Putting Market Data to Work for Tech Transfer: Stories from the Field
Here are four projects I’ve worked on recently that illustrate some of the powerful ways your TTO can make use of market data.
1. Cultivate a Potential Licensee
Fuentek was asked to assess the market potential for an innovative materials technology. In researching the market, we found plenty of folks who wanted to be at the “user” end of the value chain, but no one wanted to manufacture the material. However…
There was a contractor already supplying the material to the client’s main organization. Our analysis of the market data showed that this small business would be the perfect licensee.
But that’s not where the story ends.
This small business had never licensed a technology before. Since our client had a vested interest in having a successful licensee, they asked us to cultivate the opportunity and help the prospect navigate the process.
One of the things we did to encourage the company to come to the negotiating table was: We showed the prospect the market data demonstrating the technology’s commercial potential. Once they saw that our client wouldn’t be their only customer, they were ready to work with us as they proceeded step by step toward signing the deal.
Lesson Learned: Market data can be used to help bring prospects to the table who might otherwise not be willing to show up.
2. Give Management a Reality Check
You know those technologies that generate a lot of buzz within the university or lab? This was one of those.
We were supporting a client on developing a license agreement with an interested party. During what turned into a lengthy technical review (I’ll spare you the gory details), management started to get big ideas about how much revenue this deal could generate. They did not realize the potential obstacles that would limit how high the royalty rate could be.
So the market research we conducted helped the TTO do more than just prepare for negotiations. Our objective market data was used to help frame management’s expectations appropriately. Because they could see the similar, relevant deals that fed into the average royalty as well as how those deals were structured, management recognized that their grand plans for the favored technology needed to be adjusted. As a result, when the deal was finally signed, it sailed through the approval process because management wasn’t blind-sided by the final terms.
Lesson Learned: Market data can do double-duty when it’s documented and communicated clearly to management.
3. Find Research Sponsors
A client called me 10 weeks before a provisional patent was set to expire. The inventor felt that the technology was strong, but the TTO manager wasn’t familiar enough with the semiconductor market to know if it was worth investing in a nonprovisional. When she asked if we could help, I felt like that Grey Poupon ad… But of course.
Anyway, as we began our research, we found that the technology applied to only a small segment of a very large market. The market size was sufficient, but there were only a few companies poised to be licensees. Because of the technology’s level of development, chances were slim they’d be ready to license. But chances were good that they’d participate in a sponsored research agreement (SRA).
Armed with this information, the client was able to proceed with IP protection (since that would be needed for any future sponsored research). Then we used the market data to identify and contact potential SRA partners to begin to develop those agreements.
Lesson Learned: Market data can provide you with research partners as well as licensees.
4. CYA When Dealing with Questionable Terms
We were asked to examine a license application our client had received to determine if the proposed terms were fair. The terms seemed low to our client and, quite frankly, at first glance I agreed.
But as I dug into the market data, it was clear that the seemingly low terms were, in fact, quite fair. So in a brief but thorough document, we laid out our analysis along with suggestions for other aspects of the deal that could be negotiated to our client’s advantage.
Then our client, in turn, used our analysis of the market data to assure management that the deal had been carefully analyzed.
Lesson Learned: Market data can be used to document that the TTO is not leaving money on the table when negotiating a deal with less-than-stellar terms.
Actually, these stories illustrate more than just the various ways TTOs can put market data to valuable use. They also show the many ways that Fuentek supports R&D organizations in their technology transfer and strategic decision making. Whether it’s making patenting decisions or negotiating deals, Fuentek is your trusted advisor for insightful analysis and objective recommendations. Contact us today to learn more about how Fuentek can help you achieve your goals.