Go-to-market and Intellectual Property (IP)

The third block course was held in Hamilton and was focused on the topics of Go-To-Market and IP.  These topics are often spoken about as going hand-in-hand, but to build your strategy on these topics you need to understand what you want.  Knowing what you want is often the hardest thing for young companies to define. 

Throughout Sprout we are asking teams to always be thinking about what they want and ‘being successful’ is not enough.  Discussing how to define what you want in a new venture is for a different blog. 

Within agritech deciding how you want to go-to-market is just as important as any other sector.  However, there are some specific challenges that come with taking a product into the agricultural industry.  These challenges specifically: seasonality of problem and proving efficacy.  

Most agritech new ventures are selling a product or service that relates to a problem a farmer experiences at a specific time of the year, meaning the sales window for your product might only be four –eight weeks.

In regards to efficacy of your product or technology, new ventures must relentlessly pursue value for their customers.  This often requires trials and pilots that will prove value.

Key discussion topics at the block course

  • Working with a distributor
    • David Chin, Regional Sales Manager at LIC, talked with the new venture founders about working with a distributor and what is required to get your product picked up and sold by a distributor.  Key takeaways for the teams were that a distributor sells multiple products…how do you make yours stand out?  A distributor’s sales force only has limited hours with a customer…how do you make your product a priority for the sales person?
       
  • Personal selling
    • Larry Ellison, an experienced entrepreneur and investor gave a session on selling to farmers.  He talked through a structure he used to employ and train his sales teams.  Key points were focused on building trust with the customer and getting the close!
       
  • Value pricing
    • Richard Alderton, current CEO of Seadragon and former CEO of DeLaval Oceania, led the teams through a session on creating value pricing.  It was a timely reminder to focus on understanding and proving value to your customers, measuring it and then pricing so that your customer gets a return from purchasing your product.
Richard Alderton, CEO of Seadragon, presenting on Value Pricing.

Richard Alderton, CEO of Seadragon, presenting on Value Pricing.

Once the Go-to-Market strategy has been set, intellectual property strategy can then be explored.  It is often advised that IP strategy should sit alongside a new venture’s go to market strategy.  The key reason being that building and managing an IP portfolio is expensive and you want to ensure a return can be achieved from it.  We were fortunate to have both AJ Park and LIC play a role in sharing with companies’ things they should consider about intellectual property. 


 

Key Points

  • Be prepared for solid due diligence:
    • A potential partner or acquirer of a new venture’s product will assess your intellectual property as part of the negotiation process.  Things a new venture can do to make this seamless for a potential partner includes:
      • Keeping all intellectual property related documents including: NDAs, patent applications, design registrations, trademark documents, in a single place.  AJ Park even suggested collecting all the documents, drawings, plans, designs as evidence of your ‘know how’ on a subject in the same folder.  This way, the due diligence team has easy access to this information when they come to review it.  It will demonstrate a purposeful attempt to keep IP secure.
         
  • Take intellectual property seriously:
    • Some people gloss over the value of their intellectual property.  Something that is often undervalued is the value of ‘know how’ held and gathered through the product development and market validation process.  If a new venture is building a new product or service, efforts should be made to document the learnings that are created.  Save drawings, prototypes and other material produced through the product development and validation process.  Make notes on what works and why it works, likewise, when something doesn’t work, write down why.  All this learning should be saved and stored somewhere, for the reason described in the above point.
       
  • Get independent advice:
    •  If you are unsure get advice from people who are credible.  There are a number of really good intellectual property advisory firms in NZ.  If you can find someone first and foremost who has commercialised intellectual property, start with them.  If you can’t, find a firm like AJ Park and get some advice from them.  Generally they are willing to have an introductory discussion first and foremost to understand what challenges you are facing.