All Posts By

Claire Lebedeff

COACH YOUR STARTUPS TO COMMERCIALIZATION

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When it comes to securing partnerships, funding, and interest on technologies and/or startups, there are a multitude of things that can halt the process – most of which are outside the sphere of control of the TTO or the PI. [A lot of them can be attributed to the Valley of Death] With all of those unknowns floating around, it is important to take some time and figure out how to execute what is in your sphere of control.

This is where the TTO staff can step in and build a relationship with the PI and work with them together and one of the first spheres of control that the TTO must address. A key role of the TTO is to be a viable partner– a place where science based researchers can come for guidance on matters outside of their immediate knowledge; including legal and general business strategy. A successful office will take this opportunity to mentor PIs in how to market and pitch their discoveries.

Which brings us to a second item in the sphere of influence: helping researchers successfully pitch their ideas. Often times it is difficult for inventors to funnel their ideas of how their innovation can be applicable in a commercial setting. Like any pitch, lack of focus typically will result in lack of interest from potential investors or collaborators.

Below are some tips on how to help your researchers tell their story better so that when they meet with potential research partners, investors and angels; they will be heard in a meaningful way.

How did they discover this invention? Where did their idea come from? What there a gap in the market? What is an accidental discovery that was applied to a real world problem? Do they have a personal back story? All of these questions will help your PIs and researchers start the foundation of the story (pitch) and draw in potential partners as to why they are listening.

2

Help them describe their technology with ubiquitous language. It is easy for scientific researchers to use overly technical jargon – which will be necessary at some point in discussions. One technique is to encourage the use of analogies. Helping your researchers simply and easily describe the technology will help draw more potential collaborators into the discussion.

3

Start formulating the reasons why potential partners will want to work with your university and researchers; and quantify your answer. Will you be more cost effective? Provide better results and accuracy? Take less time?

Offering one-on-one sessions or even take groups of PIs and researchers and host short seminars on how to prepare for their commercialization ventures. The most successful offices are approaching researchers as partners and vice versa.

If you are a TTO or PI and want to learn more ways to extend your reach in contacting potential industry partners, you can

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THE LEAN STARTUP & CORPORATE INNOVATION

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McKinsey put together 3 videos where corporate CEOs shared how their companies were implementing open innovation practices and what they found exciting about open innovation.  Scott Cook, Intuit’s CEO, made a comment that he thinks corporations need the lean method more than startups do. My ears piqued and thus I went on an online exploration of Cook’s thoughts on why corporations should act like lean startups. It turns out that he has been saying this for years, articles date back to 2011.

At Intuit there is a culture and system in place that fosters corporate Intrapreneurship but there are other avenues in which a corporation looks to innovate; VentureBeat recently discussed this and outlined 10 common corporate innovation programs. My question is, how can we take this lean method and this culture of innovation and extend it to the other programs? It is mentioned in the article that there is potential for some to be combined, but if we look at this graphic we see that 2 of the top 5 activities fall under a very classic definition of open innovation and that is, to look externally for solutions to problems.

Corporate innovation can occur in one of two ways:

  1. Technology push – driven by science, this is when a corporation has a technology where they are seeking application.
  2. Demand pull – driven by users, where companies take user feedback to feed their products.

 

Intuit has successfully (and unsuccessfully in some cases) used both methods. What is clear in Cook’s comments it that he thinks corporations need to have the mindset and the ability to quickly test and iterate ideas in order to be successful in innovation. In short, they have to act like startups in that sense and keep barriers low. Yet it could be argued that startups need to act like large corporations in order to commercialize, or rather have some of the resources. So while startups show large companies a model for organizational structure, the large company has things they can bring to the startup that can help make technology transfer and commercialization successful, namely:

  • R&D resources
  • Access to external technologies & equipment
  • Systematic technology transfer methods

 

When it comes to open innovation and technology transfer, there is an overarching systematic approach and behaviors that apply to both startups and corporations. There are distinct differences between startup and corporate culture and structure that present challenges for each side when it comes to the innovation framework, but the real opportunity presented is for these two to work together in order to maximize results.

Scott Cook is right; corporations do need the lean framework – and on the other side of the coin, startups require the resources of industry. In short, the strenght of industry and startup partnerships and collaborations have great reward potential.

 

To learn more about how to find a potential partner for your problem or your technology, click to

FOR RESEARCH INSTITUTIONS: THE GROWING OPPORTUNITY FOR INDUSTRY COLLABORATION

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Recent research tells us that corporate research has become less centralized in the last 35+ years.

