Inventing
Entrepreneurs
Prof. Gerry George
Imperial College London
Simple facts
Scientists becoming entrepreneurs is not the smartest choice
TTOs, at their very best, aren’t equipped to champion
technologies by themselves
There is a lack of entrepreneurial capacity that can
understand and push technologies
Creating tensions!
Universities (and their stakeholders) becoming
increasingly demanding
TTOs ill-equipped to handle startups and licensing
because they require two different types of talent,
structure…and incentives
The application of university science requires new managerial
talent to push forward
3
Imperial Innovations
Working with inventors you need to apply an institutionalized process…..
Stage 01
Sourcing
ideas
Market
application
Stage 02
IP Protection
Stage 03
Proof of
Concept
Product
Development
Stage 04
Licensing
Stage 05
Formation
and
incubation of
technology
businesses
Stage 06
Investment
Stage 07
Exits
Page 4
The Challenges of Technology Transfer
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Technology getting out there
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Being used!
Creating value
The difficult choices are in
• Finding the market – what is best
use?
• Appropriating value – how much?
• Rights – who gets it?
Page 5
Now which market?
Biocidal
Polymer
Cell
Membrane
O
O
O
O
O
O
O
O
O
O

P
O
O
O
O
P
O
NH
P
NH
O
O
O
O
O
O
O
O
O

Page 6
Where to look?
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Biocidal polymer
Low concentration requirement
High efficacy (kills everything; incl human cells)
Can be modified for stability
Can be modified for substrate specificity
Page 7
Complicated enough?
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Market (application)
Industry (competition)
Value (capturing and sharing)
License?
Start-up?
Page 8
Wisconsin Alumni Research Foundation
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Founded in 1924
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Invention of Vitamin D
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Prof. Harry Steenbock (Biochemistry)
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Using $900 from 9 alumni of UW
University should not participate in private benefit of
public good
Page 9
Steenbock’s guidance
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Support excellence in research
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Attract and retain high caliber scientific talent
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Willingly and without encumbrances
Discourage complacency and encourage action
Incentives to invent
Invest in the infrastructure
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In people
In assistance
In facilities
Page 10
Pushing the Core
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Patenting and licensing
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Performance is stellar with licensing of 2
inventions
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•
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How did these two inventions become stellar?
What did WARF do to make these two runaway successes?
Non-core capabilities
Page 11
Exogenous Regulatory
Events
Average time decreases
Variability decreases
Page 12
Claims increase
Portfolio increases
Page 13
Graphic inferences
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Reduction of variance in time to patent
•
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Becoming better at a single core capability
Inferring learning within core capability
Mean
1244 days
771 days
750 days
Variability
587 days
347 days
314 days
Difference (t-test)
p<.001
p<.06
Page 14
So what about income?
18000000
16000000
14000000
12000000
10000000
Real Income Indexed
Actual Net Income
8000000
6000000
4000000
2000000
1999
1994
1989
1984
1979
1974
1969
1964
1959
1954
1949
1944
1939
1934
year
1929
0
Page 15
What else did WARF patent?
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Vitamin D
Vitamin K
Copper/Iron Complex for anaemia
Warfarin (Coumadin)
MRI
Silicon heat dissipation
Human embryonic stem cells
Page 16
At what cost?
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•
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Average cost to patent
Average cost to license
$23,445
$30,570
Average cost of licensed patent
Average cost of unlicensed patent
Average years to license
$54,015
$33,415
7.49 years
Page 17
What gets licensed?
20
19
18
17
16
15
14
13
12
Patent number 11
10
9
8
7
6
5
4
3
2
1
0
2
4
6
8
10
Years to first license
Page 18
Probability of license?
