"UCI Beall Applied Innovation and the Cove are incredible opportunities for current students and researchers to take advantage of all the resources UCI offers students under one roof, particularly the Research Translation Group and entrepreneurship training."

– David Cuccia
Founder, Modulated Imaging
UCI Alumnus

 
Is there a market for your product? This is the most important question to answer – if you turn your technology into a product, will customers want to buy it? To answer this question, it is a good idea to survey as many potential customers as possible. Does your technology solve a problem they think they have? Is your value proposition strong enough that those customers will be willing to pay a sufficient amount for it? Have you identified the features and benefits that are most important to your potential customers? Once you have answered these questions to your satisfaction, you can turn to assessing the market size.

MARKET SIZE, DYNAMICS AND POTENTIAL 

What is the market size? Is it growing, stable, or shrinking? When analyzing the market size, it is important to focus on the addressable market that the product will specifically benefit. (For example, the addressable market for a new high power, extremely bright LED bulb, is not likely to be the entire lighting industry, but rather, the automotive or entertainment industries interested in automotive headlights and stage lighting. This technology may be the wrong fit for residential or other uses.) Is the market controlled by a few players? If so, how will your company enter the market and/or overcome market barriers? Of the addressable market, what share can be obtained by your company? 

COMPETITION 

Now that you have identified and assessed the market size, the next step is to understand your competition in that market. Are there products already in the market that address the same general need? Is your product sufficiently differentiated from competing products and/or does it offer a significant advantage over existing products? If so, how is your technology better? Are there other companies that are developing technology that would directly compete with yours? If so, what is their stage of development and why is your technology better? 

INTELLECTUAL PROPERTY (IP) PROTECTION 

Your IP should give you a competitive advantage. Based on your understanding of the market and your competitors: What is the best form of IP to protect the technology? Is broad protection possible to secure? Are any key intellectual property rights owned by someone else? If so, how will the startup acquire the necessary rights or re-design the technology to assure “freedom to operate”? Can the company employ multiple forms of IP rights, such as a combination of patents, trademarks, copyrights and, later in the company’s development, trade secrets, to strengthen and supplement protection of its products and services? Will it be more advantageous to treat certain aspects of an invention as a trade secret and not file a patent application? 

DEVELOPMENT NEEDS/RISKS 

What further research and development will be needed to get the technology ready for commercial sales? What are the key development milestones? How long will it take to achieve these milestones and how much funding is needed to achieve them? What are the development risks, including full failure points, and how do you anticipate mitigating these risks? 

REGULATORY ISSUES 

Are any regulatory approvals required? If so, what is the history of similar products obtaining approvals, have you sufficiently accounted for the length of time and funding in obtaining approvals and what is the risk that the approvals will not be secured? 

EXIT STRATEGIES 

Based on the amount of funding required to develop the technology for commercial sale, is it possible for investors to achieve their necessary rate of return? Please note that different funding sources have different needs when calculating their necessary return on investment. For example, the federal government would not expect any return on investment when awarding a grant. In contrast, venture capital firms each have a return they seek to achieve, which could be as high as ten times the invested funding. The required return on investment can vary, so it is important to research individual investors, when possible, in addition to market standards. 

EXPORT CONTROLS 

Export controls are federal laws that regulate the shipment or transfer of controlled items, software, technology, or services outside of the United States.  In addition, these laws also restrict the release of certain information to foreign nationals in the U.S., otherwise known as a “deemed export”. 

In order to ensure compliance with export controls, it is critically important for university personnel to identify when their activities may trigger export controls. Listed below are several export control factors that should be considered and could arise at any stage of a company’s growth process.

1. NATIONAL SECURITY

The U.S. Government controls exports of sensitive equipment, software and technology as a means to promote our national security interests and foreign policy objectives. National security issues could impede certain funding opportunities, especially for the research and development of sensitive technology or materials/items. If your business involves what the U.S. government considers critical infrastructure, or emerging technologies, additional prohibitions could arise. If you believe your business may involve the development of a sensitive technology or material, you may contact UCI’s Export Control Officer for additional evaluation.

2. RESTRICTED PARTIES

Export control regulations present complex and nuanced compliance requirements where interactions with international parties are numerous and expected. Engagements with international parties appearing on one of several U.S. government debarred, denied, sanctioned lists, or other entities of concern, carry specific legal requirements, and therefore pose significant compliance risk that can bring unanticipated roadblocks to business operations. If not managed appropriately, these engagements can result in loss of funding opportunities, reputational damage or potential export violations, including civil or criminal penalties. The Consolidated Screening List (CSL) is a public screening tool available at the International Trade Administration within the Department of Commerce to screen individuals and entities for potential sanctions or regulated transactions.

3. SANCTIONED LOCATIONS

The Office of Foreign Assets Control (OFAC) of the U.S. Department of Treasury administers economic and trade sanctions against specific countries, individuals, and entities. The highest risk countries, regardless of activity, are those under OFAC’s most comprehensive sanctions, including Cuba, Iran, North Korea, Syria and Ukraine (Crimea region). Most activities involving these countries — including direct and indirect exports of goods and services — is not permissible without a license from OFAC. Please contact the Export Control Officer for more information on OFAC regulations. A license can be submitted on behalf of the University, but only for university-based activities, research, and transactions.

4. EXPORT CLASSIFICATION

If your business includes the development of a product, export control laws may be applicable depending on the classification of the product.  Your customers, especially those who may use your product abroad or export it — may request the export classification of the product to ensure a license is not required. A key factor in determining whether an export license is needed from the Department of Commerce is knowing whether the item intended for export has a specific Export Control Classification Number (ECCN), as listed in the Commerce Control List (CCL). It important to note that “technology” resulting from fundamental research and is intended to be published is not subject to the Export Administration Regulation (EAR) per § 734.8. In addition, published patents and certain patent applications outlined in § 734.10 are also not subject to the regulation.

5. FOREIGN EMPLOYEES

The transfer of “technology” or source code to foreign persons located within the United States is considered an export unless the foreign person has official permanent resident status. If your company’s research and development involve an export-controlled technology, a license may be required for certain foreign individuals to access it. Certain exceptions may apply under § 734.7 and § 734.8 of the EAR.

For more information, please visit UCI’s website on Export Controls. For questions or how export control regulations may apply, please contact UCI’s Export Control Officer.