Successful entrepreneurs learn from failure as well as success. I was reminded of this last week when I looked into Loci, a start up in the DC region that a growing number of people are talking about.
Loci is a very interesting mash-up of two big market opportunities: intellectual property creation and Blockchain database application. In talking with John Wise, Loci’s founder, I found his journey in creating the business as interesting as the business itself. His story of failure and reinvention is valuable for anyone who either is thinking about starting a business or is mired in the weeds of trying to succeed and wondering if it’s time to quit.
Wise’s vision was to create a marketplace of invention ideas – a place where inventors could see not only what had been patented, but also what had been invented and had not been patented. He believed that a comprehensive catalogue of inventions would dramatically change how inventions were created, protected and sold. The problem was that the technology didn’t exist to implement that vision.
Over time, after a number of failures, he and his team were able to develop a technology approach that supported the comprehensive information collection his marketplace needed. But commercial success did not follow. There was an unexpected issue: solving the technology problem wasn’t enough. As Wise learned, “inventors didn’t want to freely share their unprotected ideas.”
What had been a technology challenge became a business model challenge: how to allow inventors to use and benefit from his marketplace without giving up confidentiality. Wise solved this problem by selling his technology to lawyers, who could then remarket Loci’s technology to inventors. Selling the technology in this way, Wise and his team could utilize the confidential relationship that exists between attorney and client.
Now that Wise had solved the technology challenge and the customer adoption impediment, he had created something that all entrepreneurs dream of: a successful business model that matched his technology with paying customers.
Yet he was still not satisfied, and he asked himself how he could grow his business more quickly. Was there a way to make his marketplace large and complete his original business vision? How could he protect an invention’s confidentiality without using lawyers as intermediaries?
The missing piece was Blockchain, a rapidly emerging data storage methodology. Blockchain is becoming widely known in startup circles as the backbone of Bitcoin and other cryptocurrencies, but it has broader application. Wise and his team were drawn to its permanence and to the inherent confidentiality of a Blockchain database, features that made it very attractive as the last piece of the puzzle.
Applying this last insight, Wise believes that after a number of failures, he and his team have learned and positioned his business for rapid commercial growth. He views the growing interest in his company and its approach to inventions as validation for his vision and is excited for Loci’s future. But he doesn’t ignore how far he has come, finding recent workdays “almost a lucid dream.”
Moreover, Wise believes that his experience dealing with prior adversity makes him more confident and prepared. He says that “a year ago I would be freaking out. Instead, today I propose a deal” when he gets calls from much larger potential partners.
Having gone through his startup experience, what advice does Wise give to other entrepreneurs? For him, it is essential to embrace failure and learn from it. It’s an inevitable part of being an entrepreneur, and you “must accept and understand that you are never right, and there is always a better way to do it.”
His conclusion? “Everyone has the will to succeed, but few have the energy.”