Archive for partnerships
Graphene: A flat layer of carbon atoms bonded in a honeycomb crystal lattice a single atom thick.
gbrumfiel writes
“As we discussed on Tuesday, Andre Geim won this year’s Nobel prize in physics for graphene, but he never patented it. In an interview with Nature News, he explains why: ‘We considered patenting; we prepared a patent and it was nearly filed. Then I had an interaction with a big, multinational electronics company. I approached a guy at a conference and said, “We’ve got this patent coming up, would you be interested in sponsoring it over the years?” It’s quite expensive to keep a patent alive for 20 years. The guy told me, “We are looking at graphene, and it might have a future in the long term. If after ten years we find it’s really as good as it promises, we will put a hundred patent lawyers on it to write a hundred patents a day, and you will spend the rest of your life, and the gross domestic product of your little island, suing us.” That’s a direct quote.’”
While some people, including some in the anti-patent community, see this as a self-evident case for the problem with patents, it’s actually just the opposite, in my opinion. Tim’s a sharp thinker and great entrepreneur, but I have to disagree on this one.
Look at the story again. A genius on the verge of filing a foundational patent for a major breakthrough in technology approaches a large corporation who might benefit from the technology. The company learns that the inventor is about to file a patent. A valid patent would mean that the company would have to pay royalties for the invention, perhaps very expensive royalties. If no patent is filed, the company can use the technology for free and develop its own patents without having to cross-license or worry about what Andre Geim owns. Hmm, which would be better: paying a lot, or paying nothing? Having to work with an inventor or tech transfer office or new patent owner who may end up thinking an invention is worth billions, or having the whole thing pretty much gratis? Tough call, but I think the corporate leader was quick to recognize the advantages to nipping the patent threat in the bud. How could he talk the inventor out of a patent? What negotiating tactic to deploy? ah, how about the Hindenburg? That’s where you explain to the other party that their intended course of action would be a flaming disaster, with burning bodies falling out of the sky–oh, the humanity!–resulting in the adversary becoming toast themselves.
The Hindenburg: A flaming disaster and a common negotiating trick
Baloney! All bluff and bluster. But the intimidation and scare tactics work. “OK, OK, I won’t file my patent. Sorry for even thinking about that. Now I see that patents don’t help the little guy, Mr. Big. Here, take what I’ve got for free. I’m just honored to watch you commercialize my work.”
Patents are the great equalizer. It’s what gives lone inventors a fighting chance against the big corporation that wants to take what they’ve got for free. It’s not easy and may not work, but with patents you’ve got a chance and corporations know it. Good ones respect that and will work with out. Others will try to take what you’ve got anyway, or better yet if they can, talk you out of pursuing a patent. Without one, you’ve already surrendered. You might as well throw the keys of your car to any passing stranger and hope they will pay you someday after they drive away.
The story isn’t about why patents don’t help the little guy. In fact, I think it’s about how much some big corporations despise and loathe patents in the hands of little guys. So much so that they would make outrageous statements to trick a brilliant scientists into NOT doing the one thing that could have helped him most: filing a patent. Instead, he handed them his inventions for free. Score one for the big guys.
It would be fun to go back in time and be with Dr. Geim when he was given the Hindenburg treatment. I’d like to ask a quick question of the corporate executive who made the threat:
Wow, 100 patents a day. That’s so amazing, you know, because the world’s most prolific patent filers like IBM and Canon average less than 20 filings a day, and I would be surprised if they ever hit 100 patents a day, and certainly not on one single project and certainly not over an extended period of time. So how many US patents did your company get last year? Wait, it’s right here at USPTO.gov – hey, based in your pathetic past filing rate, it looks like you could never ramp up to 100 a day. You’re trying to spook me. So just what are you afraid of? Oh, I see, my patent. Nice try, Mr. Big. I’m going to file, especially now that I see how much you care. Now go ahead and hire a hundred lawyers and create your own little fiscal Hindenburg, or we can talk about collaboration.
