US economic news has been notably bleak over the past month: GDP growth figures have been revised downward; US long-term debt has lost its AAA-rating; payrolls are reported (and expected to continue) to rise at a syrupy pace; and buyer sentiment, as tracked by the Michigan Consumer Sentiment index, is falling. Additionally, developments outside of the US such as sovereign debt issues in Europe, have brought insult to financial injury, leaving insightful analyst, Mr. John Mauldin, to quote the 1987 R.E.M. song, “It’s the End of the World as We Know It” in the introduction to his August 27th newsletter. The US is humbly trudging through a financial quagmire, searching for a glimmer of hope.
To improve the status of the aforementioned indicators, government officials, business professionals, and thought leaders have called for a change in the muddle through, economic status quo. This desire for change has resulted in two schools of thought: (1) America’s Main Street (i.e. small to medium sized businesses (SMEs)) must be revitalized and (2) America must bring innovative products into the marketplace. While these notions are commonly discussed separately in main stream media outlets, little attention is given to how the philosophies work in conjunction (i.e. innovation increasing the performance of SMEs, driving improvements in economic indicators). Accordingly, this entry and the next two to follow seek to uncover how inventions are conjured in SMEs, and what they mean for long term, economic health.
I start the series with highlights of a recent discussion I had with Dr. Dave Smith of Richmond, Indiana. Dr. Smith is a passionate developer of medical products; including hydrocolloid wound dressings and adhesives. These products are currently produced in his Richmond-based company, Xennovate Medical, LLC, which was founded in 2006 from a patent sale of hydrocolloid technologies developed at The University of Akron.
In addition, Dr. Smith is in the process of developing a physiological device, based on the principals of slosh dynamics, for the reduction of Traumatic Brain Injury (TBI) in conjunction with Julian E. Bailes, M.D. of the University of West Virginia and Joseph A. Fisher, M.D., FRCP(C) at the University of Toronto. Recent device study, accepted into The Journal of Neurosurgery, demonstrated 82.7% reduction in brain injury in an internationally accepted rat model for concussion (and TBI). As a result of his findings and collaborative efforts, Dr. Smith was granted an honorary faculty position with West Virginia University’s Department of Neurosurgery. The group of researchers hope to monetize its IP through TBI Innovations, LLC, a Richmond-based start-up.
Listening to Dr. Smith speak about his innovative efforts, I found myself asking how he became successful in developing marketable products and forming start-ups in a small town environment. After two hours of discussion and several cups of coffee, it became clear that his success was based off a number of factors (i.e. axioms), which repeatedly arose during our conversation:
1. Fail fast, adapt or die - learn from past mistakes, but do not dwell in the past
2. Immersion- dive into the issue head first, reviewing the breadth of available information
3. Control - seek control, locating assets geographically close for ease of oversight
4. Opportunity and advice - search for beneficial information and collaborative opportunity inside and outside the immediate environment (specifically important for start-ups in small towns)
5. Models - develop models and telling graphics/texts to share your insights with the
6. Passion - develop a strong desire to push forward in your field
By simply observing the walls of books, countless stacks of academic papers, and the preserved head of a woodpecker, an animal whose physiology can be used as a model for his device, I realized Dr. Smith’s success was driven by above all, passion - passion to learn about the medical field, passion to understand principals of physics, chemistry, and biology, and passion to share his findings with others.
Perhaps all of these factors are necessary for Main Street start-ups to monetize their IP. Additional research is required to provide evidence for this hypothesis, but, nevertheless, Dr. Smith’s factors of success could lend advice to the US in jump-starting the economy.
I look forward to keeping readers abreast of Dr. Smith’s innovative progress and what venture seeking SMEs can learn from his experiences. Interesting insight will surely follow.