NewVenturesand

ConflictsofInterest

JimBratton,AVPEconomicDevelopment

LaunchingaUniversityStart-up• ExcitingNewChallenges

• FinancialIndependence

• TranslatesUniversityInnovation

• CreateLastingImpactbyImprovingLives

• RecognitionandDistinctiontoInventorandUniversity

• ContributetoEconomicDevelopment

PersonalExperience

• 15yearsasaVentureCapitalist• Invested$62MMin25UniversityStart-ups• Results:• 17successfulexits/8(miserable)failures• 26%IRRtoinvestors• DeepEmotionalScars

FourTypesofRisk

• TechnicalRisk•MarketRisk• CapitalRisk•ManagementRisk

BusinessModelCanvas/LeanLaunch

Resources

WhyamIincorporating?

1. Ihaveevidencethatmycompanywillmakemoremoneythanitspends.

2. Iamreadytoshiporsellsomethingtoathirdparty.

3. Iwillincur(potential)liabilitiesforthiscommercialpurpose.

4. Iamincorporatingonly toseekresearchfunding.

SoWhatNow?

• SeekOutsideProfessionalHelp• Legal• Accounting• Operational

Decisionstobemadebeforeincorporating:

• Whatformofcorporation?• S-Corp;C-Corp;SoleProprietorship;LLC.

• Whoaretheowners?Inwhatproportion?• AretheyFriends?Family?

• Howwillwepayourselves?• Howmuchtimewillitreallytakeandatwhatcost?

• Whereistheoffice?• Physicalpresence;Digitalpresence.

• DoyouhaveFreedomtoOperate?• Getalicensetoyourtechnology

SoWhatNow?

• SeekOutsideProfessionalHelp• Legal• Accounting• Operational

• InitiateaCOIPlanwithyourDepartmentChair

ConflictsofInterest

• SituationsinwhichfinancialorotherpersonalconsiderationsmaycompromiseanEmployee'sprofessionaljudgmentincarryingouthis/herUniversityresponsibilitiesthatincludebutarenotlimitedtoteaching,research,service,contractadministration,andpurchasing 1.• Conflictsinclude2 :

• Theexistence ofanactual conflictofinterest;• Thepotential fora conflictofinterest tooccur;or,• Theappearance ofa conflictofinterest.

1https://apps.hr.ou.edu/FacultyHandbook/Default.aspx#5.10

2Ibid.

HowtoManageaConflictDisclosetheConflict• College• Provost• OTD/VPR

CreateaManagementPlan• DevelopaDept.Plan• DevelopaCo.Plan

Review/Update• AtleastAnnually• Ifcircumstanceschange

• EvaluateEffectiveness

DraftingaCOIManagementPlan

• Thisisnotaform• ItisaPlancreatedbyyouandthePartywithwhomyouhavetheconflict:

• AtOU:DepartmentandCollegeleadership• AtYourCompany:BoardorDirectors

• Spellsouttheconflicts• Identifymechanismsformanagingthem• Reviewandupdatetheplanatleastannuallyandifcircumstanceschange

Summary

ShouldILaunch?

• Ifyourbusinessmodelistowritegrants-- NO.• Ifyourbusinessmodelisto:• Makemoremoneythanyouspend;• Commercializeatechnology;• And,youareabouttoincurliabilityorrisk;• -- YES.GetProfessionalHelp.

SolutiontoConflicts:• Ifyouthink itisaconflict…• ...itprobablyis aconflict.• Discloseit.• Manageit.

ThankYouQuestions/Discussion