A brief ebook presented by StringHub on how universities can accelerate entrepreneurship on campus.

2. How to Accelerate University
Entrepreneurship and
Technology Commercialization
Adam Hoeksema
Co-Founder – StringHub
October 2011

3. New university business incubators, accelerators, and entrepreneurship programs are
announced every week in the United States. It is clear that universities understand that
entrepreneurship is key to the future sustainability of higher education. With state and
federal budgets feeling the pinch year after year, universities are looking for ways to
generate revenue outside of tax dollars and tuition increases. Many colleges and
universities are making significant investments in entrepreneurship.
There are at least 3 ways that successful entrepreneurship programs can bring dollars back
to the university:
1. Licensing Income
2. Equity Sales
3. Donations
Licensing Income
Income generated through licensing university technology is hit or miss. The only person
guaranteed to make money in the technology transfer process is your attorney. Despite
the challenges, many universities are hoping to hit it big like Stanford with Google or MIT
with Akamai. A 2009 survey by the Association of University Technology Managers
reported the top 10 U.S. technology transfer programs by licensing income as follows:
1. Northwestern University, $161 million
2. Columbia University, $154 million
3. New York University, $113 million
4. University of California System, $103 million
5. Wake Forest University, $96 million
6. University of Minnesota, $95 million
7. University of Washington/Washington Research Foundation, $87 million
8. University of Massachusetts, $71 million
9. Massachusetts Institute of Technology, $66 million
10. Stanford University, $64 million
Licensing university technology is major source of income for some universities, but
there are other ways to derive revenue through university technology
commercialization.
blog.stringhub.com

4. Equity Sales
Universities also take ownership in startup companies. Recently, the University of
Michigan announced that it will be investing $50 million to develop innovative
ideas about global challenges and opportunities as well as up to $25 million into
its own start-up businesses. Why are universities investing in equity positions in
startup companies?
Universities all want to hit the jackpot like Stanford University did in 2005 when it
cashed in its position in Google for a reported $336 million.
Donations from Entrepreneurs
The final way that universities generate revenue through entrepreneurship
initiatives is from donations from successful entrepreneurs. This is an interesting
model. What would happen if universities stopped taking equity ownership and
royalty fees and just started supporting promising entrepreneurs? If you truly
supported these entrepreneurs and helped them gain success without taking
equity or royalties, would they ultimately build a more profitable business and
then donate to your university in larger amounts than you would ever earn
through equity sales and royalties?
Here is a list of recent donations to universities from entrepreneurs:
• $48 million to Marian University – Founder AIT Laboratories
• $300 million to University of Chicago - Founder of Dimensional Fund Advisors
• $400 million to Columbia University – Founder of Metromedia
• $600 million to California Institute of Technology – Co-Founder Intel
These donations all come from successful entrepreneurs who want to give back to
their alma mater. Of course there is no guarantee that successful entrepreneurs
who you supported will give back to the university, but typically entrepreneurs
want to give back to the organizations that made a positive impact in their life.
Although it would take decades of testing to prove, universities may actually find a
better return on investment by relying on successful entrepreneur donations than
by taking equity positions and royalties from startup companies. In fact, MIT has
adopted this very strategy.
blog.stringhub.com

5. MIT - Deshpande Center
MIT is one of the most entrepreneurial universities in the world. A report by the Kauffman
Foundation, “Proof of Concept Centers: Accelerating the Commercialization of University
Innovation,” explores the Deshpande Center at the MIT School of Engineering. The Deshpande
Center is a proof of concept center that “aims to accelerate the commercialization of innovations
out of the university and into the marketplace.” The Deshpande Center supports entrepreneurs
in 3 ways:
• Funding
• Advisory Services
• Access to Student Innovation Teams
In the first 5 years of operation the Deshpande Center has:
• Awarded $7 million in grants to 64 projects
• Spun off 10 startups
• Startups employ 150 people
• Spinouts have secured over $88 million in private investment
Great support and great results right? So MIT must be taking ownership in these startups
right? Or taking a royalty fee on sales? No. Instead they are relying on future donations from
the successful companies spun out of the center.
blog.stringhub.com

6. Accelerating University Entrepreneurship
No matter how you intend to derive revenue through entrepreneurship activities at your
college or university, you want to accelerate the process. What is holding most
businesses back from growth? Three of the most popular barriers to growth for any
business are:
– Money
– Marketing
– Management
Now as a university how can you support your startups in these three areas?
Some universities make direct investments in university startups, but there are other
options.
When it comes down to it startups need very little cash. What they need is access to
services and expertise in a wide range of areas.
University Student Class Projects
Fortunately there are students working on class projects in many of these areas. Student
projects could be used to support the growth of university startups. For instance, a
video production class could create a short promotional video, the public relations class
could write press releases and connect with reporters, the computer science students
could build web applications and systems to support the business.
Right now your university students are completing these projects anyway, but often
times the projects just go to waste. If the student class projects could be used to
support startup companies and provide a real world learning experience for students at
the same time, you would create a win-win situation.
blog.stringhub.com

7. Students can help develop a marketing plan, implement a social media campaign,
and develop video and written content to promote the company. By utilizing
these student supports the entrepreneur can spend more time and resources
working to effectively manage employees and projects.
For many businesses, simple class projects could drive major growth for the
business. For example, The Center for Project Excellence at the University of
Dayton reports that over the past 25 years, “Nearly 300 completed projects have
resulted in documented savings of more than $25 million for the participating
businesses” Student class projects can have real economic impact on a local or
regional economy.
Removing Barriers to Growth
By simply connecting university student class projects with businesses, you can
lower the top 3 barriers to business growth.
Money - startups require less funding because students provide services for
experience and class credit.
Marketing - Marketing, public relations, social media, video production, and
design students can support the startup’s marketing efforts
Management - When the entrepreneur can spend less time on raising capital and
marketing, they will have more time to focus on management and the strategic
direction of the company.
So this all sounds good in theory, but it is not easy to implement such a
program. You don’t have time to talk to 20 different professors and coordinate
class projects in all of their classes. Professors already have projects that they do
every year, and they won’t be interested in changing their projects. There is a
solution.
blog.stringhub.com

8. StringHub
StringHub is a web-based platform that connects university student class projects
with real world applications and then manages the completion of the project
through an online work room where students, professors and businesses can send
messages and attachments back and forth to complete the project.
We believe that the StringHub platform will help universities accelerate
entrepreneurship and technology commercialization on campus. The platform will
help connect, structure, and expedite the process of connecting student projects
with university startups or other businesses.
StringHub works like this:
1. Professor posts a class project
2. Businesses view and apply for open projects
3. Professors determine which business applicants are a good fit for the class and
assign students to each project
4. Students, professors and businesses send messages and attachments back and
forth to complete the project
We are currently seeking individual professors and universities to beta test the
platform. At the time of publication there were 8 universities from 5 states around
the United States signed up to beta test the platform.
We would be happy to discuss your needs and build a custom platform that
specifically suits your university. Send questions to adam@stringhub.com and
make sure to check out our blog at blog.stringhub.com to learn more about
innovation in university entrepreneurship.
Adam Hoeksema
Co-Founder – StringHub
www.stringhub.com