The document summarizes Florida Atlantic University's experience establishing a "gap funding" program to support promising early-stage research projects that showed potential for commercialization but were not developed enough to attract significant external funding. It describes how FAU assessed the need, sought external funding and partnerships, developed review processes, and leveraged its initial $56,000 in funding to support 9 projects and attract over $500,000 in additional funding. It also outlines lessons learned around sustainability, such as continuing to seek external matches, recouping awards from successful licenses, and carrying over unspent funds.

1. ED12: The Funding Gap
UNIVERSITY “GAP” FUNDING:
THE FLORIDA ATLANTIC UNIVERSITY
EXPERIENCE
Kurt R. Moore, CFRE
Assistant VP for Research &
Director, Technology Transfer
2009 AUTM Annual Meeting
Orlando, Florida
February 12, 2009

2. FAU Gap Fund: Quick Overview
• Started 2006
• POC/Prototype Fund
• Initial Funding: $56,000
• Externally funded
• Maximum award = $15,000
So, how did we get there?

3. Establishing the FAU Gap Fund
• Assessed our needs
– Did not need another internal research grant fund
– Identified research areas/projects with potential for
commercialization
– Identified “our” gap
• Asked: What type of fund fits our needs?
• Assessed our resources
• Sought advice/templates from established funds &
colleagues: FSU, U Minn
• Indentified potential funding strategies

4. Rules of Thumb
• Time & personnel will be required
• 1 disclosure per $2 million sponsored research
• Approx. ¼ of disclosures become licenses
• Average number of licenses per year (history)
• Missed opportunities for lack of funding
• What $ amount represents a meaningful award?
• Estimated meaningful award (minimum)
X Estimated number of projects
= Annual Gap Fund target amount

5. FAU OTT Overview: 2006
Human Resources Assessment:
• Staff: 2 professionals, 1 clerical
• Potential internal partners:
– University IP committee
– FAU Division of Advancement/Corp Relations
– Sponsored Research
• Potential external partners
– Local business development organizations
– OTT Advisory Committee

6. FAU Funding Needs Analysis
Based on 2005-06 research metrics:
• 26 disclosures & $55 million expenditures
• 4 new licenses/options
• Missed ops in the $8K - $25K range
We estimated:
• POC/prototype fund needed
• 3 or 4 potential “gap” projects per FY
• $30K - $35K = est. “ideal” funding per project
• $15 - 20K = est. minimal meaningful funding
∴$45K - $140K total estimated funding needs

7. Details: Funding the “Gap” Fund
• Previous/existing royalty income?
– Return potion of royalty income into tech
development
– Requires significant royalty revenue stream
∴ No critical mass
• Ask VP-Research for $$ ?
– Must have sufficient allocable dollars available
– Must have priority
∴ $$ Not available
• External grants & donors (FAU solution)
– Collaborate with Development Office
– Identified potential funders
– Built case for support / proposal development

8. FAU Solution: External Funding
• Identified major prospect for funding:
Research Parks at FAU (www.research-park.org)
– Operations plan required by donor
– Became basis for future proposals
• Gap Fund Review Committee (volunteers)
– Internal: faculty w/biz, tech & IP experience
– External: entrepreneurs, biz/tech development
• Faculty proposal process outlined
• Award levels determined: max = $15,000
• Matching funds encouraged

9. Goals, Benchmarks & Metrics
• University technology to market (common goal)
• Emphasize local companies/start-ups (aligned
with donor’s mission)
• More licenses/income (our goal)
• Increased R&D dollars
• Enhanced university reputation (intangible benefit)
• Mature Gap Funds: ROI = 8:1 (Source: Johnson 2005)
– $5.00 from additional federal grants,
– $2.50 from private research contracts, and
– $0.50 from additional royalties

10. First Year: FY07 Funding Results
• $56,000 external grant/philanthropic funds
+ $15,000 corporate match (1 project)
= $71,000 available funding
− $60,000 expended (3 projects + match)
= $11,000 carry over funds (FY08)
+ $51,000 pledges for FY08
= $62,000 available for FY08

11. First Year: FY07 Accomplishments
• 10 faculty applications
• 3 projects funded
– 1 corporate match ($15,000)
– 1 SBIR application ($95,000; declined)
– 2 new patents
– 2 potential licensees
• Stayed within funding projections
• FY08 faculty proposals stronger

12. Leveraged Funds: 24+ Months
$125K R&D Authority Grant Funds leveraged:
• FAU Foundation funds: $28,850
• New private donations: $37,000
– 2 gifts from individuals to Gap Fund ($7,000)
– Corporate gift to fund ($5,000)
– Foundation matching grant to a project ($25,000)
• Corporate R&D matches: $95,600
• SURCAG: $369,588 (1/2 state, 1/2 corporate)
• License/Option fees: 4 projects in negotiation
• TOTAL leveraged funds = $531,038
Gap Funds awarded to date: $101,750 (9 projects)
ROI to date = 5.2 : 1

13. Foresight: What to Expect
• Need internal “buy-in”
• Initially, basic research inquiries from
faculty
• Require prior disclosure to OTT to apply
• Not all projects will be successful
• Need to adjust your operating plan
Murphy’s Law

14. Hindsight: Lessons Learned
• Adhere to deadlines
• Expect “no-cost” extension requests
• Pre-screen applications before
presentation
• External funding for program not easy
• Require matching funds
• Final reports from principal investigators
• Donor stewardship
• Publicity helps

15. Sustainability Plan
• Carry over unexpended funds (FY09: $40K)
• Continue high priority on external matches
• Recoup gap fund awards from successful
licenses along with other IP development
costs & return to gap fund
• Continue seeking external grants/donations
(FY09: $26K as of Dec 08)
• Seek to have some of general royalty
income fund the “gap fund”

16. Questions
Kurt R. Moore, CFRE
Assistant Vice President for Research &
Director of Technology Transfer
Florida Atlantic University
777 Glades Road, Admin. Bldg, Rm. 232
Boca Raton, FL 33431
561-297-1165
kmoore34@fau.edu
www.fau.edu/research/gap/php