Technology Transfer: Accelerating Economic Development Through University Technology Transfer

by Diane Palmintera, President, Innovation Associates

“Silicon Valley,” “Rt. 128” and “North Carolina Triangle” have become familiar terms throughout the country and the world. For as long as these terms have been recognized, states and communities have been trying to replicate them. Universities have been at the center of these models and have provided a pipeline for science and technology innovation, generating thousands of technology patents and licenses and spinning off new technology enterprises.

MIT executes almost 100 licenses and launches about 20 new technology firms each year. About 150 new businesses every year are associated with MIT faculty, students, and alumni. Photo by Donna Coveney.

There is no doubt that university technology transfer and commercialization activities are impacting local, state, and national economies. Stanford University alone filed more than 300 patents last year and it has spun off some familiar companies such as Google, Sun Microsystems, Silicon Graphics, Netscape, Cisco Systems, and Yahoo!. Each year, the Massachusetts Institute of Technology (MIT) executes almost 100 licenses and launches about 20 new technology firms. Moreover, about 150 new businesses every year are associated with MIT faculty, students and alumni. Other universities such as Washington University in St. Louis, Georgia Institute of Technology (Georgia Tech) in Atlanta, University of Wisconsin in Madison, and Carnegie Mellon University (CMU) in Pittsburgh also are making impressive strides and contributing to the diversification and growth of their regional economies.

University technology transfer and commercialization

Starting in the late 1970s and early 1980s, technology transfer and commercialization of university and federal laboratory research and development (R&D) gained increasing attention and led to new federal legislation.¹ In 1980, the Bayh-Dole Act accelerated technology transfer from universities to the private sector by establishing a uniform federal invention policy that permitted universities to retain title to inventions developed through federally funded research. Subsequent acts provided additional incentives for university-industry collaboration.

University technology transfer is a complex process. It operates as part of the culture and environment within the university and as part of the larger external environment surrounding the university. There are many factors that affect the university’s ability to transfer and commercialize its research. Internal factors include the strength and focus of the university research base; leadership, incentives and rewards; history and strength of corporate relations with the university and research units; and entrepreneurial climate. Other factors external to the university, such as the availability of angel and seed capital, laboratory and incubation space, legal assistance, management capacity-building resources and networking opportunities are just a few of the elements that form the infrastructure to support university technology transfer efforts.

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¹For more on economic development activities at federal laboratories, see Partners on a Mission: Federal Laboratory Practices Contributing to Economic Development (OTP, November 2003) available at www.InnovationAssoc.com and www.Technology.gov.