1. MIT, the ILP and R&D
Pablo Delgado deTorres
MIT Senior Industrial Liaison Officer
COEPA
21 de Julio 2009

2. Why Industry Comes to Academia
• Expose management to leading-edge thinking,
technology
• Gain insight from internationally-recognized experts
• Strengthen strategic decision-making:
– development of new products and processes
– implementation of innovative management practices
– achievement of effective growth strategies
– New market and social ideas
• Create research synergies
• Recruit future company leaders
• Maintain Technological awareness
2

3. MIT Research Funding -- FY 2008
• On-Campus R&D: $643 million
Industry Sponsored R&D
$100.3 million (16%)
HHS
30%
Source: MIT Data Warehouse -- FY08 Expenditures by Sponsor
3

4. MIT Total Industry Support -- FY 2008
• Total Industry Support -- $241.3 million
Industry Sponsored R&D -- $100.3 million
Licensing -- $89.1 million
Gifts -- $42.3 million
Source: OCR FY08 Industry Support
Other -- 9.6 million
4

5. Solving Real-World Problems
• MIT Industry Alliances
– Amgen, Merck, Ford Motor Company, Nippon Telephone and
Telegraph, Merrill Lynch, DuPont, Microsoft, Hewlett-Packard
• 708 companies provided R&D/gift support in FY 2008
– 30 companies funded $1M+
– 158 companies funded $100K - $1M
Source: OCR FY08 Industry Support
5

6. MIT - functional organization
• 71 MIT-related Nobel Prize winners
– Including 7 current faculty members
• 5 schools, 34 departments/divisions/sections/other programs
– 57 interdisciplinary research units
Computer
Chemical Science Electrical
Engineering Engineering
Biology Research Mathematics
Center
Economics Management
Materials
Science
Source: MIT Facts 2008
6

7. MIT Organization
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8. Research Sponsorship
• Many mechanisms and models exist
• Typically support ongoing investigations by
individual faculty or groups of faculty
• excellent leverage of corporate R&D funds
• Examples of sponsorship options available at MIT
 single company (higher cost but more exclusivity)
 multi-company (leverage costs and share results)
 Small group of companies with common interests band together
with faculty to develop a focused collaboration on a narrow topic,
outside a consortium model
 Organized like single-sponsor projects, through participants’ or
faculty members’ own networks
 consortia and collegia (multi-sponsored shared arrangements)
8

9. Consortia
• Bring multiple companies together to sponsor research
in a field of inquiry
• Examples at MIT:
– closed consortia
 fixed number of members define and share all research and
administrative expenses and share all pre-publication results
and licensing opportunities
 example: Consortium for Advancement of Manufacturing in
Pharmaceuticals (8 companies)
– open consortia
 open membership
 current members pay annual fee and share all pre-publication
results and licensing opportunities, with right to sponsor
additional projects
 example: Media Laboratory (>100 companies)
9

10. Confidentiality in University/Industry Relationships
• NDA’s
– Single Faculty or University
– Normal Protocols
– Caution on Both Sides
– Short term
– Specific and event driven.
• Research Publication
– Essential to Faculty/Mission of University
– Review Period for Sponsor Prior to Publication
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11. Exchanging Personnel
• Usually arranged as part of sponsored research
• Company sponsors a senior scientist to participate in the
research at the university as a “visiting fellow”
• Allows company scientist:
– to participate directly in the research to enhance transfer of learning back to
the company
– to participate in other university activities and develop a broad network at
the university
• Provides a prestigious benefit to top corporate researchers
11

12. Consulting
• Most faculty seek private consulting
relationships with industry
– at MIT: 20% of faculty time for consulting
– helps faculty be aware of real-world challenges
– helps keep research current, meeting needs
– broadens faculty professional networks
– helps develop placement opportunities for
students and graduates
12

13. Consulting
• Benefits for companies:
– brings in valuable outside expertise to solve current, short-
and long-term problems
– helps broaden corporate vision for planning
– allows company to protect confidentiality and ownership of
intellectual property
– usually negotiated as personal services contracts with
individual faculty
13

14. The Environment
• Venture capital firms, investment bankers, law firms and
others.
• Collaborative Science-
 Across disciplines
 Across institutions
 Across borders
• Most research intensive area in the country
(6% of state product)
 “Academic research is especially effective as an engine of
economic growth
 in the Boston area precisely because it takes place not in an ivory
tower, but in a complex network of relationships among
universities, hospitals, other affiliated institutions, corporations and
Entrepreneurs”
 Appleseed Report
14

