A major shift is underway in UW-Madison’s approach to pushing innovations from its campus into the private sector.
With its new Discovery to Product Program, or D2P, UW-Madison will incubate about 10 projects until they’re fully prepared to become a startup or be licensed to others. Helping them with funding and mentoring, D2P will be a “finishing school [for the projects], hopefully trying to get them dressed up and ready to go out the door,” said D2P Director John Biondi.
D2P marks a much different approach to technology transfer from the university, actively seeking innovations across campus and commercializing them, said UW-Madison Chancellor Rebecca Blank.
Blank, who was previously the acting U.S. commerce secretary, said D2P could further show how crucial UW-Madison is to boosting the economy.
“One of the things that became incredibly clear to me in the Department of Commerce … was the extent to which research universities were central to any region that was experiencing economic growth,” Blank said. “There were a lot of places where there were successful plant openings and expansions and where the economy was sort of taking off. Either at the center of that or very close by, a big research university was certainly involved. … There’s always risk in these things. They may not work. But D2P has as much promise and potential as anything that I’ve seen elsewhere around the country.”
Mark Cook, who chairs the D2P advisory board, has firsthand experience with the old way of doing business. The UW-Madison animal sciences professor has launched three companies from his research, including Isomark LLC. Isomark’s patented technology hopes to detect disease from patients’ breath samples to prevent the spread of illness at hospitals.
While working on Isomark’s business plan, Cook struggled to find resources on campus and needed to launch the company in 2007 to get private funding.
“The minute we launched, the university was no longer available to us,” Cook said. “We had to use private dollars.”
UW-Madison and its patent and licensing partner, the Wisconsin Alumni Research Foundation, are each providing $1.6 million to fund D2P operations and salaries. It will include salaries for part-time mentors who can help prospective entrepreneurs with business strategy, legal work and finding startup capital.
D2P will also manage a $2.4 million UW System grant known as the Igniter fund that will go to about 10 projects, giving them funding to further develop their plans.
The Igniter fund saw 172 applications by its May 20 deadline, about half coming from faculty and staff, and another half from both graduate and undergraduate students, according to Biondi. Biondi said he expects to announce later this month the roughly 10 projects that will make up D2P’s first Igniter class, although he added D2P will still help some projects that didn’t make the cut.
Many in Madison’s tech transfer community are excited for what D2P will bring. The program, developed in large part by Cook and outgoing UW-Madison Provost Paul DeLuca, has been years in the making and was announced last November.
Bryan Renk, executive director of state bioscience association BioForward, said D2P will help projects avoid large fundraising campaigns early in the process, as they’ll be able to stay and get help on campus longer.
“It’s a big, big deal, and it’s fewer dollars they’d have to raise if they get grant support,” Renk said. “That really gives them the leg up.”
UW-Madison officials hope D2P will bridge the following gap: While UW-Madison consistently ranks top 10 nationwide in research spending, it lags in how many startups it launches and how much income its licenses produce.
In 2012, for example, UW-Madison spent almost $1.2 billion on research, making it the sixth highest spender in the country, according to Association of University Technology Managers data.
But that only led to four startups.
AUTM also ranked UW-Madison 13th nationwide in the total amount of money universities made from their licenses. But when 2012 license income was compared to the amount of money each university spent on research, the UW ranking dropped to 30th, the Brookings Institute found.
The AUTM data compares UW-Madison to some university systems like the University of California System.
Jacob Johnson, founder of Innovosource, which advises universities on technology transfer, said UW-Madison’s rankings might stem from the fact that much of the university’s roughly $1.2 billion in research spending goes to life sciences. He said those discoveries are tougher to turn into startups due to the lengthy clinical trials they must pass. They also need more money to keep going, and in investment funds available, Wisconsin lags compared to capital-heavy California or Massachusetts, he said.
“You’ve got to look at the entire body of art,” Johnson said. “And if you look at the entire body of art that is UW-Madison … all the companies and universities constantly put UW-Madison up near the top.”
Blank acknowledged UW-Madison’s challenges, saying “we don’t have 100 venture capitalists next door” and that most Midwesterners are less entrepreneurial and risk-taking than those in Silicon Valley or Boston. But, she added, a long-term view shows UW-Madison remains a national leader in tech transfer and that UW often outperforms its Midwest peers.
“Judging us by some of our near competitors — Illinois, Nebraska, Minnesota — we actually look very good,” Blank said. “Compare us to Stanford, and we don’t look very good. But we’re in a very different environment than Stanford, and D2P is a whole effort to step us up, take us to the next level. I don’t know that we’re going to get to be Stanford because our environment is different, but we can do better than we’ve been doing. That’s not to say we’ve been doing badly. It’s simply to say we can do better.”
D2P won’t consolidate the various entrepreneurship programs within the different departments on campus, Blank said. Instead, she said it will better coordinate those efforts and create a one-stop resource to connect campus innovators to the programs that fit them best.
“I’m quite convinced that we can do more by coordinating than by letting each of these [entrepreneurship programs] fit in their own silo,” Blank said.
D2P’s focus this year will largely be on projects that are near or past the “proof of concept” stage and almost ready to enter the private sector, Biondi said. That’s because the UW System grant requires commercialization of projects by June 2015, a rather short timeline. But Biondi said he hopes future Igniter funds will also target projects in earlier stages.
Biondi, who’s raised more than $60 million for nine startups, said he’s “absolutely optimistic” D2P will secure funding from the state or other sources for future Igniter rounds — and perhaps money to keep helping the program’s graduates.
“That’s another big thing that we want to achieve here,” Biondi said. “We have to look at what we can do to make D2P self-sustaining over time. How do we continue to replenish these Igniter funds? How do we continue to pay operational expenses for D2P? … Looking at the longer-term sustainability for D2P is another measure of success.”
— By Polo Rocha
WisBusiness.com
