VentureLab helps Georgia Tech faculty, staff, and students launch companies.
Becoming an entrepreneur was never on Ayanna Howard’s to-do list.
“In fact, it wasn’t even a remote thought in my mind,” said Howard, a professor in Georgia Tech’s School of Electrical and Computer Engineering.
Today, however, Howard is the founder and chief technology officer of Zyrobotics LLC. Launched in September 2013, the company is commercializing assistive technology that enables children with limited mobility to operate tablet computers, smartphones, toys, gaming apps, and interactive robots.
With eight employees, Zyrobotics introduced three gaming apps earlier this year and expects to begin shipping its first smart toy in December. By 2016, Howard believes the company could be generating $4 million in annual revenue, with 30 employees.
MARKET POSSIBILITIES TO PROBABILITIES
What changed Howard’s mind about commercialization? “Two things,” she said. “I-Corps opened my eyes to the possibility – and VentureLab provided a safe haven to launch a startup.”
A unit within Georgia Tech’s Enterprise Innovation Institute (EI2), VentureLab helps Georgia Tech faculty, students, and staff transform innovations into sustainable companies. Among its many programs is I-Corps, which VentureLab administers for the National Science Foundation (NSF) to validate market opportunities for technologies developed by NSF-sponsored researchers.
Howard went through I-Corps in summer 2012, and then incorporated Zyrobotics with VentureLab’s assistance. “VentureLab is a solid bridge to transition technology from the lab into the market. You’re not swimming with the sharks,” Howard said, noting the incubator helped her:
• Find manufacturers and electronic vendors to produce Zyrobotics’ products.
• Navigate through the licensing process by sharing insights about how other licensing agreements have been structured.
• Obtain $50,000 in grants from the Georgia Research Alliance (GRA) to develop a revised prototype.
“The GRA funding was a big help,” Howard said. “Going through I-Corps gave us critical information about what we needed to change on our device, but we still had to implement those changes. It’s hard to get that kind of money because you’re not doing academic research, and you’re not really a business yet.”
For Suman Das, a professor in the George W. Woodruff School of Mechanical Engineering, VentureLab has been instrumental in his strategic thinking. As CEO of DDM Systems Inc., Das is commercializing two technologies for additive manufacturing. The first, known as large area maskless photo-polymerization, reduces the time and cost to make ceramic components, cores, and molds used in metal-forming processes.
"It’s hard to get that kind of money because you’re not doing academic research, and you’re not really a business yet." — Ayanna Howard
The second technology, scanning laser epitaxy, can produce metal components directly from powder as well as repair existing components. Launching two disruptive technologies at the same time greatly complicates the challenges of a startup, Das explained. “VentureLab’s advice has been very important in how we approach this, what kind of infrastructure we need, and how to build a cross-functional team that can contribute to the launch of both technologies.”
In addition to mentoring, VentureLab has helped raise DDM’s visibility. Das points to the ability to secure $350,000 in GRA grants and loans, along with $3 million from private investors. “VentureLab has taken every opportunity to promote us and vouch for us,” he said. “And, because of its reputation, that gives our company additional credibility. When VentureLab speaks, people listen.”
Indeed, VentureLab ranked No. 2 among U.S. university business incubators, according to a recent study by UBI Index, a Stockholm-based consulting group.
VentureLab also placed 17th globally, scoring high for both the success of its companies and their diverse technologies.
These technologies run the gamut from computer science and Internet technologies to life science and engineering-based innovations.
Take Inmondo Tech, founded by David Sholl and Krista Walton, both of Georgia Tech’s School of Chemical & Biomolecular Engineering. The company is commercializing metal-organic frameworks (MOFs), a class of nanomaterials with numerous real-world uses, such as capturing contaminants from the air or liquids.
I-Corps helped Sholl and Walton confirm market interest, and then VentureLab picked up from there, working with them to refine Inmondo Tech’s business model, win GRA funding, and prepare to go to market. The company has already sold initial product for air purification and refrigeration applications.
In addition to business mentoring, the moral support VentureLab provides is invaluable, Sholl said, likening conversations with incubator advisers to “startup therapy.”
“Because Krista and I are faculty members and have a variety of other things going on, it’s easy to get distracted or feel overwhelmed by all the details of commercialization,” explained Sholl, who is the school chair. “VentureLab is a friendly ally that helps us evaluate where we are – and where we need to be next. It helps us stay accountable and keep moving ahead.”
