Innovo, ergo sum (I innovate, therefore I am). Those who don't innovate are falling behind. You hear all kinds of people shouting it. But what is that, innovate? And why are we all constantly talking about it? Time to take a look at what we are actually talking about.
Innovate. Every entrepreneur does it. And those who don't, should. At least that's what it strongly seems like. The buzz word innovate is before many a tongue, without the meaning being the same for everyone. That makes it tricky. Those who equate innovate with being open to (minimal) change are right to say that to stand still is to go backwards and to innovate in that sense is a must. Those who see innovation as a substantial renewal of a product or process know: this costs a lot of money, a lot of time and a lot of effort.
'It has indeed become a catch-all term,' says Jens Ruesink, fund manager of the Innovation Fund North Netherlands. 'We have demarcated the term in order to work with it. To us, an innovation is a technological development that creates renewal and a change in the market. It has to be something unique, a product that is new, a process that we didn't know yet.'
Innovation is scalable
The framing goes a little further. 'We are concerned with innovations that are also scalable. If a factory comes up with a unique line, that's wonderful; we only find it interesting if that process innovation can also be marketed elsewhere and is therefore not conceived purely for our own use. The innovation must be available to many customers without immediately costing a lot of extra work or money.'
Specifically. Quva is one of ten companies in which the Innovation Fund participates. The Groningen startup is developing a device that vacuum packs food. 'Starting in March, the Quva will be on sale at major kitchen stores,' says CEO Erik Spelt. 'What we have built is a device that can be beautifully integrated into the kitchen, just like a microwave, a steam oven or a coffee machine.'
Quva is a typical example of innovation in the Innovation Fund definition. The technology for vacuum packaging already existed, which was an invention at the time, which is different from an innovation (new versus renewal). The newness is in the application, and Jens Ruesink assumes there is a market for it, an important condition for a contribution from the Fund. "The market for vacuuming is on the rise, partly because of the trend of sous-vide cooking. Erik Spelt saw that too. 'We are in contact with the two largest suppliers of kitchens in the Netherlands. They want to start selling our product and have issued a purchase guarantee.'
One or two out of ten a success
Spelt recently raised additional funding for the final phase of product development. The Innovation Fund is (again) one of the investors. "For us, the funding from the Innovation Fund has been crucial. Especially in the initial phase, when you only have a prototype and the real development has yet to begin, it is difficult to raise capital. The risks are still high then. Then you need a party who dares to invest. In other words, the Innovation Fund.
That's exactly what Ruesink and his fund want. To ensure that promising innovations do not remain on the shelf. 'The beginning of development is when we are needed and really have something to offer. Not only because of our funding. Also because we like to think and look along to help the innovation move forward. We offer a network and advice. We stand next to the entrepreneur and are a sounding board. Yes, things do go wrong sometimes. Of the ten innovations in which we put money, on average between five and seven fail. A few ripple along without great opportunities for growth and one or two become a great success'.
That an innovation fails can have to do with anything. Ruesink sees a few recurring problems. If it does not go well, it is often because the entrepreneur has not properly assessed the market. An improperly balanced team will also sometimes prevent an innovation from being a success. A good inventor is not necessarily a good entrepreneur. We try to look at such an organization with a critical but subservient eye and support where we can.'
Capital, knowledge and network
Innovating is easier said than done. Killian McCarthy, researcher in Innovation and Organization at the University of Groningen, also sees this. 'If you look at radical innovation (an innovation that brings about a substantial shift in the market), you see that a lot of it fails. And yet it has to, because without innovation most companies don't make it either. It's about taking risks, and generally companies are not willing enough to take them. Even now, while the money is there because of the improved economy.' Incidentally, a 'failed innovation' is by no means the same as money thrown away. 'You always learn something from it, although that is an open door. You also regularly see that developments that do not immediately lead to an
innovation succeed later in another form.'
