Success and Failure in University-Based Startups

Abstract:

Adapting from a traditional government-funded research program to supporting the work through a start-up company is a difficult (and often not successful) transition. This is made more challenging in that with the relative decline in federal funding for the sciences the transition is forced on many researchers as a matter of survival. The business model of traditional research is not that different from that of the private sector; the development of an idea, models or mock-ups of the product, pitching to sources of funding, creating and marketing the product. However they differ significantly in the environment in which they are applied, as well as in the life span of a project or product. The environments for pitching an idea and gaining investment are very different in academia from that of the private sector, and most academics are stymied by the new approach. In addition, many universities labor under the illusion that start-ups will be a windfall, when in reality they represent a long term investment that will not pay out for many years. This extended timeline is also something new to academics, though persistence pays and a project may take years to fund, after it is complete and the publications written, many in the geosciences go on to new ideas. If a business is to be successful it must continue with a product long term, and develop new ideas around it. A hopefully successful balance of these approaches is being tried at the University of Alaska Fairbanks, where start-ups can build upon university intellectual property and use university resources to build a successful business. In turn the business supports research and development, primarily through faculty, staff and students at the university.