The electronics industry likes to celebrate success, touting the unusual circumstances under which many of its biggest companies were founded -- the garage is a favorite location.
It often fails to mention the hundreds, possibly thousands of other technological innovations that died unsung because the entrepreneurs either couldn't get anyone to pay attention to their ideas or failed to secure critical funding.
The stories many of us will ever get to know about events in the technology world are those of the successful companies, enterprises like Amazon, Apple, Facebook, Google, Hewlett-Packard, and Yahoo. But many others never get to Wall Street because their products failed to make it to Main Street. So, how can startups and innovators give their ideas and products the opportunity to get included in the narratives of successful companies?
The hurdles are certainly numerous. Many technological innovations die on the vine due to a variety of factors, the top reasons being lack of funding, failure to attract the right type or any sort of viable partnerships, insufficient marketing, management missteps resulting from inexperience, insurmountable competitive opposition, poor product timing, supply chain challenges such as inability to attract the patronage of suppliers, contract manufacturers and other third-party support services providers, and simply poor design of a potentially great product.
In the electronics industry, one of the toughest obstacles to the success of a new product -- in the case of components -- is failure to find a home for the parts in existing products. The industry jargon for this is "design win," which refers to the possibility of getting the component included in the list of components used by the engineer when designing the end-equipment.
A "win" on a major OEM's platform, printed-circuit board, software, or enclosure is a highly coveted victory for a startup. Scoring a "design-win," for example, on products from Apple Inc. (Nasdaq: AAPL), could translate literally into tens of millions in sales for a startup and give its products greater visibility with other manufacturers.
But how can a startup in southern France, central UK, or the Midwest of the United States score such a win? How can an innovative enterprise even get its products before the top procurement and supply chain executives at companies that control tens of billions in purchasing expenses per year? What will it take for Apple to review a component vendor's latest innovation when the manufacturer does not have a history of supplying components to the world's biggest consumer electronics company and has no direct links with its supply chain boss?
That's where folks like John Lyons come in. A veteran of the electronics industry, Lyons is CEO of J Lyons Marketing, a technology matchmaking firm that assists developers in bridging the wide gulf separating them from the companies that can benefit from and help market their products.
Lyons told me in an interview that his company's specialty is hooking developers up with Fortune 500 enterprises. "If the technology can do what the manufacturer wants, we'll help you find a home for it," Lyons said. It's not quite that simple, though. The first step to scoring that design win is convincing technology matchmakers like Lyons that the innovation is worth hawking around. Matchmakers are valued by OEMs especially because they would have already done much of the vetting that the enterprise would have to do if the middleman wasn't involved. Lyons said in a statement he emailed to me:
Over the years, we have been responsible for matchmaking hundreds of technology deals worth over a billion dollars. On one hand, we keep in constant contact with the CTOs of Fortune 500 companies so that we know the problems that they are trying to solve. It would be extremely hard for companies in Europe to know exactly which person in any number of vast US companies might be interested in their new technology but we do. Not only that but these guys will take our call because they know we deliver solutions time after time.
The products introduced to equipment manufacturers for consideration by technology marketers like Lyon must have already passed muster with the middleman who require have a deep knowledge of the customer's products and may even be aware of its product roadmap. In order to sustain the relationship on both sides, Lyons and his team are constantly in touch with CTOs at equipment vendors and spend a great deal of time hunting for valuable innovations.
An introduction by Lyons to a Fortune 500 company is not a guarantee of success, though. He admits to scoring wins regularly but added that many of the innovations he considers may not get past the front door at the equipment vendor. Lyons counts amongst "his successes a camera chip design win of 50 million units and counting, a battery design win for a Set Top Box worth $400 million, and a new disposable sample gathering device used in diagnostic testing with the potential to sell millions of units a year."
Of course, if matchmakers like Lyons cannot deliver the goods, there are other avenues technology innovators and startups can pursue. They can leverage the strength of funding partners, tap the vast knowledge and contacts available at distributors, and if all else fails, there's always the chance cold calling the OEMs might elicit some interest. It's a long shot but it may just be worth trying -- after all, both parties are always on the lookout for something different, something that improves their competitiveness.