Federal Lab nominees are Dr. Willie E. May, former NIST Director; Paul Zielinski, former NIST Director, Technology Partnerships Office (TPO) (now the FLC Executive Director); and Don Archer, NIST Patent and Licensing Officer.
NIST’s mission is to promote U.S. innovation and industrial competitiveness by advancing measurement science, standards, and technology in ways that enhance economic security and improve our quality of life. Technology transfer is one of the ways to realize that mission!
The TPO Mission Statement is to build and sustain technology partnering activities between the NIST laboratories and U.S. industries in the public and at the federal, state, and local levels of government. TPO intends to promote U.S. innovation and industrial competitiveness across the Federal government through efforts by NIST and the Department of Commerce.
The State nominee is Ronald Kaese, TEDCO’s Director of Federal Programs.
Maryland Technology Development Corporation (TEDCO) is an independent instrumentality of the State of Maryland, established to facilitate the creation of businesses and support their growth in all regions of the State. TEDCO's role is to be Maryland's leading source of funding for earlystage, technology-based businesses; to provide other business assistance to entrepreneurs; and to foster technology transfer and commercialization from State universities and Federal labs. TEDCO is leading innovation to market and contributing to a robust entrepreneurial ecosystem.
TEDCO Mission: “Enhance economic development by fostering an inclusive and entrepreneurial innovation ecosystem. Identify, invest in, and help grow technology companies in Maryland.” With federal funds, TEDCO can support tech transfer efforts nationally.
The NIST Science and Technology Entrepreneurship Program (N-STEP) is a joint effort by the NIST TPO and TEDCO designed to create collaborations resulting in new company formations by departing NIST employees and commercialization of NIST technologies, which in turn, creates jobs. Eligibility is for NIST employees who are nearing the end of their term of employment. Many are Post Docs and Associate Researchers with temporary appointments that need future career options. N-STEP offers an option based on NIST technology and their NIST-developed skills. NIST received a rare opportunity to use appropriated “Lab-to-Market” funds to improve tech transfer. NIST funded N-STEP to increase lab-to-market transfers by leveraging the talented researchers who have spent time at NIST. NIST has more than 3,500 associates or visiting scientists doing research at NIST each year. Also, an average of 85 post-doctoral researchers joining NIST each year. Most spend two years at NIST before moving on; NIST retains about 35% for longer-term employment. N-STEP is designed to encourage departing researchers to launch startups with the support to facilitate success. They get to launch their own companies, built on NIST research and their own skills. Geographically, NIST has two major locations, Gaithersburg, Maryland and Boulder, Colorado. Some venture elsewhere (California and Illinois), but most will stay in Maryland and Colorado. The N-STEP recipients' success helps ensure that citizens get greater benefit from investments made in NIST labs—benefits that create new jobs and strengthen the local and national economies.
The design of N-STEP can be characterized as having “low hurdles”. The process starts with a meeting, call, or email to discuss the program and their ideas. First, they must be eligible, and the technology must be available for licensing. Then we address issues associated with the creation of a conflict of interest or other ethical issues.
N-STEP moves the technology and the technologist toward effective operation in the commercial markets. The Whitepaper is only two pages of content, but it leads to discussions and rewrites. In the process the want-to-be entrepreneur is introduced to a new taxonomy and jargon, and they are challenged with questions and directed to where they might find the answers.
Next, they prepare a business proposal. This requires the inclusion of serious details about how the company will operate, target market(s), initial market, competition, differentiation and value proposition, how they will build a team, what critical inflection point is to be achieved with N-STEP, risk factors, budgets and financials, how to become self-sustaining, etc. This is a mentored thought exercise and a learning experience often reshaping their original plans. Once the proposal is acceptable to the TEDCO review team, the applicant must prepare a ten-minute presentation. This again goes through iterations. The entrepreneur makes their presentation and takes 15 to 20 minutes of Questions and Answers with TEDCO staff. If successful, a contingent award is made.
At this point they form their company, secure the patent license, leave NIST, sign the N-STEP legal agreement with TEDCO, and send an invoice for initial funding. These are all new experiences, so again they are mentored through the process. Even with an entrepreneur-friendly process, details are explained including what might be different with other funding sources. The funding is $100K for a one-year project to advance the technology toward commercialization. An additional $12K must be used to develop the entrepreneur’s business acumen. This can be used to access a business incubator’s entrepreneurship programs, receive business coaching, attend an entrepreneurial education program, etc. These two pots of money need to be separately accounted for. The company needs to manage their expenses and cash flow to make their funding last through the project. Half the award can be invoiced upon signing the TEDCO award agreement, 25% with a satisfactory mid-project report, and 25% upon completion of the project with a comprehensive final report. They also need to be seeking follow-on funding to continue to sustain the company.