.01
.02
Hazard rate
.03
.04
.05
.06
Hazard rate function of licensing
0
2
4
Year
6
8
Page 19
Being Entrepreneurial in Technology
Transfer
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Entrepreneurial expositions and leadership
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Vitamin D testing labs
Warfarin rodenticide testing
Wurster process roll-out
Institutional changes
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Tax and foundation laws
Patent laws
Page 20
The first invention – Vitamin D
Create Demand
Create Brand
Protect Demand
Page 21
Some TTO Solutions
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Focus on..
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Try New Things!
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Finding markets
Creating value
Incentives for entrepreneurship
Co-creation and co-development networks
Engage larger corporates in co-venturing
Fund prototyping and getting to proof of concept
Consider a portfolio approach – don’t wait for licensees before patents
Get your scientist stars fired up and help (Its not equitable, correct!)
Use your student body more productively – identify the smart and sparky ones
Try/fund a startup internship program to cultivate entrepreneurial students
Subsidize entrepreneurial capacity development – B-school and Engineering
Don’t bother too much on
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Trying to get the most money on each deal
There is no best deal!
Page 22
Where does that leave us so far?
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It takes TIME!
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But patience will kill you first
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Licensing is a tough job but TTOs get paid to do well
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Being entrepreneurial in licensing pays off
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Still… doesn’t solve the start-up problem
Inventing Entrepreneurs…who should
read this book
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You are an inventor
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or blissfully deluding yourself that you can be
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Eureka! You discovered something interesting!
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You want to make sure that your innovation is used
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You are wondering if it is all worth it at the end
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You are likely contemplating an entrepreneurial option
It’s a bunch of stories…yes
Profiles
Profiles and
and Experiences
Experiences
••
Spectrum
Spectrum of
of scientists
scientists with
with
varied
varied experiences
experiences across
across
many
many disciplines
disciplines
••
Analysis
Analysis and
and Tools
Tools
••
Participating
Participating in
in
commercialisation
commercialisation
Success
Success and
and failure
failure in
in
venturing
venturing
••
Understanding
Understanding roles
roles and
and
identities
identities
••
Real
Real examples,
examples, including
including
many
many that
that are
are ongoing
ongoing
••
Evaluating
Evaluating opportunities
opportunities
and
commercial
and commercial modes
modes
••
Personal
Personal narratives
narratives of
of
accomplishments,
accomplishments, pitfalls,
pitfalls,
and
and lessons
lessons learned
learned
••
Preparing
Preparing for
for the
the journey
journey
••
Building
Building skills
skills sets
sets
What are the stages in the
entrepreneurial process?
Personal
challenges
Market-driven
challenges
How the book is organised
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Discovering Entrepreneurial Options
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Chapter 9 – Understanding Industry Context
Chapter 10 – Accumulating Business Skills
Chapter 11 -- Primer on Financing
Visualizing the Road Ahead
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Chapter 6 – The Entrepreneurial Academic
Chapter 7 – Entrepreneurial Journey Model
Chapter 8 -- Sample Journeys
Assembling the Entrepreneurial Toolkit
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-- Entrepreneurial Purpose
– Inventing Entrepreneurial Options
– Technology Licensing
– Lifestyle Businesses
Cultivating an Entrepreneurial Identity
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Chapter 2
Chapter 3
Chapter 4
Chapter 5
Chapter 12 – The Managerial Challenge
Chapter 13 – Preparing for Growth
Chapter 14 – Exit
Preserving Identity
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Chapter 15 – Identity, Growth and Learning on the Journey
Discovering entrepreneurial options
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Decision to
propagate invention
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Commercial
venturing
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Foundations of
entrepreneurial
purpose
Stages in the entrepreneurial process
Inventing Entrepreneur Profile
Jo Handelsman
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Unique among our profiles: Handelsman never wanted to
start or run a company commercialising her technology.
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Purpose of technology transfer
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Academic identity and entrepreneurial purpose
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“I am pretty good at teaching and leading an academic
research group, so why would I go off and do something for
which I have no apparent aptitude.”
Personal element to research
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“tech transfer is important not because we want to be
entrepreneurs …and not because we want industry running
the university…. Technology transfer benefits society and the
university.”