Oh, one more thing. You need to work on that Hindenburg act. The flames shooting out of your ears were a bit freaky.
Chemical engineers interested in innovation and entrepreneurship should consider attending the AIChE 2010 Annual Meeting in Salt Lake City. On Wednesday, Nov. 10, I will chair a session featuring four outstanding speakers on topics that should be of interest to many engineers, including university researchers, corporate researchers, and managers. If you are conducting research that could lead to a new business, if you are involved in leading or managing R&D, if you are part of an effort where intellectual property could make a difference, then you should attend our session, “Intellectual Assets in the Digital Era.” You need to register for this conference through AIChE.
Time: Wednesday, November 10, 2010: 8:30 AM-11:00 AM
Location: Salt Palace Convention Center, Grand Ballroom G, Salt Lake City, UT
Chair: Jeff Lindsay, Director of Solution Development, Innovationedge, Neenah, WI
Co-Chair: Ken Horton, Gore School of Business, Westminster College, Salt Lake City, UT
Schedule of Papers and Abstracts:
8:30 AM, Paper #406A, “Business Development, IP, and Manufacturing Success: Perspectives From Utah’s Manufacturing Extension Partnership” by David Sorensen, Executive Director of Utah’s Manufacturing Extension Program. (See biographical information below.)
Abstract: The Manufacturing Extension Partnership of Utah has assisted many companies in strengthening their strategy for success and continued growth. We will discuss what it takes to advance your business, including lessons relative to leadership, vision, intellectual property, and coping with changing regulations and policies.
9:10 AM, Paper #406b, “The Role of IP in Successful Startups,” Mike Alder, Director of Technology Transfer, Brigham Young University.
Abstract: Many AIChE members will be involved with a startup at some point in their career. While the capabilities of the management team is of utmost importance, in numerous cases, the success of the startup also depends on the quality of its intellectual property. In this era, an IP-savvy team can take several steps to secure competitive advantage and realize greater value from the technology, products, or services the company offers. This presentation will draw upon experience with many startups and startup teams and will provide guidance to researchers, business leaders, and future entrepreneurs on how to better prepare for success.
9:45 AM, Paper #406c, “An Introduction to IP Law: The Underpinnings of Intellectual Assets,” Ken Horton, Kirton & McConkie, Salt Lake City, UT
Abstract: An understanding of the basics of intellectual property law can help chemical engineers in advancing their own research, in evaluating competitive efforts, in building their own business, or in general advancing their career. This presentation will cover some of the key concepts that engineers should know, including the nature of patents, the different kinds of patents (provisional, utility, design), the role of trademarks and copyrights, what it takes to be patentable, and how changes in patent law may affect your career and business.
10:20 AM, Paper #406d, “Cost-Effective Pursuit of IP in a Down Economy,” by Jonathan Lee
Abstract: How does one get the most protection and benefit from intellectual property when the economy is down? How can patents and other forms of intellectual property be obtained in a cost effective manner when budgets are tight? In this presentation, an experienced patent attorney shares insights into cost effective IP with guidance directed to managers, research leaders, inventors, and entrepreneurs.
Biographical information:
David Sorensen
Mr. Sorensen has over 35 years of experience in a wide variety of technical and managerial assignments requiring comprehensive knowledge in several disciplines relating to engineering, manufacturing, information technology and business systems. He has been directly responsible for major contracts with industry and government agencies and has a proven record of technical competence, customer relations, and business planning in rapidly expanding technical companies. Mr. Sorensen has held increasingly responsible positions in product and service organizations. He is innovative, resourceful, and aggressive in accomplishing assigned responsibilities with major strengths in strategic planning, marketing and management. He holds a Bachelor of Engineering Science and a Masters in Manufacturing Engineering Technology from Brigham Young University.