Dr. Willie E. May, former NIST Director (retired) laid out the initial concept.
Paul Zielinski was the lead for the concept’s initiation, budget justification, funding, and oversight. The goal was to increase technology transfer to benefit the nation’s economy. The specific objectives are increased patent licensing and expanded career opportunities for departing NIST employees. Paul was the N-STEP champion within NIST. He managed a rare opportunity to use Lab to Market appropriated funds and new authorities for agreements, specifically Partnership Intermediary Agreements (PIA) and Other Transaction Authority (OTA) to implement N-STEP.
Don Archer identified the appropriate eligibility requirements and conducts patent licensing. The goal was to increase technology licensing. The objective was to do it with minimal cost and ease of effort for the startup business. This left valuable resources of time and money with the startup to be used for their technology development efforts. Typically, this was done with no cost research licenses to companies created by departing NIST employees that worked on the same technology while employed at NIST. They already had intimate knowledge of the technology. Don’s creative streamlining of the process for the no cost research patent license and the use of template applications simplified and accelerated the process.
The design of N-STEP can be characterized as having “low hurdles”. The process starts with a meeting, call, or email to discuss the program and their ideas.
Ronald Kaese developed the N-STEP program details, managed the implementation, conducted outreach, administered the program, provided startup project oversight, and maintained program status. TEDCO’s goal is technology transfer into startups and early stage companies and job creation. The objectives are conversion of Federal technology into commercially viable products and services and conversion of departing Federal employees into entrepreneurs. This takes entrepreneurial mentoring, networking, market research support, company formation support, legal agreements, and startup funding. The result is an innovative combination of the Lessons Learned and Best Practices from multiple TEDCO programs tailored to the N-STEP goals and objectives. With a national coverage, remote/virtual engagement was built in from inception for non-local companies (pre-COVID).
The technology transfer mechanisms are the standards. A research license at no cost to the company, preserving needed cash for operations and translational development efforts to advance the technology beyond that achieved by NIST. The knowledge transfer is often facilitated with a CRADA allowing access to unique facilities, equipment, etc. lowering the cost for the startup. This can allow the startup formation when such a venture would otherwise be cost prohibitive. Companies are encouraged to pursue grant funding for much needed follow-on funds to further development and sustain the company. SBIR awards have been obtained from NIST, NSF, and DOE.
The overall objective of the N-STEP program is to provide commercial opportunities for motivated researchers to build upon their experience gained while working at NIST, as they explore entrepreneurial careers. Informally, two-way tech transfer is also happening as the N-STEP recipients continue contacts with their NIST contacts.
In the last four years NIST TPO has had eight more patent licenses, provided support to three existing patent licenses, and established six more Cooperative Research and Development Agreements (CRADA). There have been three SBIR awards that were obviously NIST mission related as they were N-STEP applications to advance NIST invented technology. The results from the entrepreneurial efforts to further develop the NIST technologies are related back to NIST and inform further understanding and research efforts.
There is a requirement in the N-STEP agreement for three years of Impact Statements. This allows TEDCO to track their progress beyond the initial funded project. To date, there have been 13 awards approved and 11 awards made. Three are to early-stage companies that were spinouts from NIST. Eight are startups formed with N-STEP (7 Maryland and 4 Colorado). Two have not yet completed their projects; three companies are out of business or mothballed; the six others collectively account for $2.7M in annual revenue (predominately from two companies), $1.2M in Investment (predominately from one company), an additional $4.8M in follow-on funding (e.g. grants), and 26 jobs reported in their required annual economic impact reports (through February 2020). There has been funding from the three NIST SBIR awards and four SBIR awards from the NSF and DOE. N-STEP companies have raised money from investors, Maryland small business funding sources (including TEDCO), and a corporate bank loan. Two companies are on the long path involving Food and Drug Administration approval. Strategic partnerships have also been pursued and achieved by a couple startups with international corporations. This economic impact obviously expands the local economies where these companies are located as well as the tax base.
N-STEP technologies include a Low Temperature Ion Source for nanomachining and nanomicroscopy, Chip-scale Hybrid Gas Sensors for indoor air quality Monitoring, System for Separation of Pathogenic Bacteria from Food Samples for food safety, Rapid Biophysical Diagnostic for Antimicrobial Susceptibility for development of antibiotics, Affordable Quantum Resistance Standards Based on Graphene for affordable standards, and Method for Laser Particle Separation on the Nano and Sub-nano scale for improved pharmaceuticals. The first two examples have reached the market.
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