commercialization of student projects...9/17/2008 commercialization of student projects 3 stephen...

© 2008, Georgia Institute of Technology

Commercialization of Student Projects

Stephen FlemingChief Commercialization Officer

<[email protected]>

mailto:[email protected]

mailto:[email protected]

9/17/2008 Commercialization of Student Projects

Who am I?Facts about Georgia TechVentureLab programATDC

Intellectual property at Georgia TechImpact on student projectsQuestions and Answers

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9/17/2008 Commercialization of Student Projects 3

Stephen Fleming

• 13+ years venture investment experience.–General Partner, Alliance

Technology Ventures.–18 investments as lead

investor, 15 exits to date.

• BS, Physics, Ga. Tech (Highest Honors).• 15 years operational experience at AT&T Bell Labs,

Nortel, LICOM (venture-backed startup).–Supervised startups developing first ADSL modem and one of the

first cablemodems in early 1990s.

• Multiple advisory boards at Georgia Tech; endowed chair in telecomm; occasional instructor in MBA entrepreneurship program.

• Strong regional technology leader.


National Rankings

U.S. News & World Report, America’s Best Engineering Graduate Schools 20071. Massachusetts Institute of Technology

2. Stanford University

3. University of California — Berkeley

4. Georgia Institute of Technology

5. University of Illinois — Urbana-Champaign

6. Purdue University

tie University of Michigan — Ann Arbor

8. Carnegie Mellon University

9. University of Southern California (USC)

10. California Institute of Technology (CalTech)

http://www.usnews.com/usnews/edu/grad/rankings/eng/brief/engrank_brief.php


National Rankings

U.S. News & World Report, America’s Best Engineering Graduate Schools 2008

Strength across the board!

Aerospace #4

Biomedical #2

Chemical #13 Industrial #1 17 years!

Civil #6 Materials #8

Computer #7 Mechanical #7

Electrical #6 Nuclear #9

Environmental #6 Petro/Mining not offered


GT Research Distribution

Approx. half a billion dollars total R&D on campus for FY2008!

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College ofEngineering

GTRI

College ofSciences

Research Centers

College ofComputing

Other

# patents1 390 University of California (system)2 136 Massachusetts Institute of Technology3 101 California Institute of Technology4 90 Stanford Universitytie 90 University of Texas5 77 University of Wisconsin6 71 John Hopkins Universitytie 71 University of Michigan7 64 University of Florida8 57 Columbia University9 43 Georgia Institute of Technologytie 43 University of Pennsylvania10 41 Cornell University


Patent Ranking

U.S. Patent & Trademark Office, Calendar Year 2005


IP Disclosure/Evaluation

InventionDisclosures

Dept. Chairs /Deans / GTRI

TechnologyEvaluation

Path?

Rights toFaculty?

Initiate IP Prot.

Need more information / development

MarketEvaluation

TechnologyAnalysis

ProtectIP?

MarketAnalysis

PatentApplication

ExternalCounsel

$

...continued

Export Control

Industrial Contracts

Screens

Responsibility

GTRC

EI2 / CS

$ $


IP Business Development

Rights toFaculty?

VentureLab Tech. Marketing

Path?

Startup / Spinout Industrial License

Consulting

GeorgiaResearchAlliance

$

Licensee? Rights toFaculty?

Funding& CEO?

Term Sheet Negotiation

Rights toFaculty?

LicenseNegotiation

ComplianceReview

StandardTemplates

...continued

Responsibility

GTRC

EI2 / CS

MarketingWhite Paper

External Counsel

BusinessPlan

Conflict ofInterest Plan

StandardTemplates

COI Review


Royalty Collection Monitoring

Compliance / LitigationPatent Maint. & Defense

IP Licensing/Compliance

License

LicenseNegotiation


Startup Formed

Incubator?

