Seasoned players in Utah's technology development arena are convinced there are better ways to get new innovations to the market.
To test their theory, an alliance of venture capital firms and other organizations launched an initiative last week called "Technology to Market," or T2M, that is designed to help foster new ideas through the startup phase, an initial public stock offering and beyond.
Members of the alliance donate their time to help give direction to new innovations — whether they come from a university research lab or straight from the garage of a Utahn with an entrepreneurial spirit.
The partners' payback comes down the road when the innovators they help are looking for ongoing professional services. But the first objective is to help an innovator protect his intellectual property rights, define a business plan and assess the marketability of the idea.
The list of T2M partners is telling of the scope of the technology acceleration project: the Salt Lake City law firm Parsons Behle & Latimer, with expertise in intellectual property and patent law; Ernst & Young, professional financial services; First Security Van Kasper, investment banking and advisory services; Harris & Love and its U235 division, advertising; Utah Ventures, venture capital; Wasatch Venture Funds, venture capital; Inetz, Web development; McDonald Investments, investment banking; Aon, insurance brokers/consultants; and Browne, a financial printer. The University of Utah, Utah State University and Brigham Young University are participants and potential contributors for a significant portion of new ideas T2M hopes to bring through its front doors.
Ideas for the partnership developed over time as T2M's architect, Dick Clayton, talked with colleagues about Utah's place in the technology arena. A partner with the law firm, Clayton said that after the concept began to take form, he began to recruit "the best of the best organizations, both from a professional service standpoint and a financial standpoint. I just started talking with people."
Clayton believes the T2M concept is unique because partners come from disciplines outside the core financial services arena.
The volunteer nature of the consortium makes the return on partners' investment of time and expertise uncertain. Clayton said an evangelistic component to building the alliance is its altruism. "My approach, and our approach on an ongoing basis, is: You're a major organization in this community, so you owe it to the community to see if you can help accelerate this technology. To the extent you do that, you raise the level of the ocean for everybody. You may see direct benefits, but there will be indirect benefits you can't even understand."
In addition to their promised sweat equity, sponsors have also kicked in cash to help get T2M out of the chute. The money covers expenses for things like promotional materials and the development of a Web site, (www.t2m.com), that gives innovators a place to go to become familiar with T2M and its resources.
During the T2M launch at Hotel Monaco in Salt Lake City Tuesday, Gov. Mike Leavitt lauded T2M as an example of Utah's new economy. "The mentality is a sense of cooperation between parties, recognizing that everyone benefits when others succeed," he said, adding that it is part of an emerging "entrepreneurial atmosphere where risk-taking is part of the culture."
Rob Simmons, who leads CampusPipeline.com, said it will help create a "central hub where startup companies can go."
Participation by the three universities is very important because there's a great need to train more technology-savvy engineers, he said. Last year, 832 students at the U. alone signed up for introduction to computer science classes, but there were only about 120 slots available and most had to be turned away.
He likened having companies with technology, research and financial expertise working together to an old-fashioned barn-raising. "It's not just a selfless act. . . . It's good for everyone."
Todd Stevens, managing director of Wasatch Venture Fund, likes T2M's breadth. "There are a lot of Internet resources for venture capital and startups out there," he said. This goes a lot further than Internet databanks where they just give you sources you can contact, because it really reaches back. What we hope to accomplish is to help folks in the state with great ideas take them all the way to commercial success."
Despite the "world wide" scope a Web site implies, T2M, at launch, has a definite Utah focus. "There are thoughts that if this is successful it could be cookie-cuttered in other areas," Stevens said.
Bringing the universities into the partnership significantly boosts T2M's value, Stevens said.
David W. Pershing, the University of Utah's senior vice president for academic affairs, agrees the partnership helps build Utah's innovation community. "The existence of this infrastructure should help accelerate the discoveries that are made here."
When a U. professor develops new technology on campus and then wants to license the innovation from the school to develop it commercially, "we have to determine whether or not the company the faculty member has put together has a reasonable likelihood of success," Pershing said. He sees T2M as a supplement to the U.'s own technology transfer initiative.
BYU has a technology transfer infrastructure as well and considers T2M a supplement to its in-house mechanism for commercializing campus-bred technology.
"I've launched a couple of companies before coming to the Y.," said Lynn Astle, director of BYU's Office of Technology Transfer. Astle emphasizes that he learned from his business experience that innovators need to have business savvy in addition to a bright idea.
"What we generally have in Utah is scientists and engineers who have no management experience who think they can do it without professional management, so they want to run their own company. So you have to talk them into getting management."
Astle sees a lot of entrepreneurial spirit in Utah. "It's good to see a local support system going here."
T2M has identified its areas of focus in five areas: Internet/communications, computer hardware and software, biotech/medical, energy and environment, and materials/chemicals.
One challenge T2M faces will be convincing the people with the ideas the alliance can help them while protecting their intellectual rights.
"Sometimes you run into inventors or idea generators who are so concerned about protecting their technology that they never really get it to market," Clayton said. What we're trying to do is bring together a one-stop-shopping situation so they can have the confidence that 'if I'm getting advice from this group of people and the funding, I will be protected legally and practically but also get the idea out.' "
Innovators begin by filling out a five-page questionnaire that gives a generic sense of the idea and tells how far along they are in the development process. They submit the questionnaire to T2M; then a group of probably three people triages the information and makes suggestions. Mentoring and further development follows; then the idea goes before a larger group of T2M sponsors, which plans to meet monthly.
If the idea takes off, it's up to the innovator and T2M participants to decide whether longer-term relationships follow and with which entities. "It's kind of a jump ball, if you will," Clayton said. "If somebody has a real hot idea, we want to accelerate that even faster. My view is it gets those ideas polished and in front of the funding sources. Then it's up to the innovator to decide where it goes from there."
Staff writer Lois M. Collins contributed to this story.