What characteristics should the researchpreneur have? We talked about this with Flavio Farroni, researcher and entrepreneur, who “extracts” the characteristics of this figure from the MegaRide experience. A model that works and can be replicated.
We should have many MegaRide, university spin-offs turned scaleups entered the upper echelon of the automotive industry, in a country like Italy with excellent scientific productivity compared to the scarcity of funding and world-class research quality: being able to turn this wealth of knowledge and expertise into business projects, in fact, could develop significant economic value. How to do this is the goal of the many university offices involved in technology transfer. Those who succeed in doing so are the researchpreneur, the researcher-entrepreneur, a figure that is beginning to be talked about in connection with entrepreneurship and innovation.
The reserchpreneur and the MegaRide method
What characteristics should the researchpreneur have? We talked about it precisely with a researcher-entrepreneur who has shown that it can be done: Flavio Farroni, researcher and entrepreneur, founder and CEO of MegaRide, a spin-off of the University Federico II of Naples founded in 2016, which with its partners Francesco Timpone and Aleksandr Sakhnevych has developed a method that has led it to grow, and to develop a small holding company of innovative companies (the first is called VESevo, others are about to come to light). Here’s summarizeda long conversation with Farroni in 5 rules for turning research into business.
Discover yourself as a researchpreneur
Are you born or do you become a researchpreneur? I think the first one. Few activities, by the way, are more human, innate, and difficult to automate than doing research and doing business. The potential researchpreneur suddenly finds himself, in his own journey, feeling like a researcher perhaps less “pure” than others, less rigorous, but more emotional. And an entrepreneur less relentless than others, but more “open-minded,” as only research can be. He feels a bit in the wrong place wherever he is. The discomfort of not belonging to a category becomes awareness, in the perception of one’s traits not of diversity but of distinctiveness, of being able to generate value in a new, unexplored, inherently innovative way. Doing business is a continuous chess game with one’s interlocutor, the market, and doing research is having at one’s disposal always new and unexpected moves, to play.
MegaRide, figuring out when and why to do spin-offs
In our journey, MegaRide’s always seemed like a “due” project. We were developing ideas born out of questions from the market, which had already turned to the university to receive high-quality results, but we perceived the clear possibility of going to a much broader market with skills, products, solutions developed to be something other than research outputs. Despite the initial “first detachment frictions,” which are inevitable when proposing changes that subvert the balance, the scheme appeared immediately sustainable: companies were getting the desired outputs, with lower costs when compared to those of setting up in-house R&D departments; the university was growing in skills, confronting (finally, according to many) the solving of applied problems and proactively finding funds to support both applied and basic research; and student education was seeing the development of skills with roots firmly planted in theoretical knowledge, but such that they were attractive to the market for their ability to respond to precise needs. A pattern that could be called WIN-WIN-WIN. I believe that the startup ecosystem, as we have known it and as it has evolved over the past decade, experiences seesaw phases, often due to irrational trends and fads, in any case too much tied to financial games played at too high a level than those of the startuppers. In such a context, the strength of innovative companies born in university settings, based on deep and structured knowledge, makes them statistically more robust and resilient than companies created outside. At the system level, therefore, it is in this direction that incentives should probably be targeted. With the dual benefit, by funding knowledge, of strengthening basic research, a driver of national development, and supporting innovative firms with a low mortality rate.
Keeping research and enterprise close together
Having attested to the feasibility of the scheme based on the coexistence of a research path and business creation, the key to success is all, as is often the case, in the ‘execution. Infinite are the ways in which it is possible to set up a cohort, distribute operational and managerial roles, manage work spaces inside and outside the university, and take care of the professional and personal growth of a working group that, in our case, quickly reached 40 units. The difference between those who have a good scientific project, and get lost in bringing it to market, and those who succeed, is in defining clear processes, in a hybrid and dynamic structure like that of an academic spin-off, in which extremely heterogeneous people and objectives coexist. Getting academics, subject to the constant push to “publish or perish,” researchers and doctoral students, who work on broad and long-term goals, and resources permanently hired by the company, who grow following the economic and motivational logic of the company, to work side by side is a daily challenge that can only be met with total emotional dedication to the team’s needs on the part of the founders and to the definition of differentiated goals and compartments, yet able to cooperate very closely in an elastic structure. When properly constructed, such a structure brings systemic benefits on multiple levels. Academics enhance their impact as attractors of scientific projects, thanks to the boost offered by spin-off functions devoted to communication. Young researchers benefit from a tool that streamlines the recruitment of resources, already trained through internship and thesis paths, and the conduct of research activities, often penalized by the delays involved in public administration management, in an area that would need far more responsiveness. The innovative enterprise lives in constant synergy with the research institute, which reinforces its reputational allure, and which above all goes to represent its R&D compartment, oversized beyond all wildest expectations, capable of chasing numerous trends of potential success, lowering the cost-benefit ratio.