SuccessfulStartup

ATDC orEmTech Bio

IndustrialPartner

Responsibility

GTRC

EI2 / CS

Distributionof Payments

Inventor(s)

Academic Department(s)

GTRC

PortfolioLIquidation

$

Royalties & etc.Equity


IP Business Development

VentureLab

Rights toFaculty?

Tech. Marketing

Path?


Consulting

GeorgiaResearchAlliance

$

Licensee? Rights toFaculty?

Funding& CEO?

Term Sheet Negotiation

Rights toFaculty?

LicenseNegotiation

ComplianceReview

StandardTemplates

...continued

Responsibility

GTRC

EI2 / CS

MarketingWhite Paper

External Counsel

BusinessPlan

Conflict ofInterest Plan

StandardTemplates

COI Review


VentureLab

• Founded September 2001–Now a model for other universities–Part of Enterprise Innovation Institute

• Reports up through Office of the Provost

• Faculty-focused process –Risk identification and mitigation–Venture-backable innovations

• Goal: Successful startup companies based on Georgia Tech research


VentureLab

MarketMilestonesMeetingsManagementMoney

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Market: Business Plan

• Classic startup questions—Who, What, Where, When, Why, How:–Who is the customer?–What is the pain they are trying to eliminate?

• Candy, vitamin, or painkiller?–Why is your technology the right answer?–Where (geographically) are your customers?–How much are they willing to pay?–When will effective competition emerge? –What are the growth trends?–What is the right sales channel?–Who are potential partners? Exit through M&A?

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Milestones: Business Plan

• It’s far too easy to focus on the technology promise, and ignore the “details”:–When will you have a prototype?–When will you have a beta test?–When will you have a paying customer?–How many people do you need to hire?–When will you hire them?–How much money do you need at first?–When does that run out?–How much will you need after that?–How do you know when you are winning?

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Meetings

• Launching a startup company is a team sport!• VentureLab can introduce you to:

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Angel investors

Venture capitalists

Government grantors

Business advisors

Potential employees

Beta customers

Corporate partners

Regulatory experts

Bankers

Accountants

Corporate lawyers

Patent lawyers

Recruiters

Marketers

Consultants

and more...


Management

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Management (cont.)

• Teaching a professor how to be an entrepreneur is like teaching a cat to swim:–It can be done.–You will lose blood.–You’ll never be satisfied with the results.–You will annoy the cat.

• Different motivations, different priorities, different views of “proper procedure.”

• Best bet: Recruit an entrepreneur to work with the professor. 1+1=3.

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Money

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Assistance with small-business grants from eleven Federal agencies.

Grants and loans to startups based on Georgia university research.

Equity investments in startups with a connection to Georgia Tech.


Georgia SBIR Assistance

• Small business R&D funding available from eleven Federal agencies–NASA, DOD, DOE, NIH, EPA, etc.

• Grants, not loans or equity!• For help with SBIR and STTR process, visit <http://www.innovate.gatech.edu/sbir>.

• Up to $850K availableacross two phases ofdevelopment

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http://www.innovate.gatech.edu/sbir

http://www.innovate.gatech.edu/sbir


Georgia Research Alliance

• Recruiting Eminent Scholars from all over the world to Georgia

• Investing in university capital equipment–Over $600 million in last 15 years

• Innovation grant program–Phase 1: up to $50K to university R&D–Phase 2: up to $100K to university (must be

matched—equity, SBIR, sale of services, etc.)–Phase 3: up to $250K loan to company (must be

repaid upon success or leaving Georgia)

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GRA Matching Funds

•Provides up to 4:1 non-dilutive leverage for initial outside investment:

Equity, Other Grants, etc.

Phase I $50K grant to university

Phase II $100K validation investment

$100K matching grant to univ.

Phase III $250K loan

Total $100K $400K


GT Edison Fund

• Newly-launched program to encourage invention and innovation.

• Funded by charitable gifts from GT alumni, foundations, friends of the university.

• Early-stage equity prior to angel or venture capital investments.

