Improving the Tech Transfer Process
I was finally able to sit down and watch the two hour video of the June 10, 2010 testimony “From the Lab Bench to the Marketplace: Improving Technology Transfer.” Several witnesses from different backgrounds (university tech transfer offices, VC, startup and NSF) shared their perspectives and recommendations about university technology transfer to the House Committee on Science and Technology, Subcommittee on Research & Science Education.
Lesa Mitchell, Vice President of the Kauffman Foundation summed up effective university technology development very nicely, I thought, as “opportunity recognition and analysis.” By now, many people who follow U.S. university research policy issues are familiar with Kauffman’s proposal to improve the effectiveness of university technology transfer services by allowing university researchers to choose their own commercialization agent (meaning they may opt to not use their university-provided technology transfer office). More specifically, while Mitchell made it clear there is no single model for all university technology development programs, she recommended that federal funding agencies:
- Push to increase the transparency of research resulting from federally funded research through an Innovation Exchange database.
- Should hold university technology transfer effectiveness reviews to identify under-performing universities.
- Fund proof-of-concept centers to provide seed money and expert mentoring for new businesses based on university technologies in addition to entrepreneurship education at universities to educate students and university researchers.
After watching and reading similar testimonies and special reports, I’ve started to notice common themes in what panelists perceive as barriers in the current university tech transfer models and similar overlap in their resulting recommendations for improvement.
Perceived barriers from majority of panelists were:
- University technology transfer offices take too long to license their technologies.
- University researchers and student should receive more support from their universities to pursue entrepreneurial paths while retaining a solid academic career. Suggestions included giving university researchers entrepreneurship sabbaticals, business training and mentorship and proof of concept centers where they could find funding to develop their technologies into viable businesses.
- Early stage funding for startups is the make-or-break factor in their eventual demise or success, and that most university startups die due to lack of available seed funding.
The most consistent recommendations offered by panelists were to:
- Impose additional metrics and record-keeping onto universities and researchers, or
- Spend more federal money on campus-based entrepreneurship education and help small companies based on university technologies bridge the infamous “Valley of Death” with more easily available seed funding.
So at the end of two hours of expert testimony, what needs to change and what would make things better?
We need less reporting, fewer reviews, fewer metrics. Instead, we need simple self-regulating systems that are technology based, that force transparency (hence accountability), and require minimal reporting and federal oversight. University tech transfer offices don’t need more metrics or performance reviews. While well-intended, asking universities to collect more and more metrics to defend their existence simply creates another layer of unwelcome bureacracy. Even honest people (unintentionally) game their metrics – whatever you ask people to count is where they’ll put their energy, whether or not it’s best for the organization.
We don’t need more entrepreneurial education, either. If they’re going to launch a startup, faculty and students already know the basics and the standard “Startup Bootcamp” offered at many university TTOs helps only the pure beginners. Would-be entrepreneurs need detailed tax, regulatory and other business advice, but it would be impossible to structure an on-campus class that could address the range of unique questions and needs people will have. Seed funding? Maybe, but who would give it out and how would they choose? Also, friends who have started a small business tell me that a major reason they do not seek external funding is that they risk losing control of their startup. It’s their dream, their vision, and they’d rather ask their parents for the money or live in a friend’s basement than suddenly have uninvited outsiders in the mix.
The best simple, self-regulating recommendation to improve the accountability and transparency of university technology transfer offices came from Neil Kane, serial entrepreneur, currently at the helm of a startup called Advanced Diamond Technologies. In his testimony, Kane proposed that the Bayh-Dole Act be modified to mandate that all *completed* licenses between universities and businesses be made publicly available, so researchers, companies and entrepreneurs could compare notes and know what to expect when licensing university intellectual property. (Publicly available license templates containing standard terms are already in use by some university tech transfer operations, but as far as I know, no one is sharing the content of completed licenses.) What’s intriguing about Kane’s proposed approach would be that
- Standard and public licenses would dramatically shorten negotiation times.
- Uploading completed licensing agreements would be an easy, low cost workflow adjustment for university technology transfer staff since they’re scanned into pdf format already.
- Simply opening up license agreements to public scrutiny would completely sidestep the operational burden of reporting mandatory performance metrics or conducting performance reviews.
Kane’s statement offers some interesting food for thought:
“Rather than seeing themselves as stewards of public property, due to the Bayh-Dole Act, universities have to come to believe that innovations developed with federal funds are theirs. I suggest modifying Bayh-Dole to require that any license agreements executed for subject technologies become publicly accessible. This should be legislatively mandated. Universities will vigorously oppose it, but it will level the playing field and reduce transaction costs across the board. This action will dramatically shorten the time needed to get companies formed and licenses executed. From the university or federal lab standpoint, the public contract should change from “the government funded it but we own it,” to “if we want to profit from retaining title to the intellectual property which was funded by the taxpayers, then we have to be willing to tell the taxpayers what we charged them for it.”
Melba Kurman writes and speaks about innovative tech transfer from university research labs to the commercial marketplace. Melba is the president of Triple Helix Innovation, a consulting firm dedicated to improving innovation partnerships between companies and universities.
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