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Ethics and Best Practices

Ethics and technology transfer do not always go hand-in-hand. Share your thoughts and experiences here.


Caltech's Sweet Success - An Inventor-Centric Approach

Caltech's Office of Technology Transfer (OTT) came on the scene relatively late, 15 years after the passage of Bayh-Dole. Since its inception in 1995 under Larry Gilbert's direction, it has become consistently ranked in the top three universities in annual patents received, more than 110 annually. It has also seen the formation of roughly 10 new companies each year, with a 90% survival and success rate.

Along with Stanford, MIT, Berkeley and Wisconsin, Caltech is one of only five universities that, according to Carl Schramm, CEO of The Kauffman Foundation, "have mastered the cooperative technique of technology transfer".

What is the key to Caltech's success? Their mission reads like that of many technology transfer organizations:

Caltech intends to serve the public interest by prudent and appropriate efforts to transfer this technology to those who will facilitate public use and create the innovative, unparalleled science and technology of tomorrow.

But in an age where the mission of many university technology transfer offices is overshadowed by rhetoric or platitude, Caltech has distinguished itself and as a result, is demonstrably successful.

Caltech's OTT has adopted this unique four-pronged approach to its technology transfer efforts:

  • Build Relationships with Faculty
  • Aggressively Pursue Intellectual Property
  • Be Industry-Friendly
  • Promote Entrepreneurship

As Carl Schramm recognized, Caltech is succeeding where few others are by practicing a cooperative approach. The OTT works to establish trusting relationships with its inventors and makes the process user-friendly Indeed, Caltech OTT staff, the "Otters" as they are known around campus, spend a great deal of their time interfacing with inventors.

Good relations with innovators leads to more inventions disclosures, which leads to more patents. Their success in this area is easily quantifiable based on their annual patent results.

What's more, Assistant Vice President of Caltech's OTT, Fred Farina "relies on faculty inventors to help him make the best management decisions for their intellectual property".

For those who have heard him discuss Caltech's approach, he will tell you that the OTT does no market research. He counts on faculty innovators to be aware of the market place they research in and allows them to fully participate in the commercialization of their intellectual property. To "avoid lengthy and often meaningless invention evaluations", Farina uses their expertise to make patent filing decisions.

The second factor in their approach is to aggressively pursue IP protection. While many other universities allow disclosures to languish in a state of paralysis by analysis or ignored altogether, Caltech files a provisional patent application for nearly every disclosure it receives and non-provisional on roughly half of these. At other universities, only faculty with a proven track record of profitable commercialization are afforded the "luxury" of a patent application. These other institutions could certainly learn from Caltech.

Be Industry-Friendly' is the third aspect to Caltech's approach and this means bureaucracy is not their way of doing business. Each OTT professional is empowered with the authority to conduct licensing negotiations and transactions from start to finish. Thus the OTT to facilitate licensing with minimal complications which has allowed Caltech to develop good external relations as well.

Of the many approaches to technology transfer, Caltech favors start-ups over licensing to established companies. Thus the fourth component to their approach is to Promote Entrepreneurship. Why? Start-ups are more aggressive and bring products to market faster. Small businesses create jobs in the community and stimulate economic growth. And, in the case of IPOs and acquisitions, both inventors and Caltech will see more ROI than with traditional licensing.

With relationships at the core of Caltech's methods, it is no surprise that an unwritten but well understood underpinning of its OTT's mission is to secure "two bites of the apple".

The "two bites of the apple" approach facilitates both short and long term success for all involved. The first bite usually means an equity stake in the start-up company in exchange for the license and the second comes from philanthropic support by successful entrepreneurs who look kindly on Caltech and their OTT experience.

That second 'bite' has enabled OTT to create the Caltech Grubstake Fund to fill the gap between funding for basic research and innovations ready to license. Grants are made up to $50,000 at a time based on a simple two-page proposal that is considered in a bureaucracy-free manner. Decisions are made within days of submission and approved projects are managed solely by the OTT. The fund self-replenishes based on the success of the research of its recipients. Twenty-five percent of the royalties generated from technologies funded by Grubstake are returned to it. Over 20 start-ups have come out of Grubstake funded research to date.

The results of technology transfer are not always easily quantifiable and many established metrics are too esoteric to be of real value. Yet the track record of Caltech's OTT can be measured in mathematical and finite terms. The number of disclosures, quantity of patent applications, establishment and duration of start-ups, and dollars generated from licensing quantifies their success. For those that look to figures, Caltech measures up. However, there is more to the Caltech story than what can be expressed in an annual report. The true measure of their achievement is best expressed by the satisfaction of its innovators, licensees and growing technological impact.



Comments : 0 - Last Post : Sep 22, 2009 3:00 PM by: IP Advocate
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