FROM RESEARCH TO INDUSTRY IP VALUATION THROUGH START-UPS, SCIENCE OR ART? 3 rd TTO Circle Worshop on Best Practices November, 22 th 2016 CEA (FR)/Tony Prézeau
KEY FIGURES CEA (2015 EXCEPT *2014) 16 000 Employees 4.5 Billion budget (Civil : 2.2 B - Defence : 1.6 B ) 1 400 PhD and post-doctoral researchers ± 5 850 Patent families ± 750 Delivered priority patents /year : 3 rd /4th national patent filer in FR 124 Innovative technology start-ups created since 2000 ± 120 Million budget H2020 European funds* 53 Agreements with universities and research establishments* 51 Joint research units 27 Competitiveness clusters* 2
2 MAIN START-UP GENERATION WAYS @ CEA Promising technology portfolio Promising technology portfolio Motivated entrepreneur/ intrapreneur Market insights Motivated entrepreneur/ intrapreneur Market insights INSIDE/OUT We have promising technologies, a motivated intrapreneur and no identified industrial partners interested at this stage by the techno/market perspectives. Techno push>market pull OUTSIDE/IN A (seasoned) entrepreneur who has a good vision of a market is attracted to find a diversified and state-of the art technology portfolio to support his ideas. Market pull>techno push Though 8-9 start-ups are created yearly, the main way of technology transfer remains the industrial partnerships by far, mainly due to the shorter "return on investment". 3
IP VALUATION AND START UP: DECISION SUPPORT AND MODELLING Strong SU support: market analysis, IP and competition panorama, offer structuring, business modelling, using classic innovation tools. Wish to develop models predicting if a technology portfolio is better transferred through a partnership or creating a new business based on the techno/market fit. 4
YES IT CAN BE RATIONALIZED BUT WHAT ABOUT THE HUMAN FACTOR? THE EVOLVING STRATEGIES OF THE LARGE COMPANIES? Promising technology portfolio Promising technology portfolio Motivated entrepreneur/ intrapreneur Market insights Motivated entrepreneur/ intrapreneur Market insights 5
THE ART OF THE START-UPS Being iconoclast: Challenging status-quo, opening new paths, new ways of thinking sometimes shoking new propositions accepted later as mainstream. New conditions require new answers, the old solutions are no longer fulfilling all the needs. Like art, there can be rational analyses, even scientific measurements but at the end, it is more about feelings and emotions than about only figures. 6
EXAMPLE 1: MOVEA (INVENSENSE) Created in 2007 around a rich portfolio (>500 patents now) of motion capture solutions (developed from 1998) Very long incubation, difficulty to find the adequate business model, more than 10M public money (+private funds not accounted for here) invested in the project. Finally sold in 2014 to Invensense for >50M. In addition to the immediate payback to CEA and the labs, InvenSense/Movea has signed a R&D partnership to keep developing new solutions with CEA and >50 people still work for InvenSense/Movea in Grenoble From 1998 to >2010, it was not clear if our portfolio around motion capture sensors and intelligence had a great value, even if market studies showed quite early a potential for consumer goods. 7
EXAMPLE 2: WAVELENS The technology panorama when the start-up started was not clear enough to say which ones would prevail and which ones will get the most important market shares. The intrapreneur was strongly believing in his technology (optical MEMS solution) Though contacting many actors (VC funds and industrials), no investors or producers believed in the project, that was nonetheless supported by the lab and CEA. Finally after creating a Proof of Concept (Minimum Viable Product), several high tech companies were then interested and one of them bought the SU and the IP and launched a significant partnership project with Leti, the parent Institute of CEA Tech. Taking into account all the public money invested in the project (CEA and R&D public financing), the global balance is positive (additional benefits: new R&D partnership and jobs maintained and created in FR). 8
SOME EXPERIENCE FEEDBACKS ABOUT IP Management of intellectual property is a key element of the CEA s strategy, used for the benefit of innovation transfer to companies ("innovative & secure research"). We are not in the Silicon Valley: we can not compete on funding and speed of execution a solid IP is a key asset of a technological start-up. When dealing with major companies, even if they buy more and more "packaged" / "surrounded" IP (= more a start-up than technologies), they finally buy solid IP. Even if we develop strategies from upstream (creativity, crowdsourcing, ) to dowstream (dynamic choices to maintain/extend, criteria for licensing negociation), at one point some choices are based on intuition that patents should be maintained even if no direct interest for technology transfer. 9
CONCLUSIONS Difficult to put only in a financial equation the interest of investing in a SU project and its value: the payback can come "only" from new partnerships and/or created jobs; necessary nonetheless to have a good view of the costs/public investment. A solid IP portfolio can and should follow a rational strategy but some "educated bets" have to be made that can not be justified in the short term. There is an emotional/irrational dimension to start-ups, even for technological ones, in addition to the human factor, already difficult to evaluate. 10
THANK YOU FOR YOUR ATTENTION. ANY COMMENTS OR QUESTIONS? DO NOT HESITATE TO CONTACT ME AGAIN : tony.prezeau@cea.fr CEA/VALO/SBEM Commissariat à l énergie atomique et aux énergies alternatives Minatec Campus 17 rue des Martyrs 38054 Grenoble Cedex France