FAQ from G Tech..long but worth the read ...
FAQs for Investors
Interested in investing in Georgia Tech's innovative technologies, either as the founder of a startup company or an investor with others? Many of our early stage inventions are well suited to become the basis for the establishing a new business. We welcome proposals from potential investors who may have such an interest and offer flexible licensing arrangements aimed at nurturing the startup during its initial stage. We also actively encourage entrepreneurship and faculty involvement in startup companies, but in such cases are aware of the faculty member's potential conflict of interest. In those cases, we must ensure that any potential conflict can be managed. Click here fo r full details of the Institute's Conflict of Interest Policy.
Q: Will you license an invention to a "new" startup company?
A: Yes. The company must have a sound business plan, with appropriate performance benchmarks, and an experienced management team.
Q: Will you consider approaches from investors who are looking for opportunities but have not yet established a company?
A: Yes.
Q: What if the potential investors have no previous experience?
A: We would still be happy to discuss possible licensing arrangements, but the composition of the proposed company management team would be critical.
Q: Does Georgia Tech encourage startups based on the Institute's research?
A: Yes. Subject to any third party rights to the intellectual property, and to the technology being appropriate for a startup and the existence of a sound business plan, we actively encourage startups.
Q: Why do you encourage startups?
A: Our technologies are usually at an early stage of development, and startups frequently enhance the probability of successfully bringing such technologies to market. They are flexible, can make quick decisions and this is their top priority.
Q: What is your organization?
A: The Office of Technology Licensing (OTL) is a division of the Georgia Tech Research Corporation (GTRC). GTRC is a not-for-profit corporation which serves as the contracting entity for Georgia Tech. It provides research administration, contracting and intellectual property management services to the Institute's faculty, staff and students. Title to all intellectual property developed during the course of Georgia Tech's research activities resides with GTRC. OTL's director, licensing associates and support staff sustain Georgia Tech's technology transfer activities with an innovative and flexible licensing program. The office has extensive experience working with start-up companies and the investment community.
Q: What do your licensing associates do?
A: Each associate manages individual inventions from "cradle to grave". They evaluate the disclosures, manage literature and patent searches, assess the commercial potential for the technology, make decisions on patent filing, manage the outside attorneys handling the patent prosecution, market the technology, negotiate license agreements and monitor the licensee's performance.
Q: What percentage of your licenses are to startups?
A: During FY2002, 38% of our non-software licenses were granted to startups. (FY2001 was also 38%).
Q: Can the startup get an exclusive license?
A: Yes, subject to any preexisting rights that may exist. If the conception or development of the invention had been supported by federal government funding, then the U.S. government has a royalty free license for governmental purposes.
Q: Can the startup have ownership of the licensed technology?
A: No. We normally grant startups an exclusive license. If the invention had been conceived or developed, in whole or in part, with federal government funding, we are precluded by the Bayh-Dole Act from assigning title to the intellectual property.
Q: How can I identify inventions which are available for licensing?
A: Go to the GTRC/OTL website for details of currently available technologies. You can also contact us to discuss your area of interest and we will contact you if any new technology in that area becomes available.
Q: How do I contact you?
A: Please visit the contact section to learn how to contact us. You can also stop by.
Q: Do you write or help to write business plans?
A: No. VentureLab can help you with this. Visit them at www.venturelab.gatech.edu.
Q: Do you put together management teams?
A: No. Once again VentureLab can assist you.
Q: Do you invest money in startups?
A: No. Our terms for licensing to startups are structured to minimize any upfront financial commitment by the company (e.g., we can take an equity position versus an upfront fee as consideration for a license), so that their resources can be devoted to getting the technology to market as quickly as possible.
Q: Do you take equity in startups?
A: Yes. The percentage of equity depends on the particular circumstances. We would be happy to discuss our policies on equity with you.
Q: Do you take any management role in the company?
A: No, nor any Board position.
Q: Do you provide "boilerplate" agreements for our review"?
A: We do not provide "boilerplates" as such, but if you nominate a specific technology which is of interest to you, we will provide a draft license agreement as a basis for discussion.
Q: What are your usual terms for licensing to a startup?
A: These depend on the particular case. They may include an upfront payment, equity, royalties, benchmark or milestone payments and patent costs. Two differences from our standard licenses are that we accept equity as whole or part consideration for the initial upfront license fee and other payments may be linked to benchmarks or timelines. We do this to minimize the effect on the company's cash flow, so that its resources can be devoted to getting the technology to market as quickly as possible.
Q: Can the Georgia Tech inventors take equity in startups?
A: Yes. While we encourage entrepreneurship and faculty involvement in start companies, we are aware of the faculty member's potential conflict of interest, and must ensure that any such potential conflict can be managed. Full details of the Conflict of Interest Policy can be viewed by following this link.
Q: If the inventors have ownership in the company, or are involved in the company's management, can they perform research for the company at Georgia Tech?
A: No, not as a principal investigator (PI) if their ownership or management involvement is significant. The company can support research with another faculty member as PI. If the inventor is involved in the research, not as a PI, their participation must be approved by the Provost and there must be a plan to manage any potential conflict of interest (see Conflict of Interest Policy).
Q: Can graduate students be involved in research sponsored by a start-up company at Georgia Tech?
A: Yes, this is not unusual. The integrity of the faculty-student relationship must be preserved, especially if it is a faculty startup. In some cases an independent oversight committee may be appointed by the Provost.
Q: Can employees of the company use laboratory facilities at Georgia Tech?
A: Usually no, unless it can be shown that the facilities are unique and not commercially available. Any use of facilities must be approved by the department or center head, and usage fees paid. Access to the facilities must not interfere with faculty or student use, and the company cannot have any preferential access.