According to R&D Magazine, “Academic-industry partnerships are becoming increasingly robust and collaborative as a result of growing economic volatility, competition from emerging economies and a rapidly evolving technological landscape that has changed the way people work, exchange information and conduct research.”

What does this trend mean for technology transfer professionals?

As industry focus moves away from internal R&D, there is a greater need – and opportunity – for universities to engage in industry collaboration. University technology transfer has existed for many years, but based on changes in industry R&D, the role of the university in society has never been more important.

We predict three exciting impacts for university technology transfer advocates:

1. More sponsored research agreements (SRAs)

As corporate investment in internal R&D falls, the need for research is still there. From basic research to specific research neds, corporate technology scouts will turn to SRAs to find the next great breakthrough.

Building relationships with research labs is becoming more and more essential for industry. Research labs and TTOs, take note.

2. More interest in licensing university technologies

For smaller universities and research institutions, it isn’t always easy to get industry’s attention.
However, these days even the world’s leading companies need to expand their networks to find the best technologies. That means more networking with technology transfer offices, inventors, and spin-offs. (To help your institution’s inventors prepare for meetings with tech scouts, check out our post on how to impress tech watch.)
Eventually, you end up with excited licensees who won’t let your institution’s hard-won patents go unused.

3. More great innovations on the market

If corporations are focusing more of their efforts on the commercialization of technologies, that is a form of specialization. If the transition is managed well, it means that both the research side (at univerisites) and the commercialization side (industry) will become more robust. This transition could lead to more funding for research, faster innovation, and better products that are a true benefit to society.

Interested in connecting with industry? Join seedsprint – a community that connects industry to science-based innovation.

IP LICENSING & VALUATION MODELING – FROM CLEARVIEW IP

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If you want to boost revenues in your liensing office, an IP strategy is crucial.  Our friends over at ClearViewIP recently touched on how applying financial modeling [a service they provide] can augment your IP strategy and answer questions like:

What commercialisation strategies are available for my intellectual property?

How do the IP strategies compare?

Who is the most suitable partner for my innovation?

 

Today, they have allowed us to share their article [original post here] on how you can use financial models to inform your IP decisions:

The benefits of financial modelling for IP monetisation

Financial modelling allows you to project and visualise potential returns you can generate from your intellectual property. Financial modelling lets you create a present-day assessment of the potential value of your intangible assets based on multiple IP monetisation strategies. Model visualisations, such as the graph below, allow for an in-depth study of your year-to-year projected returns based on multiple scenarios. These graphs are supplemented by key model metrics which allow comparisons between different valuation models.

These outputs can be used for a variety of purposes including understanding the potential future value of your intangible assets and supporting strategic decisions concerning your IP, particularly if you are considering an IP asset transaction. However, the value of a financial model does not have to be constrained to a single valuation. It can be more powerful than that. A dynamic model can be used as a tool during licensing and/or sale negotiations. Having a financial modelling tool is highly desirable when exploring monetisation strategies and understanding potential outcomes.

For example, in a licensing negotiation if you know the sensitivity of the royalty rate on your cash flow, the impact of milestones on your revenue, and when you can expect to pay back your investment, you will be in an advantageous position. You will have an idea of the preferred deal structure, have better-defined goals and know where concessions can be made and where you must hold your ground. Ultimately, this could lead to a better financial outcome for your company.

Employing financial modelling to guide intellectual property licensing and sales negotiations

(TAKE A LOOK AT THE ORIGINAL ARTICLE HERE FOR THE INTERACTIVE GRAPHIC – DIFFERENT POTENTIAL LICENSEES CAN BE TURNED ON OR OFF BY TICKING OR UNTICKING THE BOXES)

Above is a sample output from a ClearViewIP interactive licensing model. The plot shows the cumulative projected cash flow from a company’s IP. Most variables in the model are specified with a single number. However, a small number of variables, including the royalty rate, are modelled with high and low values to represent the best and worst case scenarios respectively. Modelling all scenarios results in upper and lower bounds for the projected revenue. This is illustrated as a shaded, bounded region in the chart. Provided a licensing agreement is signed, the potential revenue should lie in this region. The dashed line is the most likely ‘expected’ scenario. This chart is based on a model which is dynamic, as is the case for the models delivered by ClearViewIP. As such, different licensing partners can be turned on or off by ticking or unticking the boxes above in the graph. In doing so, you can see what effect negotiating licenses to licensees A, B and C has on the projected revenue.

