According to Art Espey, a serial entrepreneur whose latest venture, 4Steps2, offers commercialization assistance to inventors, technologists, entrepreneurs and universities, tech transfer offices “have seen potential business partners reduce their innovation portfolios and expenditures. This coupled with a reduction in funding sources, from grants and investors to university sources, are blowing technology transfer research commercialization efforts into the perfect storm.” Espey offers this useful set of seven tips for weathering that storm and emerging even stronger when it ends:

1. Maintain a list of problems that are relevant to the research and technologies in the pipeline. This means getting involved earlier in the research process and conducing what amounts to “an early brainstorming exercise,” he says. “Don’t just talk to the researchers. Get business input from those who are not involved with the research or the research teams. Independent ideas can be worth their weight in gold.”
2. Develop long-term business relationships. Build these relationships with key business leaders “even before you have any applicable research or solutions for them,” Espey urges. That effort will give you a better understanding of business challenges that your research might address down the road.
3. Pair researchers with business mentors. Doing so is a much more effective way to overcome the common gap in understanding between the two domains and “will go a lot further than a long forgotten entrepreneurial seminar.”
4. Develop alternative commercialization strategies early. Pinning all your hopes on one strategy is one of the reasons 9 out of 10 spinoffs fail, Espey notes. To improve your odds, have several alternatives ready if your favored strategy doesn’t work out. “I sit on the advisory board for some start-up focused investment funds. One of the strategies that we have developed recently is to go for the big distribution partnering deal with large companies. When that doesn’t work, we find out why and have alternative proposals available.” For example, limited distribution agreements with several companies may be the next strategy, with others waiting in the wings if that fails too. “It really doesn’t matter what the alternative is. What does matter is that you get to stay in the game and get a return on the sunk costs,” he stresses.
5. Reduce risks for all involved. “Right now cash is king,” Espey says. “Instead of negotiating a lower royalty percentage, offer your potential licensee a deferred royalty agreement at a higher percentage. This is the business innovator’s version of ‘no interest payments for 3 years.’”
6. Teach bootstrapping to your start-ups. Espey defines bootstrapping as making do without much outside investment, focusing on sales, and keeping fixed costs to an absolute minimum. But the hardship and mindset involved in doing that is something “few lead researchers turned entrepreneurs can relate to,” he says. He advises adding “experienced bootstrappers” to advisory boards and consulting teams.
7. Partner with other technology transfer offices. TTO partnerships, Espey says, “can lead to specific research pairing with higher degrees of commercialization potential. This focused effort will, in the long run, yield a high degree of return on investment.”

Go to: Articlebase

Posted February 25th, 2009 under Tech Transfer

Write a comment