15. Culture
• MIT culture supports innovation
• Organizational boundaries are very permeable
• Intra/inter linkages easy to form and numerous
• Environment forces random interactions
• Cost of failure is low
• Entrepreneurship is holographic at M.I.T.
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16. MIT ECOSYSTEM
Supporting environment with complimentary assets
ECOSYSTEM EL
TECHLINK
ENTREPRENEURSHIP
Supporting environment with complimentary assets OD
VCPE CENTER SM
N ES
INNOVATION X-Prize SEBC MIT VMS SI
CLUB BU MIT SLOAN
D-Lab Lab $100K BP ED SCHOOL
COMPETITION AT MIT
I-Teams ID
V AL ENTERPRISE
MIT TLO FORUM
DESHPANDE Legatum Center
CENTER
Industrial Liaison Program
Idea for Business Customers
Innovation Growth
a company Plan Funding
Copyright 2002-2005 Deshpande Center for Technological Innovation, Massachusetts Institute of Technology
Slide courtesy of Prof. Charles Cooney
16

17. Many forms of “Technology Transfer” from Academia to Industry
• The graduating student
• Publication
• The consulting professor
• Collaborative/sponsored research with industry
• University seminars/courses for industry
• Intellectual Property licensing to
– Existing companies
– Spin-Outs
17

18. What is the Industrial Liaison Program?
• The ILP is industry’s chief gateway and guide to MIT.
COMPANY
Company ILP
ILP
• Provides expert counsel on building productive partnerships
• Develops customized, cost effective programs
– assess, address strategic research needs
– facilitate faculty, researcher interactions
– monitor emerging technologies and innovative management practices
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19. ILP Facts
• Founded in 1948
• Largest program of its kind in the world
• Worldwide industry membership
– 33% N. America, 33% Asia, 30% Europe, 4% Other
– broad range of industrial sectors, both traditional and high-tech
• 20 Industrial Liaison Officers*
– average 15 years of industry experience
– most with advanced degrees
*as of January 23, 2008
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20. Typical ILP Services and Deliverables
• On-campus sessions with faculty and research staff
• Faculty visits to company sites
• Executive research briefings
• Video/Web sessions with faculty and research staff
• Customized research reports
• Symposia and conferences
• Publications
– ILP edition of Technology Insider
– Web reports and digital presentation archive
– Technology Review
• Facilitated access to MIT people, resources
• News and details of relevant MIT activities and programs
20

21. Typical Benefits Companies Receive
• Monitor emerging/disruptive technologies
• Discover new technologies to strengthen existing businesses
• Validate or invalidate key investment decisions/ new product
development
• Solve short term technical problems
• Identify new industry partners
• Use faculty for consulting/ advice
• Participate in new industry standards setting
• Train employees
• Recruit new employees
21

22. Deshpande Center for Technical Innovation
Launched with a initial $20 million gift
• Nurtures marketable inventions by:
– Engaging established industry to spark inventions that solve existing needs
– Funding proof-of-concept explorations with Ignition Grants
• Fuels market-driven innovation by:
– Funding research with Innovation Program Grants
– Getting the business community involved at an early
– stage to help shape the direction of research
– Educating the research community about
– commercialization to focus efforts in the right areas
• Implements innovation in the marketplace by:
– Catalyzing collaborations with partner companies and entrepreneurs
– Directing researchers to appropriate business and entrepreneurial
resources
– Serving as a liaison between MIT and the local business community
– Showcasing MIT technologies via symposia and workshops
• Expanding to Singapore and Portugal
22

23. MIT Deshpande Center
BRIDGING THE GAP: WHAT CAUSES IT?
The University is
about Knowledge
Creation and
Education
Academic
Research Marketplace
The Market is
about Products
Sponsored
VC Funding
Corporate
Research
Corporate
Investing
Licensing
Federal
and Services
grants
Angel
SBIR
Slide courtesy of Prof. Charles Cooney
23

24. MIT Deshpande Center
BRIDGING THE GAP: HOW WE 24
HOW? ADDRESS IT
Academic
Research Catalyst Marketplace
Program
Sponsored
VC Funding
Corporate
Research
Corporate
Investing
Licensing
Federal
grants
Grant
Angel
SBIR
Innovation-
Program Teams
Events
Copyright 2002-2005 Deshpande Center for Technological Innovation, Massachusetts Institute of Technology
Slide courtesy of Prof. Charles Cooney
24

