While Stanford’s gain from Google is unusual, technology-transfer agreements have long been the primary means by which universities support and profit from startups. However, as Facebook illustrates, more student-founded companies are bootstrapping without university technology, leaving schools without any profit — though that may be changing.
“The university has always been a supplier of both technology and talent,” says Frank Rimalovski Managing Director of the NYU Innovation Venture Fund “and its our job to foster and support that.” Rimalovski’s fund, which was created by the university in 2010, makes seed and series A investments in startups with ties to NYU. To date the $20 Million fund has made three investments two of which — Fondu and numberFire — were started by current students with no ties to university technology. “There’s definitely been a groundswell of entrepreneurial interest from students,” says Rimalovski “and if there’s another Zuckerberg walking around our hallways, we want to be as supportive as we would of a faculty member working on a new cancer therapy.”
“Young people have always wanted to change the world,” says Hugo Van Vuuren, a founding partner at the Experiment Fund (xFund), a new seed-stage investor housed at Harvard’s Graduate School of Engineering. What’s new, says Van Vuuren, is that their turning to startups as vehicles to do so. Van Vuuren’s fund, which was announced in January, has already made a number of small investments in high-profile startups like RockHealth, led by Hall Tecco (MBA 11′) and Omada, co-founded by Sean Duffy, currently on leave from Harvard’s MD/ MBA program.
“The culture on campus is definitely changing,” says David J. Miller, a researcher at George Mason University’s School of Public Policy who studies student entrepreneurship, “universities are under tremendous budgetary pressure in terms of outside funding and also from students paying tuition.” Rimalovski agrees saying “to be a real player as a university today, you have to engage students and faculty who are increasingly interested in starting companies.”
While university investment in startups outside of technology-transfer is fairly new, college campuses have long been a breeding ground for new businesses. Years before Brin and Page, Michael Dell was selling PC kits out of his dorm at University of Texas-Austin and Bill Gates was writing computer applications in his Harvard dorm. “The emphasis on tech-transfer is definitely misguided,” says Miller “when you look at the most successful entrepreneurs, technology is rarely a decisive factor — Bill Gates was definitely not the best coder around.”
I am no expert, but i think Highland Capital is a well known firm. Well, the partners there seem to agree with me that something is happening on campus with student entrepreneurs. Check out their Summer@Highland program,
Summer@HIGHLAND is a 5-year old entrepreneurship program designed to provide university-affiliated startups with the environment and resources for taking their initiative/company to the next level. The program is “founder friendly”: Highland receives no equity stake in exchange for a team’s participation, and teams are under no obligation to Highland after the summer. Our only priority is helping entrepreneurs and their teams significantly advance their startup over the summer.
Selected teams will receive $15K, free office space in Highland’s Cambridge or Menlo Park office, and the opportunity to work closely with the Highland team and an incredible network of founders. Teams will also have access to the Summer@HIGHLAND Speaker Series, which has included founders, CEOs and experts from technology leaders.
You have about 68 days to get your applications in. (Early deadline is March 1, 2012, and regular deadline is April 5, 2012).
It is interesting to note that they are not looking for business plans, but for applicants that have taken some action, on a scalable path, and are entering large markets. This is about high impact student firms, not basic t-shirt shops (so yes, they would have rejected Marc Ecko!).
Trouble on the technology transfer front from the University of Texas. I will have to learn more, but here is the one line pitch — uber successful California biotech researcher Richard Miller is lured to Texas to lead the way as the first commercialization chief, but quickly runs into conflict of interest issues for being too entrepreneurial! From Kirk Ladendorf at the Austin Statesman.
Miller, a veteran biotechnology researcher and entrepreneur in California, went to work for UT in September 2010 to help turn more of the school’s research discoveries into new jobs, companies and licensing income. As part of his job, he oversaw the work of the Office of Technology Commercialization, which assists companies that are interested in using patented UT technology and negotiates licensing deals with them.
