Financing early stage innovation ventures – a value-oriented roadmapping framework

Abstract

This practice-oriented paper describes a value-oriented roadmapping (VRM) framework, which helps entrepreneurs improve the investor readiness of their ventures through developing better business models. As investors tend to perceive risks where entrepreneurs only have eyes for the opportunities, this value-oriented roadmapping framework is a practical tool to help bridge the gap between investors and entrepreneurs. From the daily practice of the lead author as an IP value strategist the lesson has been learned how important it is that entrepreneurs develop a business case from the perspective of potential investors. The value-oriented roadmapping framework is a practical tool for entrepreneurs and was developed through a series of 8 case studies. The tool is a template-based approach, or so-called ‘canvas method’. In a workshop setting, led by an experienced moderator, participants critically assess the venture’s and or product’s market, capabilities, application, revenue model, capital investment, IP-position, from an investor’s point of view. Next, this qualitative assessment is translated into a quantitative assessment, incorporating finance and valuation theory and methodology. The end result is a roadmap for value creation, where in the end both investors and entrepreneurs require a reward for financial risks taken.