High Tech High Growth High Impact

Presentation toASQ/INCOSE

Duncan StewartPresident/CEO

January 14, 2009

501(c)3 nonprofit organization with a mission to provide resources and advice to innovative entrepreneurs, allowing

them to successfully grow their companies. Our clients create high-wage jobs, commercialize cutting-edge technologies, and

play a vital role in the economic development of the region.

Resources

Furnished Office SpacePrinter/Fax/CopierPhone/InternetConference Rooms

Advice

Business PlanningExecutive Coaching

Research & AnalysisInvestor Relations

Gary MarkleVice President Econ Dev Corp

Chris OdellExecutive Chairman

Fluke Networks

Jan HorsfallCEO

Gelazzi

Jeff CooperManaging Director

New Venture Resources

Laura McGuireCEO

Qgenisys

Chris BleesCEO

BiggsKofford

Duncan StewartChief Executive

Officer

Alan SteinerRetired ExecutiveHewlett Packard

Brian BinnPresident, MAC

Chamber of Commerce

Dr. Dan DapaniDean

Engineering CollegeUCCS

Dr. Venkat ReddyDean

Business CollegeUCCS

Heather BrownBusiness Analyst

Mary FoxOperations Director

Dr. Roger NeelandProgram Director

Executive Chairman

Ex Officio Ex Officio Ex OfficioChairman Emeritus

Secretary

President/Treasurer

Board of Directors

Staff

Kris EverettTechnical Analyst

Paul ByerSenior Advisor

Al BrownSenior Advisor

Information & Communication Technologies(ICT)

Biomedical &Sports

Technologies(BST)

Security & Defense

Technologies(SDT)

Energy & Environmental Technologies

(EET)

Emerging Focus Areas

Current Clients

ProAutus

TM

Programs/Initiatives

• Colorado Homeland Defense Alliance

• National Security Innovation Competition

• CU Technology Transfer Office support contract

• Riyadh Technology Incubation Center (Saudi) support contract

• Internships (UCCS, AFA, CSU)

• High Altitude Investors angel club

• Emerging Tech Day at Homeland Defense Symposium

• Technology Development Fund

• New World Class Incubator Facility

Technology Transfer Fundamentals:Spinouts, Startups, and Licensing

NeoClassical Economics

• Markets move predictably toward equilibrium where supply = demand

• Assumes many buyers and sellers, rational decisions, prices set by the market transaction process, commodity-like products/services, and transparency (all transactions are known)

• Wealth is created when suppliers hire workers and this income is used to drive demand

• Large firms dominate due to economies of scale and scope

• Ignores the origin of new demand• Depicts the market as static

Entrepreneurial Economics

• Markets are chaotic and largely unpredictable

• Innovation (use of inventions to create new products/services) is the driving force behind new demand

• Entrepreneurs use innovations to destroy the structure of existing markets (“creative destruction”)

• In free market economies, job creation, innovation, and economic growth are dominated by small firms

• Depicts the market as dynamic

“Anything genuinely new creates markets that nobody before even imagined.”--Drucker

Innovator’s Dilemma(Christensen)

• One of the most consistent patterns in business is the failure of leading companies to stay on top

• This is largely due to the belief in staying close to current customers (sustaining technologies)

• This focus often prevents organizations from recognizing and exploiting radically new opportunities (disruptive technologies)– They look too small and different and take too long

Corporate Options to Thrive in a Fast-Paced Knowledge-Based Economy

• Internal “skunkworks”

• “Intrapreneurship”

• Spinouts

• Corporate venture capital (startups)

• Teaming

• Acquisitions

• Sponsored university research

• Licensing (government, university, small biz, inventors)

University Research & DevelopmentVirtuous Life Cycle

GovernmentFunding

ResearchProposal

Scientific Discovery

Patent

Publication License

Commercialization

Royalties

Reputation

Income &Wealth

TaxesProducts/Processes

for Consumers/Businesses

Attract faculty/students

Jobs for EmployeesProfit for Owners

Typical University Research Process

IndustryFunding

UniversityFunding

Technology Transfer

Development Process

Products/Processes for Consumers/Businesses

Technology TransferCommercializing government/university research

• Benefits to society/economy– Development of industrial capabilities– Development of economic base (jobs/taxes)– Royalties to fund future government

research• Benefits to universities/government labs

– Royalties to fund research/other activities– Justification for future government grants– Improved reputation (attract faculty,

students & donors)• Benefits to industry partners

– Access to world class facilities and talent– Ability to exploit research without upfront

investment– Often includes eager customer

700 Federal laboratories employ more than 100,000 scientists & engineers

Bayh-Dole Act of 1980 gave universities title to patents gained from federally-funded research &

allowed exclusive licensing

Cooperative R&D Agreements(CRADA)

• Contract between R&D organizations– University, government, industry– Cross-border

• Shared objective• Shared resources• Shared ownership of intellectual

property

Because the government does not provide funding, acquisition regulations do not apply

Licensing Fundamentals

• Intellectual Property– Patent required to validate ownership

• Level of Exclusivity– Exclusive: single license– Co-exclusive: multiple but limited number– Term-based: exclusive for first X years– Field-of-use: only some uses/markets– Geographic: limited territory– Nonexclusive: anyone

• Royalties– Compensate organization for supporting

R&D– Compensate inventors for effort/initiative

90% of research funding at U.S. universities is provided by the federal government

MIT Licensing Office (2007)- 282 Patents Filed

- 147 Patents Issued- 117 Licenses Issued

- $68.8 M Gross Income

Learn More

• Association of University Technology Managers www.autm.org

• Federal Laboratory Consortium www.federallabs.org

• National Business Incubator Association www.nbia.org

www.cstionline.org