Technology Technology Commercialization Class Commercialization Class

(BA468)(BA468)

John TurnerJohn Turner

January 4, 2010January 4, 2010

““Far better it is to dare mighty things, Far better it is to dare mighty things, to win glorious triumphs, even to win glorious triumphs, even though checkered by failure, than to though checkered by failure, than to rank with those poor spirits who rank with those poor spirits who neither enjoy much nor suffer much. neither enjoy much nor suffer much. Because they live in the grey Because they live in the grey twilight that knows neither victory twilight that knows neither victory nor defeatnor defeat.”.”

But aren’t we in a recession?But aren’t we in a recession?

““Be fearful when others are greedy and greedy Be fearful when others are greedy and greedy when others are fearfulwhen others are fearful””

““When the enemy attacks; retreat and when the When the enemy attacks; retreat and when the

enemy retreats; attackenemy retreats; attack.” .”

What are we doing?What are we doing?

A “hands-on” opportunity to develop a A “hands-on” opportunity to develop a commercialization plan for technology commercialization plan for technology from the OSU portfolio and other patentsfrom the OSU portfolio and other patents

A cross disciplinary project class in A cross disciplinary project class in technology commercialization tools and technology commercialization tools and processesprocesses

An “experiential” class An “experiential” class

Class OpportunitiesClass Opportunities ““Real life” experience in managing innovationReal life” experience in managing innovation

Great resume builder- employers value experienceGreat resume builder- employers value experience

Valuable prizes-Valuable prizes-– New Enterprise Challenge ($17K prize money)New Enterprise Challenge ($17K prize money)– In class competition ($?)In class competition ($?)

Experience working in cross functional teamsExperience working in cross functional teams

Connections with local entrepreneurs, investors, and Connections with local entrepreneurs, investors, and job possibilitiesjob possibilities

COB

AEP

Tech Transfer Office

Inventors

Local Entrepreneurs, SWOT, PBR

NCIIA Boeing

HP

Startups based on University IP: Startups based on University IP: Many Good Reasons to Focus on These Many Good Reasons to Focus on These

> 400 university startups created yearly> 400 university startups created yearly from federally funded from federally funded R&D (Google, Netscape, Genentech, Lycos, Sun Microsystems, Silicon R&D (Google, Netscape, Genentech, Lycos, Sun Microsystems, Silicon Graphics, and Cisco Systems)Graphics, and Cisco Systems)

OSU has “extremely high” research OSU has “extremely high” research activity (~$250M year in activity (~$250M year in grants). Corvallis has abundant talent and new funding sourcesgrants). Corvallis has abundant talent and new funding sources

High survival ratesHigh survival rates: 68% of university startups are still in business in : 68% of university startups are still in business in 2001, regular startups experienced a 10% survival rate during that 2001, regular startups experienced a 10% survival rate during that same time period same time period

They are profitableThey are profitable: Early& SEED VCs returns 20.8%, Late stage VCs : Early& SEED VCs returns 20.8%, Late stage VCs returns 13.8%, S&P returns 8.2%returns 13.8%, S&P returns 8.2%

They “go public” more often: They “go public” more often: 8% for university startups vs 0.07% 8% for university startups vs 0.07% for other US enterprisesfor other US enterprises

Patent Selection and Commercialization Plan ProcessPatent Selection and Commercialization Plan Process

TTO Provides list and input

Advisory Team Screening

Class Screening and Plan

development

Spin Off Based Plan

Licensing Based Plan

Other Plan Recommended

Technology not viable for

commercialization

BA468 Class

Candidate Intellectual Property for the ClassCandidate Intellectual Property for the Class

Mobile

Computing

Video/Imaging Analysis

•Geonotes- GPS linked i-phone app (Tim Fiez- Gartrell Group)

•Ultra-bright blue pigment: (Prof Mas Subramanian, OSU-

Chem)

•Ultra sensitive accelerometer:

(Prof Mike Bailey, OSU-EECS and HP)

Sensor Technologies

•Sports Film Analysis Software: (Prof Alan Fern,

OSU-EECS)

Novel Colorant

Other informationOther information

Student background and introsStudent background and intros Formation of teamsFormation of teams Selection of patentsSelection of patents Inventors and accessInventors and access Mentors- what are they for?Mentors- what are they for? Student contact informationStudent contact information Invited speakers and protocolsInvited speakers and protocols Non-disclosure agreementNon-disclosure agreement

Technology Commercialization Technology Commercialization (BA468)(BA468)

Instructor- John Turner, PhDInstructor- John Turner, PhD

Class ScheduleClass Schedule– MW (12-2 pm), 328 BexellMW (12-2 pm), 328 Bexell

Contact Info Contact Info – Office: 316 BexellOffice: 316 Bexell– Office Hours: Mon 2-3, Fri 1-2Office Hours: Mon 2-3, Fri 1-2– Phone: 737-9219Phone: 737-9219– E-mail: E-mail: john.turner@bus.oregonstate.edu– Best way to reach me quickly is by emailBest way to reach me quickly is by email

2010 Class Schedule- Technology Commercialization BA468

1 2 3 4 5 6 7 8 9 10Mon Wed Mon Wed Wed Mon Wed Mon Wed Mon4-Jan 6-Jan 11-Jan 13-Jan 20-Jan 25-Jan 27-Jan 1-Feb 3-Feb 8-Feb

