Loans & Finances Today

The Lambert Review Of Business-University Collaboration, published in December 2003 looked at the relationship between industry and academia in scientific research and commercialisation of that research. It broadly supports the Government’s approach to ‘third stream funding’ which promotes knowledge transfer. The amount of money spent by UK companies on research and  development (R & D) is low compared with other industrialised nations: about $410 per person compared with $700 per person in France and $1300 in the USA.

There are barriers to commercialising university IP, including lack of clarity on ownership in research collaboration and in the variable quality of university technology transfer offices. Universities perform well by international standards in science and technology. There has been a marked change of culture, with many universities casting off their ivory tower image and playing a much more active role in their regional and national economy. But, there had been too much emphasis on spinouts over the last decade compared with licensing fend other forms of commercialisation).

Inventor clubs can provide the resources, encouragement and contacts you will need as you move your product to market. The clubs are often populated with inventors who have successfully navigated the idea-tomarket maze. They are willing to share their experiences and the expertise they have gained along the way. The knowledge the members of these organizations share can help you to avoid many of the pitfalls in inventing.

It can also shorten the length of the process by teaching you the shortcuts they have learned. The inspiration club members offer can be as important as anything else can for keeping a new inventor motivated. Inventing is often discouraging, and just knowing a living, breathing person, not unlike yourself, who has invented successfully, can provide the encouragement you need to see you through the discouraging times.

Some of the successful inventors who belong to their local inventor support groups have licensed their products, others have chosen to build a business around their inventions, and still others have chosen countless other options such as catalog or infomercial sales for their products or patents. These individuals belong to the local inventor clubs because they wish to share their knowledge with others who are seeking success with their inventions.

Anything sold as a limited partnership is a speculation. As a limited partner, you give up the right to control the investment and pay huge fees to those who do control the investment.

Limited partnerships work as fun money. Stage plays and movies are funded through limited partnerships. Returns are unpredictable and far more often negative than positive. Based on figures cited in the June 18, 2001 issue of Barron’s, more than 80 percent of the time, you lose every penny invested. Nevertheless, you do get to meet the stars, attend at opening night, secure seats for friends and family, and brag about an occasional hit.

Limited partnerships are also used to sell interests in airplanes, ships, train cars, heavy machinery, or any asset that requires a large capital investment. Overconfidence, again, is your enemy. The promoters will show you how valuable the asset is, how it will be leased or sold at a profit to a highly secure and profitable end user, and how reasonable their fees are for the service they are providing. You will have to qualify as an investor and will be told that you are one of a select group of individuals being offered this special deal for a limited time only. Once your ego has calmed down, you must ask: If this is such a great investment, why didn’t the users just get a bank loan and buy it themselves? In fact, why didn’t the promoters just get a bank loan and buy it themselves?

Remember, anything sold as a limited partnership is a speculation. Solid real estate, sold as limited partnerships, resulted in huge losses a few years back. Investors compatible with real estate were not compatible with RELPs. The packaging of any investment can affect its emotional impact on you. In the next chapter, we will look at packaging and other aspects of form that affect you even though the substance of the investment may otherwise be within your comfort zone.