3 Key Challenges Facing Businesses in the Emerging Technology Sector (and How to Overcome Them)
April 26, 2017
Businesses and projects operating in and around the emerging technology sector face their own unique business challenges. For over five years, we have been working with companies in the emerging tech sector. Consequently, we’ve developed a deep understanding of the key challenges facing businesses in the sector, and how to overcome them.
Challenge 1: User scepticism and unfamiliarity
When working at the cutting-edge of technology, it can be a challenge to find customers and investors who understand and grasp what your product or service is all about. Many businesses and their owners in the sector can also struggle to explain what their innovation does in simple, easy-to-understand terms. The battle against user unfamiliarity and scepticism can also be a difficult hurdle to overcome. Thankfully, there are some steps you can take to help your investors and end users out.
User scepticism can often be mitigated by thorough preparation. Before meeting with investors, potential customers, and end users, prepare well for the questions that they may ask and the concerns they may have. Invest time and energy into detailed market research in order to understand fully what your foreseen market thinks about your product or service and how they think it could be improved. Don’t expect the mass market to jump on-board your innovation immediately. Instead, target early adopters in your marketing. If your product or service proves valuable to them, then growth should follow.
If you find that people are struggling to understand your innovation, try summarising your product or service in one sentence. This technique will force you to be clear about what your innovation is. Also, focus on sharing about the problems your product or service solves as opposed to its technical features. In our experience, this is something that businesses in the technology sector find particularly difficult to do. However, sharing the real-world benefits of your product is essential in order to prove the value of your innovation to your customers. Furthermore, prospective customers are much more likely to care about what your product or service can do for them as opposed to how it works.
Challenge 2: Funding and investment
Funding and investment can prove a challenge for any business. However, owing to the large development and research costs involved in innovating and testing a new product or service, a lack of funding and investment can prove an even bigger barrier in the emerging tech sector. Innovating new technologies can prove complex and expensive, and securing funding can be challenging when you are yet to achieve proof of concept.
Fortunately, there are a variety of funding options available for start-ups, SMEs, businesses and project consortiums. From organisations such as the European Space Agency (ESA) and Innovate UK, to business incubators and events, there are many ways to secure funding. The regular funding competitions run by Innovate UK often offer investments of up to £500,000 and more. Whilst competition for these investments is fierce, there are many ways to boost your chances. From collaborating with other businesses or even a university, to proving the commercial worth of your business idea in terms of projected revenue and value to the UK economy, taking a commercially-focussed approach can set your application apart from the crowd.
Don’t know where to start? Check out our guidance on how to secure funding here:
Challenge 3: Managing commercialisation and the service
In our experience, start-ups, spin-outs and businesses operating in the technology sector often lack the commercial experience required to turn their innovations into viable business prospects. Commercialisation can prove daunting, especially for smaller companies. This, coupled with managing the service post-launch, demands planning, preparation and commercial expertise.
Commercial success is driven by strategic thinking. As such, businesses in the emerging technology sector should take a highly strategic approach to their products, services, and operations. Try to view your products and services as business prospects. Which real-world problem is your product or service resolving? What are its key strengths? What are its weaknesses? How does it stack up next to the competition? How can you beat your competitors and win customers?
Engage your target market or foreseen end users from early on in the development stage. Whilst many businesses undertake this research and outreach close to launch, engaging your end users from the very beginning can give you a major advantage. Not only will you better understand your foreseen market, but you may also manage to secure your first customer. If you still lack the in-house knowledge required, it might be worth employing a consultant to plug the gaps in your knowledge, and help you to shape your innovation into a viable business prospect.
Wondering how to take your product or service to market? Read our 6-step guide to find out how:
Huduma Limited provides commercial support for businesses and project consortiums who are looking to take their emerging technology products and services to market.
Looking for help with overcoming your business challenges?
Get in touch today to find out more about how we can turn your big ideas into commercial successes.