How America’s New CTO Can Help Launch Game-Changing University Spin-Offs

This is part of my Series on Entrepreneurial Culture.

I was introduced to America’s new CTO, Aneesh Chopra, a few years ago after a rousing speech he gave in Washington DC. Back then he was Virginia’s Secretary of Technology and I clearly remember being impressed by what a great a speaker he was and just how different he was from the typical government policy wonk we’ve all heard talking in broad strokes about the importance of technology, job-creation and the like. As he was finishing his speech people actually got up off their seats and started applauding. He had the whole place buzzing.

This was obviously a guy with great intellect who was talking specifics and who brought a tremendous understanding of the tech landscape to the table. Tim O’Reilly actually wrote the definitive post (http://radar.oreilly.com/2009/04/aneesh-chopra-great-federal-cto.html ) about Chopra back in April and it is well worth reading as it outlines his qualifications, his vision and the many initiatives he brought to fruition in Virginia. This is someone who actually gets things done!

I’m bringing Chopra up because he was recently interviewed by the New York Times http://bit.ly/PIPwJ  and specifically mentioned what he’d like to see change within University Technology Transfer:

“Mr. Chopra noted that among universities, there is a wide range in how effective they are in commercializing the work of their laboratories. He wants to take the practices used by the most commercial of universities and spread them to other research facilities.”  He also stated that “…. rather than purely thinking about basic research…. the government should focus on investing in technologies that can be developed. A first step is to find ways to actually measure how much research is being commercialized.”

These statements were quite stunning to me actually. First of all, a prominent government official was unequivocally stating that some universities are doing a better job commercializing IP than others.  Second, in terms of that age-old policy debate  that pits the funding of pure basic research against the funding of commercializable technologies, Chopra feels that government must also fully embrace the latter. This is refreshingly plain talk from a senior political appointee.  

So how do we make this happen? I believe that the best way for the government to help commercialize the country’s most promising university technologies would be through the creation of a special fast-track program.  This program would selectively provide proof-of-concept funding for breakthrough university technologies suited for a spin-off. Bridging this “gap phase” or “valley of death” as it is called in the industry, is the most formidable challenge we are faced with in the world of university spin-offs.  This money would thus be used to fund the vital proof-of-principle work that really needs to get done before talented investors/entrepreneurs can be incentivized to spin-off companies from the academy. I am specifically talking about funds for beta versions of software, prototypes for medical devices and animal studies for drug discovery projects.

Obviously these emerging spin-offs would have to address the innovation mission of the Administration http://www.whitehouse.gov/issues/technology/ : Modernized infrastructure: broadband, health care information tech, electrical grid & cyber-security.

The other crucial feature of this Program would be to assemble a world-class Selection Board comprised of successful entrepreneurs and/or investors with domain expertise in the relevant disciplines. This Board would not only select the country’s best spin-off opportunities but could also help recruit the right management for them.

Hopefully I'll be able to get this message to Aneesh because I truly believe it could lead to the emergence of game-changing university spin-off companies that could have a role in helping us transform this economy.

Comments

[Steve Kubisen]

First, I agree that Aneesh Chopra is a clear thinking, results driven leader. I too have had the pleasure of hearing him speak when he was Secretary of Technology for Virginia.
A federal program that is regionally managed to spur innovation to commercialization is clearly needed. One of the keys in maximizing results for a portfolio is fast failure; that is to do the killer experiments first and weed out the innovations that will fail sooner rather than later. The costs to commercialize become greater as the process moves forward. If you minimize the chances of failure early you will vastly improve your efficiency and speed of the overall process.
If you require a matching of federal funds with private or state funds, you will help ensure accountability. Having funds for beta testing would help provide support for doing these killer experiments and flesh out the best commercializable opportunities. By having the federal program be a fund of funds and investing federal money in state and private early stage funding, one would not need to create a new venture management structure. This program would encourage the funding of beta tests and encourage further state and private investment.
A $2 Billion national innovation fund has been proposed to the SBA and is seriously being reviewed by Karen Mills and her staff. This level of support is appropriate to drive the innovation commercialization opportunities from our research universities.