A Game Changer to Stimulate Formation of Startups Based on Drexel Research
December 14, 2020
Drexel Applied Innovation has launched a new program to encourage and support the formation of startup companies based on Drexel research. The "Drexel Express Startup License" is a startup and investor friendly licensing agreement with pre-set terms. This new licensing tool will be used in cases where the startup is partnering with Drexel Applied Innovation to successfully complete designated commercialization pathways.
The pre-set terms are significantly more favorable than those typically extended to startups by universities. The Drexel Express Startup License aims to streamline the licensing process and reduce the turn-around times from months to weeks, thus enabling the startup and its founders to focus their energy on building a company and not on negotiations.
“From my past experience as a co-founder of a venture-funded university spinout, I know that launching a startup is challenging enough. The typical university startup licensing process can be time consuming and frustrating for the startup which adds to the challenge. The new program enables my team to be on the same side as the startup team so that we can be a partner in their pursuit to make real-world impact", says Shintaro Kaido, Vice Provost for Innovation and Executive Director of Drexel Applied Innovation. In 2018, Kaido conducted a survey with 52 venture capital investors in Kauffman Fellows to better understand the gap between academic tech transfer and mainstream venture capital. Kauffman Fellows is a highly selective, global fellowship of top venture capital professionals originally founded by the Ewing Marion Kauffman Foundation in 1994. A major finding from the survey was that about 90% of the non-life sciences investors in the Kauffman Fellows community had experienced a situation where they were interested in investing in the startup (favorable due diligence outcomes on the startup team, market and technology) but ultimately passed on the investment due to the terms of the licensing agreement between the startup and the university.
The Drexel Express Startup License program incorporates the lessons learned from the Kauffman Fellows study as well as the take-aways from a recent panel on technology commercialization during the MXene Conference 2020 where the panelists from Prime Movers Lab, Osage University Partners, HG Ventures and NSF unanimously agreed that university tech transfer offices can better support their startups. "(there is a) need for clean, clear and quick license agreements", says Ginger Rothrock, Senior Director with HG Ventures.
Rothrock and the panel also urged universities to encourage postdocs and PhD students to consider a career in entrepreneurship. “Can a scientist be a CEO? Yes, you can, and the best are self-aware, hire complementary people and are great story tellers”, says Rothrock.
As such, the Drexel Express Startup License will be offered to Drexel innovator teams which successfully complete the NSF I-Corps national cohort. The license will be offered to the new C corporation founded and led by an Entrepreneurial Lead (EL) with an exclusive field-of-use for the application thoroughly explored through I-Corps customer discovery (customer discovery interview logs and presentations during the NSF I-Corps national program must be submitted to Drexel Applied Innovation).
“A key imperative in the University’s strategic plan is to expand Drexel’s research impact. The Drexel Express Startup License program is the first of set of initiatives to re-imagine Drexel tech transfer and remove barriers for Drexel innovators, systemize commercialization pathways and catalyze commercialization of Drexel’s unique and internationally recognized research strengths. This is a very important step in our streamlining efforts, and we look forward to unveiling other new approaches to support Drexel's innovators”, says Dr. Aleister Saunders, Executive Vice Provost for Research & Innovation at Drexel University.