Posts Tagged by core competence
"Core Competence" and the Clean Energy Business
| January 6, 2010 | Posted by Craig Shields under Renewables - Business |
![](http://i708.photobucket.com/albums/ww83/craigshields/BTBusiness.jpg ""Core Competence" and the Clean Energy Business")
Each week, many people write into us at 2GreenEnergy from all around the globe wanting some sort of assistance with renewable energy ideas. Normally, “assistance” means “funding.” It’s certainly true that we are connected with a small team of carefully chosen boutique investment bankers in NY City, and that we routinely pass along the business plans that seem most solid to them.
But I have to admit that I have a morbid fascination with those business plans that don’t pass muster – that I consider to be fatally flawed (plans that, of course, I do not pass along). I’ve even developed a set of categories for them in my own mind.
First are those that are clearly specious in terms of basic engineering and physics, e.g., a wind turbine that supposedly captures two or three times more energy than the conventional three blades. Wrong. This is impossible, since the existing system already harvests about 60% of wind “flux,” i.e., the wind that passes through the circle defined by the tips of the turning blades.
Along these lines we have the perpetual motions machines, which seem to arrive here at a more-less constant pace. This category is composed, again – in the privacy of my own mind — of two sub-groups: “crackpots” (that is, people who seem to believe their story) and “charlatans” (people who don’t). I’m never nasty or condescending with anyone, but I DO ask to see a working model. Strangely, I get this response (uniformly): No, I don’t have a working model; I just need another few hundred thousand dollars, and I can produce one quickly. “Gosh, sorry,” I say, “I’m afraid I can’t help.”
The other broad category of “non-starter” plans are those who have obviously bitten off more than they can chew. Here we have inventors who seem to lack a sense for the idea that the hard work is just beginning – maybe a fellow with a legitimate breakthrough who somehow believes that all the R&D, manufacturing marketing, and distribution are simply unimportant afterthoughts.
I sometimes find myself explaining something to someone that I’m quite certain he’d rather not hear, for example, “Your idea could change the world — but there’s a problem. You have a vision …. but you’re neither a seasoned businessman, a financier, a patent attorney, a human resources executive, a manufacturer, nor a distributor. I ask you to consider a basic solution, one that has been employed by smart people all over the world: sell or license your idea. I can help you sell this concept to a fully funded corporate entity that wants to bolster its position technologically and gain an additional competitive advantage. Or maybe we could talk about setting up a meticulously protected licensing relationship with an enterprise that has already established manufacturing practices — along with existing distribution channels.”
In essence, it’s the concept of core competency that became fashionable in the 1980s. Simply do what you’re good at. Don’t rein in your success by converting a personal weakness into a stumbling block toward your company’s progress.
And this rule is even more applicable in the world of clean energy than it is elsewhere, as this industry is destined to soon be measured in the trillions of dollars annually. Cut a licensing deal for your technology that captures a millionth of that market. You’ll be doing just fine.
Related posts:
Clean Energy Businesses and Core Competency
| January 3, 2010 | Posted by Craig Shields under Renewables - Business |
I just posted this piece on renewable energy business plans on RenewableEnergyWorld.com. In essence, I encourage everyone trying to make their way in the clean energy industry to be honest with themselves about their strengths and weaknesses, and consider selling or licensing their technology to a larger enterprise if this will foster the development of their technology.