Below the graph, a table with the cumulative cash flow and the risk-adjusted cash flow are shown. Each strategy has an accompanying risk associated with it. For instance, in this case it is perceived to be more likely that one or two licensees sign an agreement in comparison to all three licensees. For each case, the perceived risks translate into a success factor which suppresses the cash flow, giving the “risk-adjusted net cash flow” shown. This value is used as a comparator between licensing deals and between different strategies.

When would you use a financial model in your IP strategy?

There are a number of triggers to prompt a company to consider obtaining a valuation of their IP. The following scenarios are just a few examples of when and why a company would seek a financial modelling report for their IP:

  • If a company wishes to exploit their IP through licensing or sale, thus generating an additional revenue stream
  • If a company is in need of quantitative analysis of their IP to support their decision making to choose the route offering them the highest potential return
  • To calculate the damages of IP infringement
  • If a company requires a third party with valuation modelling experience to assess and/or support proposed licensing terms, damages calculations and more
  • For internal investment calculations and decisions
  • If a company seeks lending from a bank while providing its IP as security
  • Other possibilities include when a company files for bankruptcy or when a company wishes to insure its IP assets

Financial modelling in practice – an IP valuation case study

ClearViewIP is often asked to assess the commercialisation options for our clients. For this example, the client had a patented invention and wished to know how to exploit their IP to maximise their return on investment.

In collaboration with the client, ClearViewIP investigated three options: an exclusive global license strategy, the sale of the company’s IP and a joint venture.

An IP valuation model was created for each strategy. The models were customised to match the client’s requirements and preferences. Information was collated from the company’s employees and supplemented by market data from other sources. Variables in the models were assigned values on the basis of that information. ClearViewIP directors and consultants also contributed their knowledge of comparable deals in the industry to better define parameters such as the royalty rates and milestone payments.

The models were used to inform the company which strategy could potentially result in the highest return. ClearViewIP provided a detailed step-by-step implementation plan for the strategy. Having received ClearViewIP’s advice, the company decided to pursue the recommended strategy and recognised the potential of the dynamic model that was supplied to them going forward.

What is the IP valuation modelling service delivering?

Based on the questions you’re trying to answer, ClearViewIP provides custom-built, dynamic, IP valuation models to help get you closer to understanding the licensing scenarios available to you. This maximises the usefulness of the deliverable for you and ensures the valuation is as accurate as possible. These are the types of questions that can be answered with the help of ClearViewIP’s financial modelling service.

What commercialisation strategies are available for my intellectual property?
How do the IP strategies compare?
Who is the most suitable partner for my innovation?
How much revenue can I expect to achieve in 10 years’ time if I license my IP?
How much will I need to invest in my IP?
When can I expect to recoup my investment?
My IP is being infringed. What are the damages I am owed?

THE SERVICE IS CONDUCTED OVER THREE STAGES:

  1. Data gathering – through various processes of information gathering, ClearViewIP will assess the current situation in terms of your company’s investments, IP position and your objectives as well as conduct supplementary research for additional market data
  1. IP commercialisation strategy brainstorming – ClearViewIP’s highly experienced team will create a shortlist of potential strategies specifically for your company
  1. Financial modelling – a dynamic model is created for each strategy to qualitatively assess each option.

DECLINE IN CORPORATE RESEARCH? OR, INCREASED PARTNERSHIP OPPORTUNITIES?

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I recently came across an interesting research paper that details the potential reasons that corporate R&D has seen a decline in activity and was left feeling very positive about how shifts in industry behavior have changed the opportunity for research in academia or elsewhere. Between 1980-2007, the number of patent declarations from industry has decreased but the total number of total patents declared  has not declined. Furthermore the age of technology used in products is not getting older.

The authors point out two overarching reasons for this decline in internal research (& development):

  1. The rise of small research startups and;
  2. Considerations of commercially minded corporate R&D managers.

I think they are missing out on something else entirely, consumer behavior, where the speed at which a successful company innovates is off the essence, but that is a different topic entirely. Other notable hypothesis came up – are corporations publishing less to protect their IP? While this could have something to do with the declining numbers, it would not be significant, but worth noting.

Boiled down, we are finding that corporations have started spending more time on the D [development] and less time on the R [research] in R&D. Subsequently outsourcing basic research. Which lends well as studies have shown that that researchers are more productive when they are working in a less structured environment [like a university setting] so managing them and providing appropriate support can prove difficult for both parties.

What does this mean for university researchers? For budding scientific entrepreneurs?

