Archive for January, 2009

Road Block to the Ventur(e)a Highway – unblock it with Deal Flow and Cash Flow.

Posted in Uncategorized with tags , , , , , , on January 7, 2009 by lmdiorio

Happy New Year.  There is a really interesting article in the most recent edition of Forbes entitled, Venture Capital’s Comping Collapse. It is definitely a great snapshot of some of the performance measures in the Venture Capital world over the last few years and their dramatic decline.  In some aspects of the world of technology licensing, VC’s are often looked at with awe because they invest and help create start-ups and have been associated with the likes of Google, Skype and many others.  Even the movie Wedding Crashers pays homage the VC’s, John Beckwith: We’re brothers from New Hampshire. We’re venture capitalists.  Jeremy Grey: I’m sick of that. Let’s be from Vermont. And let’s have an emerging maple syrup conglomerate.” andClaire Cleary: So is it just about the money? John Beckwith: No no, it’s about, uh, investing in companies that are ethically and morally defensible. Sack Lodge: Well, like what? Give me an example. John Beckwith: Like what? Well, there’s the company that we have where we’re taking the, the fur or the wool from sheep and we turn it into thread for homeless people to sew. And then they make it into cloth, which they in turn sew, then um… make little shirts and pants for other homeless people to sell. It’s a pretty good deal.”

There has been a dramatic push in the technology licensing and economic development arenas to take new and innovative technologies and spin out companies.  Everyone seems to be looking for the next Google.  But in a world where people like myself are trying to market very, very early stage technologies is it the right idea?  Do not get me wrong – if you can do it – do it.  I’ve watched a few start-up companies initiated and I’ve seen them be successful.  They can be great in terms of job creation and wealth – both great things.  But – during these difficult times financially shouldn’t DEAL FLOW and CASH FLOW matter the most?  I understand mandates for economic development initiatives but there is also a mandate to try and commercialize these new and innovative technologies for the greater good – to promote innovation and possibly save lives.  In doing so things like reimbursing expenses, upfront fees, royalty and milestone payments may add up to more than what others can provide.  Not only may it have the potential to be greater but it helps in funding and maintaining the organizations supporting the commercialization.

So take a look at the article and judge for yourself.  I love what I do and I love the people that I get to work with on a daily basis.  All I want to see is copious amounts of University and Research Institution technologies commercialized and continue the goals that Bayh Dole set out to support.   Whether it is a start-up company, the next Skype or a plan ‘ole license deal – let’s promote innovation.