Invention Dimension I: Why is the U. tops in start-ups?
By Jenny Brundin
Salt Lake City, UT –
When it comes to creating new start ups from inventions, the University of Utah is tops. It's tied with MIT for first in the nation in creating new startup companies from research. College officials from around the country are flocking here to learn the U's secret. To understand why the university is leaps and bound ahead of most other universities in the area of converting inventions into spin-outs, we start in the lab of Dr. Glenn Prestwich.
Researcher Lindsey McCord is checking on her mice. These aren't ordinary mice. They've got splotches of bald patches - red and inflamed. These mice have rosacea. It's a chronic skin condition where the cheeks, nose, chin, forehead, or eyelids become inflamed. Fourteen million Americans suffer from rosacea and there isn't really a good treatment. So these mice are the guinea pigs so to speak, for finding relief.
"The first step is coming up with a model so that we can study the disease," McCord said. "And then we use that model to treat the animals with the compounds that we're testing."
Many universities stop there. They'll test and test and amass huge amounts of knowledge. But the University of Utah excels at going one step further. Dr. Glenn Prestwich oversees the mouse experiment.
"Everything in the research laboratory is a really fancy science fair project," said Prestwich.
"And unless you have a focus on the end users, the end users are the patients and the physicians that are treating the patients. Without that focus, research is just kind of playing. The challenge is getting from the research, the technology, to a product. And that's what the U. has become good at."
So good in fact, that the University created 20 new companies in 2008, tying with MIT. The national average is three. And that's even with the research budget at MIT 5 times larger than Utah's. Jack Brittain is the U's vice-president for Venture Technology Development. He says on average, it takes 100 million federal research dollars to eventually get a spin out company.
"We were doing one company for every 15 million," said Brittain.
So far this year, eighty universities have already paid a visit to the U to find out its secret. To start? A long history of fostering inventions one that began well before most other universities. Other schools, says Dr.Ted Stanley, were completely academically focused. Our university was different. It had, says the anesthesiologist and inventor, an entrepreneurial culture. Stanley was recruited to Utah in the 1960s by Willem Kolff.
Kolff developed the first artificial kidney and artificial heart transplant. A few buildings over, another professor, mechanical engineer Wayne Brown, was also blazing an entrepreneurial path.
"They were doing cutting edge stuff in engineering and medicine and they were very powerful and influential people," said Stanley. "They had lots of grants and contracts from the government and they attracted other entrepreneurial type people around them."
In the 1970s, researchers David Evans and Ivan Sutherland toiled away in abandoned barracks on campus. There they invented a whole new field: computer graphics and visualization technologies like flight simulators for pilots. Their graduate students went on to start companies like Silicon Graphics, Pixar, Adobe and Netscape. Back then, though, the U's support of inventors was haphazard at best. The U's Jack Brittain says that all changed with the Bayh-Dole Act of 1980.
"Suddenly the universities were the patent holders and had intellectually property that they needed to worry about protecting and marketing," said Brittain.
But getting most academics to take their idea and turn it into a company is like getting a cat to jump into water. Dr. Glenn Prestwich:
"How do you talk to lawyers?" asks Prestwich. "How do you talk to potential investors, angel investors who made money off of real estate, and you have to tell them why your product, your company in the health sciences is worth them, their company, putting half a million dollars into?"
And this is where the U's approach is more honed than many universities. First, it has a team of entrepreneurial faculty advisors like Prestwich. They're trusted peers, high level scientists, who know a lot about starting companies. Jack Brittain says professors feel more comfortable talking to them instead of through a bureaucratic apparatus.
"[They're afraid]" that if they stick their hand into there, they'll get sucked up into the machine," said Brittain.
Second, the U has a fund to build prototypes to see if an invention works. Third, it helps secure venture capital. It's scooped up, in fact, more than $270 million in the past 5 years, 90 percent of it from out of state. Joe Tanous spent decades in the private-start up industry. He says Utah gets a lot of respect from Silicon Valley investors.
"Not only have they cranked out a lot of spin outs, that's one measure, but how long those spin-outs survive is another measure," he said.
Utah spin-outs have a high success rate and tend to lead to others. Glyco Mira is Glenn Prestwich's newest company. He's the researcher developing a drug to treat rosacea, the skin disease. Everyone gets excited when researcher Lindsey McCord presents her findings to the group. They show that their compound is having an effect rashes and redness on the mice. The current method of treatment used in the clinics by rosacea sufferers, metronidazole, is having none.
Prestwich tells the group about what's up next to move the drug into human clinical trials. They'll meet with sub- licensees to find out what they need to go to investors to raise the three to five million it will take to get the drug into the clinics. Into the clinic, says Prestwich, and into the hands of patients.