EXPERTS AT CREATING COMPANIES
Although Georgia Tech has numerous programs to support startup activity, one of VentureLab’s hallmarks is its client base. “We’re white and gold,” said Keith McGreggor, director of the incubator since 2008.
“VentureLab will help anyone who is actively affiliated with Georgia Tech, whether they’re a student, faculty member, researcher, or staff. If a building custodian has developed an intriguing innovation, they can come to us.”
People sometimes confuse VentureLab with ATDC, another entrepreneur-support unit at EI2. Although the groups work together, VentureLab focuses on technology developed within the Georgia Tech community whereas ATDC serves entrepreneurs throughout the state not necessarily affiliated with the Institute. Another distinction, VentureLab gets involved with innovations at a much earlier stage. “We work with the companies for a while, then they move into ATDC and go out into the world,” McGreggor said.
"I think it’s one of our super powers. Because our group doesn’t take any equity or royalties from the entities we help create, we can give unvarnished advice." — Keith McGreggor
In most academic institutions, licensing and commercialization services are housed under one roof. Yet, VentureLab is separate from the Georgia Tech Research Corp., the university’s licensing arm.
“I think it’s one of our super powers,” McGreggor said. “Because our group doesn’t take any equity or royalties from the entities we help create, we can give unvarnished advice. What’s more, our group is filled with entrepreneurs — super-geeks who have launched companies, raised money, lost money, hired, and fired. We’re experts at creating companies.”
Indeed, McGreggor has founded or co-founded six software firms, including the first artificial intelligence company in the Southeast. Roberto Casas, VentureLab’s associate director, and its five other principals (Colin Ake, Paul Freet, Ben Hill, Harold Solomon, and James Stubbs) are seasoned entrepreneurs who have started companies with technology ranging from material sciences and telecommunications to clean energy and aerospace.
This broad knowledge base has been especially valuable to Lumense, a company that’s commercializing technology developed at the Georgia Tech Research Institute (GTRI). Lumense has developed biological and chemical sensors that continuously monitor gases and liquids in real time to detect trace amounts of contaminants – quality control work previously possible only with expensive lab equipment.
CEO Mike Slawson helped incorporate Lumense in 2011 after VentureLab’s Paul Freet introduced him to co-founders Ken Johnson and Dan Campbell, who helped develop the technology at GTRI. Although Slawson is a serial entrepreneur and former venture capitalist, he praises VentureLab for helping identify blind spots. “I’ve been exposed to a lot of markets, but they know more about some than I do – and they know some that I don’t,” Slawson explained. “It’s been very helpful to discuss the pros and cons of different markets we want to pursue, along with their sequencing.”
Slawson also credits Freet for providing introductions that led to two rounds of funding, totaling $3.65 million, from angel investor Leland Strange of Intelligent Systems Corp., and The Coca-Cola Company. The money is helping Lumense refine its sensor platform for high-volume, low-cost manufacturing, and Slawson expects to deliver initial units in early 2015.
“Our technology is simple but powerful,” Slawson said. “In my venture capital career, I’ve seen that a cutting-edge technology doesn’t always win the battle. What’s more important is to have a product that’s well timed for the market.”
GETTING OUT OF THE LAB
Under McGreggor’s aegis, VentureLab has evolved from traditional commercialization services to an intense focus on customer discovery.
The first order of business for startup teams is to contact 100 potential customers and verify interest in their product.
In addition, VentureLab wants entrepreneurs to understand the customer’s purchasing motivation. “Why would they buy a product from your company?” McGreggor asked. “That’s different than identifying a customer segment, and you can’t Google it. You have to go out and talk to actual living, breathing people.”
These conversations can be eye-opening for academic researchers. “We saw customers were interested in features different from what the research community focuses on,” said Sholl. “Researchers win credit for devising a brand new material. But potential customers want to know about more mundane features: Is it stable? Is it cheap? Can you give this to me in the form of a powder or a pellet? Such things don’t get addressed in research literature.”
VentureLab makes the innovation process more efficient, observes Bernard Kippelen, a professor in Georgia Tech’s School of Electrical and Computer Engineering and director of the Center for Organic Photonics and Electronics.
No stranger to commercialization, Kippelen holds more than 15 patents and has been involved in several startups. He equates VentureLab’s customer discovery process with the methodology scientific researchers use: First conduct experiments, and then draw conclusions from the resulting data.
“It’s important to go through that process in the business world,” Kippelen said. “You need to be able to generate data to validate your assumptions about customers before you raise millions of dollars and spend years of your time only to find out that your great technology is not so great.”