• Still primarily in fundraising mode, but has made a single initial investment (4Q2007).

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✓9/17/2008 Commercialization of Student Projects

VentureLab

MarketMilestonesMeetingsManagementMoney

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VentureLab Projects (current)

http://www.gtventurelab.com






VentureLab Graduates

May 2008


ATDC

Advanced Technology Development Center




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Intellectual Property (IP)

• Patents: protection of eligible technology and business models, within limits

• Trademarks: protection of domain names and product identity (“branding”; GT logo)

• Copyrights: protection of texts, media, software, and “look and feel” (to a degree)

• Trade Secrets: protection for secret information (e.g., the Coca-Cola formula)

• Know-How: contractual transfer of implementation knowledge from experts

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Intellectual Property

Intellectual property is (usually) not:

• Designs• Ideas• Concepts• Drawings• Suggestions

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Background IP

• Intellectual property that was created before or outside a research project,

• Intellectual property that must be used in in a research project,

• Intellectual property that must be used in order to practice intellectual property that results from a research project, or

• Intellectual property that is infringed by the practice of newly discovered intellectual property.

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IP Goals at Georgia Tech

• Reward the faculty for creation of valuable IP

• Support innovation

• Strengthen research programs

• Strengthen global reputation

• Attract top-quality faculty & students

• Fulfill tech-transfer obligations

• Add value to intellectual property

• Strengthen industry relationships

• Create successful entrepreneurs

• Strengthen local technology community


Income Distribution

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0%

33%

66%

100%Fir

st $

25

00

$500K $1M+

Georgia TechResearch Corp.

Inventor(s)

Academic Unit(s)

$2,500


IP Policy at Georgia Tech

For inventions first conceived or first reduced to practice in the course of Georgia Tech research:

• Georgia Tech will generally claim title to the technology.

• Georgia Tech may offer the sponsor the first option to exclusively license the technology on fair and reasonable terms to be negotiated.

• Georgia Tech will retain the right to practice the technology in research and education.

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IP at Georgia Tech (cont.)

• Georgia Tech will not obligate the intellectual property rights of others (especially future students).

• Potential conflicts of interest for those responsible for the design, conduct, or reporting of research must be managed.

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# patents1 390 University of California (system)2 136 Massachusetts Institute of Technology3 101 California Institute of Technology4 90 Stanford Universitytie 90 University of Texas5 77 University of Wisconsin6 71 John Hopkins Universitytie 71 University of Michigan7 64 University of Florida8 57 Columbia University9 43 Georgia Institute of Technologytie 43 University of Pennsylvania10 41 Cornell University


Patent Ranking

U.S. Patent & Trademark Office, Calendar Year 2005


Open Source

• Yes, we open-source some software.• The particular open-source license matters!

–GPL vs. MIT vs. others

• You need to consult with GTRC before releasing open-source software that builds on any GT intellectual property.

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Putting IP to Work

• Publications, reports, conference papers, theses, and dissertations

• Students graduating & taking jobs in industry• Continuing education and professional

development• Consulting• Service on government panels• Technology licensing:

–Startup companies–Existing industry

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Technology Transfer


Why Tech Transfer?

We commercialize new technology to:• Ensure public benefit from Georgia Tech

research.• Provide inventor satisfaction and motivation.• Meet Georgia Tech’s obligations to sponsors.• Comply with Federal law!

–For research sponsored by Federal agencies–Accounts for approximately 80% of GT research.–Enabled by the Bayh-Dole Act of 1980.

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IP Policy at Georgia Tech

• GT has a comprehensive Intellectual Property Policy: <http://tinyurl.com/msp35>

• Georgia Tech Research Corporation (GTRC) is granted IP rights by the Board of Regents.

• Researchers are required, as a condition of employment, to disclose inventions which must be reported to sponsors.

• Students are required to disclose intellectual property that arises from assigned work at Georgia Tech.

