Last week, Charles Ross and I were in Texas for the annual conference of the National Association of Seed and Venture Funds (NASVF). Charles is on the board, and I was there to accept their 2011 award for “Excellence in Entrepreneurial Capital Formation” on behalf of EI2. I thought you might be interested in my remarks…
Thanks for recognizing the work we’re doing at Georgia Tech. All of you know that any award like this needs to go to a whole host of people, not just one guy, but on their behalf, I appreciate it.
I’m here representing Georgia Tech in general, and the Enterprise Innovation Institute in particular. We’re the part of Georgia Tech that deals with the business community, whether that’s two kids and a dog and a patent application, or whether it is the Boeing Corporation.
Georgia Tech has one of the most active licensing operations around, and one of the busiest commercialization programs around, and has the nation’s oldest, largest, and most successful university-based incubator with ATDC. And ATDC companies have raised over $2 billion since 1999… and is wasn’t all Bubble money! Half of that is in the last five years.
When I began wondering what I was going to say today, I realized I was going to be asked: “How does Georgia Tech do it?” And I realized that the only appropriate answer is that: “We’re comfortable doing more than one thing at a time.”
We’re the biggest engineering school in the country, and we know that one size cannot fit all.
Those of you who know me know that I’ll talk about this stuff until physically restrained. But we have a busy day, and I promised Kelly and Jim that I’d keep my remarks within ten minutes.
So, at the risk of reading you a laundry list, I want to let you get a very brief feel for the variety of startup support programs we have at Georgia Tech.
| GT:IPS | Georgia Tech Integrated Program for Startups. Jon Bayliss touched on some of the difficulties in dealing with state universities. Were very much a “push” program. We wanted a standardized IP license, and we’ve finally got one. It’s a good one.
We had it scrubbed by four local law firms, who account for most of the startups coming out of Tech. But that wasn’t enough. We realized we had to put together a training program around conflict of interest and IP protection and a whole bunch of things. So, to get the streamlined license, you have to go through five modules of classroom training. And, yes, professors have actually been coming to class. It’s working. |
| VentureLab |
I’m biased, but I think VentureLab is the best commercialization support group in the country. It has a separate staff, NOT part of the licensing office, who have direct entrepreneurial experience.
VentureLab averages about one spinout company a month, maybe a little more. One of our core beliefs is that allowing professors to be CEO is like teaching cats to swim: You CAN do it, they won’t be very good at it, you will lose a lot of blood, and they will HATE you. So we don’t allow that. We insist on finding an experienced entrepreneurial CEO from the community before incorporating a company. That’s a lot of work, but it’s worth it. |
| GRA Commercialization Grants |
As part of VentureLab, we work with our friends at Georgia Research Alliance — some of whom are here today! Lee, Connor, say hello. GRA is a public-private partnership which gets most of its funding from the state of Georgia.
Without going into all the gory detail, GRA allows us to put up to $400K of grants and loans into a spinout company before they have to sell equity to an angel or a VC. That early money is magic, and it really improves the success ratio of the VentureLab spinouts. |
| GCMI |
We’re trying to take some of what we’ve learned about commercialization outside the university. We’ve launched the Global Center for Medical Innovation, where we help practicing physicians commercialize their inventions.
It’s a process similar to VentureLab, but it’s backed up by a shared prototyping facility where we can deliver dozens to hundreds of devices for animal and and human trials. |
| ATDC |
The Advanced Technology Development Center. It’s been around almost 32 years, so we’ve made every mistake at least once. Sometimes twice.
It’s big. We currently have over 400 technology startup companies… about 40 of them are tenants in our bricks-and-mortar facilities, but the vast majority are not. And most have no real tie to Georgia Tech, except you can usually find an alumnus or two if you look hard enough. We provide a mix of coaching, of connections, and of community-building activities, and it’s working really well. |
| Flashpoint |
We looked at the Y-Combinators of the world and asked: “What would it look like to have one of those on a university campus, with academic rigor in the educational component?”
So we started one. We admitted 17 companies in August, and they’re in dedicated space across the street from my office. There’s a dedicated investment fund. And the challenge is: “What can you produce in four months?” They’re going to have a Demo Day in January, and I think several of them will get funded. It’s an experiment, but we’ve already committed to a second class in 2012, and I think we’ll continue beyond that. |
| NSF I-Corps |
Great minds think alike, and Steve Blank has been working with the National Science Foundation to create a nationwide program called I-Corps.
It’s based on a lot of the same assumptions as Flashpoint, and we’re proud that a Georgia Tech team has been selected as one of the first twenty university spinouts nationwide to go through the program at Stanford. I think we’re going to learn a lot from each other. |
| Georgia Seed Capital Fund | We have a small seed fund that we can use to match private sector investments in local startups. The state hasn’t given us any money in a few years, but we’re always hopeful… |
| Georgia Tech Edison Fund | And we have a charitable-contribution fund, where we don’t have investors, but we have DONORS. Fully tax-deductible. Mostly Georgia Tech alumni, who want to see some of their contributions being used to support entrepreneurs and not the football team. |
| SBIR Assistance Program | Since we like Federal dollars, we have a program to help small companies identify, apply for, and win SBIR awards. We’re not an EPSCOR state, and we’ve been hammered by state budget cuts lately, but even after cutbacks, we managed to help bring $9 million in grants to Georgia last year. |
| Technology Enterprise Park | Everybody has a research park, and we have one too. We’re expanding ours, which is focused on biotech and cleantech, where more mature companies can locate laboratory facilities right next to Georgia Tech. |
| Innovation Partners | Finally, Charles Ross is here from my team. We’ve started up a line of business helping cities, states, and even other countries analyze their own innovation ecosystems. We’ll help them — maybe you! — identify opportunities for incubators, accelerators, seed funds, parks, or other programs. And we’ll even help get them going. This isn’t a zero-sum game. |
So we have a lot going on. The last thought I’ll leave you with is that, as the nation’s largest engineering school, we think we’re pioneering a new discipline: “startup engineering.”
Building a startup can be like building a bridge. A couple of thousand years ago, when people needed a bridge, they’d cut down a bunch of trees or haul a big pile of rocks and just BUILD one. Usually it would either be ridiculously OVER-built… or it would fall down.
Then the Romans worked out how to use segmented arches and they built hundreds of bridges, all over Europe, and some of them are still in use. For the first time, you had people ENGINEERING bridges, not just piling up a lot of rocks.
We think we may be at a similar point today with startups. Paul Ahlstrom talked about this in the opening session. We’ve learned enough about what works — and what DOESN’T work — for startups that we can actually set up some engineering principles and make some predictions.
It’s a long way from perfect, but it’s very very different than the process of just ten years ago. It’s an exciting time to be in this business.
Georgia Tech is proud to be leading the way and, once again, thank you very much.
Stephen,
Thanks for your work building these programs. It makes me proud to be a part of Georgia Tech! A quick anecdote for you: Tech does well in producing entrepreneurs. In the first round of Startup Chile there were 9 GT alumni- more than MIT or Stanford. It’s been a strong community to draw from down here.
However, throughout my time at Tech I’ve always felt like the undergraduate entrepreneurship ecosystem is sadly lacking- especially with regards to the COE. For all the great things going on across the highway, it seems like the priority, as usual, is on research over undergraduate education (in this case commercializing research). The Inventure prize has been a great start, but the students I talk to still don’t see entrepreneurship as an option for them. Heck, for the largest engineering school in the country we don’t even have a functioning undergraduate entrepreneurship club.
I have one semester left (this spring) and would love to help change this…. Capston Design classes come to mind as a place to start.
Do you have other suggestions?