Now, more than ever, industry is looking to make partnerships with universities, PIs and scientific startups. They have learned that they can accelerate innovation with technology scouting. But what are the ways to take advantage of this opportunity and what does this information mean for your startup or research?

Next week, we will discuss how research institutions and startups alike can take advantage of this opportunity.

In the meantime, get a jumpstart on the power of scientific startups and check out our infographic on how university startups and spinouts help your TTO

UNIVERSITY TECH TRANSFER 101: 5 COMMON TECHNOLOGY TRANSFER AGREEMENTS

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As a university researcher with a new invention, there are many options for connecting with industry partners. Do you license your invention? Find an industry partner to help develop it further? The options can seem overwhelming.

If you are affiliated with a university, you can work with your Technology Transfer or Sponsored Research office to choose the best type of agreement for your emerging technology. Read on for five of the most common technology transfer agreements.

Patent Licenses

One common practice is for institutions is to license patents to companies. There are options for both exclusive and non-exclusive agreements. Patent agreements are negotiable, and there is not a standard across universities.

The agreement will also outline development milestones that correlate with royalty payments.

Milestones for commercialization may include:

  • Receiving a baseline level of funding
  • Submitting a product for regulatory review
  • Conducting alpha or beta testing
  • Making a product generally commercially available
  • Reaching a sales threshold

Technology Licenses

Similar to patent licenses, technology licenses deal with innovations such as software or designs that can be licensed to a company. While they are similar, technologies have separate agreements than patent licenses.

Options to Grant Licenses

An “option to grant” license (often referred to as an “option”) is an agreement that provides a company a time limited right to obtain the license. Options are done for a fee and are common in sponsored research agreements. Because university research is often within the realm of basic research, this provides potential industry partners the opportunity to validate technology before taking on the full risk of a patent or technology license.

Depending on the technology – and other factors – options last between six and twelve months. A key difference between options and license agreements is that options do not allow for the commercialization and selling of the technology.

Sponsored Research Agreements

Your technology may need additional research or funding to get to the next phase of discovery. At a univeristy, the Office of Sponsored Research Agreements is responsbile for sponsored research. These types of agreements are formed when a company provides either funding or resources to a university research project. The sponsoring partner will typically receive preference to licenses and IP that from result the project.

Additionally, sponsored research agreements often give a private company the option to non-exclusively license any institution-owned, background intellectual property used in the research activities, because they may be necessary for commercialization efforts.

Materials Transfer Agreements

Material transfer agreements (MTAs) are used to manage sharing research materials between the university and industry partners. A materials transfer agreement is very similar to a non-disclosure agreement, but covers the limited use of physical materials rather than (or in addition to) information.

 

Interested in more technology transfer and open innovation opportunities?

HOW INDUSTRY PREPARES FOR OPEN INNOVATION

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In the 1990s open innovation was emerging as the only way to stay competitive. We saw product life cycles become shorter as companies began to invest in new technology.

There are plenty of resources available on how to spark connections with promising deep technology startups. But what if your firm has yet to make open innovation standard practice?

As open innovation evolves and digital tools become more sophisticated, it is more important than ever to make sure your company is prepared for successful partnerships with universities and startups. Fortunately, tried and true strategies can help today’s firms design a modern open innovation game plan

Set clear expectations

Setting expectations internally is key to successful open innovation. It’s easier to scout new technologies and move opportunities through the pipeline if a team has clear goals and benchmarks to live by.

Some guiding questions

• What technology readiness level and subject areas should we consider for partnerships?

• What can we offer potential partners?

• What volume of opportunities can we accommodate at one time?

• How should we share information with other tech scouts and other departments?

Since innovation in the areas of science and engineering are information intensive and involve many parties, it’s vital to have clear expectations on how responsibilities and information will be handled.

Clear internal expectations can also make things simple for prospective partners, who expect consistency and clarity from your team.

Leave it to legal

Intellectual property protection is by far the most complex issue that companies have to understand and overcome where open innovation is concerned. This is an issue that faces both inventors of technologies and corporations. The difference is that bigger corporations [typically] have the means to put processes in place to help protect both parties. While this is a bit of a catch-22 due to organizations needing information that is confidential and inventors needing to prove the value of their work, there are a couple things the industry partner can do to control the situation. “Companies implementing open innovation programs can control the costs and potential liabilities by using an automated system to guide submitters on what to disclose, what not to disclose and how to disclose information. It also documents the history of communications between corporation and inventor, which is critically important to preclude downstream litigation.”1

