I want to monetize my idea.” “At what stage should I consider selling my invention?” Most of us who are bitten by the idea generating bug want to take these ideas to the next level of monetizing them. Owen Laughlin, a U.S. Senator, once said, “Money never starts an idea. It is always the idea that starts the money.”

There is a high success rate for an idea that addresses a market need, or that identifies an untapped market potential. On the contrary, an idea or a core technology that was not initiated by a real market need faces an uphill battle to succeed.

Consider, for example, a scientist in the area of material sciences who has invented an ultra-lightweight composite material with very high mechanical strength. Even if the material is patented, it will add value to the inventor only when the inventor finds a potential buyer or a market for the material. Many ideas are pushed through such an ‘idea chasing the market’ strategy. As an example, consider yet2.com that provides an online platform for inventors to sell or license their patented inventions to companies seeking inventions in different technological domains. If the invention was not initiated by a real market need, the likelihood of an invention finding itself in the hands of a buyer may be low. In 2006, inventors allowed about 68,000 inventions to expire in the U.S. patent office. Most of these inventions did not mature into commercial products probably because many of them fell into the ‘idea chasing the market’ category.

On the other hand, consider a situation where an aviation company needs a material with very high strength-to-weight ratio for an ultra-light-weight plane. The inventor of the composite material is more likely to monetize the invention by selling it as a solution to the aviation company’s needs. As an example, consider Innocentive.com that provides an online platform for inventors worldwide to offer inventive solutions to companies and industries. The philosophy behind Innocentive.com is that of a ‘market need chasing the idea.’ Companies and industries with specific problems and needs post their challenges on Innocentive.com. Groups of researchers, scientists, and engineers then brainstorm and provide innovative solutions to these problems. An idea that is sought after has a higher probability of morphing into a commercial product than an idea that is desperately seeking a market.

Corning Inc., the makers of specialty glass and ceramics, recognized the needs of the telecommunication space for high speed communication. Strategically aligning their expertise in ceramics to address the problems of high speed communication, Corning designed low loss, high bandwidth optical fibers, and advanced opto-electronic components for the telecommunication segment. By identifying the problems in the telecom segment, and thereafter aligning their R&D to a real market need, Corning has become a leader in the fiber optics market. Sarnoff Corporation, on the other hand, offers technological products in a wide range of areas from semiconductor devices, opto-electronics, communication, and many other diverse technologies. Many of these pure technology providers try out a large number of disruptive innovations, and even if a few of them turn into a commercial success, that’s more than sufficient to recover the entire R&D investment.