A professor, a VC, and a serial entrepreneur walk into a class
Our program began in the Winter of 2004 with a single course on entrepreneurship conceived and taught by a professor (me), a venture capitalist (Scott Lenet), and a scientist turned entrepreneur turned angel investor (Charlie Soderquist). That course sparked two promising ventures and taught us a series of insights that still drive our greatest impact.
The first lesson we learned was of the tremendous value and fun that came out of combining these three different perspectives, experiences, and networks in the classroom. That has guided our teaching style ever since.
The second lesson came from the two new ventures, which had formed around a medical student and an engineering student who had audited the class. We quickly recognized an untapped market just outside our doors. That Spring we went to eight of our most productive faculty on campus and recruited their best science and engineering PhDs and postdocs to form the first class of Business Development Fellows. These students take 5 hands-on courses in innovation and entrepreneurship at the Graduate School of Management, learning and working alongside our MBAs and participate in our campus business competition. That year, we had three more companies launch. The value of combining the university’s best graduate students, their research, and an introduction to entrepreneurship came into focus. As an added benefit, integrating these researchers into the MBA classroom has added to the experiences (and opportunities) of the business students.
Our early successes also caught the eye of Chancellor Larry Vanderhoef, who challenged us to scale the program. UC Davis spends over $750M on research every year and has over 7,000 graduate students — each with deep knowledge of the latest research in their fields yet also just beginning their careers. We have colleges of Agricultural, Medicine, Nursing, Veterinary Medicine, Biological Sciences, Engineering, and Letters and Sciences. Fortunately, we also have a strong culture of interdisciplinary research and faculty are used to working (and walking) across campus on a daily basis.
So we designed what would become our flagship program, a three-day Entrepreneurship Academy focused on the needs of university’s PhD, post-doc, and faculty researchers. These three day intensives bring together 45–50 researchers interested in understanding and advancing the commercial potential of their research. Through the academy, they explore the real-world problems their work can solve, the products or services enabling those solutions, and the business models required to deliver them. While we developed the curriculum, we held on to our first lesson: individual sessions are taught by entrepreneurs, angel investors, venture capitalists, IP and corporate lawyers, R&D managers, and others with direct experiences and relevant war stories. Each night, the participants share their emerging ventures with eight to ten local mentors in a speed-dating session that provides them with quick feedback and introduces them to the value of mentoring. We run four academies each year, three of which focus on particular sectors like biomedical engineering, food & health, or green technology. At this point, participants in our program come from all seven major colleges. Engineering, medicine, and agriculture account for 60%, management students make up less than 10%.
Consider the following outcomes:
A Business Development Fellow and PhD in neurology joined a start-up that is building solutions in an area of her research. She recently wrote us:
“I’m at a startup that uses what we know about the brain to design for behavior change. I’m the neuroscience expert on the team, but it’s a small startup…so I am learning a lot and learning fast! I am grateful to you and the Fellowship experience — [it] gave me an edge in the application and interview process and is helping me in this transition and adapting to the startup culture.”
A doctoral student in environmental science, attending our Green Technology Entrepreneurship Academy, used the time to explore the commercial potential of her research. While it became clear this work would not support a company, one of the mentors was a R&D director at a major corporation and offered her a job on the spot.
A faculty member in Chemical Engineering had developed a dramatically more efficient means to break down biomass in the early stages of ethanol production. Evaluating the commercial potential, it became clear it could not become a new venture on its own and, as a Full Professor, he had no desire to abandon his research, his lab, and the dozen or so doctoral students and postdocs working for him. Since then, he’s closed four licensing deals, which has exposed him to the needs in industry that he and his students are now working to solve.
Four undergraduates attended our Green Technology Entrepreneurship Academy and brought with them an idea for converting biomass to plastic — research they helped conduct in a lab on campus. As they fleshed out ideas and quickly tested their early market, financial, and technological assumptions, the initial feedback — and connections — gave them the confidence to commit to their new venture. Ten years later, one of those students remains the CEO and just closed a $49M round (they’ve raised $70M in total) which also brought Nestlé and Danone in as both investors and strategic partners.
