RESEARCHER TURNED ENTREPRENEUR: HOW DO YOU IDENTIFY THE RIGHT MARKET?

The first question you need to answer is: “What problem will you actually be solving for your future customers?”.

Answering this question will let you define your value proposition, clearly list every form of competition (and your competitors), and get a clear view of the market segments to address as a priority. Indeed, there’s a good chance your innovation addresses several problems, for very different markets. There’s also a very good chance you’ll only have very limited visibility into this at the start.

Coming from the academic world, you obviously already have a clear view of a few very specific fields of application; they are often linked to your collaborations with industrial partners, which is very valuable. But it may well be that other markets, other segments that are much less obvious or even completely unknown to you, turn out in the end to be far more relevant to your start-up’s success. Pivots are costly… sometimes essential but costly…and sometimes triggered too late as well.

The importance of stepping back when conducting market research and broadening your field of investigation.

To have a good chance of not getting the market wrong to investigate, you need to carry out a 360° analysis as the first step of your market research. In practice, people often do exactly the opposite… they dive into two or three market segments… and if that fails, they step back. This exercise is intellectually very costly and hard to carry out, especially when the clock is ticking… and for a start-up or an SME, that clock is called cash flow!

Let’s take the example of a researcher who developed an ultrasound generator capable of characterizing liquid solutions in real time. Having done his thesis in the hospital world, the first obvious field of application for starting his company was to develop a medical device meant to monitor the patient’s condition during open-heart surgery.

Niche market, very long time-to-market.

The need being met was clearly critical, and the proposed solution was interesting. But it was also clear that setting up the start-up by addressing this first market right away was going to prove complex (regulations, fundraising, certifications,..).

In other words, it would take years of work and development, and hundreds of millions of euros in investment, before the start-up generated a single euro in revenue. The immediate question for the researcher and the incubator was: is there a more accessible, more promising market? Instinctively, two other markets were mentioned: chemistry and food processing. Without further delay, market research was launched on these markets, but unfortunately with inconclusive results: the technology in question did not solve any critical problem, or any problem identified as such by the industry players interviewed.
Back to square one!

It was only after carrying out a quick 360° analysis based on the technical and scientific literature that new and very surprising features and fields of application were identified. This then made it possible to investigate markedly different markets, such as the construction and public-works sector, and to very quickly identify market segments with very fast access and major potential.

This example illustrates how important it is for researchers to have a 360° overview of every market that might be interested in their technology.

It is also very real: the start-up in question used TKM’s services, and after analyzing the entire world scientific literature, TKM advised it to develop its business in the construction industry around one very specific, critical application (meaning one with associated economic stakes estimated in the millions of euros…).
Since then, this start-up has worked exclusively with cement makers and builders, offering them on-site monitoring solutions for the hardening of concrete structures.

Without TKM’s involvement, it would have taken months and a string of lucky coincidences for this researcher to even think of approaching a cement maker. With TKM, it only took 5 days of research to put on his radar a market – and therefore customers! – that he would never have considered.