Making Money with Technology

You have a new idea. Your new idea involves using technology. You think you have an innovation on your hands. But wait… it’s only considered an innovation after it has successfully been implemented. And in the business world, if something is considered a success that means you have either increased your income, or managed to lower your costs after implementation.
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Our entrepreneurial genes endow us with an almost unlimited supply of ideas. But the ability to make money from our ideas is not always as evident. This is especially the case with technology, as it changes at the speed of light, and sometimes at the blink of an eye, we can miss out on an opportunity to make our ideas work for us. So we attended the workshop, Tech & Money, by Janne Vereijken of the Dutch-based consulting company, Spring Company, at the Connecting the Dots conference held on October 22nd to 24th to learn more about how we can make money with our technology ideas.

Success Factors
The key to a successful technological product or service venture, according to Vereijken, is to identify the ideas for products or services that are both commercially feasible, desirable and technically possible, all in one. If any of those three components are lacking, then your idea will never take off the ground.
The initial questions to ask would be: Which client segments could benefit from the innovation? How can technology solve this? How am I going to make money with this? Then, make sure your potential customers are ready and actually want this innovation. There are many ambitious innovative products that ended up without their predicted hype. The Segway, 3D television and Google Glasses for consumers are famous examples of products that were expected to become household items and ended up getting adopted by only a small few. They were commercially feasible and technically possible, but not sufficiently desirable.
The other key component in your endeavor is to think about how you are going to make money from this. In other words, what is your business model or your earning model? Either you are trying to generate more income or lower your costs, whichever the case you need to come up with a way in which to build a framework that will allow you to make a profit.

Profitable Business Models for Inspiration In today’s economies there are different busi-ness models for different types of technology. Vereijken’s simple example explains this business model concept.
Take for instance a car: you can buy it, lease it, rent it, share it (SnappCar), take a taxi (Uber), and even let it drive itself (Google’s self-driving car). This list includes seven business models in which you can make money with one technology. Vereijken calls this the Earning Model. For every idea that you want to launch, you need to assess which Earning Model you will use with the technology you will be implementing. During her workshop, Vereijken covered several earning models and examples of ways in which companies have used technology to create value and make money.
• The Share Model: (Examples include: Airbnb, SnappCar and Peerby). They all share their property to third parties. Airbnb is a company where homeowners are offering their homes to tourists on vacation. SnappCar shares a car ride when you’re going in the same direction. Peerby enables you to borrow the things you need from people in your neighborhood. Think: what desirable assets can be shared between people or businesses that can be feasible using technology?
• Platform Model: (Examples include: Uber, Apple App Store, Facebook, Amazon). These companies open up their business to other companies. They use their platforms to sell for others. Some companies like Uber are platforms from the start, while others became platforms.
• Licensing to Consumers Model: some are paid, like for instance Windows while others, like Skype, give their services away for free, but you have to pay for permission to download additional features (freemimum model)
• Licensing to Competitors Model: Pixar developed amazing software to make its animated movies, then sold it to other competitors in the same business. This is a great way to earn back your investment. So maybe ask yourself: how can I get others to use my technology?
• The Co-creation Model: (Examples of this model include: Threadless, Design Your Own Shoes, UltraMaker2 (3d printing) and Lego). Much of what they offer utilizes the creativity of their customers. These companies each built a community in which the customers upload great content, ideas and projects. That enables them to keep their own organization lean and low in costs.
• The Do It Yourself Model: (Examples include: Shopify, WordPress, AppBuilder, Etsy and Blurb). You don’t need expensive consultants or other service companies, but software enables you to do things yourself.
• The Access Model: A type of business whereby instead of owning something, you gain access to it. Some examples are Netflix, Spotify and Bundles
• The Help 2 Choose Model: (Examples include: booking.com and verzekeringssite. nl). These companies will list your options and help you choose the deals that best fit your needs, saving you time and money.
There are also endless ways to use technology to lower costs. UPS, for example, uses big data for route optimization, planning and to figure out the most efficient way to pack their packages in their delivery vans. Predictive maintenance through the use of sensors and other IoT (see inset box) is also booming.

Do’s and Dont’s
Making money from technology can be tricky. Here are some of Vereijken’s tips for smoother sailing:
• DO put your customer’s needs up front.
• Generate lots of ideas. DON’T stop at your first great idea because this may stop you from seeing even greater opportunities.
• DO prototype quickly – technology evolves quickly. Start testing as soon as possible and don’t wait until you have perfected things.
• Test your business case; as soon as your product is out there you can test it in a low-key setting before you expand and increase your expenditure. That way you can start making improvements based on actual feedback from your real clients. This will avoid unnecessary time, money and effort, and you will make changes based on your customers’ feedback.

The Internet of Things (IoT) is the internetworking of physical devices, vehicles (also referred to as “connected devices” and “smart devices”), buildings and other items—embedded with electronics, software, sensors, actuators, and network connectivity that enable these objects to collect and exchange data.
Source: Wikipedia

Examples of IoT: The Apple Watch, Amazon Dash Button, anything connecting your (home) appliances remotely.
The Internet of Things (IoT) is the internetworking of physical devices, vehicles (also referred to as “connected devices” and “smart devices”), buildings and other items—embedded with electronics, software, sensors, actuators, and network connectivity that enable these objects to collect and exchange data.
Source: Wikipedia