MGCS Panel of Startup CEOs and Venture Investors Discusses Commercializing University Research
The research labs, entrepreneurial programs, venture incubators and startup accelerators on university campuses across the country provide fertile ground for originating, road-testing and commercializing new discoveries in science, medicine, engineering and other fields that have the potential to change the world. But the process of turning great ideas into great startups with great investment potential can be as challenging at times as it is rewarding.
A discussion group of entrepreneurs who have licensed university technologies and venture investors who have taken stakes in university spinouts presented their perspectives on research commercialization during the Nurturing the University Start-up panel on Tuesday, May 17, at the 2016 Michigan Growth Capital Symposium.
David Wentzloff, co-CTO of PsiKick, advised university faculty to validate their research ideas in the lab first and then to disclose patentable discoveries to their respective university’s technology transfer or commercialization office. Wentzloff, who is a professor of electrical engineering and computer science at the University of Michigan, co-founded PsiKick with a collaborator at the University of Virginia in 2012. The startup is developing battery-less systems for highly disruptive Internet of Things and industrial Internet applications.
“Learn quickly and from good people,” Wentzloff remarked. “Gain all the knowledge you can about the entrepreneurial process and put your feelers out for people with entrepreneurial experience who can help you.” Other advice he offered included:
- Assemble the right founding team ─ “It’s more like a marriage.”
- Attract qualified advisers and board members with startup experience
- Create a sound business model
- Identify a potential target market
- Apply for government grants to fund initial startup operations
- Seek introductions to interested angel and venture capital investors
Matt Bell, a principal at Cultivian Sandbox Venture Partners, injected a venture investor’s viewpoint on licensing, technology transfer and spinout companies to the panel discussion. “Do your homework before you sign a license agreement and make sure you understand why the university is requiring it,” he advised researchers and faculty. “Ask questions about intellectual property ownership, because various universities have different policies on IP.” Intellectual property arising from federal government-funded research requires compliance with certain formalities stipulated by the Bayh-Dole Act.
The timing for launching a spinout can vary from “do it now” to “maybe do it never,” Bell conceded. However, he urged principal investigators and inventors to develop and leverage an ecosystem of entrepreneurial experts to help guide them through the formation, launch, operation and financing of their company.