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http://preview.tinyurl.com/msp35

http://preview.tinyurl.com/msp35


Georgia Tech Research Corp.

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Commercialization Process

• Initiated by filing a disclosure form:<http://tinyurl.com/2xpfdk> –Faculty or student

• Three paths:–Startup–Industrial license–Consulting

• Different paths for different inventions.

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http://preview.tinyurl.com/2xpfdk

http://preview.tinyurl.com/2xpfdk


Follow the Money

Where GT asserts ownership of intellectual property:

• If patents are pursued, GTRC assumes the cost burden of patent filing and maintenance–Provisional (U.S. only)–Utility filing (U.S. only)–International (when appropriate)

• Financial proceeds (royalty, equity sales, etc.) are split equally:–1/3 to inventor(s), 1/3 to academic unit, 1/3 to GT

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Student Roles at GT

• Undergraduate inventors• Graduate Research Assistants• Interns, co-ops, and fellows• Future employees of industry partners

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Prior Art Searches

• Georgia Tech is an official Federal patent repository.

• Extensive resources available to students:• <http://tinyurl.com/39vlcf>• <http://tinyurl.com/2ppybr>

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http://preview.tinyurl.com/39vlcf





Who Owns Your IP?

• The Student Handbook states that any student enrolled at Georgia Tech is subject to the Institute’s Intellectual Property Policy.

• If any intellectual property is conceived or developed by a student during the performance of their course work, title to the intellectual property resides with GTRC.

• Student inventors enjoy the same rights and benefits as do faculty and staff inventors.–Including access to VentureLab!!!

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• GTRC is in the business of complying with all relevant contractual obligations, state and Federal laws, tax regulations, export control agreements, etc., etc., etc...

• GTRC is not in the business of stifling student innovation.


However...

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Section 50.6(D)

• In addition, ownership rights to Intellectual Property developed by GIT faculty, staff or students shall reside with the Creator of such Intellectual Property provided that:

– (1) there is no use, except in a purely incidental way, of GIT resources in the creation of such Intellectual Property (unless such resources are available without charge to the public);

– (2) the Intellectual Property is not prepared in accordance with the terms of GIT contract or grant; and

– (3) the Intellectual Property is not developed by faculty, staff or students as a specific institution assignment as discussed in 50.6 B above. The nature and extent of the use of GIT resources shall be subject to GIT regulations.

• When there are multiple Creators, some or all may have ownership rights subject to the tests described above, but the parties are encouraged to enter into a mutually signed written agreement to clarify their respective rights and responsibilities, in accordance with guidance in Section 50.8.

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TheFinePrint


And Remember!

Intellectual property is (usually) not:

• Designs• Ideas• Concepts• Drawings• Suggestions

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What Does That Mean?

After disclosure, GTRC will apply multiple tests to your technology:

• Does the disclosure constitute protectable intellectual property?

• Was it based on sponsored research at GT?• Was it supervised by a GT professor? How

closely? • Was the work conducted in GT laboratories?• Does it rely on GT background IP?• Are there co-inventors (inside or outside

GT)? Have they signed an agreement?• Are there other factors in play?

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What to Expect

• GTRC will normally take about two weeks to review your disclosure.

• If none of the tests are triggered, your work may be deemed “Individual Effort.”

• A waiver letter will be prepared stating that GTRC assigns all intellectual property rights back to the individual inventor(s).

52Klaus Advanced Computing Building




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For Further Information

Stephen FlemingChief Commercialization OfficerGeorgia Institute of Technology

Personal blog: <http://www.academicvc.com>

<[email protected]>

<http://innovate.gatech.edu/commercial/>

Project database and staff blog: <http://www.gtventurelab.com>

(404) 385-2360

Download this file at <http://www.gtventurelab.com>

http://academicvc.blogspot.com




http://preview.tinyurl.com/yupc6h

http://preview.tinyurl.com/yupc6h

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