From The Herald, by Bernard Frutin
is to create. To innovate is to alter or change, usually
in response to customer demand.
Naturally there are many more innovations than there are
inventions. However, I prefer to invent. That is how I
earn my living. If my experience is anything to go by,
Scotland is full of inventors. Every second person I meet
tells me that they have an invention or brilliant idea.
Very, very few do anything about it. But some go for it!
To invent is an act of creation, like sculpting or painting.
A project comes to mind and if it is potentially
simplefor simplicity is the key to successful
inventionsand provided the concept has some obvious
market potential, I will develop the project.
A creative inventor is like an artist painting a landscape.
Neither works best under any form of external discipline.
Financial pressure advising the use of more red paint as
it is less expensive than black is just not acceptable.
Neither is team work. Inventors and artists must create
by their own efforts. Cash itself is not the driving
force and never will be.
Financial institutions find this hard to understand.
British financial institutions all demand a measure of
discipline, they require monthly figures, cash-flow
forecasts and updated weekly or monthly progress reports.
Given the choice of offering funds to either management
buy-outs, or dedicated teams of development engineers or
scientists, highly focused on a specific well-defined
project, or, for example, a creative inventor like
myself, the finance houses, under pressure to complete
within their own market and protect their
shareholders fundds, will in general offer
financial support to what they see as the lower-risk
But "real" inventors will still inventat
least once! They will borrow the initial funds from
banks, friends or even mortgage their houses.
Unfortunately this cash runs and therein lies their next
major problem. I speak only from my own experience as an
inventor, but I believe that as a rule of thumb the
original attempt by an individual inventor to cost his
development will be out by a factor of as much as five.
Five times his initial cash estimate will be required,
fiv times the timescale to get his product to the market
So where does the inventor turn to access additional
funds? Banks will generally refuse second tranche
fundingso back to the venture capitalists and financial institutions
with the inevitable result. Thereafter these partially
developed ideas are then picked up by the very companies
the inventor had appraoached with the original concept.
This company then innovates using its own in-house
expertise and another product is launched with no credit,
financial or otherwise, given to the British inventor.
The problems faced by inventors are not new. In 1815, 181
years ago, John McAdam of Ayr, with no formal
qualifications, set out to develop an improved road
surface. He also financed his invention personally and it
impoverished him. Interestingly enough, eight years later
he sought a grant from public funds, James Watt invented
his steam engine in 1769; five years later he went into
partnership with a wealthy Birmingham businessman.
equivalent must be a "business angel" where the
"patron" could, if he chose, not only invest,
but personally participate in the future development of
the project in a less structured manner.
This concept can be stimulating, interesting, tax advantageous
and, provided the two parties respect each others
personal aspirations, could prove to be commercially
viable. This is possibly one of the more promising
avenues for the cash starved inventor and I would like to
see this whole area of financing developed and
The "business angel" may also be able to introduce
the inventor to contracts to assist in the marketing of
the product. The inventor traditionally can sell to two
main markets - end-user consumers and companies who will
buy the concept and develop it for sale to the market.
Inventors should appraise the relative benefits of selling the
product and selling the concept. With the help of a
consultant they can examine the strengths and weaknesses
of each option and may want to examine the potential
market for the product before reaching a positive
A fresh understanding and approach is needed to tap into the
substantial potential value of British inventors as yet
unrecognised and under-utilised. As a general rule,
inventors do not invent service industries. We invent
gadgets, gismos, mechanical devices, etc., and they all
need to be manufactured. What fertile ground for new
business start-ups and job creation. We represent a
significant untapped UK resource.
Bernard Frutin MBE of Rocep Lusol Holdings is a recognised
Back to news articles