Coming into focus: setting a company vision
Founder, CEO, PatSnap
The importance of vision
Since last year, there have been many moments where I have found myself wondering about ways to define PatSnap's vision and mission more clearly. It always leads me back to a question that I find myself pondering a lot, namely whether all founders have a clear vision from the day that they founded their company or whether the vision is always a work in progress.
For example, Bill Gates is noted famously for saying that his vision was to have computers on every desk and in every household. Google's founders, Larry Page and Sergey Brin, committed themselves to the task of organizing the world’s information, as well as articulating that now infamous "do not be evil" mantra.
Flash of inspiration or always evolving?
This made me curious. The media always portray great entrepreneurs as visionary leaders who know the destination for the company right from day one. This was not my experience, as I did not have an upfront grand vision for PatSnap when I started out. I wasn't even sure how big the market for patent information would be!
So I tried to find out more and more about this and, as expected, not all these stories in the media are entirely true. The vision and business models of companies evolve as the founders grow and change during their entrepreneurial journey.
I found some of the interviews that have been carried out with Bill Gates over the years. In one, for instance, he recalls: “Not that we had any clear view that it would ever be a large business, but I had to pay these friends that I had hired.” In another statement, he continues: "Microsoft’s original business plan was to write software for personal computers. There was an unbelievable amount of software to be written, and we could do it well and we could do it on a global basis. The original customer base was the hardware manufacturers. We sold to literally hundreds and hundreds, you know, over 100 companies in Japan, over 100 companies doing word processors and industrial control type things. We knew in the long run we wanted to sell software directly to users, but we actually didn't get around to that until 1980, when we had our first sort of games and productivity software that people would go to a computer store and actually buy the software package."
So, what about Google then? Well, as it turns out, the same applies. Larry Page actually wanted to sell their search engine algorithm to Excite and Yahoo in the early days but got rejected. While it has become part of a dim and distant memory today, Vinod Khosla, of Khosla Ventures, recounts a time when Google was willing to sell for under $1 million. At that point, Brin and Page were worried that the search engine was taking away too much time from their research. Khosla (who was then a partner at venture capital firm, Kleiner Perkins) had convinced Brin and Page that Google should be sold for $1 million. When George Bell, CEO of Excite, refused the offer, Khosla even managed to convince the Google duo to drop their price to $750,000. Still, Bell wasn’t interested.
This brings me to PatSnap's version of the story. During the first few years of founding Patsnap, we were always in survival mode. We were still figuring out our product-market fit, while at the same time burning cash every month. At one point, back in 2010, we decided to refocus and consequently re-built major aspects of the product from scratch. It pushed back our go-to-market significantly, meaning that we would not have any revenue for yet another 12 to 18 months. I remember that back at the time, I was solely focusing on making sure we could finish developing the product before the money ran out.
When the product was re-launched in 2012, it started to generate revenue, but financially we were still in the red. I had to embark on an around the world trip, pitching to investors to make sure we had enough money to continue running the business. It was only after many pitches and many rejections that, in 2014, we managed to find our Series A investor.
That is when I had more time to think about the future of PatSnap and why I had started PatSnap in the first place. I realised that I hadn’t started PatSnap out of a motivation to make money. That was never my first goal. What I love is the idea of building something of significance, something that could have an impact on the world, and along the way touches as many people’s lives as possible. This can be through people working with me, or by generating value for our customers. It is always very satisfying when customers come back to us and praise us for helping them a lot.
Customers bring the vision into focus
At PatSnap, what is really rewarding is how we can help our customers to formulate a better IP strategy and hence, from there, enable them to innovate better, more efficiently, more effectively. I believe that in the next few decades, as we continue our voyage into the knowledge economy, IP will become a must-have currency in business. Every organization will live and breathe IP. They will all recognise the importance of IP, as it becomes a main part of their company functions - just like finance, sales and marketing are in a company in the current climate. Even a small mom and pop shop will need IP, as they will have to trademark their logo and brand.
The other mega-trend is that R&D expenditure around the world has been increasing year over year for the past few decades and will continue to increase for the next few generations, at least. The pace of technology innovation will only increase. Understanding IP, making full use of the intelligence and acting upon it, finding good technology partners, buying and selling IP and generating revenue out of it – all of these will be key.
It would be so fulfilling knowing that companies innovate better because of our vision. Helping a medical or pharmaceutical company to discover a breakthrough cure, or a car company that uses our solution to crack the world’s energy efficiency problems, or assisting NASA in developing innovative space technologies, so that one day we might travel to Mars.
These are really fantastic prospects in my opinion and I am excited by what the future holds.