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The Right Business Model - Case Study

A breakthrough technology with real industrial potential is not always enough. Successful commercialization requires a clear market strategy.

French start-up company IT Concept was established in 1991 to exploit a discovery made in the laboratories of the national research institute, CNRS, by Robert Verger.

Lipases, a group of enzymes which break down oils, are widely used in industry, especially in detergents. Verger found a way to study lipase activity by measuring variations in the interfacial tension at the oil-water boundary caused by the oil's decomposition. The effect was well known, but at the time Verger built and patented a prototype tensiometer no one had produced a commercial instrument.

Cool tool

"Alain Cagna signed a licence agreement, and IT Concept quickly developed a tool which for the first time allowed enzyme activity to be characterized directly in mediums of different temperatures and acidities," says Cagna's partner, Bernard Delorme. "It soon attracted considerable interest both from manufacturers and industrial users of lipases."

In 1994, an instrument was sold to the Dutch multinational Unilever, but other potential customers were slow to place orders. Cagna and Delorme found that, with minor hardware and software modifications, the tensiometer could be used to study not only lipase activity but also the stability of foams and emulsions, and they began to promote it as a generic device for the measurement of interfacial tension.

"Emulsion stability determines the shelf-life of foodstuffs such as mayonnaise, while foam stability is important for a range of products, from champagne to industrial cleaners," Delorme explains. "Stability in turn depends on interfacial elasticity and viscosity. Our software could measure these factors quickly by analyzing the response of a droplet to controlled perturbation of the interface, captured in a sequence of CCTV images."

Planning for success

Shell Petroleum bought an instrument to study high-temperature bitumen-water emulsions, and contacts with Unilever's food manufacturing division convinced Cagna and Delorme that there was potential in that sector as well. But by this time, IT Concept was running out of money. It had developed a series of terrific instruments, but it had almost no paying customers.

The definition phase of an Innovation project(1) proved a turning point for the company. Thorough analysis of the market potential focused its efforts on the food and drink sector, and identified two representative end-users to test and publicize new applications. Other development work, outside the scope of the project, was to be undertaken only on a commercial basis, as contract research.

"The reference applications for emulsions and foams have helped us to explain the technology to other potential users, and have enabled us to establish partnerships with distributors in Norway, the United Kingdom and the United States," says Delorme.

From a base of profitability, IT Concept is now targeting the chemical industry, and in 1999 recruited a chemical engineer to develop the applied research and test service side of the business.

(1) IN10381I - Dynamic drop tensiometer for the measurement of dynamic interface properties in emulsions and foams in food industries.

Contact

B. Delorme, IT Concept
Tl. +33 4 7470 2820
Fx. +33 4 7470 2824
E-m. itconcept@compuserve.com.

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