After posting on Wednesday that I had joined The Combine, the emails and questions started coming. First, thanks to everyone for your collective “Congratulations!” Second, the most common question I received was, “What’s The Combine?!?” Since KP Reddy & Hans Utz have put me in charge of marketing The Combine, I hope I can answer that question. And since I’ve been running Pitch Practice for 3 1/2 years, I hope I don’t embarrass myself trying to sum it up in less than 30 seconds. Here goes:
The Combine engages with corporations to monetize their dormant IP.
Well? Yeah, I don’t like it either. What the heck does that even mean? Let’s take it one piece at a time.
We are a team of experienced startup entrepreneurs, executives from large consulting firms, and an ecosystem of service providers (legal, PR, design, infrastructure, software, etc.), the combination of which creates a fantastic environment to launch tech startups.
We engage our clients first to comb through their IP, patents, and innovations to determine which one or ones have the best market opportunity. Once we identify these opportunities, we engage in a short term diligence process. That process – usually about 90 days – includes deep customer discovery, market analysis, financial analysis, and business model discovery. We figure out how to take the idea to market.
Big companies are our clients. These companies have patents, products, and other innovation artifacts. The issue is that big companies are good at what they do, whatever that is, but big companies cannot act like startups. Additionally, big companies – especially Fortune 1000 companies, don’t – CAN’T – take $100M bets. With multi billion-dollar bottom lines, these companies have to take billion-dollar bets. But nimble startups can make a bet on $10M or $100M opportunities.
We build the product and take it to market. We’re the C-Suite of the startup. We run it, hire the team, raise the funding, serve the customers, and build the value of the business.
their dormant IP.
This is the crux of the issue. Companies create internal solutions to solve internal problems. Companies have brilliant people patenting fantastic ideas. The problem is, and this problem is the problem that The Combine solves, that the vast majority of these ideas, solutions, patents, and other innovations never get monetized. There are a thousand reasons that never happens. We make it happen.
2% and 95%
Now we’re getting somewhere! The reasons for the creation of The Combine are these two numbers: 2% and 95%. Two percent of all patents are ever monetized. Actually it’s less than 2%. And 95% of all tech startups fail. Actually, it’s more than that. The gap we are addressing is corporate innovation.
Some big companies – like GE, for example – “do innovation” really, really well. They invent things and take them to market in billion-dollar fashion. Other companies whose DNA is not built on constant innovation struggle to take an idea from “cool!” to a positive P&L. Granted, that’s a really, really big leap. Any profitable company has to weigh whether or not they should divert resources (people, money, time) on anything outside their core business to try and make that leap. It is their obligation to make a wise decision for their shareholders. If an idea cannot impact the company’s bottom line in a material way (e.g., billions or dollars), they should not pursue it.
Our answer to that dilemma is to find interesting IP buried in the innovation vaults of big companies and take it to market as a nimble new company, ultimately creating a great businesses.