The Innovation Consortium Approach: How Entrepreneurs Gain Value From Collaborating with ...

Not all brilliant ideas in a lab are brilliant ideas for a business. At both the macro and micro level, many argue, there is a disconnect between academic research and entrepreneurial innovation, particularly in highly technical areas like biotech, cleantech and life sciences.

In order to bridge this gap, state and federal officials, universities, and members of the business community are beginning to collaborate on “innovation ecosystems” or “innovation consortia” to help address the gap between university discovery and commercial success. The cleantech community in particular has embraced this model. Fledgling cleantech consortia exist in the Rocky Mountain area, the Great Lakes region, and New England. The creation of innovation consortia can be “an engine for economic growth that combines…world class research universities with private and public financing sources, enabling public policies and leading clean energy companies, all collaborating to accelerate clean-energy research, product development, economic growth, and jobs creation” said New England Clean Energy Council President Peter Rothstein.

Empirical research from The Council on Competitiveness bears out these assertions. Led by Professor Michael Porter of Harvard Business School with support from the Monitor Group, the Council’s research on innovation clusters points to cluster-specific institutions as a necessary component of regional economic success: “Diverse groups (e.g., rival firms, related and supporting industries, universities and research centers, training institutions, government, and so forth) contribute to cluster strength, but their contribution is not automatic. An organization dedicated to mobilizing these groups does much to strengthen the cluster….(and) significantly increase the success rate of start-up companies.”

What are the incentives for seasoned entrepreneurs and venture investors to participate in such consortia? Entrepreneurs and investors provide “sweat equity,” usually in the form of mentorship of emerging projects, but receive an explicit or tacit right of first refusal on management and/or funding.  While many entrepreneurs already contribute to business plan competitions and work with university technology transfer offices, participation in innovation consortia provides greater voice for entrepreneurs, allowing them to “communicate…needs and desires (e.g., for talent, ideas, patents) to local universities, research institutes, and training centers…(and) identify issues of common concern and opportunities for mutual gain.” (From “Clusters of Innovation: Regional Foundations of U.S. Competitiveness, Council on Competitiveness,” available here).

This post on Clean-Tech and Start-up Issues was authored by Caitlin Vaughn.

 
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