Class Intro (mentors)IP and Opportunity Assessment

* * Inventor PresentationsSelect Patents & Form Teams

Commercialization OptionsLB,MM CW, TBD Databases and Marketing Surveys

SWOT & Genl ApproachThe Pitch

HP TBD Corp Tech Commercialization

11 12 13 14 15 16 17 18 19Wed Mon Wed Mon Wed Mon Wed Mon Wed

10-Feb 15-Feb 17-Feb 22-Feb 24-Feb 1-Mar 3-Mar 8-Mar 10-Mar

Timeline and MilestonesFinances and VC Expectations

BN Investor PerspectivePrepare Commercialization Plans

PG Entrepreneur PerspectivePresent Commercialization Plans

(meet w JT) ^ ^In class Portland BRTReviews Reviews

BA468 Mentors for this Term

David Reihl Physics Faculty at LBCC, retired HP Project Mgr

Ray Dandeneau HP (retired manager and very smart guy)

Bill Buckley New Business Development Expert- HP TDO

Michael LaPort Director of Marketing, Peak Systems

Recommended Texts ResourcesRecommended Texts Resources

““Technology Ventures: From Idea to Enterprise”, Technology Ventures: From Idea to Enterprise”, Dorf and ByersDorf and Byers

““Academic Entrepreneurship: University Spinoffs Academic Entrepreneurship: University Spinoffs and Wealth Creation”, Shaneand Wealth Creation”, Shane

““Technology Management: Developing and Technology Management: Developing and Implementing Effective Licensing Programs”, R.C. Implementing Effective Licensing Programs”, R.C. MegantzMegantz

““Crossing the Chasm”, Geoffrey MooreCrossing the Chasm”, Geoffrey Moore

GradingGrading BA468 is a 4 credit classBA468 is a 4 credit class

There is no final or midtermThere is no final or midterm

Grade will be determined byGrade will be determined bya) Attendance, class participation and team dynamics, and balance of a) Attendance, class participation and team dynamics, and balance of

contribution (30% total)contribution (30% total)b) Interim Results: patent screening, market surveys, SWOT analysis, b) Interim Results: patent screening, market surveys, SWOT analysis,

elevator speech, project plan (30% total) elevator speech, project plan (30% total) c) Final Presentation and Final Report (20% each)c) Final Presentation and Final Report (20% each)

Feedback will be provided on a) halfway through the course Feedback will be provided on a) halfway through the course and on b) within one week after presentation of results. and on b) within one week after presentation of results. Peer evaluations are also a part of your gradePeer evaluations are also a part of your grade

Effective team communication, sharing of work load, and Effective team communication, sharing of work load, and conflict resolution are essential to success conflict resolution are essential to success

Interim AssignmentsInterim Assignments These 5 assignments are each 6%, for a total of 30% of the gradeThese 5 assignments are each 6%, for a total of 30% of the grade

– Patent assessments (due Sat, 1/16); Patent assessments (due Sat, 1/16); written onlywritten only– Market evaluation (due Wed, 1/27); Market evaluation (due Wed, 1/27); written + presentationwritten + presentation– SWOT analysis of commercialization options (due Wed 2/3); SWOT analysis of commercialization options (due Wed 2/3); written + written +

presentationpresentation– Elevator speech (present Mon 2/8); Elevator speech (present Mon 2/8); presentation onlypresentation only– Financial and project plan (due Wed 2/17); Financial and project plan (due Wed 2/17); written + presentationwritten + presentation

All except the first are team exercisesAll except the first are team exercises

Written assignments may be e-mailed (preferred) or sent Written assignments may be e-mailed (preferred) or sent electronically by the specified date/timeelectronically by the specified date/time

Commercialization Plan Commercialization Plan Presentations and CompetitionsPresentations and Competitions

1)1) In class final presentation- Wed, March 3In class final presentation- Wed, March 3rdrd

2)2) PBR Judging Panel- Wed, March 10PBR Judging Panel- Wed, March 10thth

3)3) New Enterprise Challenge- mid April New Enterprise Challenge- mid April

$$$$$$$$$$$$!!!!!!!!

BEC

The 7 Elements of an Idea Resume

The Solution• Offering • Function• Advantage

The Need• Unmet Problem• Customer• Value & Scope

Business Win• What’s Unique• Business Leverage

Issues & Next Steps• Assumptions/Objections• What to Learn First

InvestigationResources &Expectations

Benefits toOrganization &

Sponsor

Momentum &Credibility

Answer a VC’s FundamentalsWho is the customer?What do they want?How much will they pay?Why will they buy from you?How much money do you need?When do I get it back?

A Clear, Concise, Concrete, Statement of the Idea is the Critical Starting Point

Technology focus vs Customer focus Technology focus vs Customer focus

Technology commercialization is difficult!!Technology commercialization is difficult!!

The best business plans are built around a The best business plans are built around a compelling compelling customer needcustomer need- - “a problem in search of a solution”.“a problem in search of a solution”.

You have the opposite situation- a “technology in search of You have the opposite situation- a “technology in search of a problem”a problem”

This is not a technical exercise! Use business and consumer This is not a technical exercise! Use business and consumer knowledge, and careful market research to find the best knowledge, and careful market research to find the best way to extract value from these inventionsway to extract value from these inventions

Small Group Activity Small Group Activity

• What factors will determine the What factors will determine the success of a technical idea in the success of a technical idea in the marketplace? marketplace?

• Think of at least ten- more is betterThink of at least ten- more is better

• Identify your top fourIdentify your top four

Parting QuestionParting Question““How much is an idea worth?”How much is an idea worth?”

Typical valuation methods:Typical valuation methods:-Market based valuation?-Market based valuation?

-Cost based valuation?-Cost based valuation?

-Opportunity based valuation?-Opportunity based valuation?

Challenge: An invention has the following characteristics Challenge: An invention has the following characteristics

- 25% chance of success= P- 25% chance of success= P

- Takes 5 years and $5M to bring to market= E- Takes 5 years and $5M to bring to market= E

- Offers exclusive access to a market of $100M for 5 years=R- Offers exclusive access to a market of $100M for 5 years=R

Estimate the value of this inventionEstimate the value of this invention