Speaker 1  0:01  
Good afternoon, everyone. Welcome to What support can TTS provide to faculty driven startups beyond licensing presented by Autumn. My name is Holly Lundgren. autumns online professional development manager and I will be your staff host for today. All lines have been muted to ensure high quality audio and today's webinar is being recorded recorded. If you have a question for the presenter, please type it in the q&a box at any time. I want to take just a brief moment to thank autumns annual webinars sponsor, Marshall, Gerstein, and Borun. We appreciate their ongoing support. And now I will introduce our distinguished speaker. Joy is the Assistant Director of the Office of Economic Innovation and partnerships, where he oversees and manages technology transfer activities, and corporate partnerships for the University of Delaware. Among his other roles, Joey is actively involved in managing intellectual property, assisting in establishing startup and spin off companies and bringing forth University industry collaborations and partnerships. He has more than 20 years of experience in the field of business development, and a career that has produced highly regarded commercialization strategies and outreach practices of novel technologies in engineering, biotechnology, agricultural and the biomedical sector. Join is a registered patent agent for the US Patent and Trademark Office. He is also a Small Business Innovation Research reviewer for The National Institutes of Health. He earned his registration as a technology transfer professional from the alliance of technology transfer professionals, and is a past recipient of autumns. Howard Bremmer scholarship, in his, in his capacity as chair of the audit and financial management profile portfolio, Joy oversees autumns, audit, Finance and Investment committees. And now I'll go ahead and turn it over to our speaker. Welcome, Joy.

Speaker 2  2:02  
Thanks so much, Holly. Welcome. Audience. It's unfortunate that due to the fact that we have to do this on a webinar, I can't quite see how many of you are around, but I'm hoping that everyone is ok listening to me and have access to at the very least, the video so you can I'm going to turn over to my slides here. And, and then we can get going give me just a second peace.

Speaker 2  2:53  
All right, here you go. Once again, thanks so much, Holly, for the introduction, and welcome, everyone. I hope everyone is doing well, I would like to, of course, begin my discussion here by thanking autumn for inviting me over and extend our gratitude to all those individuals that are keeping us safe in these troubled times. And I am, of course greatly appreciative of many of us, even in our academic community that are working with an on the frontline with many of the COVID infected patients and and I greatly appreciate the effort that they've taken on in the roles that they're doing at the current time. So thank you very much, once again, for everything. Thank you, to everyone that joined this, this discussion here. And I would just go ahead and quickly give you an introduction of why I'm here and what the topic that we're gonna be talking about is going to be about. So let's talk about tech transfer in general. So as Holly mentioned, and I greatly appreciate this glorifying bio that he provided of mine. Of course, needless to say, from what she read that I've been in this profession for many years now, and I've seen the profession evolve. And I'm presuming that many of you who are listening to me today are the folks that have also been in the tech transfer world for maybe some or longer years. But you've seen within your short or long stint that profession is evolving and it's growing in general and nature. And so, due to the fact that it is changing in nature and is much more expensive than what it used to be many years ago, I thought of putting this topic together, where I will be speaking about a specific aspect of the role of tech transfer professionals and their duties as it is evolving towards assisting with startups that are particularly driven by faculty of From where their own affiliates are. So how best can tech transfer professionals assist with faculty members that want to start their business, mostly around technologies that they have invented. So that's kind of what the the length and breadth of my discussions would be. And the genesis of my discussion is, is really on the fact that when, for many of you, who started in the tech transfer world many years ago, felt that tech transfer was really a functionality where we hang do our jobs in a format, where our role is to take on invention disclosures, file some kind of patents around it, shop around for the brightest and the best candidates. And if it does happen to be a startup and the licensing the technology and then wash it off your hands and let the startup take its course and try and commercializing the technology. So that used to be what the mindset was many years ago, after the incipient of the by dual act. But of course, a lot has changed since since. And this is where the role of the tech transfer professionals has also come in play only for the expensive functionalities that they're kind of working on with. So let me begin with my first slide here. And as you can see, from the first slide, I have tried to depict what we tech transfer professionals consider ourselves to be. So I would want to give a disclaimer right now as we go ahead with this discussion, that we are mostly facilitators in the job. So we are here to assist with faculty driven startups start the technology to commercialize only in the facilitators role, we are not in the role of making decisions on their behalf. So let me give that general blanket disclaimer here, and then provide you with some of the touch points that I feel are important that tech transfer officers should need to get involved in these startups as as they move forward. So beginning the discussion, maybe it would probably be appropriate to talk about the two ends of the spectrum. The first 10 being how we describe tech transfer in today's world. So let's go with the definition as is written technology transfer the process by which new inventions and other innovations created by these institutions, labs are turned into products and commercialized through. And this number one is where it used to be a conventional tech transfer the licensing and patenting of IP to corporations was something that was standard. But now we've moved on. And we have gotten ourselves into a situation where we do in real large numbers, the creation of startup companies, where we end up licensing these technologies. And those licenses are usually governed by faculty that have developed these technologies. On the right hand side I have mentioned are depicted some of the information that comes from Orem from its infographics. And many of you have already seen it. But what I want to highlight here is other than the fact that tech transfer is a big contributor to the general gross domestic product of a nation like ours, somewhere in the range of 865 billion in the last 20 to 25 years, we have also churned out as many as 13,000 plus startups in due course. So there is a substantial portion of tech transfer that goes on where we don't don't don't just end up transferring the technologies to corporations, but also to start up. Now, having said that, I would like you to pay attention to the bottom of the of the slide here. And as I want to emphasize on another fact. And that is the other side of the spectrum. And that really revolves around how we define startups in today's world. So again, for many of you who had been involved in licensing to startups, maybe a decade ago, there was a general conception that startups are basically nothing but smaller scale companies. So in general, if you carve a license out to a startup, it's really no different from giving it to a corporation, except that this corporation probably is strapped by issues regarding personnel strapped by issues regarding money. So it's basically the same as a small company, but it's sort of branded as a startup. But again, in due course, in the last 10 years or so, we've had a sea change in the thought process of what these startups are. And now we are kind of getting to the That's some level of consensus, arguably. So that startup is basically not a small company. But it is a temporary organization designed to search for a repeatable and scalable business model. So it's really not anymore that we have the startups as a miniature version of corporations. But these are very unique entities that in some respects, are trying to find out a business model that suits the technology that they have license from the university. So it for some people, it may just be a matter of semantics. But for the point of view of tech transfer professional, it is of paramount importance, because realistically, when you're trying to license the technology to a startup, it's no more the kind of structure and the kind of basis that you licensing these technologies as a small, small corporation, it's a little different. And how these are different is something that I'm going to eventually end up talking in this presentation. So hopefully, you will appreciate the fact that while the professional tech transfer is moving, so is the definition of startups. And so in some respects, we are really handling a very complicated situation here, where we are not just trying to figure out the best modus operandi to make sure that the license works well. But also trying to figure out the best modus operandi for the entity whom your license is it is technology to, which is no more a standard, small, small level corporation. So let's move on. And talk a little bit about what I'll be talking in the presentation today. And I do again, want to mention the fact here, that the contents of this presentation would be very expensive. And so by no means do I consider myself to be

