By Jim Stafford
Copyright © 2017, The Oklahoma Publishing Co.
There is a saying in the startup world that if you want to be successful, you have to learn to fail fast.
It appears to be an oxymoron, but there really is substance to the expression, said Scott Meacham, president and CEO of i2E Inc., an Oklahoma City-based not-for-profit that provides business advisory services and investment for many of the state’s new tech-based ventures.
“If something is not going to work, before you put in a lot of time, effort and money into it, you need to figure that out,” Meacham said. “If you are on the wrong path, you need to know that pretty quickly so you can get redirected.”
That’s why i2E created the Venture Assessment Program (VAP) as a way for entrepreneurs to find out quickly if their product has an actual market willing to buy it. The VAP is a three-week course in which new business owners are forced to reach out to potential customers and then assess the reaction.
Which leads into another word embraced by the startup world: pivot.
Entrepreneurs “pivot” all the time when they discover one market may not be ready for their product, but another is. Or their product needs to be retooled to match the needs of their customers.
When they pivot, they change their product or aim for a different market.
That’s what happened at both Selexys Pharmaceuticals and WeGoLook, two Oklahoma startups that recently sold for millions of dollars.
Selexys developed a new therapeutic to treat sickle cell disease and sold for $665 million last November to industry giant Novartis Pharmaceuticals.
WeGoLook, which provides on-demand field services to the financial service, insurance and consumer markets, sold an 85 percent stake in company in early December to the insurance claims management provider, Crawford & Co., for $36.5 million.
“In the Selexys Pharmaceuticals deal, the original indication of the molecule was to deal with inflammation around transplants,” Meacham said. “What we saw go to market was actually a treatment for sickle cell disorder. That was a product pivot.”
By contrast, WeGoLook changed its primary market focus.
“When WeGoLook started they were going to be a tool basically for people buying things on eBay,” Meacham said. “But, as we saw, it pivoted to the B2B space into a much broader opportunity.”
For entrepreneurs who enroll in i2E’s Venture Assessment Program, the goal is to quickly discover if the product fits the market.
“Many, many times as a result of that feedback from their target market, entrepreneurs decide they are going down the wrong path,” Meacham said. “The whole program is designed to give them that.”
That means that entrepreneurs come away from the class with a green light on their concept, a suggestion that a pivot is in order or a recommendation to shut the whole thing down.
And that is failing fast.