Create an entrepreneurial ecosystem
It is in the context described that the further systematization step took place, which makes the MegaRide path replicable. The story of our spinoff and its success, its ability to dialogue with the top of international motoring right from its first steps, focusing on the value of knowledge and the specialized training of resources who thrive on professional excellence and a sense of belonging, has found herself in the creation of our second project. Four years after MegaRide, VESevo was born. Also in its name, a dedication to the Campania region. She too, born from Federico II and raised in the university incubator. If MegaRide is in fact a software house evolving towards onboard solutions for mobility, VESevo develops a hardware device, protected by several international patents, originally designed to show racing teams how to make the different compounds of their tires work best. We started from the automotive industry and from the consolidated network in the industry, because rubber is the main component of tires, but in a short time we found ourselves moving towards much more, because electric cables, sheaths for the construction, shoe soles, athletics tracks and tennis balls. All products that require strict and continuous quality control, which VESevo can carry out in real-time, quickly and in an extremely effective and economical way. The company thus passed in a short time to a phase of exponential growth. Without the experience of MegaRide, without the deep knowledge of the entry market, without the attention that the brand has offered to the founders, without the ability gained in conveying scientific skills towards quick and direct answers for market interlocutors, VESevo would be probably much further back than where she is today, or perhaps she would never have been born. MegaRide has grown into a small technology transfer holding company, with stakes in VESevo (and soon other new startups it is “accelerating”). The resources of the two companies work together, and together with the researchers of our research group. Marketing, logistics and administration are shared. The processes for converting scientific advances into product development, the methods for monitoring personnel activities and the vision based on the continuous growth of resources and their complete responsibility in self-managing their time and life/work balance, all refer to the same corporate culture, which developed organically in the course of MegaRide. If the same research team sets up two different technology transfer projects in a short time, both with immediate impact on the market, following the same approach, which can be replicated in its own and in other contexts following a structured scheme, it perhaps makes sense to talk about the development of a method.
Learning to read the market and design growth
Returning to the first point, who then is the researchpreneur, and how can these figures’ aptitude for value creation be systematized into a replicable scheme? The university, in the last decade, has cleared and probably freed from their stigma as impure researchers, the figures of research managers, attentive to the development of an international network and to the needs of the market, to be met by matching them with technical expertise from universities and their laboratories. If open innovation is the key to the growth of the country, and its industrial and research sectors, it is in it that technology transfer experts are custodians. Enhancing the skills of those who know how to converse with the two worlds, interpreting the needs of the incoming future, and declining the contents of the vast catalog of ideas that the academy produces, from a revenue-oriented perspective, is perhaps the yet unfinished step in the development of the university-business chain. Again adopting MegaRide’s path from case-study, it is from the privileged observatory on technological trends offered by the research division that oversees the company’s innovation processes that perceptions of the needs facing the market have arisen. Founded as a software-house dedicated to the development of digital tire models for motorsport, it initially evolved toward solutions for testing, analyzing and reproducing the behavior of vehicles in contact with the road. Today, MegaRide, which from a corporate point of view has become a micro-holding, from a technological point of view is preparing to pour its knowledge into the vehicles to come, which are increasingly interconnected and autonomous, and capable of handling complex algorithms in the ECU. The ability to interpret this need in advance, to prepare products and processes to benefit it, while continuing in parallel to keep a constant eye on a changing horizon, is the strength of research-driven companies.