Since 1995 he’s been the Director of the Utah Manufacturing Extension Partnership (MEP-Utah), serving primarily the 6,200 manufacturers in the state of Utah. MEP-Utah was selected to initiate and manage the NIST Information Technology Network for over 60 MEP Centers nationwide. Mr. Sorensen is also a BYU adjunct faculty member and the Associate Dean of Technology, Trades and Industry at Utah Valley State College. With a staff of 18, in one year MEP-Utah helped create or save 2,719 jobs in Utah, increased manufacturing sales by more than $121 million and increased employee payroll by more than $84 million.
He’s been the Chairman & CEO for Echo Solutions, a start-up software products and services company; Executive VP of Eyring Research Institute; General Manager of EG&G Services; Director of Engineering at EG&G Idaho Inc.; Manager of Architect Engineering and Construction at Aerojet Nuclear Company and Manager of Power Generation Equipment at Bunker Ramo. He also has experience with GE’s Nuclear Instrumentation as a Senior Applications Engineer, and in engineering positions at Kennecott Copper, Intermountain Industries, and F.C. Torkelson Engineers.
Michael Alder
Mike is Director of Technology Transfer at Brigham Young University, where his work has been nationally recognized by BusinessWeek and others for their success. Mike is also Chair of the Board for WestCAMP Inc. where he has also chaired the National Centers of Excellence (NCOE), a division of WestCAMP. Mike is formerly the CEO of the Biotechnology Association of Alabama. He was also a Venture Partner with Redmont Venture Partners, Inc. He has been heavily involved in the founding of Tranzyme, Inc.; Vaxin, Inc.; Folia, Inc.; Chlorogen, Inc.; Allvivo, Inc. and Cr3, Inc. All but one of these are biotechnology companies (Folia produces specialty biopolymers).
Mr. Alder has 30 years of experience in leading technology-based startup companies. He was previously CEO of Emerging Technology Partners in Birmingham, Alabama from 1997 to 2003. Prior to coming to Alabama in 1994 he co-founded the Grow Utah Fund that focused on creating technology-based businesses. In 1989 he was asked by the Utah Governor to head the State’s Office of Technology Development, which he did for 5 years as its Executive Director, helping bring Utah’s Centers of Excellence programs to national prominence. In 1973 he founded NPI, a plant biotechnology company in Salt Lake City, Utah and served as President, COO and Vice Chairman of that company for 15 years as it grew to over 700 employees.
Ken Horton
Ken Horton is a member of Kirton & McConkie‘s Intellectual Property Practice Section in Salt Lake City. His practice includes domestic and foreign patent prosecution, patent opinions, intellectual property litigation (including both state and federal court actions), domestic and foreign trademark prosecution, trademark opinions, copyrights, trade secrets, intellectual property evaluations and due diligence, as well as technology and intellectual property agreements. Mr. Horton has extensive experience in both pharmaceutical and semiconductor technologies. He is a frequent speaker on the topic of intellectual property law and strategy, speaking both at the 2007 and 2010 A.I.C.H.E. annual conferences and the 2009 A.C.S. annual conference. Additionally, Mr. Horton is an Associate Professor in these topics in the MBA Technology Management Program at the Gore School of Business of Westminster College.
Jonathan Lee
Jonathan Lee is a registered patent attorney and a member of the Utah State Bar practicing at ALG (AdvantEdge Law Group). His practice focuses on adding real-world value to companies, both large and small, by acquiring, securing, and protecting intellectual property rights.
Mr. Lee has prepared and successfully prosecuted hundreds of patent applications throughout his career, primarily in the electrical, electro-mechanical, and computer engineering fields. He currently helps a number of Fortune 1000 companies manage and develop their domestic and worldwide patent portfolios. He also regularly counsels clients in other aspects of intellectual property law, including litigation, licensing, and opinion work, as well as due diligence examinations, copyrights and trademarks, and patent reexamination proceedings.
Prior to joining ALG, Mr. Lee worked for nationally recognized law firms in Washington, D.C. and Salt Lake City, Utah.
Mr. Lee was recently selected as a Mountain States Rising Star by Super Lawyers, a peer-reviewed publication.