25. TLO’s Mission
Bring about commercial investment to
develop inventions from MIT research
–To bring therapies and other products into
public use
–To show the public, Congress, and funding
agencies tangible results of basic research
–To allow faculty and students to see real-
world results of their research
–For economic development—in
Massachusetts and nationally
Content courtesy of Lita Nelsen director of the TLO
25

26. Technology Licensing Office Statistics
• 500 new invention disclosures/year
• 100 new technology licenses/year
• 15-30 new companies/year
• Over 650 active licenses
• About 300 spinout companies total
Spinouts particularly important for “Break-through”
technologies
– Investments are large
– Time-to-market long
– Risk of success very high
– Large, existing companies reluctant (or unable) to invest at such an
early stage
 Effect on earnings
 Disruptive to their own R&D agendas
– But ready to buy products/company at substantial price when spin-out
reduces risk and time-to-market
Content courtesy of Lita Nelsen director of the TLO
26

27. MIT’s Patent and Licensing Goals
• See that ideas are practiced broadly
• Maximize benefits to general society
• Enhance the educational process
• Create companies and jobs
• Provide funds to patent future ideas
• Provide modest income to MIT
Content courtesy of Lita Nelsen director of the TLO
27

28. The Tech Transfer Bargain
• University research leads to patent—but technology is
unproven and high risk
• University is willing to grant exclusive patent license to
Company who will commit to the risk of developing the
technology
• If development succeeds, the patent protects the Company
from competitors
• University benefits from product being developed and from
royalties (shared with inventor)
Content courtesy of Lita Nelsen director of the TLO
28

29. Strategy: do a lot!
The Volume Strategy
• Aim to maximize the number of technologies being
developed
– Rather than try to pick a few “winners” and concentrate on them
• 100 license/year—20-30 startups
Why are we able to do so much?
• LOTS of world-class technology—dependent on government
support of basic research
• Good IP protection
• Consistent Tech Transfer policies throughout the university
– It’s about Impact, not (primarily) Income
• An experienced Technology Licensing Office
Content courtesy of Lita Nelsen director of the TLO
29

30. Advantages of the “Volume Strategy”
• Maximizes participation of faculty and students in the
technology transfer process
• Maximizes number of technologies invested in by
companies and VC’s
• Maximizes probability of hitting a home run
• Technology is probably too early to be able to pick the
winners!
Content courtesy of Lita Nelsen director of the TLO
30

31. Helping Inventors
From the TLO Inventors guide
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32. Biotechnology Cluster, Cambridge Mass.
32

33. Emerging Energy Cluster in Greater Boston
33

34. 100K Student Business Plan Contest
• Over 100 entries/year
• Volunteers from business community serve as
mentors and judges
• Over 500 people (mostly from business community)
attend the final awards ceremony
34

35. Venture Mentoring Service
• Over 100 volunteers from the entrepreneurial, angel
investing, venture capital and other businesses
provide mentoring to entrepreneurs (including alums)
associated with MIT.
35

36. MIT Enterprise Forum
• Founded and run by volunteers from the business
community
• Run separate monthly clinics for
– “concept companies”
– Startup companies
– Early growth-stage companies
• Annual instructional and networking conference
• Several hundred audience attendees per month
36

37. And Many Others
• Entrepreneurship Center: Matches MBA students with
internships with entrepreneurial Company CEO’s
• Student Venture Clubs at undergraduate, graduate
levels in b-School, School of Engineering, etc.
• …….
37

38. Economic Engine
38

39. First Time firms
39

40. Age of Founders
40

41. Alumni Companies by Industry
41

42. Startup Funding
42

43. Sales
43

44. Where
44

45. Out of State Sales
45

46. MIT: References
Bank Boston Study (1997)
http://web.mit.edu/newsoffice/founders/
Multi-University Study (2003)
http://www.masscolleges.org/Economic/default.asp
Technology Licensing Office
http://web.mit.edu/tlo/www/
Industrial Liaison Program
http://ilp-www.mit.edu
$50 K Competition
http://50k.mit.edu
46

47. Remember – When you reach the summit Copyr
you are only half way thru your journey ight
2002-
2005
Desh
pand
e
Cente
r for
Techn
ologic
al
Innov
ation,
Mass
achus
etts
Instit
ute of
Techn
ology
47
47 Slide courtesy of Prof. Charles Cooney