venture development framework

Using practice-based evidence, VentureWell developed the Venture Development Framework to describe the development of early-stage science and technology-based ventures. This framework can inform the development, implementation, and evaluation of programs supporting entrepreneurs. For example, it can help practitioners define program scope, develop program content, or identify program gaps and partners. For researchers and evaluators, it can inform program evaluation by articulating what milestones ventures can achieve after completing different programs.

The framework is presented in a technical brief entitled, Developing and Evaluating Programs for Early-Stage Entrepreneurs: Describing Science and Technology-Based Venture Development. 

Venture Development Framework Overview

Dimensions of Venture Development

The Venture Development Framework describes the development of science- and technology-based ventures at the very earliest stages of commercialization. It is focused primarily on a trajectory for for-profit ventures that will likely seek equity investments. It describes venture development along six dimensions:

Team & Venture Structures: The people involved in and the structure of the venture.  

Technology Innovation: The product/service, including the ability to manufacture it.

Intellectual Property (IP): The strategy and structures needed to secure venture-owned IP and to license university-owned IP (if relevant).

Market: The intended stakeholders/customers.

Business Model: How the team will make money, self-sustain, and/or disseminate the innovation.

Resources: The financing and relationships/institutional support needed to advance the venture.

Example assessment of an E-Team at 2015 and 2019

venture development framework

Venture Development Stages

For each of the dimensions, we have identified milestones: the observable changes we expect to see as a venture develops over time. We have grouped the milestones into five venture development stages that focus on teaching the following concepts to promote progress.

Explore the interactive framework below to learn more about the five development stages and their respective milestones:

vdf pie Business Model - Early Stage Growth & Market Penetration Market - Early-Stage Growth & Market Penetration Intellectual Property - Early-Stage Growth & Market Penetration Technology Innovation - Early-Stage Growth & Market Penetration Resources - Early-Stage Growth & Market Penetration Team & Venture Structures - Early-Stage Growth & Market Penetration Business Model - Investment Readiness & Early Traction Business Model - Investment Readiness & Early Traction Technology Innovation - Investment Readiness & Early Traction Market - Investment Readiness & Early Traction Team & Venture Structures - Investment Readiness & Early Traction Resources - Investment Readiness & Early Traction Intellectual Property - Investment Readiness & Early Traction Business Model - Business Model Development Business Model - Business Model Development Technology Innovation - Business Model Development Resources - Business Model Development Intellectual Property - Business Model Development Business Model - Market Validation Business Model - Market Validation Technology Innovation - Market Validation Resources - Market Validation Intellectual Property - Market Validation Business Model - Market Discovery Business Model - Market Discovery Technology Innovation - Market Discovery Resources - Market Discovery Intellectual Property - Market Discovery Team & Venture Structures - Business Model Development Team & Venture Structures - Market Validation Team & Venture Structures - Market Discovery Market - Business Model Development Market - Market Validation Market - Market Discovery

Team & Venture Structures

Early Stage Growth / Market Penetration

Milestones (Entering)

"The venture has outlined and/or hired its first employee positions.

All early-stage players are fully involved and understand their compensation.

The venture has identified its ideal board of directors."

Milestones (Exiting)

"The venture has employees with a mix of technical and business skills.

Founding team members draw a salary. The founding team has started to vest.

There is an active and functioning board of directors."

Investment Readiness / Early Traction

Milestones (Entering)

"The venture has been incorporated (e.g., LLC, C-Corp).

The team has a full-time CEO.

The team has developed a team thesis (solidifying roles) and has a founders agreement.

Team members have processes for working together (e.g., for communication and decision-making)."

Milestones (Exiting)

The venture has established a capitalization table that illustrates ownership stakes, including equity share, and a system for compensation/vesting.

Business Model Development

Milestones (Entering)

"There is a provisional team lead, agreed upon by the team. All team members are committed/spend the necessary time on the venture.

The team has both the technical skills and business knowledge to meet technology and business model milestones.

Team members have begun to identify processes and structures for working together effectively. "

Milestones (Exiting)

"There is a team leader in a full-time capacity.

The team can articulate to an outside party why they are moving ahead. "

Market Validation

Milestones (Entering)

The team has an interest in business/entrepreneurship as a means of getting their technology into the world.

Milestones (Exiting)

"The team has agreed on the path to commercialization.

Team members have considered and identified their roles.

The team has identified knowledge/skills gaps.

Team members recognize the importance of team dynamics and team development."

Market Discovery

Milestones (Entering)

There are one or two people working to solve a problem they are passionate about or a grant-backed research project. They are interested in finding out how to get their idea/technology into the world commercially.

Milestones (Exiting)

Team members have reflected on their goals for their technology and considered various paths to market.

Technology Innovation

Early Stage Growth / Market Penetration

Milestones (Entering)

"The team has a technical development plan that is aligned with IP strategy and product performance specs.

The team has a manufacturing plan for its first product."

Milestones (Exiting)

"The team has vetted and selected a manufacturer and has completed its first run.

The company has launched its product. "

Investment Readiness / Early Traction

Milestones (Entering)

"The team can articulate their innovation in both the context of a technology with vast potential and a product with a clear use case.

