Research Project

The Research Project is not a business, nor is it intended to be a business. This is evident when you examine the prototype diagram:

First, because this is research, there is a lot that is not known, hence the blanks that appear for many of the sub-questions that are illustrated in the prototype diagram.

Second, the New Venture Template™ still reveals some interesting relationships. For example, ratings that show strong Core Competence and level of Innovation, explain some of the reasons that research may be stimulated.

However, no Product Market Match => (implies) that this is NOT a business, and should not be treated, thought of, or managed as such.

Figure 1: "B/K" Diagram

Figure 2: Target "Bulls-eye" Diagram

ADVICE:
Fund as a Research Project until Product Market Match is established. This means that the effort should NOT be represented as a business to investors. It also means that the effort could enjoy substantial funding, but funding that is NOT based upon any implied rate of return.

CASE STUDY EXAMPLE:

Richard Wazny -- The Research Project
Richard Wazny was working on a doctorate degree in economics at the Harvard University. He had been awake for almost twenty-four hours and was ready to collapse. He had never been so excited about anything in his life. He was making some last minute modifications to his doctoral thesis – an examination of transaction cost economics that he started nearly nineteen months earlier. His thesis defense date was quickly approaching and he wanted everything to be perfect for his final presentation. Richard was confident that his research would not only pass, accrediting him with a Ph.D. designation, but also win him the respect of his peers globally. He was on the verge of something big.

THE WORK
Richard had dedicated years of his life exploring the conditions under which principles of transaction cost economics could be productively applied to the transition of command economies from the hierarchy to the market system. He discovered during his research, that systematic strategic action at three levels in a command society – the societal assumptions, the institutional, and the firm – may reduce human asset specificity and thus encourage a successful transition. Otherwise, asset specificity would compromise potential first order economic gains and in turn inhibit a successful transition. Richard argued, that firms need not fail when the basic market structure shifts from a command economy to a market system.

The implications of Richard's research were far and reaching. Easing the transition of a command economy to a market system could potentially save nations from billions if not trillions in losses, not to mention complete degradation of the social and political landscape. Richard was ecstatic about contributing something so significant to such a great cause. But what reward would he reap for his contribution to humankind? What compensation did he deserve for his extreme competence, hard work, and undeniable perseverance? This was an aspect of academia that Richard had struggled with throughout his graduate and post-graduate life. Aside from the honor, prestige, and perhaps the possibility of one-day winning a Nobel Prize or equivalent award, Richard's magnificent contribution to posterity would go unrewarded. How could something so important and theoretically valuable to the world be worth so little in terms of remuneration? It just didn't seem fair.

But Richard Wazny made a promise to himself before choosing to attend Harvard: he vowed that he would devote his talents not toward matters of material or financial gain but toward the betterment of the human race. This noble philosophical underpinning ultimately drove Richard in his pursuit of understanding. And understanding it was, indeed.Richard internalized his motives and, with the skill of highly qualified surgeon, meticulously dissected the wealth of information known in academic spheres as transaction cost economics.

Advancing upon the findings of leading authorities in the field, Richard combined a spectrum of knowledge and understanding into a new strategic cohesive whole. It left nothing to sell, nothing to purchase, and nothing to imitate; there was no substitute for it, no physical form to it, and no resource generated by it; it did not have to plan for the future, nor did it need to be insured against the unplanned; there was no risk. It was simply information – a higher level of understanding, always changing and evolving, and born out of a commitment from not one but many exceptional individuals over time.

Richard Wazny had no regrets. Understanding was his reward.