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Defining Innovation in Technology Startups

Many view innovation as the starting point for a successful company; that is think of an innovative idea, and success will follow. The reality is in the everyday details.

As a technology investor, when asked to consider the theme of Innovation and Agility for this year’s Vision 2022 programme, my first thought went to the incredible science that I am fortunate enough to engage with. From deep learning to quantum computing to DNA storage, technological innovations are limitless and form one of the key foundations in the companies that we, at Amadeus Capital Partners, invest in. Showcasing technical innovation in novel materials (by companies such as Xampla, Paragraf), AI algorithms (in companies like PolyAI, Healx, Speechmatics, Sprout.ai, v7 and Pimloc) and Quantum Technologies (seen in Riverlane, NuQuantum), comes naturally to deeptech companies.

However, as tempting as it is to think that if one starts with great technical innovation the rest will follow, the reality is that innovation is but the first step. Sustainable success requires agile product development that incorporates customer feedback seamlessly to identify product-market fits. Take Cambridge Silicon Radio (later CSR Plc) for example – this world leading connectivity technology, when it first started, was advised that the near range would make it suitable for automatically opening garage doors and also that big OEMs would not trust start-ups to deliver mission critical semiconductors. It was said that instead of ‘fabless manufacturing’, the licencing of semiconductor designs and intellectual property was the only viable business model! It was agility and market feedback that allowed the company to capture the Bluetooth semiconductor market, culminating less than 3 years after foundation with contracts. Nokia, then by far the most important supplier of consumer devices in the world was one of several early clients. CSR went on to supply billions of chips and take more than 50% of the Bluetooth market.

So, while innovation and agility in product development is important, there is a wider scope for this duo. Commercial nimbleness plays a key role in success – the willingness to build a plan while also being comfortable with adapting the strategy and execution to suit market conditions is crucial to survival. Innovation is also necessary in recruitment, to build diverse teams, develop new ways of working and foster inclusive corporate culture.

It is the ability of both the management team and the investors of a company to be innovative and agile in all areas of the business that ultimately leads to success in growing enterprise value.

The author would like to thank Glenn Collinson, co-founder of CSR for his input regarding Cambridge Silicon Radio.

Authored by Dr. Manjari Chandran-Ramesh
Partner, Amadeus Capital Partners

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