The team has identified a piloting partner that enables them to properly test their technology.

The team has begun to explore manufacturing/production capabilities."

Milestones (Exiting)

"The team can showcase product specs, functionality, and design to meet customer needs through a demonstration.

The team has examined manufacturing options and has identified opportunities to produce the technology at consistent, sufficient, high-quality volumes and at an acceptable cost."

Business Model Development

Milestones (Entering)

The team has developed a prototype that has been tested in a controlled/lab setting.

Milestones (Exiting)

"The team can articulate next steps for testing the technology to meet customer needs (for example, what is needed for customers to place an order or to secure funding).

The team has defined the parameters for field testing/piloting the technology and the metrics required to validate the technology.

The team has identified the types of capabilities required to
manufacture the technology."

Market Validation

Milestones (Entering)

The team presents a technology that is novel and technically feasible with some credible proof of principle (i.e., preliminary testing/bench top testing)

Milestones (Exiting)

"The team has defined priorities for technical development based on their understanding of customer needs.

The team has identified critical resources or deadly no-go hurdles for technical development."

Market Discovery

Milestones (Entering)

The team has conducted very early/fundamental research: the technology is under development and there are many potential use cases.

Milestones (Exiting)

The team has developed a research trajectory for their technology, informed by ideas about potential use cases.

Intellectual Property

Early Stage Growth / Market Penetration

Milestones (Entering)

"The team has converted its provisional patent(s) to nonprovisional patent(s) and is considering other forms of IP including trademarks and copyrights.

The team has developed its IP strategy, including processes for maintaining and creating new IP.

If applicable: The team has secured an exclusive license to the technology from the institution."

Milestones (Exiting)

"The team is implementing its IP strategy (international filings complete, process/deadlines for additional filings, legal fees budgeted, managing budgets, internal invention disclosure procedure, etc).

If applicable: The company is meeting the milestones and terms agreed upon in the licensing agreement. "

Investment Readiness / Early Traction

Milestones (Entering)

"The team has submitted provisional patent(s). The team has developed an IP position (why IP is important to business, what non-provisional patents need to be filed) and has secured legal counsel.

The team has drafted an early-stage version of an operating agreement in which the IP has been assigned to the company, not to any individuals hired by the company.

If applicable: The team has begun discussing licensing the technology from the university (if applicable) and/or has an option agreement. "

Milestones (Exiting)

"The team has a vetted plan for converting provisional patents to non-provisional patents and has begun to develop its IP strategy.

The team has decided if and where to file international IP.

If applicable: The team is negotiating/has negotiated the terms for licensing the technology from the university (if applicable). "

Business Model Development

Milestones (Entering)

"The team has begun the process of drafting a provisional patent(s) including claims.

If applicable: The team has agreement with its tech transfer office on who owns the technology (team or university). "

Milestones (Exiting)

"The team has drafted a provisional patent. The team can articulate the timeline for the next steps (after filing provisional patents), including any adjustments to the claims and to the international strategy if applicable.


If applicable: If the team owns the technology, the team has secured documentation of the waiver from the technology transfer office. Or, if university owns the technology, the team has an understanding of university policies and has begun the conversations to set expectations on accessing an option or a license. The team is working with the tech transfer office to file the provisional. "

Market Validation

Milestones (Entering)

"The team has compared its technology to other alternatives, completed a prior art search and identified novel features of its technology.

If applicable: The team has filed an invention disclosure with its university. "

Milestones (Exiting)

"The team has established a hypothesis for defensibility of its technology and determined the type of application they would file. The team understands the pathway to accessing IP (either by assignment to a company or a license).

If applicable: The team understands its university policy for ownership and licensing of a university-generated IP. "

Market Discovery

Milestones (Entering)

Often too early for defensible IP; however, some teams may have filed patents on the core technology without clear claims for utility.

Milestones (Exiting)

The team has a basic understanding of similar technologies.

Market

Early Stage Growth / Market Penetration

Milestones (Entering)

"The team has tested and vetted all of the business model assumptions. Lessons learned are reflected in financial model and sales strategy.

There is proof of customer interest; for example, early sales, contracts, or commitments."

Milestones (Exiting)

"There is a repeatable, scalable, and/or recurring sales pipeline.

The team has validated its business model and growth strategy though earning revenue and demonstrating a path to profitability."

Investment Readiness / Early Traction

Milestones (Entering)

"The team has a deep understanding of their chosen market sector.

The team is discussing what sales opportunities would look like with potential customers

The team has proof of customer interest, for example potential customers have provided letters of intent or shared resources (time, money) for validating the technology for their own context (e.g., serving as a pilot partner)."

Milestones (Exiting)

The team has documented a compelling, clear and accessible market opportunity.

Business Model Development

Milestones (Entering)

"The team has revisited the competitive analysis. The team can articulate the size of the market segment they are choosing to enter and the value chain in which they are operating.

The team has engaged with customers/stakeholders to verify and iterate upon value proposition. First customer market segments provide strong substantiation of the business case; for example, by letters of support validating the demand."