Speaker 2  12:06  
an expert in any of these areas. But I'll be touching upon some of these areas. Only because I feel on a personal note that this is where tech transfer offices should start to take a closer look at and this is where tech transfer offices to try to get their expertise bolstered, where they are getting more and more involved with startups so so the the touch points would be discussed in these contents of the discussion. And in my opinion, the first touch point would be the the end of the pipeline, which is the license deal itself. So let's begin by where we drop off, which is creating or writing the license for a startup and try to understand what we'll have to make or make changes to or to differently from what it used to be in the past or what we'll be considering to be different from what conventional license would be. Let's talk a little bit about another aspect, very important aspect, of course, which would be revolving around conflict of interest. And as you can well appreciate here, the situation that we have a faculty member who is also sitting on the other side, as a company manager, who is wanting to take the technology from the university. So there is obviously a situation where there is the possibility of a lot of conflict to happen. So how best to tech transfer offices handle conflict of management, conflict of interest and manage those. The other topic I wanted to talk about here would be another touch point, which sort of revolves around the aspect of having a good management in place for the startup that the technology is getting licensed off to, and what rules of tech transfer offices should be in trying and handling those kinds of management issues for the company, if any. And once again, here comes the disclaimer that I mentioned earlier that our job is to facilitate and not to make decisions. So what does the transfer office really have in store for assisting with startups, faculty, different startups to develop the management team. The other thing I would want to talk beyond this would be to help in our roles in coaching startups in various functionalities and various aspects. And that will be discussed in some detail. And then specifically, coaching for a particular area where startups are prolific, which is the SBIR and STTR grants. Beyond which I will be talking a little bit about innovation programs, that tech transfer offices can get involved to make sure that the start reps can get the resources necessary to go about trying and doing something that they are good at. And, and then going through aspects of networking, and how best tech transfer offices can assist with the startups in finding finance and building the company. At the end, before I conclude, there'll be a little talk about events, where we do not find the startup to be doing as conclusively as we wanted to. And then what would be our arrangement just in the event that there will be a collapse. So that'll be the general contents in the next 45 minutes or so of my discussion. If you have any questions, as Holly mentioned, please feel free to type them on the chat screen as much as I would really want to have this discussion to be interactive. Unfortunately, the platform doesn't allow us to do so. So please feel free to feel free to type these your questions you may have. And then I will try to answer them as best as I can, to the best of my capability. All right, so let's delve in and before I delve in, let me talk a little bit about myself and my university. You will start arguing that as to why I'm speaking so much without really the background, but I do want to mention that I come and I've been working almost for a decade now at University of Delaware, which is pretty neatly located between Washington, DC and New York, for those of you who are in this vicinity and who have traveled, you know that we are one of the largest economic stimulants for the state of Delaware, which is the second smallest state, and yet the first state of the US. And University is fairly prolific in the way they act. And I am hailing from an office called the Office of Economic innovations and partnerships, which is a little beyond the tech transfer functionality in that we try to assist with the economic development of the state in general. So we are not confined to just our university and having said that there are three other universities within the state that we fund the tech transfer functionality for so we're basically the face of three other universities, other than University of Delaware, we have a fairly substantial research budget. And so along with that budget, we we do a good number of invention disclosures, by all means, our office is what we would call a medium sized office. So we get roughly 50 to 60 mentioned disclosures every year. And, and those invention disclosures, of course, turned into products that see some commercial light at the end of the tunnel. And, and of course we've had some good success stories as well. But since this discussion revolves around startups, I do want to mention that we've so far been successful in the last decade of our existence, being able to churn as many as 30 startups that are still standing on their feet. And they're sort of delivering in the manner in which we wanted them to deliver. So we have issued licenses to those startups. And those startups are as functional. And they're trying to give us any resources that's necessary for us to do. Again, it would probably not be appropriate to not talk about a couple of success stories. And so I'm going to quickly change gears and talk a little bit about a couple that you may or may not have heard. And the first one I would want to bring to your attention would be the STF technology that was developed here at University of Delaware. It's called a shear thickening fluid. And, you know, just like any tech transfer professionals and I presume the audiences, primarily composed of tech transfer professionals, we, for nearly eight years ago, we filed inventions around this took this technology to license it off to a startup company. So just to highlight what the technology is, is basically a membrane that really looks like a rubber rubbery membrane in general, but it's completely stab resistant and developed with the D. DOD. This was a technology that was built for defense purposes for armors. But the technology came in our lap and DOD just wanted to license it only for their own applications. And it came to our lap and we eventually turned the technology off to a startup company that was developed by Dr. Nam Wagner. And the technology has been in application various areas. And one that has been a real commercial success has been in the use of this technology, in Reeboks pure move bras sports bras, in general, in general. However, it's also being used in applications and shoes and helmets. And a lot of studies right now going on in how it can be used for other app applications and the company is doing fairly well. Let me just quickly talk about the second one. And this is a technology that many of you would, would appreciate because you probably have it all in your hands right now as we speak, is the one at the bottom. So the two gentlemen who you see holding this, this gadget in front of them is John alias and Wayne Westerman. Professor and postdoc who developed this, that stream multiday. It's called Touch tree multi touch keyboard in 1998. So they came to our office with the disclosure, and just basically meant for people who had issues with carpal tunnel. And so we took this technology around file patterns, and gave ownership of the patents to a company called finger works that these two individuals developed in 2005. And long story short, this technology is right now been, the company eventually got bought over by Steve Jobs, Apple in 2005. And now is existent, as we know, as touch screen technology, and first introduced in the iPhone 2008. So the touchscreen technology that you see on your cell phones and all the electronic gadgets,

