School:Rice University
Contents
Background
In April 2010, over 140 leaders from higher education endorsed and submitted a letter to then Commerce Secretary Locke through his National Advisory Council on Innovation and Entrepreneurship (NACIE). They committed to work more closely with industry, private foundations, investors, and local, state, and federal governments to enhance efforts to promote innovation, entrepreneurship, and the commercialization of research results. Underlining their commitment was a willingness to employ strategies, enhance existing activities, and expand efforts in several areas, including:
- Promoting Student Innovation and Entrepreneurship,
- Encouraging Faculty Innovation and Entrepreneurship,
- Actively Supporting the University Technology Transfer Function,
- Facilitating University – Industry Collaboration, and
- Engaging with Regional and Local Economic Development Efforts.
The Office of Innovation and Entrepreneurship (OIE) recently followed up with each signatory to better understand their efforts to embody and implement the ideas contained within the letter, as well as to improve our ability to develop policies and programs that support innovation, entrepreneurship, and the commercialization of research results. OIE is conducting phones calls with every respondent to discuss their strategies and develop a general outline of each of their initiatives. For a select few institutions, including some who have not signed the NACIE letter, OIE has conducted a more thorough exploration of their strategies and initiatives. The goals of these “deep dives” is to discuss the historical and cultural context for the relevant work being done at leading institutions, highlight innovative practices, and uncover future trends. Through this, OIE will be better equipped to advise on policies and develop future programs.
Overview—Commercializing Innovative Business Plans 9
William Marsh Rice University - commonly referred to as Rice University or just Rice - is a private research university located in Houston, Texas. Since its establishment in 1912, Rice has grown into a highly regarded research university with an expanding entrepreneurship program.
Rice is noted for applied science programs in the fields of artificial heart research, structural chemical analysis, signal processing, space science, and nanotechnology. It was ranked first in the world in materials science research by the Times Higher Education (THE) in 2010. Under the leadership of President David W. Leebron, Rice has maintained a very high level of research activity for its size, with $115.3 million in sponsored research funding in 2011.
Activities that support commercialization of research have also become a hallmark of Rice University. By the late 1990s, it became clear to a Rice University business professor that entrepreneurship and research programs at Stanford University and MIT were economic development catalysts in the Silicon Valley and greater Boston regions, respectively. Consequently, Rice decided that it had a duty and academic pedigree to replicate the human capital and economic development successes in the Houston, Texas region. With seed funding by former Rice president, Dr. S. Malcolm Gillis, their entrepreneurship program, known as the Rice Alliance for Technology and Entrepreneurship that brings together the George R. Brown School of Engineering, the Wiess School of natural sciences and the Jesse H. Jones Graduate School of Business in a strategic collaboration, opened in 2000.
Rice University maintains a “distributive” culture, which reflects the need to work across different arenas of campus, while consciously avoiding duplication. It also encourages bottom-up thinking and strategies. However, most innovation, entrepreneurship, and commercialization of research results, transition through the Rice Alliance. This includes the just concluded 2012 Rice Business Plan Competition. The competition attracted 131 sponsors, 207 judges, and 42 graduate student teams who competed for $1.5million in prize money. The U.S. Department of Energy’s Clean Energy Prize was one of the sponsors. 11 different schools have won the competition’s grand prize in the last 12 years. In this way, the NACIE commitment letter is consistent with Rice University’s culture of innovative approach to entrepreneurship and commercialization of research.
Brad Burke is the Executive Director of the Rice Alliance, and he reports to four different people—the heads of engineering, bio sciences, business school, and the vice president for research. The culture at Rice Alliance is favorably biased towards business plan competitions, rather than innovation competitions. Unlike business plan competitions, innovation competitions tend to promote innovation as an end, rather than a means. At Rice, the primary motivation for business plan competitions is to bring ideas to market; innovation at Rice University is a means to commercialization ends.
The number and acquisition value for some Rice Alliance business plan competitors have been impressive. 128 competitors have successfully launched companies, and 7 have exited through acquisitions. The 2005 Rice Business Plan Competition winner, Auditude, was acquired by Adobe for a reported $120 Million. Auditude also spun out another company, IntoNow, which was acquired in April 2011, by Yahoo, for a reported total value of $20 to $30 million.
Rice University adopts several eligibility standards that serve as the rule of thumb for business plan competitions applicants. Winners of the competition, which now serve as both catalyst and support structure, receive about $100,000 in seed funding. Participants are early stage companies, who may not have received over $500,000 in venture funding, and are seeking funding to develop commercial prototype. However, most teams have received some level of federal funding.