Escape red tape

Or, make it work. Process, structure and sometimes complicates processes and structures are ubiquitous in large organizations. Working for a Fortune 50 I learned that sometimes I knew exactly what to do and sometimes I had to ask 10 different people how to do something and no one knew.  With open innovation it is important to know the process, the approvals, and strategy. Without that, the company cannot execute against their goals. Luckily we have seen a rise in the CINO – Chief Innovation Officer – whose job it is to open up operations and make these types of activities feasible. “An open innovation program with a strong internal structure is one that:

  1. Effectively solicits ideas;
  2. Reviews ideas in a timely manner;
  3. Makes decisions whether or not to pursue the submission just as efficiently; and
  4. Communicates regularly with the innovator on the status of the submission.”2

 

Since that study by HBR, 20+ years have passed and open innovation has remained a cornerstone of corporate strategy and many large organizations have seen success by focusing on open innovation – look at GE, Clorox, DSM, Orange, and Samsung. These companies didn’t have success by accident, there was a conscious effort to create a way for their organizations to accept ideas and commercialize emerging technologies.

5 MUST ASK QUESTIONS FOR POTENTIAL INDUSTRY PARTNERS

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For startups, partnerships can help you avoid the dreaded valley of death. However, industry partnerships require proactive communication from both sides. As you get closer to a partnership agreement, make sure that you ask these five questions of your potential industry partners.

Interested in initiating dialogue with new industry partners? Join the seedsprint community.

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HOW FACULTY CAN ATTRACT INDUSTRY PARTNERSHIP

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Last week we briefly outlined five ways that startup activity can help the university’s TTO.

  1. Increase Public Benefit
  2. Create economic opportunity
  3. Recruit and maintain faculty
  4. Professional & financial gains for TTO & faculty
  5. Create new partnership & funding opportunities

 

Today we want to dive in a little deeper on how your faculty and their research drive awareness and ultimately attract industry partners. Joy Goswami from University of Delaware spoke to us about how their office is helping educate faculty on the importance of translational research and dispel any myths about the process. In addition to helping faculty understand the process, it is important to let them know how crucial they are to their continued success.

When faculty engage in translational research they certainly help promote their universities and by default the public by working on solutions with commercial potential benefit. Furthermore, for those researchers who are interested in entrepreneurship, there are a few key mutual benefits.

 

For most scientists, validation is a part of everyday life. So when spin-off activity is successful, that validation brings two main benefits to the researcher. The first is what stimulates most researchers and that is the satisfaction of engaging in challenging work. But the second is the attention that the research draws, more specifically, that the validated research has the potential to help secure additional funding and resources to continue the work or begin other innovative projects. For the university and the TTO – the benefit is the exact same; the more they can prove the efficacy of their programs, the more funding they are likely to receive from either public or private sources.

 

From the university’s perspective, this type of success is also a way to have a conversation with partners to generate other types of activity. Traditionally, ‘big’ business will shy away from what they consider a risky investment, like research that is in stages like insilico/invitro. However, when success stories from spin-off activity reach the bigger players, they see that the university and their researchers are capable of commercial activity and are more likely to engage in a partnership. This could mean sponsored research, collaborations, funding or licensing deals.

 

By encouraging entrepreneurial activity in any form, the rewards can be exponential if you think of the partnership potential and the resources that it could bring back to the university; financial or material. We call this type of activity the virtuous cycle – where all parties involved contribute and all parties benefit.

 

 

To learn more, download our latest infographic!

http://tiger.gatech.edu/files/KauffmanPresentations/Roach_Sauermann_TFS091225.pdf

HOW UNIVERSITY SPIN-OFFS BENEFIT YOUR TTO

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University-industry partnerships are increasingly important, as are university spin-offs. Spin-off are firms formed by university faculty, students or postdocs, usually based on a university license of intellectual property. University spin-offs may also be startups that are engaged in joint research projects with a university.

In recent years, university technology transfer offices (TTOs) face increasing pressure. There are a multitude of activities they are responsible for, including:

  • Relationship management;
  • Business development;
  • IP management & strategy; and,
  • Support services – including startup support and business counsel.

Promoting university spin-offs have the ability to demonstrate impact and economic benefit while also taking care of the university itself in regards to image, reputation, culture and financial gain.

 

Here are five ways that startups can help promote your university.

1. Increase Public Benefit

2. Create economic opportunity

3. Recruit and maintain faculty

4. Professional & financial gains for TTO & faculty

5. Create new partnership & funding opportunities

 

Interested in connecting with industry partners? Join seedsprint and promote your institution’s research for free.