We asked Dave Howells, of PrOXisense to outline the challenges facing a high-growth, high-tech start-up.
Dave, PrOXisense is a tech start-up, soon going for B round funding. Can you talk a bit about the challenges facing high-tech entrepreneurs?
There’s been so much said already, and a myriad of textbooks written about the tech start-up journey. From our experience at PrOXisense, I would say that one of the biggest challenges is a mismatch of supplier/client company cultures.
If you think about it, you have these small start-ups, often just a handful of people. They have incredibly creative, inventive minds; they are flexible, explorative and are able to change direction easily.
To prove and investigate the boundaries and potential of their new tech, start-ups need to work alongside OEMs or Tier 1 companies to test the technology in the field and explore future challenges that it could solve. And there’s the disconnect.
What do you mean ‘disconnect’?
It’s about the issues faced by the coming together of two types of organisation who have totally opposite cultures – the disconnect is that there’s a potential to clash in almost every business aspect.
The OEM/Tier 1 company size means that they are at the very opposite of a start-up’s ‘flexible, explorative, able-to-change-direction’ position on the innovation spectrum. They just can’t operate like that; they are often too large and tightly structured to have a similar entrepreneurial culture or to allow resources for true innovation. So, you have two vastly different personalities trying to find common ground.
Also, the huge companies traditionally haven’t been set up to deal with anything less than TRL 6. Most start-ups are at TRL 4 or 3 or less and have the dreaded ‘Valley of Death’ to be attempted before they can get a chance to work with the big organisations. It’s difficult for a start-up to get proper buy-in higher up the supply chain when they are in ‘The Valley’.
So again, there’s a disparity issue between the two types of company; a start-up’s tech isn’t often where an OEM/Tier 1 needs it to be.
With these differences in mind, it’s important to note that we’re asking a lot of the OEMs/Tier 1s to reach back and support start-ups at such an early stage. I have noticed though, that more OEMs/Tier 1s are starting to look at companies with technology below TRL 6, so that’s a promising development.
Also good news is that over the last few years, there’s been a marked difference in how welcoming OEMs/Tier 1s are to early-stage start-ups. They do recognise that if they truly want to flush out and catch exciting new innovations, they need to get involved early and allow testing and experimentation in their environments.
Do you need the OEM/Tier 1 companies to be involved as you develop your technology?
Absolutely. It is crucial and fundamental to everything we do. We need them to pull the technology through – that’s the main difficulty in tech exploitation. Start-ups have the seed of a new technology and the expertise to refine and shape it for the future – but they need to find a supply chain to buy in to the concept and participate in creating a market for it.
I’ll stick my neck out here and say that USA is really good at that. In the UK, we tend to be great innovators but not such great exploiters – but I think we’re getting better.
Can you tell us a bit about where PrOXisense is in its start-up journey?
Right now, we’re in a fortunate position to be honest. We’ve had seed and A round funding and are now preparing for second round investment in 2020. We’re part of the University of Oxford innovation ecosystem, which helps us connect with larger companies – they’re attracted by the clusters of innovation around universities.
We are also happy to have two superstars in our portfolio that are both in their ascendant: one superstar is our technology and the second is our OEM/Tier 1 relationships.
Our technology – we are so confident about the tech we currently have in development. The potential for their applications is vast.
Our OEM / Tier 1 relationships – future investors will see that we have successfully negotiated the tricky path to reach the elusive OEM/Tier 1 and have a proven track record of strong collaborative partnerships.
We’re doubling our team shortly, so that will inject another level of enthusiasm and expertise in the business and of course, with this going on, we’ve grown out of our current office and have moved to larger premises in the Harwell Campus science and innovation district near Oxford.
To sum us up: PrOXisense may currently be a small company, but we are in the enviable and difficult-to-achieve position of having BIG company clients getting excited about our technologies. That’s encouraging news for a high-tech start-up.
Dave Howells is Business Development Director of PrOXisense
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