Same goals, different trajectory
Over 2000 participants have have attended our academies and so many university researchers provided us with our third valuable lesson. The vast majority come to learn how their research can change the world, not to start companies. Indeed, research has shown that starting companies is just one, and one of the smaller, means for commercializing university research. Publishing, consulting, placing students (or getting a job) in industry, patenting and licensing, starting a new venture, shaping policy all are viable and valuable options. So too is “letting go and moving on.” Assuming and encouraging everyone to start companies can do as much harm as good.
We learned that our first contribution lies in helping participants understand whether and how their work has value beyond the university. Then it’s helping them determine the best path forward — maybe it’s a startup, or licensing, consulting, etc. Which path is best depends on the particular aspects of the research and researcher. Finally and most important, we help them define and take the first steps along their chosen path. If that path is a new venture, we have follow-on programs as well as a variety of resources, incubators, and lab space on campus and in the community.
Our programs provide a variety of other benefits for university researchers. When we started, few researchers engaged with the office of technology transfer and licensing and fewer still trusted the process. We have been able to provide valuable perspective and objective guidance to everyone from doctoral students to senior faculty on how to navigate the system for university patenting and licensing. Second, few researchers understand their own role in patenting, licensing, and other ways of commercializing their research. We were able to describe the importance of treating patenting, licensing, and commercialization less like a hand-off and more like a service. Finally, we discovered that our programs prepare graduate student researchers for working and managing innovation in corporate R&D settings. Given that roughly 75 percent of graduating science and engineering PhDs across the UC system enter industry, but do so with little knowledge or preparation for the transition, it turned out our programs make them highly competitive in this job market.
Cliffs and Valleys
Perhaps the largest lesson we learned from our focus on researchers was of a gap in the entrepreneurship curriculum. There’s plenty of material on having ideas, everything from design thinking to user-observation, problem-finding, problem-solving, brainstorming, etc. And there’s now plenty of material on designing and building new ventures, from lean startup to team-building, networking, legal, and financial best practices. Most of this material tailors to the student who has already decided they want to be an entrepreneur and is in need of having a good idea, building a new venture around it, or both.
What was missing was help in making the commitment to move forward at all. The tug of the familiar — finishing a PhD or postdoc, writing another grant, getting back to the lab — means many promising developments in university research are never pursued. So much is made of the valley of death in the entrepreneurial lifecycle, yet it did us little good to focus on that when so many were stuck on what we came to call the cliff of commitment. Of course, those students who have committed to being entrepreneurs first (and just lack a good idea) face the opposite problem, they’ve already leapt, but we’ve found still benefit from following a more disciplined vetting and commitment process.
Over time we have increased our focus on understanding and managing the commitment as a journey, not a decision. This means helping protocols-entrepreneurs recognize the critical uncertainties holding them back, the necessary experiments to give them confidence moving forward (or letting go), and the network of mentors, advisors, co-founders, and others who will support them along the way.
Looking back and moving forward
At this point, our institute has delivered over 35 Entrepreneurship Academies and helped launch over 75 companies (that have raised over $150M). But the bulk of our alumni remained in academia or took industry jobs, where their entrepreneurial knowledge and skills have helped them design impactful research programs, work effectively with industry partners, align R&D projects with the needs of the business unites, and even launch a new venture years later. At the same time, our programs have helped build strong ties between our Graduate School of Management and the other Colleges and Schools across campus, leading to opportunities to develop new academic programs in energy, agriculture, food, and healthcare. Moving forward, we are growing our programs for graduate and undergraduate students across campus in ways that combine an entrepreneurial mindset with their own disciplinary work and careers — wherever they go.
Andrew Hargadon is the Charles J. Soderquist Chair in Entrepreneurship and Founding Director of the Mike & Renee Child Institute For Innovation & Entrepreneurship at the University of California Davis.