Miller resigned effective Dec. 31 after he was told by UT officials that he could not have a personal and financial involvement in companies that might want to license technology developed at UT.
UT generated $25.6 million in licensing revenue in the most recent fiscal year and completed 29 new licensing and options agreements, according to the commercialization office’s website. The school also received 58 U.S. and foreign patents last year.
Juan Sanchez, UT’s vice president of research, said there was no active conflict of interest with Miller’s involvement with the companies because they had not yet licensed technology from UT. However, Miller “was setting up a scenario in which he would be negotiating with himself, and that would have been a conflict of interest, which we would not allow,” Sanchez said.
“We couldn’t move forward with his expectation of having a dual role” with the companies, Sanchez said. “It was clear that he would have to divest his interest. The resignation was his call. I would have liked him to remain as chief commercialization officer, but he chose not to.”
Sanchez said he instructed Miller in December to divest his interests in three startup companies that he had co-founded with UT faculty members and graduate students. Miller did divest his holdings in the three companies — Wibole, Graphea Inc. and Ultimor — but resigned sometime after that discussion, Sanchez said.
Get the most out of university technology transfer is a common cry, its no wonder we are running into scenarios such as this.
Over the past decade, UT has stepped up its efforts to generate more revenue from technology licensing. Part of the reason is faculty pressure and recruitment of top-level researchers. Both new recruits and existing research faculty have pressed the school’s administration to take a more proactive role in tech commercialization.
Pike Powers, an Austin lawyer and veteran economic development activist, said Miller brought new ideas to UT but might not have understood the constraints of working for a public university.
“He was offering some new ideas and thoughts about ways that the University of Texas could be more competitive,” Powers said. “I don’t think he received as strong a reception as he wanted to receive, so it was frustrating for him. He met with numerous members of the business community, and we advised him to be very careful about what steps he took next and to make sure he had the full support of the business community and the UT administration. But I don’t think he ever heard that message to the extent that he should have.”
What I find interesting is that people are looking for entrepreneurial leaders, but they also demand consensus. That is a little backwards no?
Some interest debate surrounding the funding and mission of government funded research is taking place in the wake of Minister for State Universities and Science David Willetts speech on making the UK the global science research leader. Professor Stephen Curry provides great coverage of the debate in the Guardian:
Willetts’ musings on role of government in directing science were more interesting, and included some practical ideas for how ministers might effectively access scientific expertise in order to guide research investment. He was careful to emphasise the sanctity of the Haldane Principle and peer review, which enshrine the rights of the scientific community to judge grant applications on scientific merit. Nevertheless, the minister did not shy away from the conundrum that he has a democratic responsibility to shape policy that is beneficial to the UK economy. Such strategic choices will necessarily colour views on research priorities.
The scientific community should be heartened to hear a government minister speak so confidently of the potential of science to feed into economic growth. It was an argument that the community relied on in the run-up to the Comprehensive Spending Review in October 2010. But scientists remain wary of government interference in what some see as their exclusive domain. Coincidentally, evidence of that wariness was provided in letters from leading scientists to Times Higher Education and the Daily Telegraph in the days following the speech, which criticised what they perceived as excessive interference by the Engineering and Physical Sciences Research Council (EPSRC), in the process of awarding public money for science. The signatories to the letters were particularly critical of strategic decisions by EPSRC to focus on particular research areas, to judge the potential long-term impact of the proposed research in assessing applications and demanded rebalancing of decision-making power away from EPSRC officials and back to scientists.
I am in the midst of a deep dive into technology transfer on campus and came across Technology Transfer 2.0 (from Triple Helix Innovation). Here is Melba Kurman‘s list of top 5 events from 2011 that will shape university technology transfer:
But my sense was that this year’s big events will make their true impact felt over the longer term.
With no further ado, here’s the short list.