“… my mother developed an immunological disease, …. that
ultimately caused her death after 17 years of miserable
illness. … there was just nothing I could do to help her fight
the bacteria that were killing her.”
Prof. Jo Handelsman
Professor
Plant Pathology and
Industrial & Systems
Engineering
University of
Wisconsin - Madison
Long term institution building
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“At university research serves education… Waiting is a luxury
that industrial science simply can’t afford”.
Assembling the entrepreneurial toolkit
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Industries and markets
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Industry attractiveness &
value chain
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Disruptive technologies
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Start-up location choices &
implications
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Cost and differentiation
strategies
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New business road test
Stages in the entrepreneurial process
Inventing entrepreneur profile Michael Stonebraker
Five start-ups
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Served as CTO twice & CEO three times while
faculty
One of the pioneers of relational database
technology
Focused on execution:
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“…its rare that you have to compete early on against
the elephants, because they are slow moving. You
have to prove it’s a good idea to get their attention.”
“It’s all about executing at lightning speed. That’s the
secret to start-ups, spend no money and execute in
zero time.”
Michael Stonebraker
Professor
Computer Science and Artificial
Intelligence Laboratory
Massachusetts Institute of
Technology
Clearly, these are not skills natural to
academics!
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Preserving Identity
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Scientific identity
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Characteristics of
inventing entrepreneurs
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Common experiences
Stages in the entrepreneurial process
Inventing entrepreneur profile
John Hennessy
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Pioneered the RISC (Reduced Instruction Set Computer)
technology at Stanford, commercialised via start-up
company MIPS Computer Systems.
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Transformative experience:
“It probably was the single most formative year of my life. …
You learn about leading people and managing teams; you
learn a lot about focus. And you learn that there is a great
reward when you build a product and people use it.”
Not always glamorous:
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“... I did everything I wiped counters; I picked up donuts for the
guys … I hired people …, I was the technical evangelist, I
went on the road and did cold calls all the time.”
Prof. John Hennessy
President
Stanford University
Co-founder of MIPS
Technologies
Academia over Corporate:
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“… It has to do with breadth and mental stimulation. There is
no CEO job in the entire world that has the breadth of this job
[President of Stanford University], because no company has
this breadth.”
Entrepreneurial journey model
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Roles
Research
Occupying positions expected to pursue knowledge discovering:
scholar, professor, student, inventor.
Commercial
Occupying positions expected to engage in managing business:
executive, manager, technologist, consultant.
Technology-based
Focuses on technology, invention, or application of science.
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Identities
Market-based
Focuses on end-users who with unmet needs or broadly
unsolved problems.
Entrepreneurial journey space
Combining responses to role and identity
evaluations places an individual in one of
the quadrants of the journey model
matrix.
A – strong focus on long term research.
B – research focus on specific technology
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with some consideration of applications.
C – focused heavily on commercial
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applications to meet specific market needs.
D – commercial role based on specific
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technology embodiment.
E - role designed to solve customer problem
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without as much focus on specific technology.
Journey model matrix
Types of Journeys
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The Research Transfer Entrepreneur
The Sabbatical Entrepreneur
The Research-driven Inventing Entrepreneur
The Dual Role Entrepreneur
The Corporate Entrepreneur
The Business-focused Inventing Entrepreneur
Lessons from the journey model
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Venture path is not same as entrepreneur’s journey.
Every journey is unique and personal.
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Is there an optimal path?
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For a given effort, an optimal path can be discussed
Journey transforms the inventor.
A rich mix of thought and practice for Mindful Action
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Idiosyncratic initial conditions.
Changes in roles and identity.
Of experiences of those who have taken them
Skill sets for the journey
Frameworks to understand the issues
Highlighting the major challenges and opportunities
Make informed choices on inventors’ involvement in
entrepreneurship
Inventing
Entrepreneurs
Prof. Gerry George
Imperial College London