How Seattle VCs Are Adapting to the UW TechTransfer Revolution

4/15/09Follow @gthuang

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balance in mission for a research university like the UW between ‘fundamental, theoretical’ research and ‘applied, commercially useful’ research is going to take years and a cultural mindshift.”

On this point, Lucinda Stewart of OVP Venture Partners says, “There’s obviously risk in hiring aggressive people like Janis [Machala] and Linden. They’re not academics, they’re on the for-profit, commercial side. They’re kick-butt women, which is awesome.” Indeed, from any venture capitalist’s perspective, the change has been dramatically for the better. “When I was working for the Washington Research Foundation in 1998, TechTransfer was much less ‘user friendly’ than it is now under Linden and Janis’s leadership,” says Erik Benson of Voyager Capital. “They know the university’s ecosystem, they know the best entrepreneurs, and they know which VCs are best for each opportunity.”

So how are venture capitalists going about their business on campus these days? Madrona Venture Group and Arch Venture Partners have had a strong presence at the UW since the 1990s. Madrona has been particularly active in the computer science and engineering department: Oren Etzioni and Dan Weld are full-time UW professors who spend part of their time advising Madrona about startups. Madrona is also known for holding “office hours” in the computer science building, where researchers can come in and talk with a VC about technology commercialization and starting companies. (New Seattle software startup PetraVM has its roots in one of these meetings with Madrona’s Matt McIlwain.)

But that’s barely scratching the surface of the hard work it takes for a venture firm to build expertise and relationships that will lead to a successful startup. “You don’t just show up and fund a company the next minute,” says Greg Gottesman of Madrona. “We want to build long-term relationships with graduate students and professors in areas they’re interested in. They provide such great insight about what’s possible. They’re looking three, five, 10 years out…We can provide a real sense of what are people doing in the startup/venture world with technologies like this, and a real business perspective—how can we turn what you’re doing into a business opportunity? It’s not one meeting, but often over several years.”

OVP, for its part, is holding its first office hours at the UW on April 23. Stewart says it will be a quarterly event, and the inaugural session will focus on areas like enterprise infrastructure, software as a service, analytics, and cleantech. In terms of OVP’s broader approach to working with researchers, she says, “We like to come in really early. Rick [LeFaivre], myself, and Mark [Ashida] are all assigned to the UW. We’re triple-teaming it. If we wait until the time companies are ready to raise money in Series A, it’s often too late. We’ll back projects at the prototype level. We know four or five professors in different areas—security, search, cleantech—and we’re trying to make sure the handful of people we should know, we know.”

Down the road, closer to commercialization, UW TechTransfer can offer a venture firm … Next Page »

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com or call him at 617-252-7323. Follow @gthuang

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  • http://lazowska.cs.washington.edu Ed Lazowska

    As someone who was instrumental in brokering the marriage between Linden Rhoads and the University of Washington, I’m particularly thrilled at the changes she’s making, and at the positive reaction to them.

    However, at the risk of sounding a bit defensive:

    - Yes, UW can and should do better at tech transfer.

    - However, it’s important to remember that UW consistently ranks among the top dozen universities in the nation in a number of key measures related to tech transfer.

    - It’s also worth knowing that under Linden’s predecessor’s predecessor (got that?), Bob Miller, UW developed what was widely regarded as the most innovative and effective software tech transfer practice in the nation.

    - It’s important to remember that the vast majority of university entrepreneurship takes place not through “traditional” tech transfer – licensing – but rather through alumni, who throughout their careers create new companies and transform existing ones.

    - Finally, the reason that Madrona gets so many UW deals is that THEY WORK THEIR TAILS OFF. They’re here all the time – walking the halls, talking to faculty, talking to students, visiting labs, offering advice, awarding prizes, helping with courses, mining the research for commercializable ideas. That’s the same way that Kleiner established its relationship with Stanford in the 1980′s – John Doerr walked the halls. I’ve noticed, over the years, that the less engaged specific VC’s are, the more they tend to complain.

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