2004 Utah Changed

• Jon Huntsman became Governor• USTAR concept formulated• Utah’s President Michael Young

USTAR Economic Leverage

$25M/yearTeam

Investment Average$166M/year

ResearchFunding

$250Mone-time

InfrastructureInvestment

Cumulative $977MState Investment

$4,992M NewResearch Funds

123,406USTAR

jobs

422USTAR

companies

Average$166M/yearState Taxes

$4,979M NewState Revenues

Papers . . . . . . . . . . Patents . . . . . . . . . . Products

USTAR Team Funding• Start-up: average $5 million/team

– 3 PIs per team– teams average 30 members– computers and scientific equipment– moving costs for research– salaries and benefits costs are ongoing costs

• Research funds pay salaries after 4 years– Hire more teams– USTAR provides long term salary at $500,000 per

team for expenses not covered by federal grants

UniversityCommercialization

Is the Critical Path

USTAR Return on Investment

$25 Million annual state investment & $250 Million for buildings

422new

companies

123,406 new jobs paying

$62 Billion in salaries

$4.9 Billion new external

research funds

$5 Billion in new tax

revenues for Utah

Utah Transformed Operation

• 2004 Technology Prevention Organization

• “Hoping the coyotes will raise them”• Bottom third of TTOs, ranked 96th

• 2008 Sustained Success• Tied MIT #1 after 2 years at #2• 09 Legislative proclamation• #1 2009 and 2010• 5000th invention in 2010• Over 300 inventions 2011-12

4 Years Later

Returns from Commercialization• Dollars are in

– Equity and royalties– Research back to the University– Donations and other support

• University of Utah receivedover $35 million in gifts tosupport commercialization

• Commercial-sponsored researchyields more than license income

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

5

10

15

20

25

Start-ups

University Inventors, Startups, & Revenue

Revenues

FY 2004

FY 2005

FY 2006

FY 2007

FY 2008

FY 2009

FY 2010

FY 2011

$0

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

$60,000,000

$70,000,000

$80,000,000

$90,000,000

Commercial Research Commercial Clinical Research

Licensing

FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 20110

20

40

60

80

100

120

140

160

180

Repeat Inventors New Inventors

Faculty Inventors

Leading Indicator: Investment

2005 2006 2007 2008 2009 2010 2011 2012$0

$200,000,000

$400,000,000

$600,000,000

$800,000,000

$1,000,000,000

$1,200,000,000

$1,400,000,000

$1,600,000,000

Cumulative Grants FundingCumulative Investment FundingValue Private Companies

Economic Results• 2004-2011: 134 companies created

– 74 companies 1970-2003

• 168 University of Utah companies– raised $568 million in financing 2005-12– 7,160 Utah employees, total Utah direct and

indirect employment: 19,818*– Total payroll over $947 million*– Taxes generated per year: $96.2 million*

* 2011 Bureau of Economic and Business Research economic impact study

What we know now • Smart team play

can compete withunlimited resources

• Look for leverage/OPM• Fund Critical Paths

– Monitor milestones– Do not fund “no results”: post performance funding

• Outcomes depend on shots on goal– control strangles speed and momentum– place small bets with immediate milestones

• Capital Formation is about outcomes