American Invents Act
Stanford vs. Roche
Drug companies begin to invest in Chinese R&D labs
More proof that entrepreneurship is not a level playing field
Who took New York? Cornell vs. Stanford
Later, she goes into detail on each of the top five. From the Who Took New York:
Not everyone bought it, though. Some cynics wondered whether Mayor Bloomberg, a top-notch politician, was pulling a Tom Sawyer, tricking others into paying him for the opportunity to do his job of painting the fence (or in this case, cleaning up waste on Roosevelt Island and building a new campus). According to this perspective, Bloomberg brilliantly played the egos of two the big universities against one another. Their prize? The privilege of spending billions of dollars to clean up and develop a piece of his city. But thankfully for the tech campus, nobody listened to the cynics.
In October, final proposals for the tech campus competition were submitted. And the intrigue intensified. Stanford abruptly dropped out of the race. Some claimed that Stanford got scared at Cornell’s enthusiasm and “quit before it could lose.” A more diplomatic proffered reason was that Stanford was not used to the east coast style of negotiating deals.
According to the Chronicle of Higher Education, apparently Stanford walked away from final negotiations because of two major terms it disagreed with. First, the city demanded that Stanford accept full liability for any problems from whatever toxic waste may lurk on the campus building site. And second, the city also demanded that Stanford stay with the project, even if the city failed to provide its originally promised $100-million contribution.
In contrast, in its proposal, Cornell enthusiastically agreed to do whatever it took. Luckily, a Cornell alum donated $350 million to the project (wasn’t me) only hours after Stanford’s withdrawal since somebody’s gotta pay for all the building and faculty salaries and site cleanup and stuff.
Looking forward to reading the Tech Transfer 2.0 blog into the new year.
Just read an interesting piece about University of Cincinnati’s efforts to offer more entrepreneurial opportunities to students and faculty in its engineering programs. (h/t tto2newco).
Apparently Dean Carlo Montemagno of the College of Engineering and Applies sciences is an educational innovator at UC. From the Enterchange:
He soon will launch an Entrepreneurial Innovation Center, too. In recent interviews, Montemagno revealed to the Enquirer the first details of a university initiative to create high-tech, high-paying jobs and drive economic development in this region.
Likely to open at the Edgecliff campus in Walnut Hills, the innovation center will give his college’s 140 professors and 4,300 students access to workshops, mentors, lab space and an engineering accelerator program to help build and launch businesses.
A new entrepreneurial sabbatical allows professors a year away from teaching in order to start their companies.
Eventually, all three efforts will be open to faculty and students in other UC colleges.
“The idea is to remove the wall between discovery at universities and implementation in the economy,” Montemagno says. “It ensures the relevancy of the research to fit the needs of the economy.”
From a recent university press release on the entrepreneurial initiatives:
University of Cincinnati officials today signed a memorandum of understanding (MOU) designed to increase the level of technology commercialization in Southwest Ohio.
Signing the MOU between UC and the Hamilton County Development Corporation were Santa Jeremy Ono, UC provost and senior vice president; Carlo Montemagno, dean of UC’s College of Engineering and Applied Science; and David Main, president of the Hamilton County Development Co., Inc. (HCDC) and Hamilton County Business Center, Inc.
The non-binding MOU intends to foster a culture of innovation and entrepreneurship within the university’s College of Engineering and Applied Science (CEAS) by promoting the creation of technical businesses based on the research achievements of faculty, students and staff. This enterprise is expected to encourage the creation, development and growth of innovative ventures by leveraging the combined strength of UC’s technology expertise and HCBC’s entrepreneurial assistance services.
I have been looking and I see no mention of the Carl H. Lindner College of Business at the University of Cincinnati in any of the materials discussing these recent initiatives.
I received a marketing email from FrugalDad.com sharing an infographic they put together on patents. The Problem with Patents infographic is based on an NPR story so it clearly has a point of view. The involvement of major research universities and technology leaders such as Stanford, Texas, and University of Pennsylvania is what has piqued my interest. From Jason at Frugal Dad: