The University of Minnesota, a laboratory for exploration, knowledge and debate, also is an economic engine for our state.
There continues to be progress for the U in converting promising research to commercial success.
The turn started about 12 years ago, amid harsh criticism that the University of Wisconsin was doing a demonstrably better job converting laboratory achievements to commercial success.
Jay Schrankler, a former Honeywell scientist and executive, came on board with a mandate to accelerate technology transfer.
This can be touchy, at the intersection of academic freedom, laboratory research and capitalism amid pressure to find a solution or product that does some good and also makes a buck for investors.
Schrankler, a guy with range and a good bedside manner, made considerable progress. In fact, Schrankler left his $290,000-plus post at the U in 2019 to take a similar job at the University of Chicago, a hotbed of research and innovation.
‘A nice rate’
Schrankler’s No. 2, Rick Huebsch, a veteran of 11 years in business development and management at the U, and 20 years before that in the software trade, has taken the tiller.
“Back in 2008 or 2009, we were averaging about four to five startups a year,” Huebsch recalled. “That was definitely behind peer institutions such as the universities of Wisconsin, Michigan, Florida, Washington and other public universities. And we were behind some private universities as well.
“Now, we are averaging 15 to 20 new startups a year. That’s a nice rate. And we have a survival rate of 75% since 2006. That’s approximately 150 companies since 2006, companies that are still independent or which were acquired and still alive inside of an acquirer.
“Through techniques and seminars and culture and the growing Twin Cities startup ecosystem, we’re growing a startup ecosystem [at the U]. It’s quantity and quality. These are proof points and demonstrate years of runtime. Now we believe the cultures and traditions here are networked. We’ve got the researchers, the people and the ventures. We have quantity and quality startups.”
According to the U’s Technology Commercialization annual report, in fiscal-year 2019, the U’s Venture Center launched a record 19 startup companies based on discoveries and inventions by university researchers in energy, food, biological sciences, engineering, software and medical devices.
Five U startups were acquired or went public. There have been eight successful “exits” since July 2017 that meant a financial return.
Those 150 U-bred companies have raised $1.15 billion in capital, including acquisitions and public offerings.
About $600 million went to Twin Cities-based companies and $528 million to outstate fledgling companies.
The surviving companies today have generated about 820 jobs, mostly in Minnesota.
Moreover, the 30-person tech-commercialization operation of scientists, patent attorneys and others pays for itself without public funds.
For the last five years, the tech-transfer office has averaged revenue of more than $20 million annually from licenses, equity stakes and other revenue-generating interests. The revenue has swung from $46.9 million in 2016 to as low as $16.1 million in 2018.
“The revenue is lumpy, because you may have a significant acquisition of a company in one year that doesn’t occur in another year,” Huebsch explained. “But we are one of only 14 percent of the tech offices in the United States that pay for themselves.”
Finally, the U has emerged as a patent-filing leader among universities, with 146 to 179 annually since 2015.
The Gophers basketball team, for better or worse, gets more publicity in a year than this outfit will get in a century.
Technology transfer and starting new companies that create better food, safer drugs and cleaner energy are far more important to our future.
Neal St. Anthony has been a Star Tribune business columnist and reporter since 1984. Reach him at firstname.lastname@example.org.