Speaker 2  21:15  
is a technology that came from University of Delaware, and was spun through a startup company. And, and simple and so was very successful in in the way it eventually ended up being. Of course, those were early days. And I'm going to just get down to the actual story here. But I'm sure many of you who are sitting on the other side of the screen listening to me also have similar stories to tell. But the idea in general is, as we discussed, the beginning of the meeting here is to try and make arrangements that the tech transfer office can facilitate situations where the startup that have licensed the technology can eventually do so in a way in a format that eventually becomes successful in doing what they're doing. So let's begin our first touch point here of what tech transfer offices can do to assist with faculty. And obviously, like I mentioned, I think we can start the story here with talking a little bit about the license itself. So let's talk about the license to begin with. So here you are a situation where the invention disclosure has come to you from a faculty, you have decided to eventually file a patent, the faculty eventually volunteers to start a business around it. And the first thing you'd want to do is to eventually give it off as a license. So do you know anything about the company? Before we give up the license? I would tend to say no. Do you have any idea of how proficient the faculty member would be to commercialize the technology? You have no clue, of course, no. Hopefully the merits of the faculty and the technological skills but whether the faculty member is going to be one that'll stand out as a good steward of taking his or her startup to the next level. And then commercializing technology you don't? Do you have any clue of whether the faculty has enough money to eventually make this startup work? You really don't. So when you begin the license deal, the first problem that all tech transfer professionals really face is in the license itself. How do you carve a license, where you have a very early stage technology developed by the same faculty who wants to start a business eventually ended up making this into a success. And so you would try to think that the company would become successful, but you really have no basis to eventually carve out your license. And just, you know, just to readdress what licenses is basically it's an exchange of rights in lieu of receiving royalties, right. So on the top as shown a gentle cartoon depiction, that you are the license at the University of giving up the license to the to the startup, who is eventually the licensee and providing some rights and restrictions on it. And in lieu of that, getting back royalties, which will eventually hopefully, build some equity for the university. But the licensee is really a blank cheque, they have absolutely no idea what they are. So what you would typically do in a situation like this, and that's the standard practice that we do is to build upon the philosophy of developing the license that will be back loaded, which implies that you don't have any money right now. The company really has no, no, no basis to show their success. But you can volunteer as a tech transfer professional to assist the startup in every way that you can Can and carve a license, that would be backloaded implying that your success is something that we're looking for. Once you're successful, then you pay us back for all the risks that the university has taken in due course. However, that's not without saying that they don't have any skin in the game. And so as a normal practice, because of the fact that many universities have the biannual provision, where it's the fiduciary responsibility to make sure that this law, this particular startup is the most conducive startup for them to license out the technology, you would want to make sure that you have some idea of what the company is wanting to do with the technology in the short term. So what we typically do is we send them out a questionnaire. And that questionnaire basically comprises of questions that would give you some idea of what their wants their needs, and the goals for the business would be. And based on that questionnaire, we craft the license agreement. And we basically base the license agreement upon upon equity. And that's something that is important because it is a risk. But the equity is, is one that you want to eventually be very mindful of. Now, when you build the equity, for that particular license agreement, you have to make sure that the equity is such that it is got provisions where it is not precluding the startup company, from getting investors to eventually take a stab. So the amount that you're eventually wanting to get out of the company, by virtue of the equity has to be very, very delicately balanced, and sometimes even renegotiated in due course. So that's something that tech transfer professionals will have to bear in mind. And probably, if not communicated, keep at the back of the mind, that the licenses will probably need to get renegotiated somewhere down the line when the startup eventually ends up getting successful, or get a better feel of what the business model is. Other aspects that startup will have to take care of that tech transfer offices will need to know is a little bit about whether the university would want to be involved in the funding rounds. But they would be wanting to be involved in board participation, the level of upfront if there is any that is involved, that they would want to take. Now again, a word of caution, startups don't have too much money. So it's always a good idea to keep the up front to as minimal as possible, depending on the capabilities that are demonstrated to you talk about the milestone and also make very clear and elaborate clause on the on the license agreement that talks about what I termed the Phantom costs, that is hidden costs. Because many startups don't quite appreciate and understand the amount of costs, they have to eventually end up paying for things like patents, or in the unlikely event that there is litigation. So keep that clause very clear in the license agreement. And in as a standard norm, you know, sort of Delaware always goes with the startup to at the very least end up paying for the patent prosecution costs. Because the university does not want to take the risk. But again, it depends on the university as to what they really want to do and and move forward with. So based on the best judgment, make sure that the license is carved out, well make sure that it is somewhere as a situation where you understand the company, make sure that the company does not have to come back renegotiating the keeping in mind that this is something that may very likely end up happening as typically happens in our university as well. The next aspect, the tech transfer offices. And by the way, if you have any questions on my previous slide, and feel free to scribble them down, and I'll try to address them.

