It seems anybody with a good idea can now overcome the first big hurdle –getting the money to pay the people behind it and to bring it to market. That’s all well and good, but it is no guarantee of success, as many budding entrepreneurs and their investors have found out.
One advantage of being funded by a VC company or traditional investor is that the money is usually accompanied by expertise – the very expertise that is needed to make an idea really successful. It is usually their objective to apply the best advice and people to the project to make it as successful as possible, as quickly as possible, so it can sold on.
This does not always sit well with the original people and is the most common reason for falling out between innovators and investors, but not having that expertise behind them is probably the second most common reason for failure.
However, there is a third means of bringing innovation to light, and one that could benefit the companies that need it most. Communication service providers, once great centres of software development in their own right, are hungry for new products and services to stave off lower voice and messaging revenues.
Encouraging staff and partners to make an effort with innovation and committing a percentage of revenue to investing in R&D is a first step. It could really make a difference by attracting those bright young minds that are currently writing apps at home because they can’t get a ‘proper’ job.
And why don’t governments get innovative and offer incentives or subsidies to companies to hire these people instead of paying them unemployment benefits to stay at home?
This would certainly give CSPs a head start in discovering new technology and products ort services that could be sold on to other similar players in non-competing territories. Investing in innovation is also a great motivator for existing staff, too. Even those working in the most menial tasks feel encouraged when they see their company coming up with new ideas, maybe even ones they could be involved in.
Perhaps some of those marketing dollars now spent attracting new customers could be redirected into innovation funding, attracting new forward thinking people, progressive partners and stimulating existing staff into action.
If the C-suite doesn’t realise the potential of funding innovation then perhaps it is time for shareholders to shift their allegiances and funds to companies that do. Oh, isn’t that what is already happening?