Your source for expert commentary on IP management issues.
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Editor-in-Chief, Anatole Krattiger
Why This Topic Is Important
The creation of new firms, and even new industries, is, in the long run, one of the most powerful impacts
that public sector research and technology transfer can have on an economy. In some cases it is the only
hope for a new technology to be developed. This section describes competing approaches to managing
the process of venture creation, examines the roles of the different players involved, and details
institutional policies that can enhance the rate and the success rate of start-up companies.
Key Implications and Best Practices: Section 13
Given that IP management is heavily context specific, these Key Implications and Best Practices are intended as starting points to be adapted to specific needs and circumstances.
- Not all university inventors are entrepreneurs nor are they interested in being company founders, and not all spinout company founders from a university are the technology’s inventors.
- While inventors are treated equally under university patenting and licensing policies, involvement as a company founder entails a greater degree of risk and commitment to move an invention to commercialization. You may be valuable as an active partner of a spinout company to prevent the repetition of unsuccessful experiments (blind alleys) and to add needed creativity with respect to problem solving as development and commercialization proceeds.
- Participation in a spinout can be a particularly rewarding experience, financially as well as personally, as it involves the practical application of your ideas.
- Venture capital investors combine a broad view of the market with solid technical expertise. You will need to be prepared to convince investors not so much of the technical merits of your research, but of how your ideas lead to economic returns.
- Rather than venture capital driving the creation of new companies, it is usually the creation of new companies that attracts venture capital.
- Venture capital investors can be great allies, but will impose, for good reasons, distinct conditions on the project. Be open, patient, and willing to work with investors.
- Much of the success of a spinout or start-up will depend on the entrepreneurial spirit at the institution. The more entrepreneurial, the more likely it will be that someone wants to set up a new company.
- There are many factors that determine the feasibility and success of a spinout company. The technology’s intrinsic value and your commitment to your invention are only part of the picture. If you can find an existing partner with market penetration, the chances of success increase. If you are still convinced, even after failing several times to find a willing licensee for your technology, then it may be time to consider creating a company. As these matters arise, seek the guidance of your institution’s technology transfer office.
Dealing with Spinout Companies
by Jon C. Sandelin
The Role of Technology Transfer Intermediaries in Commercializing Intellectual Property through Spinouts and Start-ups
by Tim Cook