Speaker 2  29:00  
But I would want to move on to my next aspect that would be of paramount importance. And that is conflict of interest. And it's pretty obvious, right? So when you see a situation where you see the faculty sitting on both sides of the table, it's pretty obvious that there would be a conflict and very often, rather, I would say more often than not, I personally found that faculty members are not all that good at wearing two hats. So even when the communication happens between the faculty and the tech transfer office, we virtually we virtually point out to them. Hey, Dr. Joe Smith, are you wearing your startup hat or are you wearing the faculty hat? Because what comes out of the mouth sometimes is very muffled because they are wearing both hats, one on top of the other and they don't quite communicate well enough to you as to what they really want to get. Get to at the time and they want to grab the license Do you want to look for assistance from the tech transfer office, so make sure that you that you clarify to them that a conflict of interest literally has to happen, there is no way that it can be avoided, only because you're sitting on both sides of the table. And so they have to be very clear articulating what the conflict is. And that really varies from one faculty to another. But if they have articulated that, it's going to be very clear to you that what the tech transfer office needs to be involved front and center is to manage this. And so they have to develop some kind of a management strategy to make sure that the conflict of interest is handled the best in the best format, and eventually handled in a manner that it is manageable. So try as much as possible to address some of these conflicts in a way that is incorporated in the license agreement or in the policies of the university. You don't want to get into a situation where there is a conflict, and you just don't know how best to handle or you haven't quite communicated that well enough to the faculty member. So try and, you know, dot all the i's and cross all the t's, so to speak, or the other way around. But make sure that you have situations where these communications, this conflict of interest can be managed, the communication is complete. And there is some procedure and policy in universities where these are handled well enough. At our university, of course, we have a conflict of interest committee that meets on a biannual basis, and every faculty member that has started a business has to fill up a conflict of interest form. Now it could be the Center Street, that is the easiest thing they have to do. Of course, we don't want to make it very stringent. But in the event that there are situations that come in play, and I'm going to run just a few just to give you an example of what situations we we have faced, there has to be some policies around. So let's go through a few situations here. And I'm just doing this for the sake of your understanding of where the conflict could come. Let's talk about a faculty inventors double dipping, alright, he's seeking equity as a founder, and also sharing in the universities equity shakes stake. So what happens here that, that the faculty is basically double dipping. So it has it's, it's it's getting money, as the founder of the company is also getting distributions from royalty. Now there has to be some clarity from the university standpoint of what happens in such an event. And again, there is a range of activity that universities have eventually ended up doing. You notice the Delaware at this point in time has no problems in double dipping. So we made it very clear that you are actually sitting on both sides of the table, and you can make profits from both sides. However, there are other universities that think that that's not appropriate, and there really isn't any right or wrong answer. And as I said, it's a conflict of interest that needs to be managed. And as long as that relationship is clear, and as long as the policies are clear from the university or outline in the license, that should be fine. Let's go to scenario two. The faculty want to grant but it appears to be using the funds in his university based research and not the companies. So what do you do so you have a faculty that has eventually won a grant, and is not using the money appropriately. So make sure that there is some protection in the grants from grant funds, and you eventually are going to make your conflict of interest committee, raise a flag and make them aware that this is what's happening. And the appropriate entity should be eventually taken care of. And the faculty members should understand that that's not the right thing. Another situation that we face very often is when a faculty starts up a business, and really doesn't have any space. So they're using the lab space, are the lab equipments for doing the research that is meant to be done for the startup, in a situation like that. The policy again needs to be very clear. Who does what, where does it have to happen? Again, universities have been all over the board in this. There's some universities that have the privilege and the capability to offer lab space for startup use. US doesn't. So we have to make it very clear, for instance, to the faculty, that if you are using University equipments, you will have to somehow make sure that you have to pay up for that as though it's a startup company or a company that is leasing university space. And we have to run it by the administration. The chair of the college needs to approve and sort of the dean and money and resources need to be eventually coming as to eventually come from the startup to the university in the event that there is a use of a classic situation is when we've had situation. matter that was handled where there was to conflict because the faculty was actually developing prototypes, and selling it out to commercial entities on behalf of the startup. So there was a conflict there. And we had to handle it basically, based on these policies. Another one, and I won't do too many, but just maybe a fourth quick one is when you the faculty spending much more time in doing or working for a company using federal resources. So where does the time commitment really come? And so there has to be some clarity in where the faculty is putting the time. So if there is a need for time sheet, compilation of what is the need for them to eventually write something where there is, there is a documentation that revolves around where the time goes, the conflict can be handled. And of course, there is also issues with consulting, universities are fairly prolific, and most of them that I know of where they outlined very clearly what the consulting role of that particular individual is, the faculty is, and eventually, where they're going to be eventually putting their time in for consulting and how much is the length and breadth of what they can eventually end up doing. So we talked about two things now, the license itself and then conflict of management. These are the two that we discussed. Once again, if you have any questions, feel free to shoot these. But like I mentioned, tech transfer offices, in my personal opinion, should be involved in these aspects, fairly hands on to make sure that the startup is not doing anything wrong, or is at least continuing to comply with these policies. And then they're trying to do their best to try and commercialize the technology that eventually ended up licensing. So beyond this, the next question that comes in mind, and this is a scenario that many of you may have seen.