In May 2010 I was invited to speak at a conference of WTA (the Wisconsin Telecommunications Association) about innovation lessons for the telecommunications industry from our recently published book, Conquering Innovation Fatigue (John Wiley & Sons, 2009). Here is a condensed version of the presentation. I’ll do another Pixetell soon with some additional content.
Can’t help mentioning this: I had a technical problem with the above Pixetell and sent an email to their tech support team. I had a response within minutes. In fact, I had a phone call – the kind that takes real people using real time – and the quickly helped me troubleshoot the problem and get this post working. Wow! Miracles still happen–or at least great customer service. Love Pixetell. Great way to turn PowerPoints or whatever you have on a computer plus your voice into a recorded presentation that you can share with a URL, embed into a blog, or save as a movie. Pixetell is a product of Ontier, Inc.
Amyris: Great Story of Open Innovation and Renewable Products
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In my ongoing work on analyzing the intellectual property landscape in biofuels, one of the most impressive companies I’ve run across is Amyris, a renewable products company whose clever use of synthetic biology goes far beyond biofuels. Amyris was founded by Kinkead Reiling, Neil Renninger, and Jack D. Newman who met at Berkeley and founded Amyris in 2003, headquartered in Emeryville, California. With a grant from the Bill & Melinda Gates Foundation, they first developed their technology under a non-profit initiative to provide a reliable and affordable source of artemisinin, an anti-malarial therapeutic. It was viewed as a long-shot, but they found success that paved the way for the growth of the company into other areas. They are now developing new microbial strains that can produce other useful molecules from renewable feedstocks. This industrial synthetic biology platform is providing alternatives to a broad range of petroleum-sourced products. he extremely useful molecule farnesene is an important part of their business. It provides a compound that can be used to produce flavors, perfumes, detergents, cosmetics, biodiesel, and other products.
This week Amyris created a stir by announcing a record number of deals and partnerships for a single week (a record among bioenergy companies, according to Biofuels Digest). These partnerships include P&G, Total, Soliance, Cosan, M&G Finanziaria, and Shell:
Amyris has taken it up a notch with a series of stunners surrounding its synthetic farsenene, which it has named Biofene – the first product that Amyris is seeking to produce at commercial scale.
Beyond its success this week with Biofene announcements, which are the basis for the P&G, M&G and Soliance partnerships — there are the broader arrangements with Cosan to develop a platform in renewable chemicals, and the equity agreement with Total that will provide needed capital as well as a broader platform for Amyris’s expansion into hydrocarbon fuels.
The mysterious agreement with Shell, regarding diesel, is one to watch. The decidedly vague disclosure was buried in Amyris’ amended S-1A registration statement, but not otherwise mentioned in a flurry of press releases from the company as it promotes its expansion in this pre-IPO environment. Shell Western Trading & Supply is one of 17 Shell trading companies that buy and sell to customers within and outside of Shell.
This news shows an interesting example of companies forming partnerships with an innovative start-up with great technology and apparently highly valuable IP. According to my Patbase search, Amyris has 21 patent families, quite a large number for such a young company. They clearly have been active and aggressive in pursuing patent protection, and those patents are critical for the meaningful partnerships they are now forming. It’s a great unfolding story of open innovation and technology transfer.
The story extends beyond the US. They have operations in Brazil, for example, which is one of the world’s hotbeds for bioenergy, bioproducts, and collaborative innovation.
Further information comes from today’s article, “Amyris: farnesene and the pursuit of value, valuations, validation and vroom,” also from Biofuels Digest.
In late 2009, I was invited to speak at Singapore’s Innovation and Enterprise Week 2009, an event held at Biopolis and sponsored by A*STAR, the world-class research organization of the Singaporean government, in collaboration with Exploit Technologies, the tech transfer arm of A*STAR. While I enjoyed the opportunity to discuss our book, the important thing to me was the opportunity to learn more about that amazing country and their bold approach to promoting innovation and technology. In my presentation for the large crowd at Innovation and Enterprise Week, I discussed the fascinating parallels between the Singapore experiment and the evolving experiment in innovation in my state of Wisconsin, where the Wisconsin Institutes for Discovery represent a brilliant approach to combining the best of public and private innovation.