Rice considers itself one of the first universities to institute a university-wide entrepreneurship center. And the Rice Business Plan Competition provides students excellent experiential education. But there have been some drawbacks and challenges. The competition is on some level a victim of its success. The size and scope of the competition now requires increasingly more resources. Even so, Rice continues to seek innovative ways to ensure that every engineering student has some awareness of commercialization and entrepreneurship.
Other challenges abound. While many faculty members at Rice have a strong culture of entrepreneurship, overall, faculty feel they can improve on the 3 or 4 companies they commercialize annually. Faculty can also more effectively draw connections between their research and the creation of societal impact. There is a widespread concern that America is losing its global leadership position in research and commercialization. Government for its part should continue to improve policy and programs that promote innovation, entrepreneurship, and commercialization of technology. The Office of Innovation & Entrepreneurship’s university case studies are a good start. Even so, especially because of its strong focus on research and commercialization, these remain the types of drawbacks and challenges the Rice Alliance is happy to engage. Houston’s regional and local economy, for instance, derives invaluable benefits when Rice University convenes next generation companies.
In 2012 Rice Alliance will, in addition to the just completed Business Plan Competition, host the 2012 Energy & Clean Technology Venture Forum, and the 2012 IT and Web 2.0 Venture Forum, among several other events. Rice University has also been severally recognized for its commitment to innovation and commercialization. These include the 2011 & 2012: #14 Best U.S. Entrepreneurship Program – US News & World Report; and the 2011 NASDAQ OMX Center of Entrepreneurial Excellence Award, among others.
Below is an enumeration of Rice University programs that support the five buckets in the NACIE sponsored university commitment letter.
Student Entrepreneurship
Rice University Technology Venture Challenge is a business plan competition where undergraduate students submit business plans for new technology ventures. Ventures have ranged from a solar-powered electric vehicle, improved tools for liposuction, low-cost vision testing device for individuals from developing countries, improved dry-eye diagnostic tool, improved defibrillator to ensure proper placement, among others.
CoRE—Community of Rice Entrepreneurs is a Rice undergraduate student entrepreneurship club that founded the business competition which is open to all Rice undergraduate students. The competition is supported by the Rice Alliance for Technology and Entrepreneurship, the Rice Center for Engineering Leadership (RCEL), and Finger Interests, a local investment firm headed by Jerry Finger, who is also an Adjunct Professor in Management at the Jones Graduate School of Business.
- Teams compete for three cash prizes totaling $8,750
- The grand prize is $5,000 in cash. More than 25 judges from the Houston business and investment community evaluate the business plan presentations.
In 2011 the Rice Alliance awarded prizes to all eight engineering and science graduate students and post-doctoral fellows who presented a four-minute pitch on their research findings and commercial applications for promising nanotechnology research at Rice University.
The Rice University Business Plan Competition (RBPC) is the World’s Richest and Largest (according to Rice), awarding more than $1.3 million in prizes; Over 133 past competitors are in business today having raised in excess of $394 million.
Since 2001, 133 RBPC teams have launched their companies and are still in business today, raising a total of nearly $400 million in funding.
In April 2012, 42 teams from around the world will compete in front of 250 judges for an expected $1.3 million in prizes.
There are also additional prizes for the Elevator Pitch Video competition.
The RBPC expects to award 9 Major Investment Prizes including:
- $150,000 Grand Prize Investment from The GOOSE Society of Texas
- $100,000 from Kleiner Perkins Caufield & Byers Prize for Clean Tech Innovation
- $100,000 from Greater Houston Partnership/Opportunity Houston Investment Prize - Life Science
- $100,000 from Greater Houston Partnership/Opportunity Houston Investment Prize - Energy/IT/Nano Aerospace
- $100,000 from DFJ Mercury Tech Transfer Investment Prize
- $100,000 from Waste Management "Think Green" Investment Prize
- $100,000 from OWL Judges Investment Prize
- $100,000 from Department of Energy Clean Energy Prize
- $20,000 from Courageous Women Entrepreneurs Prize
3 Day Startup is an entrepreneurship education program designed for university students with an emphasis on learning by doing.
- The idea is simple: start tech companies over the course of three days
Faculty Entrepreneurship
Faculty Advisory Committee is one of the internal advisory bodies of the Rice Alliance for Technology and Entrepreneurship (Rice Alliance), a nationally-recognized initiative devoted to the support of technology commercialization, entrepreneurship education, and the launch of technology companies.
Faculty members also work closely with the Office of Technology Transfer to protect intellectual property developed by them during their pursuit of the university’s mission of providing an unsurpassed educational experience to its students and serving the educational needs of the larger community.