Speaker 2  36:48  
The star comes to you and says, the faculty comes to you and gives you an invention disclosure and says, hey, I'm interested to start a business. But it's either one of the two, but I have absolutely no idea whether I can do it, I pref prefer not to. And I want to basically hand it over to the tech transfer folks, to see how best they can accrue or recruit a management team that can eventually end up running my startup. Or they would come saying that I know the technology absolutely like the back of my hands. And I want to be front and center this technology. And I want to take in, take the technology and run with it. So I want to be the CEO of the company, and this is my baby, and you better make sure that the license is given to me. So situations like this happen. And that's when the onus goes back on the tech transfer office to make a determination. Once again, our role here is to facilitate and my personal opinion, I have always told most faculty members not to be the CEO of the company. And part of the reason why they have said that, and I've been wrong many, many instances, there is no right or wrong answer, to say the least. But I've said that only on the presumption that the CEO of the company needs to have certain mindset, which eventually a faculty member may not end up happening. So let's talk about this a little bit, here. And that in you're trying to fill up the position of CEO, it might be a good idea for you to not be one and try to be standing on the side as the CTO. So the CEO, of course, implying that he is the executive officer of the company, and the CTO being the head of the technology officer of the company, and somebody the CEO of a company, he would have to have some skill sets that may or may not be pertinent to the individual that has developed the technology. But when that individual is the CTO of a company, in other words, is in charge of the technology of the company, there is possibility that that individual might be good. So if the faculty member comes back acknowledging that, yes, they want to be the CTO, and he has somebody in mind to be the CEO, great, then you have a company up and running. If the individual says that he does not have anybody in mind, then you can actually end up end up reaching out to some entities within the university or outside to see if there is any possibility. So here is our tech transfer office, we have feeder program with many of our neighborhood, academic and business entities that provide us from time to time interest of personnel who'd want to start a business of their own with entrepreneurial skills, mostly graduate or undergraduate students that have the acumen and as looking for the next best thing to do. And so we keep a Rolodex and we eventually would share that with the CEO or the I'm sorry with the faculty and mention the names and bio and say if they're interested, they can do the recruitment themselves. Or we, you know, ask the ask the faculty themselves whether they have any students, or recent graduates or postdoc that has interests Did and again, oftentimes, the faculty member would come back with some responses, if not theirs. But some some of the colleagues can have grad students that may have entrepreneurial mindset and would want to be the CEO. Or if your university has a residence, you know, entrepreneur in residence program, for instance, there could be candidates that can come, but we eventually facilitate the selection of a CEO. And that CEO would be interested, if interested would eventually end up wanting to become the so called manager of that particular startup. And there's some level of credibility and in doing that, only because we feel that faculty members are not the best CEOs of their own companies. So why do I say that faculty members, not the best CEOs of the company, so this comes with a little bit of statistics and data that I ran a webinar and in the past, and I've talked about, but again, I don't want to go into great length about this. But the reality of the matter is that when you look at the changing landscape of startups, you will notice and from this slide, you'd see that there's a general difference in the attributes that most of the faculty members have with what would be necessary for a CEO. And that's basically because while the faculty is very good at inventing, and knowing the technology very well, the mindset of a CEO is mostly customer driven, and not technology driven. Also the mindset of CEOs amenable to pivoting so they can change, they may have some level of understanding or some level of, of outlining of what the business should run, but they are amenable to change, whereas mostly those that are technology driven, are not amenable to change, because it's really their baby. And they've known the technology well enough, that the driver is not the technology itself, but it is the customer. And that's what some of these faculty members find hard to eventually believe. Their belief, always, almost always, and I'm sure many people listening to me here would appreciate this is that the technology is great. There'll be many companies wanting to come and pick it up. And we'll be making millions and millions of dollars in no time. So that's a notion that many of us hear from faculty members. And that is unfortunately, not the notion that the CEO of a company startup company should have. There are basically three roles that most CEOs have to play. So there's a functional aspect that the CEO needs to eventually take care of that many faculty members are incapable of doing. Again, this has no attributes to their capabilities. And I've been proven wrong many times. And there are some faculty members that are great and everything. But I thought I'll outline it only because this is something that has been studied, and it has been outlined by others as well. One, most CEOs know how to strategize, that is to drive the mission and vision of the company. They know how to bring together human capital, a team together, and just not putting the team together, but motivating them in the proper way. And they also know how to secure finances, further operations, and eventually reaching out to entities that can eventually end up getting them the appropriate amount of finances that would be necessary for them to run the company and agency. So this is another aspect that I thought I'd want to highlight in this talk. tech transfer offices, again, are here to facilitate and one of the facilitation would be to end up assisting with startup in building the agency and the organization. And my personal preference may not be yours. But my personal preference based on some statistics and data is to not end up having the faculty member who wants to start the business, be the CEO of the company, but to have somebody else who could be a student who could be affiliates, who could be others that have already been serial entrepreneurs in the past, to be the CEO of the company, and provide them with appropriate revenues for them to run the company and incentives to run it. And then take the technology to the next level as they are usually more successful than the faculty members themselves. So that is another aspect. Once again, if anybody has any questions in this on this aspect, please feel free to shoot right back to me and I'll be more than happy to respond to questions on that. So moving on to the next topic. That's a topic where I would want to really highlight a little bit about

Speaker 2  44:49  
the glass half empty. So as we know that startups you know, obviously have very good intentions at the beginning. But as they eventually Start moving, they realize that the startups are not always successful, not nearly 100%, the success rate is as low as anywhere between 20 to 33%. So let's, on an average mentioned that 1/3 of all tech transfer of all, all faculty driven startups eventually end up succeeding, which is reasonably good. But the fact of the matter is that they don't end up succeeding. Now as tech transfer professionals that scan the kind of country and theater because when we take a look at the invention disclosure, and we make a commitment for technology to be taken to the next level is a we resources in terms of personnel resources, in terms of putting the money in filing patents come and play, we have done hopefully, enough diligence to make sure that the technology is good enough for us to invest all the resources for it. So why is it that when we have a technology that we feel is one that is commercializable does not end up to be something that is commercializable, in the hands of a faculty driven startup. So it's kind of an odd ball for us. And as much as we want this to be 100% It really is way lower than that. And so the next aspect that I personally feel that tech transfer offices should be involved in, in assisting with startups is really a drill down of the reasons why most startups fail. And so if you look at the first reason that has been highlighted from many studies in the past, you will realize that the failure of most startups is because the technology that you have ended up licensing to that particular startup is, is not wanted. It's not a technology that has any demand. And, and the customer really is not finding any value from the technology. Now, why is that the case. And that's primarily because of the technological bias that we have technological bias in terms of the tech transfer professional that has licensed the technology and technology bias that is coming from the faculty member that wants to start up a business, there is a general presumption that the technology will be something that will be taken off by any entity who would be the customer only because of the technological merits. But that really is not the case. Because what they have to eventually end up doing is to end up getting the technology in the hands of the consumer, based on what the customer really wants. So again, for those who are in the startup business, they would know very well something that I'm going to be talking about in the next slide, that the entire notion of building startups around technology is sort of broken down to something that is mostly customer driven nowadays. And so again, in the last 1012 years, there is a lot of evolution that has happened, where the whole concept of business plans have sort of dwindled to nothing. And we are now getting into this new era and world where startups are asked to develop something called the Business Model Canvas, which is the cartoon that are depicted on the right, which basically is a fill in the blank, where a startup would want to draw it out and try and develop their business model based upon their understanding of the customer. And that is mostly done by an outreach program, where startups are asked to go and interact with the customers, and then fill in all the blanks based on the interaction. And again, many of you know that there is a very prolific program here in the US, called The ICORE program that many universities are also affiliated with, where the exercise of trying and developing these business Canvas models have been put in play. And the tech transfer offices have now started have not begun to start taking an active role in explaining to many of these faculty driven startups the importance of these business models, and helping them in getting involved in these Ico programs. So that's a big role that tech transfer offices can play usually with an affiliate that is with the office and then assist with developing those. The other thing that tech transfer offices can play a big role is usually around let's take a quick gulp of water give me a second

