How to reward a team ?

wildwest1

I am seeking some advice and ideas as to how reward a team which I am putting together in order to move forward with an invention that I am working on. Here is some of the background.

I have been developing a new energy device this has been mainly a solo effort to date. The device has a patent and underwent testing at a well established and recognised University which has now issued a promising conclusion in the research and validation document.

This device is still at a early stage but could be a front runner in the future. I am in a position where I will be able to obtain some grant aid for further research. Some of the research design manufacturing and testing can be completed by myself. however I really need to put together a team inorder to move this invention forward. The team ideally would consist of the following members:

CEO
Financial Officer
Operating Officer
Development and Marketing Officer
Technical Adviser x 2

How do you compensate these team members when their role would not be a full time paying postions and the company would have no profit for some time. Would you give a stake in the company what kind of get out policy should be in place.

Any advice welcome

SeanSouth

To give you a direct answer to the question you asked, I would say you are very limited in your options, apart from the obvious one of issuing capital. Even then, what kind of a team can you build and what sort of commitment can you expect from that team if you have no money to pay them now and no guarantee that you will have it in the future.

I suspect that you need to address wider issues first >

1.Do you have a business plan. What does that business plan say about rewarding the management team from day 1 ? If you dont have a comprehensive plan, you need to start with that.

2. If the product is good, has patents and has a promising future, Isn't the
next step to attract equity investors who will stump up the necessary start up capital which will be used among other things to pay salaries until the revenues start to flow ? This is the normal process through which management teams normally get paid in the early days. Are you complicating things unnecessarily by trying to combine investors and managers into one.

3. Can you really build an organisation around one device or idea.
I've rarely seen it done. Most innovative companies need at least a handful of projects or products to sustain them. Can you really build a whole organisation around this one device ?

4.) Have you considered bringing in an established company or corporation
to take over the product "under licence" or under some other type of agreement instead of trying to build your own organisation.

5) Have you already prepared financial projections and developed plans for production, marketing, sales, further R&D ?

Might be picking this up all wrong however if you don't have funding for basic salaries , wheres the money going to come from for everything else.

TheCostumeShop.ie: Ronan

Sounds like you need to do one of three things:

1. Try to raise Angel or Venture capital and pay the members the going rate.

2. Offer the ideal candidates ownership in the venture.

3. Take the idea and license it to an existing company.

Obviously you think this is multi million Euro deal since you use'd high level "C" titles, but if you have a team as above - whats left for you to do? Are you really the person to run this business or might it be more sensible to cash in now having got this far? Inventors don't always transition well to business operators.

I think we need to explore all the possibilities of the above three and one will eventually come out as a clear winner.

wildwest1

Thanks SeanSouth and Ronan for the excellent advice.
I have to agree with Inventors don't always transition well to business operators, and from my point of view I wouldn’t get the same buzz that I can get out of designing, researching, building and testing devices.
Try to raise Angel or Venture capital and pay the members the going rate.
Yes I also think that this is the route a team would to go down, but I would need a team first.

2. Offer the ideal candidates ownership in the venture.
Sean south has the same option as I have on this what kind of a team can you build and what sort of commitment can you expect from that team if you have no money to pay them now and no guarantee that you will have it in the future.
The device has very promising result which has been validated so it deserves a dedicated and interested team.

3. Take the idea and license it to an existing company. I think this is the route that I will look in to a bit more. I would like to have an
arrangement with the licensee where we could work together to further develop the idea.

kob29

Go on Dragons Den and get them to give you money for their expertise!