Entrepreneurs in the North East have been told by a representative of tech giants Google to double their rate of failure if they want to double their rate of success.
Joe Faith, a product manager at the international internet giant, was speaking at Venturefest North East, a one-day conference on innovation and entrepreneurship, and lifted the curtain on how Google’s approach to innovation could apply to businesses and entrepreneurs in the region.
The former Northumbria University lecturer, who has a background in data visualisation, told more than 600 delegates from across the start-up, venture capital and corporate spectrum that Google has pursued many dead-end projects - just like any other organisation.
Mr Faith said: “The techniques used by Google to drive innovation parallel pretty closely those used by the wider start-up community. Innovation is not the same as new. If you go into a supermarket, you’ll find half of the products are marked as new and improved.
“Just because you’ve got a new product doesn’t make it an innovative product. And just because something contains innovative technology, doesn’t necessarily make it an innovative project. For instance, putting a laser in a mousetrap isn’t creating an innovative product. The outputs are still the same - a live mouse goes in and a dead mouse comes out.
“However, innovative technology is crucial in many cases because it provides a defensible market.”
Mr Faith explained that innovative products often involve an element of surprise, but that dynamic limits the usefulness of traditional market research.
He added: “Henry Ford famously said that if you asked customers what they wanted, they’d have told you a faster horse. Asking customers is not always a reliable guide to finding out whether your innovative product will be viable in the marketplace.”
The Google man touched upon the concept of the ‘minimum viable product’ - a tool used by innovators to gauge demand and build understanding of a product’s “legs”.
Designed to test the water with minimum investment across time, money and resources - the minimum viable product can take the shape of a basic prototype, or even a website or video outlining the concept’s key features.
Mr Faith explained: “If you’re pretty confident about your technology, but not that sure about how the market will react to it - the minimum viable product can take even a basic form such as a video, or a page on kickstarter.
“If the question mark is over the viability of the technology - then a minimum viable product is more likely to take the form of a prototype.”
In much the same way that scientific hypotheses are tested, Mr Faith explained that innovations, in the eyes of funders, must also be “falsifiable” - what would it take to be proven wrong.
He added that entrepreneurs must clearly define the conditions in which they will acknowledge their idea that will not work, and move.
“Google is not just good at producing a lot of useful new services. It has also produced a lot that have since fallen by the wayside. Internally, that’s expected,” added Mr Faith.
Now in its second year, Venturefest North East, part of the national Venturefest Network, is designed to help delegates introduce innovation and innovative thinking into their business.
This year’s conference saw GrowthAccelerator bring together 25 funders representing all parts of the funding ladder from venture capital fund managers and angel investors to crowdfunding and business support organisations
The event was delivered by Newcastle Science City in partnership with the Technology Strategy Board and the North East Local Enterprise Partnership. It took place at the Hilton NewcastleGateshead.
Mr Faith lives in Newcastle and works at Google’s London operations during the week - where he wryly confirmed - “yes, there is free food, but no, we don’t all have self-driving cars.”