Speaker 2  49:53  
is around business pitch competitions. So this is where you're going to be providing coaching assistance to most of the faculty remembers. And as you know, there are various competitive pitches in and around your community in the university within the university outside. So faculty members often come and ask for assistance in these pitch competitions. So, tech transfer offices, again, have a general role in trying and assisting with many of the startups in providing these pitches. So what are these pitches, they're basically tips for having your company stand out from the rest. And many times these pitches are actually technology based, along with its market base. So this is where tech transfer offices can be of benefit to faculty driven startups, where they provide with the tips for getting their intellectual property, their value proposition of the particular technology standout. And regardless of what kind of pitch they're making, and the general notion that the message has to be driven home, by a startup in about three minutes, if it's an elevator pitch, or about 15 minutes, if it's, if it's, if it's on a call, or about 60 minutes, if it's an a meeting. So whether it's a three minute or a 15 minute or 60 minute presentation, they have to somehow surpass their competitors, which is mostly again, driven on the basis of, of the technology. So and obviously, in terms of the merits of the technology, the university transfer offices can play a big role. So many times we have, we get queries from faculty driven startups who come and ask us for assistance. So whenever it comes to situations where we have to provide them with information about how the technology is better from a competitor, whether we have done some kind of patent landscape studies, whether we can help them with freedom to operate studies for the intellectual property, whether we have done a general sense of, of reports about competitive products in the market, whether we have any data and analysis about the value of the technology, we kind of tend to help them out only because they can use those data for their pitches and competitions, which is obviously of critical value to them. Because based on that inventors would, investors would eventually end up funding their startup businesses. The other approach that tech transfer offices play and help many startups is a networking with the investors. And so we obviously, are in a community where there is a lot of networking. That happens. For those, again, who are old school tech transfer professionals. We have been groomed in with the message that tech transfer is a contact sport. And that really is the case and that hasn't changed at all. So with any kind of networking that we can help with startups and in finding investors, I think we are pretty beneficial in doing that. And of course, applying for one of the largest granting nonduality granting agency SBIR STTR. That's where tech transfer offices can also play a big role. So in this again, slide, I tried to generally give you an idea of how tech transfer offices can play a role in assisting startups on the side. SBIR STTR is a big elephant in the room. And many of our startups have eventually ended up in succeeding in getting SBIR STTR. And not without assistance from us, of course, they put most of the sweat and toil. But with every all the tribulations that have gone through tech transfer offices in our offices have helped them in some big way. So I'm going to dedicate one slide to talk about SBIR STTR here, and how our office eventually ends up coaching, again, by no means is this a coaching that are teaching that I would want to eventually emphasise in a way that has to be implemented by tech transfer offices across us. But it's something that eventually we have found it very successful. So as part of my office in particular, I've worked a lot with SBDC, the Small Business Development Center, and we have a dedicated person assisting with faculty startups in in coaching for the application process. So we provide a lot of coaching and the coaching can be either in the pre proposal of the SBIR STTR and, and I will not go into too much details presuming that you all know what this funding agency is, as you know, it is and you know, it's basically called the America Seed Fund for a reason that nearly $2 billion are pumped in into the economy by by the federal government to assist and Start Small Business Innovation Research and Small Business Technology Transfer the acronym for s BR iR an STTR. And most of the funds are non dilutive. So the goal with 11 agencies, including NSF, NIH, DOD, USDA, NASA, blah, blah. And then with that, there are various phases, phase one, two, and three. And again, this qualifies for a big discussion. And I'm sure many of you already know much about it. But oftentimes faculty don't have a clue when they actually start up or have very little understanding of what it is, to the extent that they need coaching. And so any coaching that you can provide or your technology transfer office can eventually build up in providing only serves a good purpose because at the end of the day, getting this grant is non dilutive, and is a big step for them to move forward to the next level in getting their technology to the next level of readiness, which obviously complies with the technology getting more on the commercial, commercial pipeline, so so we help them with the pre proposal work, or we can help them with the proposal preparation itself. And in specific, our office has collaborations, like I said, with the SBDC. And we also have some grants that we have kept aside from licensing revenues that we generate, to help with some of the startups in consulting assistance, and then getting one on one consulting or consulting where they, the consulting agents would come in. And they do it four times a year, I believe, or they do it on a webinar scale, where they would actually speak with a group of faculty to talk a little bit about the SBIR STTR program, and eventually provide them with all the resources needed for them to eventually end up starting to write. Now another level that I personally have taken on on the SBIR STTR is being a reviewer myself, in the hopes of understanding what the process is, and what it is that most of the reviewers eventually end up seeing. When it ends up getting to a point where they have to understand this process well enough. So if any professional really wants to end up wanting to become a SBIR or STTR reviewer, you can approach the granting agency, provide them with your credentials. And they actually hire volunteers to help them with the with the process, as I have done in the past. And if you have any specific questions in this regard, I'll be more than happy to assist with you. Another aspect that we see a lot because mostly of unintended understanding of the program is if you know fraud and abuse of this program, we have been victim to that ourselves, the University and I'm sure many universities, but again, it is upon the tech transfer office where if it isn't intended, these abuses have happened because of the fact that we have not been able to coach most of our entities in the proper way. And I think I would go a step further to try and assist with these faculty members to provide them with all the coaching needed. And not just because they can apply for it but break all the myth in terms of what eventually is