Case in point: Kippelen is working on an optical technology he originally thought would help manufacturers who use lasers to achieve cleaner, more precise cuts. After four weeks of talking to potential customers, Kippelen saw little enthusiasm from manufacturers. Yet, discussions with vascular surgeons identified a completely new application for his technology: an ultra-fast camera shutter that makes medical imaging safer and less invasive than the current method of ionizing radiation.
“VentureLab is real partnership,” observed Kippelen. “It’s a constant exchange of ideas and best practices about how to commercialize innovations. They help you through a process where you forget about the technology for a while, get out of the lab, and really listen to potential customers. It completely changes how you think about your research; it’s no longer about publishing the next paper but truly finding solutions to people’s problems.”
Customer discovery also helps establish relationships in large companies at the senior level, pointed out VentureLab’s Harold Solomon. “Even if faculty members don’t move ahead with a startup, they may get sponsored-research opportunities. It’s a no-lose proposition.”
"Today’s jobs didn’t exist 20 years ago and won’t exist 20 years from now." — Keith McGreggor
In addition to customer discovery, another new twist at VentureLab has been the introduction of educational programs.
Among these is Startup Gauntlet, a six-week course similar to I-Corps – but focused on students and community entrepreneurs instead of NSF researchers. (VentureLab teaches both Startup Gauntlet and I-Corps at other schools in the Southeast including the University of Florida, the University of Alabama, Auburn University, and Florida State University.)
“Until 2012 most of our work was done one-on-one,” said VentureLab’s Freet. “We still do that, but the educational component enables us to scale our impact and work with hundreds of students and faculty members each year instead of dozens.”
Beyond Startup Gauntlet are three new educational offerings targeting Georgia Tech students:
• Startup Lab: A for-credit class for engineering students, Startup Lab debuted this spring with 30 students. Freet expects 100 to enroll in 2015.
• Startup Summer: Eight teams (a mix of current students and recent graduates) receive a $15,000 stipend to commercialize an innovation. As with I-Corps and Startup Gauntlet, the first order of business is to confirm customer interest.
• Startup House: A dormitory floor (currently the penthouse of the John Patrick Crecine Apartments) is reserved for students who want to pursue entrepreneurship. Participants have opportunities to learn about entrepreneurship, meet local entrepreneurs, and tour local startups.
“We’re constantly trying new things so we can be more effective,” said Freet. “We believe our mission is not just to launch startups, but to teach the process and experiment with it.” Entrepreneurship has become the new required “muscle memory” for students, McGreggor added. “Today’s jobs didn’t exist 20 years ago and won’t exist 20 years from now. Because of that, graduates need to be able to recognize opportunities and seize them. We need to do everything we can to graduate people who can create jobs rather than just take jobs.”
ECONOMIC GROWTH AND BEYOND…
Since its inception in 2001, VentureLab has launched approximately 150 companies and helped them attract more than $1 billion in outside funding.
Taking innovations to the street translates into more jobs, capital investment, and an increased tax base. Making sure startups are sustainable – that they have identified a way to profitably solve a market problem, are able to attract talent, and can develop infrastructure to scale – is what turns a few jobs into many and keeps companies’ top and bottom lines growing.
While economic development is a core mission, VentureLab’s impact shows up in other ways. Commercializing university technology yields considerable value for society. “Imagine if we can replace ionizing radiation for vascular surgery, especially for infants,” Kippelen said. “Easing pain and saving lives is pretty rewarding.”
Sholl believes that VentureLab brings a different nuance to the university’s intellectual environment: “Even if my grad students end up working for a giant petrochemical company, they can use their entrepreneurial skills to develop new ideas, think about who their customers are, and connect with them.”
For Howard, commercialization has been gratifying on multiple levels. “For one thing, it’s rewarding because it’s challenging,” she explained. “Being a business owner is forcing me to learn a whole new set of skills.” Like Kippelen, commercialization has made Howard look at academic research differently. Instead of thinking about “the next great paper and citations,” she now focuses on how her research could ultimately help someone.
There’s also a bit of ego involved, she added: “It’s one thing to be respected in academic circles – people in robotics know who I am. Yet, I’ve gotten emails from strangers who are genuinely excited about Zyrobotics’ products. Launching a company allows you to take an idea out of the lab and have real impact in the world, which is an amazing feeling.”
T.J. Becker is a freelance writer based in Michigan. She writes about business and technology issues.