University-Affiliated Venture Capital Funds

Prologue: Stephen Atkinson likens the lure of investing in developing medical technologies to the goal of a career in popular music: “In both fields there is so much fascination with the fabulous success that a few well-prepared, and often just lucky, individuals have that many people can become blind to the intrinsic irrationality of the marketplace. Unfortunately, for every Bruce Springsteen there are thousands more who, being blind to these market realities, often give up a great deal and have nothing to show for it.” The stakes for investors and guitar players are great, but so too are the stakes for society. Improvements in public health rely heavily on the successful commercialization of university-originated technologies. Atkinson, an insider in the business of technology transfer, has seen his share of successes and failures and has been witness to fundamental changes in the administrative and financial apparatus used in academic/ industry relationships. Here he writes about those changes and draws from his considerable experience to offer lessons for future initiatives by evaluating the effectiveness of three early university- affiliated venture capital funds. Atkinson founded Harvard University's first technology-transfer program in 1976 and Harvard Medical School's Office of Technology Licensing and Industry-Sponsored Research in 1984, directing each for eight years. He is a former president of the Society of University Patent Administrators (now the Association of University Technology Managers) and has been an international consultant to universities, teaching hospitals, corporations, and inventors. Atkinson holds an A.B. degree in American government from Harvard University. He is director of licensing and technology management for OraVax, a Cambridge, Massachusetts-based biopharmaceutical company engaged in developing and marketing vaccines, and is of counsel to Plougmann and Vingtoft, a consulting firm based in Copenhagen, Denmark. Abstract: This paper briefly reviews university/industry licensing and research collaborations and focuses on three university-affiliated venture capital funds, which represent the most direct participation by academic institutions in creating new ventures based on technologies invented by their faculty members. The paper provides an early perspective on these funds as mechanisms for bringing new biomedical technologies into use. Although the new models have not existed long enough to fully evaluate their effectiveness, the early evidence is sufficient to suggest helpful guidelines for development of more efficient initiatives in the future.