Even MIT Hasn’t Figured out Technology Transfer

November 25 2010 5 Commented

A recent article in Forbes references, two studies that support my ongoing opinion that transfer from US universities into both existing businesses and startup ventures is really, really difficult to do, currently ineffective and surely in need of a major overhaul.

A 2009 study found that MIT alumni have started 25,800 still-operating businesses, with a total of 3.3 million employees and $2 trillion a year in revenue. Combined they’d be the eleventh-largest economy on Earth.  But, this study did not suggest that MIT graduates were commercializing MIT R&D.  MIT alums are starting companies and that is absolutely wonderful.  MIT has clearly created an environment which encourages graduates to become entrepreneurs.  Cool, huh?

BUT… in the decade between 1996 and 2006, MIT earned a measly 0.3%, or $490 million, from $12.2 billion in funded R&D.  Wow…that is abysmal.  If MIT’s record of commercializing publically-funded R&D is so poor, doesn’t the tech transfer system really need a major overhaul?  We need to continue to search for better ways to transfer technologies out of universities and national laboratories, rather than continue to fund the old, ineffective ways of the past.

5 Responses to “Even MIT Hasn’t Figured out Technology Transfer”

  1. Derek says:

    Looking at revenues may not be the only measure of MIT’s tech transfer office’s success. There is no mention of MIT’s policy on when to hold or divest equity from IPOs of companies like:

    Also, the aggregate of R&D spend is not truly a good measure of total commercializable research (I would guess that the theoretical physics department doesn’t patent too much . . .)

    Tech Transfer might need an overhaul, but if you are going to use one of the two best institutions in the country (Stanford being the other) the data used has to dig deeper than top-line statistics.

  2. admin says:

    Thanks, Derek- I could not agree more. Stanford and MIT are the best in the world at commercializing publically-funded R&D. But…are they as good as they could be? We spend billions of dollars in the US and our overall record for commercialization is pathetic. When will we begin to realize that pouring more money into the top of the funnel will never fix the pinch point at the bottom.

  3. Jeff Lindsay says:

    Actually, the University of Utah led the nation last year in number of starts ups, and Utah’s BYU has been recognized for the high # of start ups and patents per R&D dollar, and has had a lot of licensing deal per dollar R&D. MIT might have something to learn from the folks out West. But universities are still missing the boat nationwide by not proactively crafting IP estates and creating real licensing positions. Right now it is a random trickle-up process. They need to learn much more from leaders in industry.

  4. As usual in ethnocentric USA, the above discussion is very focused on the USA.
    Globally, Europe does as well as the USA along the three dimension of tech transfer: collaborative research, licensing and start ups. Switzerland is the country where it is best done
    US universities could indeed do veyr much better, especially given the enormous amounts of money availale in this massive market. Some of them are pretty good at communication and marketing….
    Asia is catching up fast. Several universities in Japan and China, are at the level of the best. The speed of progress is astounding. Mechanically, the rest of the world is diluted as a result.
    Where the USA do well is to grow champions rapidly. The start ups founded by drop outs manage to develop them into large corporations
    more on this ? see my just published book From Science to Business (wwww.sciencetobusiness.ch)
    happy 2011 !
    G Haour

  5. Jon says:

    Good comments above. It is an axiom that one can always do better. You did not measure the amount of returns MIT obtained through contributions from alumni founders. Many of the key parts of MIT’s campus were financed by alumni. It would otherwise be unlikely to see a Frank Gehry structure in a town like Cambridge.
    I do not agree with #4, tech transfer in Europe is primarily achieved through existing large corporations, with bizarre activities such as EU funds going to large Swiss food companies.