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August 2000
Research Park offers opportunities
for economic development
Since 1961, the Purdue Research Park north of the West Lafayette Campus has been fertile ground for economic development.
And since 1993 - and especially in the past year - work has intensified to help new ventures. Three business incubators have opened to provide a place for faculty who want to commercialize their ideas or companies who want to develop businesses based on licensed Purdue technologies.
"More than 36 companies that did not exist prior to 1993 have been launched at our park," says Stan Mithoefer, director of real estate for the Purdue Research Foundation. "The start-ups have hired more than 221 employees - jobs that would not be in this community or possibly elsewhere without our incubation system."
The first Research Park incubator, a 28,000-square-foot facility, opened in 1993. It is operating at capacity with 29 businesses.
The newest incubator at the park celebrated its first anniversary earlier this summer. The Purdue Research Foundation also turned another existing building into an incubator.
Companies in the incubators benefit from a shared office concept, flexible leases, attractive rental rates and some shared office services. Also provided are two-way video conferencing and high-speed Internet access.
To complement the business incubators is the new Innovation Center. Incubator tenants whose success requires more office or lab space graduate to this facility.
Tenants of the Innovation Center have access to the same services provided to incubators, but lease space at higher rental rates.
Both the one-year-old Purdue Technology Center and the Innovation Center will be fully committed to tenants by year's end.
The incubators and other new expansion complement existing Purdue Research Park tenants. Twenty other high-tech companies operate independently from the incubator system. Those companies, many of which are spin-offs from Purdue-licensed technology or companies that have graduated out of the incubators, employ 654 workers.
For faculty: A way to further develop research
Philip Low, Joseph F. Foster Professor of Chemistry, embarked on the American dream a few years back - even though he feared it might turn into a nightmare.
Twelve years ago, Low headed a research team that found a way to diagnose and potentially cure ovarian cancer by using the vitamin folate. He then had to decide whether to sell the technology to a company or set up his own business to develop and market the treatment.
Low decided he could best safeguard the quality of the science by setting up shop at the Purdue Research Park. That's how he joined the ranks of researchers taking their ideas directly to market.
Although venture capitalists approached him, Low resisted their offers.
"I believed they'd be more concerned with a quick return on their investment," he says. Instead he and some friends formed Endocyte Inc.
"It's never been about whether I'd make more money," Low says. "To me, being an entrepreneur is about keeping control of the direction of the science and having the opportunity to explore the full potential of this discovery."
Research, not business, is what drives Low.
"I'm still able to spend 95 percent of my time at Purdue, teaching and conducting research, because I followed some good advice: hire an experienced chief executive officer to handle everything except the direction of the science," he says.
Low continues to research folate, looking now at its potential to help those with severe arthritis and autoimmune diseases. He serves as chief scientific officer of Endocyte.
Another faculty entrepreneur, Joe Pekny, professor of chemical engineering, does research and serves as his company's CEO. He believes that being an entrepreneur enhances his research.
"The research I'm able to conduct through my company makes me a better teacher and a better researcher at the University," Pekny says. "I work at Purdue during the academic year and if I have an idea during the summer, I can have it in use in my company in two weeks collecting data."
His company, Advanced Process Combinatorics, helps established companies make business decisions more effectively through sophisticated computer software.
Corporations that wanted the product he was designing helped along Pekny's venture. Other customers weren't hard to come by.
"We benefit from a University halo effect," he says. "Businesses know the best talent in this particular arena comes from Purdue. By forming a company at the Purdue Research Park, we've kept all that talent in one place."
APC is housed in a business incubator run by the Research Park. Endocyte has moved from its incubator site to a shared office building in the Research Park.
Forums, financial assistance offered
to new entrepreneurs
Help - organizational, monetary, practical - is available to Purdue faculty and staff interested in starting a new business venture.
The Office of Technology Commer-cialization, or OTC, will offer the new monthly Entrepreneurs Forum this fall.
OTC also administers the new Pre-Seed Capital Investment Program.
The Purdue Research Foundation also offers two venture capital seed funds and the innovative Gateways Program to help fledgling companies.
A roundup of services offered to entrepreneurs:
Entrepreneur Forums
Monthly Entrepreneurs Forums kick off Sept. 1 with guest speaker Robert Machen, president and chief executive officer of Trylon Corp.
"The lineup of speakers is excellent, says Lisa Kuuttila, assistant vice president for technology commercialization and OTC director. "We are bringing you successful entrepreneurs, investors and others who work with start-ups."
The forums also will provide networking opportunities, giving those who attend the chance to meet other entrepreneurs and learn from shared experiences.