Below are three video segments from my presentation. A couple of friends in Singapore took the video. There are a few gaps in sound and so forth, but I hope you can understand it. Don’t miss my lame magic trick in segment 3. They seemed to like it–proof again of the great courtesy that one finds in Singapore. In all seriousness, I think there are important lessons about innovation that can be gleaned by inspecting both the Singaporean system and the Wisconsin Institutes for Discovery, which include the Morgridge Institute for private sector research and the public Wisconsin Institute for Discovery. Madison and Singapore are on opposite sides of the world, but on the same side of the innovation spectrum, at the leading edge.
Update: On April 24, I posted a newly recorded and shortened Pixetell presentation covering the basic information I shared in Singapore, without the magic or other excursions.
I am deeply grateful to the many people who kindly shared their time to help me prepare for the presentation, including Sangtae Kim, John Wiley, Charles Hoslett, Carl Gulbrandsen and Janet Kelly from the Wisconsin side (Wisconsin Institutes for Discovery and WARF), plus Boon Swan Foo, Seito Wei Peng, and Sze Tiam Lin at Exploit Technologies in Singapore.
Part 1:
Part 2:
Part 3:
Dark Energy and Dark Matter: What Astrophysics Can Teach Us about Innovation Success
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The Matter-Energy of the Cosmos is Mostly Dark Matter and Dark Energy
It’s that way in the business world. too. Companies can create tidy org charts and draft neat process maps to describe how they work, but the unseen reality outside the visible systems may be what really dominates operations. Increasingly, experts in knowledge management are learning that easily overlooked and often invisible intangibles can dominate corporate value and performance. Numerous intangible transactions may be essential to the success of a company, including casual information sharing between trusted friends, helpful exchanges of tips and best practices between employees or between external partners and internal employees, or loyalty that is gained when people are included in decision making. The invisible linkages and hard-to-observe exchanges in a company’s internal an external ecosystems may be the real engines of value creation, regardless of what is on a process map or workstream. By not understanding the value of such intangibles, corporations can easily break key linkages and crush subtle engines of value creation.
Many companies focus on their “value chains” – a term popularized by Michael Porter in his seminal 1985 work, Competitive Advantage. The value chain describes the linear chain of events as materials and products move from sourcing through manufacturing and out to the market. It is a highly useful paradigm for manufacturing and was highly applicable to much of the economy in the era when Porter was doing his research. But since that time, the explosion of the knowledge economy has changed the way we work and create value. One of my favorite authors, Verna Allee, a revolutionary expert in knowledge management, has detailed the move from the value chain to modern ecosystems and Value Networks in her book, The Future of Knowledge: Increasing Prosperity through Value Networks (Burlington, MA: Elsevier Science, 2003). Verna Allee and Associates have introduced a clever, methodical tool called Value Network Analysis for analyzing and visualizing the transactions of intangibles and tangibles that affect a business.
After my training in Value Network Analysis by Verna and her associate, Oliver Schwabe, an exciting new perspective on business and human behavior opened up. I have been highly impressed with the power of Value Network Analysis and the insights that it can rapidly deliver for a company. The Value Network Analysis work that Innovationedge has done as part of larger projects for some of our clients has been a very exciting part of my work since joining Cheryl Perkins’ exciting company. We value the tool enough that we had Verna Allee speak at the 2008 CoDev conference to introduce other business leaders to the basic concepts behind Value Network Analysis. I’m very pleased to see a community emerging of people using Value Network Analysis and developing exciting tools for it.
Here are some resources that you may find helpful in further exploring this area:
- Value-Networks.com
- Hosted Value Network Tools
- A Value Network Approach (PDF) – 2002 Whitepaper by Verna Allee
- ValueNet Works™ Analysis for Boeing (PDF)
Part of the initial output in Value Network Analysis are maps, called “holomaps,” showing human entities as nodes and transactions of tangible or intangible items between them. There is much that can be learned from such holomaps – a topic for later discussion. For now I’ll show you two sample holomaps I created to illustrate simple ecosystems. One shows several external nodes around a manufacturer and the other shows some structure within part of a corporation. For simplicity, the maps lack all the labels explaining the transactions.
