James Dyson knows a thing or two about innovation.

As the brains behind the iconic Dyson bagless vacuum cleaner line and the Dyson Air Multiplier fans, he has invented some of the best household items we use every day. What you might not realize is that he also runs a foundation dedicated to encouraging young entrepreneurs in the field of engineering and design.

I caught up with him recently to find out what it takes to be an inventor and create products that are so innovative, they attract the attention of the masses.

1. You only have one thing to say to an entrepreneur about innovation, what would you say?

Act on frustrations and persevere. Set out to solve a problem that frustrates you, and stay focused on it through the inevitable failures and setbacks.

2. How important is iteration and what have you learned about it?

To be an inventor you have to believe that there is always a better way of doing something. And, you can't expect to get it exactly right the first time. Every iteration can be improved upon, and each of these failures teaches you something that you can apply to the next iteration. It took me 5,127 prototypes--5,127 iterations--to develop the first bagless vacuum cleaner. It's highly frustrating, of course, but worth it.

3. How do you know when to stop iterating?

You stop iterating when you have solved the problem you set out to solve. But it's not a full stop--more of a pause. Because there will be more ideas, and advancements in technology that will create possibilities. There is always progress to be made and at Dyson we continually question how we can make something better.

4. Do you feel a product like a vacuum or fan has to be a little better than the competition, much better, or twice as good? Why is that?

I don't worry too much about what the competition is doing. Ideas are borne out of frustration. And the aim is always to solve these problems--to make things more efficient.

5. How do you know when your innovation will be a success, and not a novelty?

It's difficult to know something will be a success when you set out to make it. Often it's a stroke of luck or serendipity when you stumble upon an answer to something in the lab. That's why I encourage my engineers to think big, to experiment and tinker. But the focus should be on the function not form--design is only beautiful when it actually works. It's easy to get caught up in the beautiful design of a product, but as soon as you ignore its true purpose, it becomes a novelty. Everything we do at Dyson aims to be functional above all--to solve a problem.

6. What was the exact moment when you first realized you could innovate?

I'm not sure there was an exact moment, but I discovered it quite late in life. Nobody taught me that engineering or invention was a viable career path early on. That's why I started the James Dyson Foundation--to inspire young people to tinker and invent, so they realize their engineering potential.

7. What's more important, the idea or the money behind the idea? Which one would you pick if you could only have one?

The idea--I am and will forever remain an engineer--what excites me is being able to go into the lab every day and try to solve a problem. But you need the resource--the investment to develop these ideas into viable products.

8. What do you feel is the biggest problem you have solved? 

I believe everything I've invented aims to make life a bit easier. A vacuum that doesn't lose suction, a hand dryer that actually dries hands quickly and hygienically--they're all designed to be more efficient and to save you time.