Rice Innovation Management System (RIMS) is an on-line system by the Office of Technology Transfer that allows researchers, especially faculty, at Rice to disclose their research innovations electronically. This new technology is the first step that professors take to turning their inventions into a product or service. By using the new system, faculty members will be able to reap some of the financial benefits of their inventions, create opportunities to receive additional funding for research and also helps them coordinate with other researchers if there is more than one group working on an invention.
University Technology Transfer Functions
The Rice Office of Technology Transfer (OTT) is a component of the University’s outreach efforts to make the benefits of new discoveries available to the public. OTT provides a service to Rice faculty members, students and staff researchers by protecting intellectual property developed by them.
- The OTT facilitates the interaction between academia and industry, so that science may be transformed into technology.
The Rice Alliance for Technology and Entrepreneurship (Rice Alliance) is Rice University’s nationally-recognized initiative devoted to the support of technology commercialization, entrepreneurship education, and the launch of technology companies. It was formed as a strategic alliance of three schools: the George R. Brown School of Engineering, the Wiess School of Natural Sciences and the Jesse H. Jones Graduate School of Business in collaboration with the Vice Provost and the Office of Research.
- Since its inception in 2000, the Rice Alliance has assisted in the launch of more than 250 start-ups which have raised more than half a billion dollars in early-stage capital
- More than 1000 companies have presented at the 125+ programs hosted by the Rice Alliance
- More than 26,000 individuals have attended Rice Alliance events in the past nine years and over 24,000 individuals subscribe to the Rice Alliance Digest newsletter
University-Industry Collaboration
Rice University has initiatives that form part of its industry collaboration. These include: The Virginia and L.E. Simmons Family Foundation Collaborative Research Fund. The foundation generously provided $3 million over five years for collaborative research among investigators at Rice University, Texas Children’s Hospital, and The Methodist Hospital Research Institute.
- The program is designed to promote truly excellent, collaborative, and interdisciplinary research among investigators at the three institutions
- The program focuses on junior investigators who have not yet established funding as well as experienced investigators who are new to collaboration among the three institutions
Rice's Richard E. Smalley Institute for Nanoscale Science and Technology has on-going research collaboration with nanoAlberta, part of Alberta Advanced Education and Technology in Canada, to address issues surrounding the production of petrochemicals from Alberta's oil sands, one of the world's largest reserves of recoverable oil.
Rice University is also one ofTexas Instrument’s primary academic partners for research in embedded processing. Rice's digital signal processing (DSP) researchers recently won a new, three-year $1 million grant under the program.
Regional and Local Economic Development
Rice 360° draws on the diverse experience of faculty from the Jones School of Management, the Baker Institute of Public Policy, and the Schools of Social Sciences, Humanities, Natural Sciences, and Engineering to determine how to make technologies available, meaningful, and useful to people around the world. These technologies include a low-cost incubator designed Rice students that is with phototherapy lights based on the Blantyre Hot Cot, which has been used in a Malawi hospital now for four years to treat babies with neonatal jaundice.
Deep-Dive Questions
- Is innovation an integral part of Rice’s institutional culture?
- Why is it important? And how does it influence entrepreneurship and tech transfer?
- How do you envision your program in the future?
- What is your vision for each of the case study’s bucket?
- How does your institution leverage (or intend to leverage) geographic endowment?
- Are your innovation, entrepreneurship, and tech transfer programs integrated?
- Why, or why not?
- Are there any unique successes (and or challenges) you may wish to highlight?
Conclusion
Rice University is a leading private research University and an Association of American Universities (AAU) member school. Mr. Brad Burke’s comments have been instructive in better understanding Rice’s various innovative entrepreneurship, research, and technology transfer programs. It also frames the NACIE commitment letter by way of Rice University’s strategic plans and institutional culture.
The Office of Innovation and Entrepreneurship thanks Rice’s assistance with this case study, and looks forward to a continued close and collaborative relationship in building America’s innovation infrastructure.
9 Comments by: Brad Burke, Managing Director, Rice Alliance for Technology and Entrepreneurship.
Top institutions:
Sponsored Research:
Business Plan Competition:
Rice University Engineering:
RBPC:
RIMS:
Rice OTT:
The Rice Alliance for Technology and Entrepreneurship:
Collaborative Research Fund:
Energy and the Environment:
Rice & TI:
Rice 360°:
Source: "The Innovative and Entrepreneurial University: Higher Education, Innovation & Entrepreneurship in Focus", Department of Commerce, October 2013.
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