Holomap of an External Ecosystem
Holomap of an Internal Ecosystem
One interesting approach is to use the “holomaps” you get in Value Network Analysis as tools for “what if” scenarios to explore what new partners might do for your business model, or what new business models might do for your ecosystem. Using holomaps to explore innovation ecosystems is a particularly fruitful approach for those doing open innovation and wondering who should be in their external ecosystem.
We have further information on this topic that we’d be happy to share with you. It’s certainly something you should look at to understand how business really works.
Innovation Fatigue Factor: Zapped by Partners
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One of the nine major innovation fatigue factors that we treat in Conquering Innovation Fatigue is theft of the invention, of the IP, or other assets. One of the most painful and most common sources of theft of an invention is from partners such as vendors or customers. One apparent example is the dispute between Woodstream Corp. and Agrizap, Inc., a case that went to district court and then on appeal to the Federal Circuit Court. Again, there are always two sides to these stories, and we encourage people not to judge losers of legal battles too harshly, for truth and justice are not always the product of courts. But the apparent facts of the case, as reported in public documents, illustrate the kind of problems that many inventors face and need to be protected against.
Agrizap, Inc. had developed a rat killer based on electrocution. It was patented in US Pat. No. 5,949,636. Woodstream, the maker of the Victor® brand pest control products, approached and developed a partnership with Agrizap. During negotiations under a non-disclosure agreement, Woodstream sent samples of the Agrizap product to Chinese manufacturers. Agrizap learned of this and challenged their motives, but a vice president of Woodstream assured Woodstream that the action was simply to obtain a price quote for use in negotiation with Agrizap and was permitted under a particular section of the non-disclosure agreement. However, it appears that they were looking for help in making their own product. Woodstream soon licensed the patent from Agrizap to allow Woodstream to sell the product to a limited group of companies such as Home Depot and Lowe’s. Agrizap agreed not to compete in those markets. They provided Woodstream with products, not knowing that Woodstream was working on developing their own version of the same. Within three years of the partnership, they were competing directly with Agrizap with their own version of the product.
Agrizap sued for patent infringement. Unfortunately, during appeal, the Federal Circuit used the recent KSR decision on obviousness to argue that the patent was simply a combination of known elements to achieve a predictable result, and thus invalidated the patent. But Agrizap also sued over fraudulent misrepresentation and won a $1.2 million award in spite of losing their patent. The existence of good documentation about their agreements, including oral aspects of the agreement, proved to be more valuable in the end than the patent itself. (Resource: “. . . Eliminates Pesky Patents Too! Agrizap, Inc. v. Woodstream Corp.,” Advanced Patent Trial Strategies (APaTS®) series, Robins, Kaplan, Miller and Ciresi, LLP, Minneapolis, Minnesota, April 14, 2008.)
In this case, unfortunately, the activities of Woodstream forced Agrizap to sue and thereby put their patent at risk. Had Woodstream been more forthcoming, Agrizap might have been able to license the patent more broadly or continue using it to generate revenue. One can argue that eliminating an invalid patent is a public service, and that may be the case, but the invalidity is painful when it comes from rules that change midstream, adding new uncertainties for patent owners. And in any case, the apparent misrepresentation by Woodstream resulted in substantial loss for Agrizap. It gave Woodstream several years of market penetration before they launched their own product, when it would have been much better for Agrizap–had they known of Woodstream’s intent–to simply enter the market directly and build momentum before Agrizap had time to reverse engineer their product. No one wants to form a partnership with someone who secretly plans to turn around and compete directly against you.
Choose your partners and friends carefully. The ones with poor ethics will usually lead to regret and loss. Make sure you have solid documentation of your agreements and understandings, in addition to strong patents, in order to protect your interests in spite of the uncertainties of law.