McCarthy sees that the existence of an "ecosystem" around innovation is important, that it helps to make innovations successful. "That ecosystem exists in the North. The lines are short, government, educational institutions, funds and business know each other. NOM is important in this context, for example because it has venture capital at its disposal, but also knowledge and a network. And that is what entrepreneurs who want to make a major innovation a success need.
Good ideas should not get dusty
The Northern Netherlands Innovation Monitor is a McCarthy subject. The latest monitor shows that SMEs in the Northern Netherlands have not increased their spending on innovation in recent years. 'That's a waste. You have to fix the roof when the sun is shining and that's now.' That may be a lull before the storm, because the same monitor also shows that entrepreneurs are more familiar with subsidy and funding opportunities for innovation. These are all part of the ecosystem already mentioned.
A very distinct ecosystem is the Water Campus Leeuwarden, which is completely focused on innovation. NOM also participates in the Frisian network and cluster organization of this ecosystem, Water Alliance. Alex Berhitu is responsible for business development on behalf of NOM. 'Innovation is what we exist for. Fascinating ideas about and with water are emerging around the Water Campus. It is a shame if such ideas are left on the shelf to gather dust. That is not innovation. Only when they hit the market do I call that innovation.'
Making extraordinary ideas and inventions applicable in practice. That's what Berhitu wants. 'Beautiful inventions can work in a beaker, but do they do what they are supposed to do on a larger scale? We help answer that question from entrepreneurs and we have the facilities to do that, to turn beautiful ideas into commercial success. To turn ideas into innovation, in other words.'
Blue energy almost innovation
The Water Campus Leeuwarden ecosystem still contains many developments that could reach 'innovation' status. 'Often they are inventions aimed at sustainability, for example the recovery of valuable raw materials from wastewater. There really is a lot of great stuff in between, but whether they all lead to innovation, you can never be sure. We make every effort to do that.'
There are examples of success: 'The hydraloop is one of them. Water purification for the home is that. Looks like a refrigerator, beautiful. The first hundred have already been put on the market, so I call that an innovation.
Linking existing ideas in new ways. One of our best-known projects is Blue Energy, the technology to generate energy from the transition from salt to fresh water. Ten years ago it was a beautiful concept, now we are in the final stage of development, the largest conceivable pilot at the Afsluitdijk. Now a few kilowatts are being generated. That has to go to hundreds of megawatts if the technology is really to be applied in a commercial power plant. So that's almost an innovation.'
'It's about using technology that is not available ready-made, that you have to develop yourself,' Hans Praat of the Region of Smart Factories (RoSF) explains innovation from the business world. 'You know it can be done, but it's not there yet. We help companies that want to create such technological solutions.'
No one understands everything
That phrase "you know it can be done" is an important one for the RoSF, the northern field lab for smart industry in which 40 northern partners from government and industry work together. Praat: "We don't sit at the kitchen table at the very beginning of the idea. There the risks are still too great. We deal with feasible solutions. This often involves existing technology that is deployed in a new way. Technology with sensors, for example, or with autonomous processes.'
In the field lab, entrepreneurs and (educational) organizations work together in a conditioned environment. 'People who understand IT talk to industrialists, for example. This is how you arrive at new developments. We link people and organizations to increase the chances of success. A process usually takes two years. Entrepreneurs normally never have or take that much time to fully develop a good idea into an innovation that can be marketed. That's why such a field lab is a perfect place to get more innovations.'
Innovate must, but it doesn't happen by itself. You need manpower, time, good ideas, development opportunities. And deep pockets, if you want to implement an innovation that has real impact. 'There are not many entrepreneurs who can do all that on their own,' says Jens Ruesink. 'You can't know everything as an entrepreneur, which is why important facilities and good people around you are important. Innovation also costs money and not everyone has that. nThis is why it is essential that all the factors that determine success are present in the ecosystems in the Northern Netherlands. You need each other and we help each other move forward.'