Technology Entrepreneurship & Commercialization

Developing the next generation of Entrepreneurs and the High Growth companies of tomorrow.

… And in the beginning it was written – go forth and start companies!!!

A process-based approach for turning technologies into

business opportunities

• COSEPUP Report:“Reshaping the Graduate Education of Scientists and Engineers,” NAS/NAE, 1995

• NSF / KIETS Grant: “Technology, education, and commercialization:

Development of new concepts in integrated education”

(1995-1999)

Result: a scholarly underpinned process -- TEC

History

Rationale for TEC:Bridge the Gap between Research and Commercial Application

Res

ourc

es

Level of Development

“Valley of Death”ResearchResources

CommercializationResources

Research Facultyand Students

Entrepreneurs and Business Community

• Method for crossing the ‘Valley of Death’

• Roadmap for commercialization

• Process for information gathering and business opportunity development

• Strategic Decision Framework

• Common language and shared goals

The Process or “Algorithm”

The TEC Algorithm

Strategy Development& Implementation

Evaluate Opportunity

Transform Technologyinto Products/Services

Concepts

StartupStartup

ScienceScience&&

TechnologyTechnology

The objective of the Ideation phase is to develop a set of prioritized product concepts with strong T-P-M linkages

Collect Further Info

Product IdeaProduct IdeaPrioritizationPrioritization

&&SummarizationSummarization

MarketMarketDescriptionDescription

Ph 1

ProductProductDefinitionDefinitionProductProduct

DescriptionDescriptionRefinementRefinement

ProductProductIdeaIdea

GenerationGeneration

FurtherTechnical

Development

•TechnologyDescriptionWorksheet

• Initial TPMWorksheet

• Product AttributeWorksheet

•PAMM

•Summary TPMWorksheet

DecisionDecision

Description/Ideation

Phase 1 Objectives:– To eliminate product ideas (not

technologies) based on fatal flaws

Phase 2 Objectives:– To build the business case

Idea

Phase II

FunctionalAssessment

StrategicAssessment

ProductRedefinition Decision

Product Definition

Confirmation

Reject or Retain forFurther Refinement

Phase 1 & 2 Assessments

Yes Determination Determination of Strategic of Strategic

FactorsFactors

AnalysisAnalysisof of

Core AssetsCore Assets

StrategicStrategicComponentsComponents

AnalysisAnalysisofof

ComplementaryComplementaryAssetsAssets

CommercialCommercialStrategyStrategy

BusinessBusinessProposalProposal

DecisionDecision

Reject

Iterate Back

Provides a decision making process leading to the

commercialization strategy and the business proposal.

Commercialization Strategy Development

2005 2006 2007 2008 2009Sales

Units 10,000 55,000 120,000 250,000 400,000 Price 150 150 150 150 150 Product Sales 1,500,000 8,250,000 18,000,000 37,500,000 60,000,000

Total Sales 1,500,000 8,250,000 18,000,000 37,500,000 60,000,000

Cost of GoodsDirect Costs 157,500 157,500 157,500 157,500 157,500 Operations 742,500 4,792,500 10,642,500 22,342,500 35,842,500

Total Cost of Sales 900,000 4,950,000 10,800,000 22,500,000 36,000,000

Gross Profit 600,000 3,300,000 7,200,000 15,000,000 24,000,000

ExpensesDevelopment 289,820 291,191 357,617 415,326 483,245 Sales & Marketing 251,373 1,372,855 3,500,000 4,500,000 5,500,000 Administrative 286,366 400,303 434,841 467,235 500,000

827,559 2,064,349 4,292,458 5,382,561 6,483,245

Other Income (Expenses):Interest Income (1,126) (25,629) (94,926) (94,926) (94,926) Interest Expense (20,005) (67,099) (282,055) (150,000) (95,000)

- - - - - (21,131) (92,727) (376,980) (244,926) (189,926)

Income Before Taxes (248,689) 1,142,924 2,530,562 9,372,513 17,326,829

Proforma Income Statement2005 - 2009

The Top Line has to“make sense” for an opportunity to

exist.

2005 2006 2007 2008 2009Sales

Units 10,000 55,000 120,000 250,000 400,000

Price 150 150 150 150 150

Product Sales 1,500,000 8,250,000 18,000,000 37,500,000 60,000,000

Total Sales 1,500,000 8,250,000 18,000,000 37,500,000 60,000,000

Cost of GoodsDirect Costs 157,500 157,500 157,500 157,500 157,500

Operations 742,500 4,792,500 10,642,500 22,342,500 35,842,500

Total Cost of Sales 900,000 4,950,000 10,800,000 22,500,000 36,000,000

Gross Profit 600,000 3,300,000 7,200,000 15,000,000 24,000,000

Putting the components together:– ensure that the core

technology is commercially viable

– identify required complementary resources

– make partnering, leveraging, and acquisition decisions regarding essential assets

– networking and placement of opportunity with partners &

investors

CORECORETechnologyTechnology

Business Plan

Legal Services

AccountingServices

Mgt Team

Outsourcing

IPMgt

MarketingResearch

FacilitiesMgt

Building the Emerging Case

Creating the Business Proposal

Student Engagement

• Graduate Business, Engineering and Science studentsare placed in multi-disciplinary teams

• Each team is assigned a portfolio of technologies anda team of Executives-in-Residence as mentors

• Students apply the TEC Algorithm to their portfoliosas they learn each phase

• The final product is a Business Plan suitable as the basis for launching a new, high growth venture

Business

Scientists & Engineers

Others

Incomplete

Information

Uncertainty

Risk

Algorithm provides:Algorithm provides:•StructureStructure•LexiconLexicon•Something to believe inSomething to believe in

Everyone is Out of their Comfort Zone

• Provide incentive – start company

• Align goals and rewards – grade on decisions

• Provide support – mentors

Program Environment

Team Based Structure

• Self-directed

• Grade based on decisions made

• Roles assigned and changed

• Mentors

Student Impact

•Encourages alertness to entrepreneurial opportunities among graduate scientists and engineers.

•Enables career advancement - TEC graduates have gone on to become entrepreneurs, business leaders and company founders. •Provides valued skills that lead to advancement and promotion within organizations.

Local Impact

• Responsible for attracting $200+ Millionof Venture Capital to Triangle companies

• Over 350 new jobs created

• 250+ graduates of the program

• Consulting and Training in Fortune 500companies

• Adoption of the processes by large corporations

12+ Years of Experience and Results

MYCOSOLMYCOSOL

Start-ups and Licenses Created or Supported

Known Start-ups by TEC’s Graduates

CronosCronos

Universities

Diffusion of the TEC Approach

University of Cape Town University of Aveiro

Dublin City University

Loughborough University

Ohio State University

University of Ljubljana

Escola de Gestão do Porto

Universidade do Minho

Universidade do Porto

Universidade Católica Portuguesa

Universidade do Novo

Deadeok Innopolis Venture Assoc

Universidade Técnica de Lisboa

Instituto Superior Técnico

Universidade de Coimbra

Email: Roger_Debo@ncsu.eduPhone: 919.515.5717Fax: 919.515.9813

North Carolina State UniversityCampus Box 7229

Raleigh, NC 27695-7229

Roger DeboDirector

TEC Program