Speaker 2  58:12  
assisting them with qualifying for these programs, as it is a big one and it's one that is like I said completely non dilutive. So as of now, just to again, go back on what I discussed, we talked about the license deal. We talked about conflict of interest. We discussed a little bit about the recruitment of CEOs. We spoke about coaching and in the coaching, we mentioned Ico pitches, networking of events. We talked about federal fundings like SBIR. And I'm going to wind up with a couple of quick discussions around support the tech transfer offices can provide an innovation programs. And finally networking. So once again, if anybody has any questions on SBIR, STTR, feel free to let me know and I'll be glad to answer them. So innovation programs, and I don't have to go into a whole lot of detail on this because I'm sure many of you know, I'm sure your tech transfer office is well aware of being affiliated with incubators. And many, many times you will have questions from faculty startups to give information about how best they can launch their company through an affiliate incubator that they have. And by all means tech transfer offices are very successful in developing these incubators and assisting with the faculty members in trying and incubating themselves. But other than incubators, I do want to mention about some of the accelerator programs and as you know, accelerator programs are those that accelerate the growth of startups within three to four months to make them ready for it to get investor funding so they are a little more difficult to get both incubators and accelerators eventually are paid so the faculty will have to eventually ended up using some of the resources that they eventually may have to shed to get into these accelerator or incubator programs. But tech transfer offices on the side can assist in a big way to assist with these faculty members get into these, these entities. And of course, student innovation centers, there are, there are several, I'm sure most of you people listening to me right now from other universities know, what didn t in innovation centers are. And they're mostly again around students. And they are basically built on the venti model where the students either within the university or from outside can pull in the resources and the talent and can help the faculty to get the technology to the next level. So any assistance that tech transfer offices can provide, in getting their faculty different startups to get support from these innovation programs. Again, Arjun View University should be amenable to doing and there are several examples, and I'll be more than happy again, to talk about them offline, if there's a need for anyone to understand or learn more about these programs. Networking, that's the next topic that I would want to obviously share. Now the big role that tech transfer offices have to play and I mentioned this a little bit earlier, a tech transfer is a contact sport. So in any way that we can help faculty startups to develop networks are great. And if the networking can go a step further, where if resources allow, you can develop a proof of concept center, and proof of concept centers being competitive granting programs, either within the tech transfer office affiliated to it or outside, that your tech transfer offices willing to eventually participate. That's a big assistance for many faculty driven startups to get help from our office. ourselves, we have a small pot of money that we share out on a competitive basis, we have our entrepreneurial venture center, and that has money, also that we do on a competitive scale, where we have pitchers and faculty go and pitch and then eventually get money from that the venture center for proof of concept, or they would get money from outside entities within our neighborhood and community, where the competition is a little larger, but the funds that eventually end up getting is also high. And each of these proof of concept centers, of course, provide a pot of money. And is where tech transfer offices can again, help them to get those because again, mostly, these pitches revolve around the technology itself. And that's when the professionals can help the faculty member in building their pitches based on what requirements for that particular centuries. Angel and VC funding. Obviously, I need not mentioned a whole lot about it. As you all know, networking is important. And these Angel and VC funds are difficult to get by and they are sometimes hidden. But try to maintain Rolodex of contact, and help the faculty as best as possible to try them to get connected with them. And if the university has the flexibility and leverage, and this is mostly usually higher level discussions where it can eventually develop a VC fund, where the university itself works as a VC agency. That's the other assistants that technology transfer office can help crowdsourcing and boot camps again, there's a lot that is going on in the space. These are all by the way topics of their own, and there can be a lot of discussion around it. But as of 2005. As you all know, there is a lot of crowdsourcing that has also been taken away from restrictions where startup companies can get money using just simple, you know, Kickstarter, or Indiegogo or rocket hub or you know, dozens of others that are existing, or startups are sometimes also expressed their interest to do to go with a do it yourself, crowdfunding for university. So if there's any way that the tech transfer office can help them mostly to the regulatory and getting them hooked with experts who are good at crowdsourcing, again, I would tend to encourage tech transfer offices to do it. And of course, tax credit. As you all know, the first r&d tax credit was instilled in the US and way back in 1981. And there is up to 250,000 per year in a five year program that many of these startups can get tax credits for. So if there is an interest in a startup wanting to get tax credit benefits to tech transfer office can mediate discussions with the startup and can assist with getting them associated with the entity that can help them with getting the tax rate that maybe pretty vital importance for them and trying to get the benefits from the Trump tax breaks that they can get from the federal government. So before I wind up, so this is my last slide, everything doesn't go northwards. Obviously, there is a possibility for some of these entities to go southwards as well. So if such an event happens, and the startup, you know, in all intent, was hoping for the best did not end up getting to where they ended up, going, which obviously happens for various reasons.

Speaker 2  1:05:45  
There is always a way that tech transfer offices can handle these and mitigate any complications that can come their way. And, you know, obviously, the issues could be due to trust issues, bad communication, some leadership setbacks, it could have issues about technology failures, that what you were hoping for, is really not ending up happening to be as good. There could be issues with IP valuation that you have done incorrectly, or there could be capital factors. But whatever the reason is, I think that it's always a good practice to eventually end up making sure that there is a scope for renegotiation of these terms. And like I mentioned, that is something that most tech transfer professionals should keep in the back of their minds, if there is a need for renegotiating licenses, keep that opportunity open. And if it has to be done, for reasons that I've articulated in this slide, there is there should be some scope of going that, doing that, as well. But in the unlikely event, that termination of the license has to happen, one should keep at the back of their mind, ideas of how best to handle situations like sublicense. And this is a very common fault, that many tech transfer offices do not take into account that you started eventually providing resources to on all the help to a faculty driven startup that has eventually sublicense the technology to a larger company. And just in the event that the startup does not work, how does the relationship eventually happen? And the best course of continue to happen is where you get into direct relationship between the university and the company that has been sublicensed and then continue to build that relationship without the involvement of the middlemen, which is the startup in this case. And of course, if the IP has to return back, or the research materials, or there's some data that's returned back how best that needs to be handled, now, there's not a right answer or a wrong answer. And it always obviously, depends on the situation. And, but it's something that tech transfer offices will have to eventually make sure that they take care of in the event that this ends up happening. So with that I have covered most of the aspects that I personally felt are roles and, and attributes that tech transfer offices will have to start thinking of when they eventually end up working with startups. Like I said, this is a webinar. And obviously, you're all sitting on the computer. So I don't have the privilege of seeing my audience. But if anybody has any questions, I would be more than happy to take them. So I'm going to stop here. And thank you all for listening to me for better half of an hour, maybe a little more. There was obviously a lot of information that was shared here. And I'm sure there's a lot of questions you would have. But I would certainly entertain any discussions or any comments or questions that you may have in the remaining time that we have. Holly, I give it back to you.

Speaker 1  1:09:03  
Thanks, Joy. If you have any questions, you're welcome to enter them in the chat section, or in the q&a section. Or you could even raise your hand and we can unmute you temporarily. Right now we don't have any questions. So we're hoping to get some otherwise we'll just go ahead and close out. Let's see. Let's give it a little bit of time. I know a lot of us are getting used to using Zoom. That's right. So hopefully people are able to find where to ask questions.