Milestones (Exiting)

The team has completed market testing with multiple customers/stakeholder groups in their value chain to validate the technology's basic market assumptions (e.g., end-user context, needs, constraints) and to refine the value proposition.

Market Validation

Milestones (Entering)

The team can describe the key partners and competitors in the market, understands the dynamics of the problem their technology will solve, and can articulate why their technology is superior to alternative products (problem-solution fit).

Milestones (Exiting)

"The team can clearly identify the specific market(s): who and how the technology will be used.

The team can articulate a clear business thesis and an initial value proposition: a description of the perceived value or importance of the product from the customer/stakeholder perspective (""demand"")"

Market Discovery

Milestones (Entering)

The team is aware of a societal or technical problem/challenge (a "need") that their technology may address.

Milestones (Exiting)

"The team has identified use-cases for the technology and grouped customers into market segments.

The team has begun to analyze the pros and cons of alternative markets."

Business Model

Early Stage Growth / Market Penetration

Milestones (Entering)

"The team has tested and vetted all of the business model assumptions. Lessons learned are reflected in financial model and sales strategy.

There is proof of customer interest; for example, early sales, contracts, or commitments."

Milestones (Exiting)

"There is a repeatable, scalable, and/or recurring sales pipeline.

The team has validated its business model and growth strategy though earning revenue and demonstrating a path to profitability."

Investment Readiness / Early Traction

Milestones (Entering)

The team has conducted a cost of "goods sold" analysis and vetted unit economics, value chain economics, and other key financial assumptions (both bugeted spending and revenue projections).

Milestones (Exiting)

The team has validated components of the business model. The team has built an initial financial model and financial packet, including bottom-up sales projections and a customer acquisition/demand generation strategy. The team has identified most business assumptions.

Business Model Development

Milestones (Entering)

The team can describe the customer base willing to pay to solve the problem they have identified (conceptual product-market fit).

Milestones (Exiting)

The team has developed a draft business model articulating the industry-specific marketing strategy, cost/pricing structure, distribution channels, and potential partners that need to be tested/validated.

Market Validation

Milestones (Entering)

The team has identified a pathway to market and has a sense of the pros and cons involved with pursuing the chosen pathway.

Milestones (Exiting)

The team can describe possible revenue streams, how their competitive position impacts their goals for development of the technology, and potential alignment with a market opportunity.

Market Discovery

Milestones (Entering)

The team has a desire to move the technology into the world but no/limited sense of how to do it or what options exist.

Milestones (Exiting)

The team has considered various pathways to market (selling a product, selling a service associated with the product, licensing, partnering, open-sourcing, etc.). The team has considered the needs and perspectives of potential customers.

Resources

Early Stage Growth / Market Penetration

Milestones (Entering)

"The team has secured an initial round of angel or seed funding and is launched into early commercial phase.

The team has secured a workspace and the technology, lab, or equipment resources it needs to commercialize their innovation (independent from their research institution)."

Milestones (Exiting)

The team has secured the funding needed (from whatever sources) for a year's worth of operations.

Investment Readiness / Early Traction

Milestones (Entering)

"The team has secured at least some outside, non-dilutive funding.

The team intends to pursue equity funding within the next 6-12 months.

The team has a clear plan for infrastructure needs and ideas for a funding transition out of the academic context (if applicable)."

Milestones (Exiting)

"The team has a well-developed fundraising strategy with milestones and has completed key deliverables needed to raise funding (term sheet, pitch deck, advisory board, regulatory strategy, etc.)

The team has a financial plan, which includes a cash flow forecast, a high-level income statement and a balance sheet."

Business Model Development

Milestones (Entering)

"The team is likely supported by grants.

The team can articulate how their profile and goals may align (or not) with different types of external funders or partners. The team has a basic understanding of the types of funders that can support the venture.

The team has secured the necessary relationship to support development of the technology, including institutional support for product development and a technical/medical advisory board."

Milestones (Exiting)

The team has strengthened external relationships and understands key concepts (potential suppliers, regulatory requirements for financing, milestones funders expect, processes for engaging funders) that can help them to secure funding and other resources.

Market Validation

Milestones (Entering)

"The team may be funded through academic research grants, pitch competition awards, and/or friends and family.

The team has secured initial advisors and institutional support (if applicable). "

Milestones (Exiting)

"The team can identify the type(s) of funding/resources needed for their desired pathway to market.

The team can articulate the types of experts/strategic partners they need and has begun to develop key relationships, for example with technical or medical experts."

Market Discovery

Milestones (Entering)

"The team is self-funded/ volunteer-based or funded through academic/fundamental research grants.

Grant-backed teams may have advisors or partners."

Milestones (Exiting)

The team understands the resources needed to bring a technology to market and has generated ideas for where they might find financial, infrastructural, or intellectual/expert support.
Market Discovery Icon

Market Discovery

Market Validation

Market Validation

Business Model Development Icon

Business Model Development

Investment Readiness Icon

Investment Readiness & Early Traction

Early-Stage Growth Icon

Early-Stage Growth & Market Penetration

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