The Power of Networks
By: Daniel Schepis
Tags: Innovation, Networking, Funding, Technology, Commercialization

In November I had the pleasure of facilitating a panel discussion on the role of networks in commercialisation for the Commercialisation Studies Centre. There were a number of fascinating insights from the distinguished panel of business leaders Samantha Tough, Peter Rossdeutscher and Brodie McCulloch, who brought diverse perspectives of the innovation and commercialisation process. A recording is available below and I have also summarised a few key takeaways.

The webinar was framed around a theoretical discussion of Relational Proximity, an emerging perspective useful for understanding the shared characteristics which support collaboration in networks. The underlying logic of proximity suggests there is optimal closeness between firms across five dimensions:

My recently published study identified how specific activities such as hackathons and living labs increase proximity across these different dimensions and can be critical to start-ups forming relationships in new markets. This empirical evidence resonated with the experiences of the panellists, who were able to share their own examples in various commercialisation contexts:

Samantha emphasised the two critical facets to commercialisation are finding the right partners and receiving advice on the most appropriate funding/structure, none of which can be ‘done in a vacuum’.

Similarly, Peter framed commercialisation as ‘very much a team sport’, requiring social capital investments built over time (and over coffee) which then provide the introductions needed to advance projects.

Reflecting on the state of the Western Australian ecosystem, Samantha proposed that the small size and isolation of W.A created opportunities for pilot testing innovation relative to larger, more competitive markets. This aligned Peter’s suggestion that demand must be amalgamated across industries within W.A to gain enough traction.

There was unanimous agreement about the positive trajectory of the entrepreneurial ecosystem in W.A, with Brodie identifying several activities such as weekly meetups and new co-working spaces, which have helped to increase density and improve resilience across all levels despite low investment.

In contrast, the panel also shared thoughts on the State’s limitations in commercialisation, namely many firms lack a global outlook which is particularly critical given the insufficient ‘patient capital’ available for early stage ventures.

Panellists believed that while partnerships between diverse firms of different sizes and industries (including university researchers) were most valuable, these networks did not interact enough to identify common interests and align incentives.

Peter shared his approach to bridging cognitive divides through identifying common problems shared across industries and then assembling clusters of innovators around these key opportunities. This strategy can provide a commercialisation pathway by market testing in progressively harder to access industries, thereby building proof of viability while scaling.

Brodie suggested that firms recognise the value of co-location to accessing and exchanging knowledge, which he believes will persist despite current challenges shifting many work routines online. He offered an anecdote that as soon as Covid restrictions eased in Perth, people rushed back to face-to-face events.

The significance of networks and networking to the complex process of commercialisation was underscored by all panellists, with their experiences adding depth to our understanding of how they operate. A key takeaway of the event is that network size or number of connections are not necessarily most important, but rather the content of these relationships and the manner in which they collaborate over time.