Startups, Jobs, Economic Impact: An Analysis of Commercialization at UW

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Presumably, UW startups that establish themselves outside of Washington would not have the same local economic impact as those located here.

Two startups among the UW’s 18 last fiscal year are based elsewhere. TaggPic, which developed technology to spot landmarks and other features in digital photos, was founded in Ithaca, NY, where a UW computer science PhD had moved to become a professor at Cornell University, which also counts TaggPic as one of its startups. It had a handful of employees, including computer vision experts with ties to Cornell, before it was quietly acquired earlier this year by Google. The C4C said it licensed UW technology to TaggPic that was “pivotal in executing on its business model.” But the UW never had equity in TaggPic. The company’s founder declined to be interviewed.

Another fiscal year 2014 UW startup, Ennaid Therapeutics, was incorporated in Georgia in May 2013, and has offices in Atlanta and New York City. The company, which is working on cures for mosquito-borne illnesses such as dengue, lists on its website milestones including licensing technology in October 2012 from Tulane and Rockefeller, and in July 2013 from Florida Gulf Coast University. There was no mention of UW technology on the site, but Ennaid founder and CEO Darnisha Grant Harrison said in an e-mail that it licensed UW flavivirus inhibitor technology in 2014, which “has helped Ennaid Therapeutics develop a much stronger intellectual patent portfolio. Also, being recognized as a UW start-up has helped bring good press our way.”

The rest of the 2014 startups appear to be based in Washington state, including several in the C4C’s New Ventures Facility, which has hosted 19 companies since its opening. Those companies had a combined total of 140 employees—not including consultants and volunteers—during their stays in the incubator, according to the C4C. (That was the closest I could get to an actual employment figure for recent UW startups. The C4C said that it is currently “in the process of collecting economic impact data.”)

But if UW’s startup numbers and the boost provided to the local economy seem inflated by some measures, there’s also a case to be made that the impact is sometimes understated. Take the example of GraphLab, Inc., which makes tools for developing predictive apps using a variety of data types. Co-founded by Carlos Guestrin, a computer science professor recruited to the UW in 2012, GraphLab was housed until June in the New Ventures Facility. It outgrew the space and found an office in the Fremont neighborhood for its 25 employees. GraphLab emerged from work Guestrin led at Carnegie Mellon University. No technology was licensed from the UW, so it is not a UW startup by AUTM’s standard, and the UW has not touted GraphLab as such.

A poster of GraphLab in the New Ventures Facility.

A poster of GraphLab in the New Ventures Facility.

Likewise, startups formed by UW faculty based on their expertise or insights, but not on a defined piece of intellectual property licensed from the university, aren’t counted as university startups—regardless of whether they received help launching the business. The UW can also license a technology to an existing company that might completely change its course and prospects, but because the company wasn’t established for the purpose of licensing the technology in the first place, it doesn’t count as a UW startup. (It did some 250 licensing deals in  2013, according to the AUTM survey data.)

AUTM recently began asking universities to report how many other new companies—apart from the strictly defined university startups—received support from the institution, a question that seems to provide much more latitude to measure UW’s various roles in new business formation and growth. The UW reported 69 such companies in the 2013 AUTM survey, but it hasn’t highlighted that statistic and doesn’t plan to. The C4C said “other new companies” is “not a well-defined term.”

Young said he’s delighted to see companies like GraphLab supported by the university, but doesn’t count them because they don’t measure what he’s concerned about.

“What I’m concerned about is [that] the great work we do on this university campus does good,” Young said. “I’m not concerned about the money. I’m not concerned about who gets credit. I’m concerned about doing good. And that’s Carnegie Mellon’s stuff doing good. And that’s great. And if we can help facilitate that, I hope someday Carnegie Mellon will help create a company that will use our technology.”

Debate over the startup numbers

There are critics who look at the UW’s numbers from the last two years and see a much dimmer picture. One of them is Gerald Barnett, who worked in the UW’s tech transfer office for more than a decade beginning in the early 1990s and more recently led a Kauffman Foundation-funded initiative to research and develop new approaches to university innovation and economic development.

Barnett disputes the number of UW startups formed in the last two fiscal years. … Next Page »

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