Unknown Speaker  1:09:52  
Just hope I didn't scare the audience.

Speaker 1  1:09:55  
You had a lot of really good information. Maybe they're just digesting it.

Speaker 2  1:10:00  
Yes, Holly, do you want to make a comment on sharing the slides? I wanted to give access to? Absolutely,

Speaker 1  1:10:06  
yeah. This afternoon, I'm going to go ahead and send out to everybody that logged in a PDF copy of the slides that joy provided. So you'll be able to review them at that time. If you have a question you think of later, please feel free to reach out to me, or join directly if you have his contact information. Otherwise, you can reach out to me, I'm the one that emails you all the time. And I'll make sure to connect with joy. It looks like we do have a question here. Joy. What process do you use to value the licenses?

Speaker 2  1:10:45  
Yeah, I'm sorry, I couldn't retrieve the question. Yeah. Are you trying to ask for the value of the license or the technology?

Speaker 2  1:10:56  
Think it's a question from Becky, I just I'm not sure whether you understand the question, right.

Unknown Speaker  1:11:04  
The license for the technology?

Speaker 2  1:11:06  
Yeah. And, again, I think for most of the valuation of the technology, the ones to answer your question here, Becky. So as you know, there are various methodologies, conventional methodologies, that there are for any IP to get valuated, you know, whether you use the market, or you use an assessment of, of the profits that the technology would make, or whether the technology is one that is disruptive enough that there really is no competition, in which case, you'll have to make an extrapolation of what what kind of revenues, you'll eventually end up burning in due course of time, so. So it's hard to make a general valuation of these technologies. But where we eventually start off, is really not so much about the value of the technology itself, but the value of what the startup eventually ended up providing to us if the technology is of success to them, to the extent that we sometimes eventually end up not providing them with direct licenses, and asking them to indulge in an option agreement and a pretty long option agreement if necessary, you know, not the conventional week or month, but maybe a year, if necessary. So we would even offer and this is just to make this technology more amenable for them to use, we even offer them to have the valuation stalled until the company makes some determination of what their business model is going to be. And when I say business model, like you mentioned, you know, their Canvas has to be completed. So they're going to give us some numbers, where they provide us with information of what, in due course of time, they're going to be an ending up, ending up providing us back to the university, providing back to the owner startup, as a basis for us to craft the license, which can be held off until then. But to be very frank and honest with you. The value of technologies developed by a startup is very difficult to assess even using the conventional tools that we usually have. And part of the reason is, you know, we kind of craft out technology that are meant to be for faculty driven startups only those that are super disruptive, and that are super away from what the norm is. So if it's just, you know, a process a piece of IP that is process based, that has very little value proposition or it's a technology that is a general improvement, but not a major improvement from an existing technology. The values is not usually as as good as it would be, until, you know, the faculty eventually ends up telling us what it is. Okay, yes, Becky? Go ahead. No, I just I just read the question from Becky and yes, you're right. The license, we look at the company to provide us with the business model canvas. And

Speaker 1  1:14:23  
okay, we have another question. What equity percentage do you typically see for institution and founder to be attractive to investors? That's

Speaker 2  1:14:30  
a very tough question. Clara, you know, anywhere between this is something my boss will eventually end up giving me a slap on my wrist for but anywhere between 5% to 10% If necessary, but going too much into larger equities. You know, your your university will have to, you know, take a lot of risk because if equity is very high Have you run the risk of the faculty members not getting getting enough of an investor interest? So we are kind of on the moderate side of things, and I believe five to 10% is what we usually keep doing.

Unknown Speaker  1:15:19  
You're welcome, Claire.

Speaker 1  1:15:22  
All right. See, I'm not seeing any other questions. Did you have any parting thoughts or final thoughts there joy. Otherwise, I'll go ahead and close this out. Generally,

Speaker 2  1:15:35  
again, I just want to again, mention that, you know, I'm presuming that most of you who are listening to me are tech transfer professionals, and I do want to just generally emphasize the fact that, you know, the profession is changing in a big way. And so, and we are, you know, automotive community, and I'm kind of going to this community that has eventually bolstered our own existence and, and groomed us and taken us gotten us to where we are today, I think the community will have to start interacting more, which it has all this time, due to which I'm even in a situation to provide you with this, this content. But what I what I really appreciate, and I like, is to continue to have these kinds of discussions and, and try and get to the profession to become more than what a generic profession is. And, you know, generally said that tech transfer professionals are, it's probably one of the most important job that is the most hidden, as they call it. And, and I think that's very true. I mean, there's a lot that we have to offer. But the philosophy that I work, and I'm sure you all would probably agree with me is to make sure that your role as a tech transfer professional, is to make sure that all the innovation that comes out of the lab, reaches the marketplace, and whatever methodology you strategize and adopt, will eventually change and, and it's really upon us to make sure that we are taking the best stance in in a very unified way to bring those technologies to the marketplace for the consumers to use. So that's the general mandate, the general philosophy, it should not be stringent, it should be something that we should keep ourselves open for thoughts. And most importantly, I think we should keep collaborating and discussing this on platforms like these for better nurture, and, and more robust discussion. So thank you, again, to autumn for providing me with this platform to speak. And thank you, everyone, for being there on the other side of my screen to be listening. And I would certainly appreciate and thank you, everyone, who are once again in this mix, and then and providing the resources to help the tech transfer profession to bolster and get to where it is today. Thank you, Holly.

Speaker 1  1:18:15  
Thank you so much joy. You know, on behalf of autumn, I want to thank you for sharing your time and expertise. I also want to thank all of you for attending today. We hope you found the webinar informational. Please remember to complete the webinar evaluation link will pop up when you close out of this webinar. This will help us to serve your needs in the future. I want to thank our annual webinar sponsor one more time thank you to Marshall Gerstein and Borun. We really appreciate the continued support. We also want to remind all of you that recording of this webinar will be available for viewing within about one week of today probably a little bit less. Access to this recording is included in your registration. You can visit the autumn website to view the recording or to purchase a past webinar you might have missed. This concludes our program for today. Thank you again for joining us and have a wonderful afternoon.

Transcribed by https://otter.ai