An Incubator That Hatches Businesses
Behind closed doors at Photonics, ideas turn practical
In the video above, Frank Bobe, president and CEO of Entra Pharmaceuticals, talks about how BU’s incubator program helped his staff develop battery technology to control drug levels in a patient’s body. Clifford Robinson photo below by Vernon Doucette
For five years, Raj Mohanty tinkered in a kind of parallel universe, an odd place where objects are so small they can be seen only with a scanning electron microscope, movements so quick they are measured in billions of oscillations per second. For Mohanty, a College of Arts & Sciences associate professor of physics, nanoscale structures are intriguing stuff, and his investigations are driven by a purist’s fascination with the science as well as a hope that his efforts will someday prove useful and profitable.
“You just keep working on something,” he says, “and from time to time you have an idea that may be relevant in the marketplace.”
Mohanty’s market-relevant idea came in fall 2006, when he found a way to use silicon to make very small resonators — chiplike devices that oscillate at extremely high frequencies. He knew that the device he had created could be put to work as a clock, replacing the much larger quartz crystal timepieces used in radio transmitters for the last 90 years. He also knew that the market for such an innovation, well suited for cell phones and other wireless devices such as GPS receivers, was somewhere north of $1 billion and possibly as high as $5 billion.
“There is a tremendous need for components that can be miniaturized,” says Mohanty. “What we came up with is a way to manufacture these microcomponents on a chip scale.”
He took his idea to BU’s Office of Technology Development, whose job is to match promising technology with first-rate business resources and produce competitive start-up companies. There he met a business-savvy advisor named Matt Crowley, who helped him write an e-mail to venture capital firms that had invested in similar technology. Within days, Mohanty got his first response: a potential investor hoped to stop by his lab within the next week.
The speed of that response and a few more like it persuaded Crowley to leave his BU job and join Mohanty as a founding partner and vice president of business development for the company, which they called Sand 9. They moved into an office on the sixth floor of the Photonics Center, where Mohanty found his embryonic venture in excellent company.
A few doors down the hall, the firm MTPV is honing a technology that turns industrial waste heat into electricity. Another neighbor, LumenZ, has found a way to get more light from less energy and is building what may be the next generation of LEDs. Entra Pharmaceuticals is fashioning an ultra-lightweight drug delivery system that uses battery technology to time the flow of drugs into the body. Ninth Sense, founded by a CAS physics professor, Shyamsunder Erramilli, is creating patient-specific protein biomarker–based therapies for diagnosing and monitoring breast cancer. Good Start Genetics is hammering out a prepregnancy test that screens for 60 genetic disorders, and PatientFlow Technology, founded by Eugene Litvak, a School of Management research professor and director of the Management of Variability Program at BU’s Health Policy Institute, is writing software to help health-care facilities reduce waiting times, cut operating costs, and improve care.
And so it goes, behind the often closed doors of the 13 young companies occupying office and lab space provided by the Charles River Campus Business Incubation Program. They have come to take advantage of a range of provisions and services that could mean the difference between an early death and a long, lucrative life.
Clifford Robinson, director of BU’s incubator program for four years until his retirement in September, says the critical mass of the place attracts not only cutting-edge researchers like Mohanty, but investors who will swallow some risk for a potential monster payoff. In the last three years, the 23 companies that have entered the incubator program have raised more than $90 million and created more than 150 jobs within the incubator. Counting 16 companies that have left the incubator in recent years, the number of new jobs jumps to more than 1,500, and the dollars raised leaps into the hundreds of millions. A123 Systems, a lithium-ion battery maker that left the incubator in 2002 to set up shop in Watertown, Mass., was recently awarded $249 million in federal stimulus funds.
Robinson, whose workdays included scheduling visits from investors from around the world, is closemouthed about the start-ups’ business deals. He will not say, for instance, which company or companies were visited last spring by Anatoly Chubais, a market-oriented Russian economist who served for 10 years as the head of Russia’s state-owned electricity provider, United Energy System, and is now director of the Russian Nanotechnology Corporation. But Robinson will say that in addition to frequent visits from venture capitalists, the incubator’s guest list includes the chief minister of Penang, Malaysia, the minister of economy, industry, and employment of France, the president of the National Research Council Canada, consuls general of Canada, France, China, and the United Kingdom, and economic development officers from Spain, Switzerland, Singapore, Norway, Ireland, and Scotland.
From Robinson’s perspective, the Photonics Center incubator is a boon to everyone involved. For investors, he says, it’s a department store of opportunities, from nanotechnology to computer software, many of them spun from concepts first imagined in research institutions such as BU, the Dana-Farber Cancer Institute, MIT, Massachusetts General Hospital, Draper Laboratory, Harvard, Cornell, and Dartmouth. Resident companies are offered shared lab space, conference rooms, and in many cases, interns. Since 2006, Robinson says, more than 80 BU students have worked as interns for incubator companies, and 10 have been hired as full-time employees. The University also benefits from more than $2 million in fees annually, basking in a good-sized serving of prestige in the world of venture capital.
He also sees another beneficiary: the economy. “In this current economic climate, universities are being called on more than ever to contribute economic value to the community,” he says.
Robinson is fond of quoting Carl Schramm, an admirer of the Photonics incubator and the president of the Kauffman Foundation, one of the world’s largest foundations devoted to entrepreneurship, who calculates that one-third of the U.S. gross domestic product is produced by companies that did not exist before 1980.
Mohanty, whose company has attracted more than $10 million in venture capital, says he opted for space in the incubator because it was convenient, because he liked the idea of keeping BU in the loop, and because he wanted to focus on his technology and not worry about office management. The effort to avoid distraction has paid off, he says: Sand 9 hopes to have its first micro-oscillator on the market next year.
Check back tomorrow to read part two of the series on BU’s incubator culture.+ Comments