The speaker will give a brief presentation at noon with an open discussion following. Lunch will be provided.
For reservations, contact Courtney Hedge at 49-42610; e-mail cahedge@purdue.edu. Space is limited, so reservations should be made as soon as possible.
The program lineup:
"Lessons Learned in Starting and Running Companies." Robert Machen, president and CEO, Trylon Corp. Sept. 1, Room 322, Stewart Center. Registrations must be received by Aug. 28.
"The PerSeptive Biosystems Story." Fred Regnier, professor of chemistry and founder of PerSeptive Biosystems Inc. Oct. 6, Room 214B, Stewart Center. Reservations are due by Oct. 2.
"Starting Companies Based on University Innovations in Science and Teaching." Teri Willey, vice president, ARCH Development Partners. Nov. 3, Room 310, Stewart Center. The last day to register is Oct. 30.
"Financing University-Based Start-Up Companies With Venture Capital." Lyle Hohnke, general partner, Javelin Capital Fund. Dec. 1, Room 310, Stewart Center. Registrations are due Oct. 30.
Gateways Program
The Purdue Gateways Program provides Purdue Research Park start-ups management assistance, access to financing, and exposure to critical business or technical support services.
The program connects start-up businesses early in their development with mentors. The mentors help them identify market prospects, develop prototypes, launch marketing activities and develop financial resources.
"Our model provides high-tech entrepreneurs with a professional atmosphere to conduct business, but also offers them the expertise, networks and tools they need for success," says Sam Florance, Gateways Program director.
"Because the research park is aligned with Purdue, these fledgling companies benefit from the valuable advice of Purdue faculty and alumni who have distinguished themselves in specific areas."
A task force of accountants, attorneys and bankers also provide a diverse perspective in response to new ventures.
Financial assistance
Through PRF, the University encourages entrepreneurship by offering high-tech business ventures several new avenues of financial assistance.
The new Pre-Seed Capital Investment Program, administered by OTC, will invest up to $250,000 in each faculty-owned company that licenses Purdue technology.
PRF has invested $1 million in each of two venture capital seed funds: CID Equity Partners and Gazelle TechVentures. These funds make no-strings-attached product development funding available to high-tech entrepreneurs.
Also available are federal small business research grants, or SBIR grants.
"Purdue's reputation as a premier research institution hangs like an umbrella over the Research Park, helping its incubator tenants attract small business research grants," says John Schneider, assistant vice president who directs the Office of Industry Research and Technology Programs.
One such incubator tenant, En'Urga Inc., succeeded because of federal small business research grants.
Yudaya Sivathanu, mechanical engineering senior research scientist, formed the business to do some technical consulting on a government project that wasn't research-oriented enough for University participation. To supplement his consulting work, he applied for SBIR grants, and with those funds he soon developed his first spectrometer.
NASA noticed and asked En'Urga to work on a project to measure flame spread in microgravity environments. Since then, En'Urga has developed a wide range of products from that core technology, including a near-infrared fire detector, which was developed jointly with Purdue engineers.
"Choose the applications you know you can develop yourself, and license out the others," Sivathanu advises. "This will provide your company with the time and cash flow needed to focus on a sure thing."
Purdue Research Park through the years
1961
Purdue Research Park founded as a traditional business park north of the West Lafayette Campus.
1993
The current small business incubation complex begins with the Business and Technology Center, a 28,000-square-foot building. Business assistance includes a shared office concept and referrals to University resources and expertise.
1994-98
President Steven Beering establishes policies and procedures related to faculty entrepreneurship.
1998
January - The Gateways Program, a business assistance service, is proposed. In the fall, the Purdue Research Foundation commits to building a second incubator.
The Business and Technology Center is fully leased.
February - Purdue academic leaders get the green light to commercialize. Robert Ringel, executive vice president for academic affairs, holds a training seminar for deans and department heads on entrepreneurship.
August - Ground is broken on a second incubator, the Purdue Technology Center, which has 60,000 square feet.
October - Sam Florance is hired as director of Purdue Gateways Program.
November - Ground is broken on the Innovation Center for tenants that have outgrown the incubator facilities.
1999
May - Construction is complete on the Purdue Technology Center.
June - Hentschel Center, with 12,000 square feet of space, is converted into a third incubator.
November - Construction is complete on Innovation Center, which has 48,000 square feet.
2000
February - Purdue starts venture capital seed fund to provide as much as $250,000 to faculty-owned businesses that license a Purdue technology.
June - Almost all space in the Innovation Center and the Purdue Technology Center is committed to tenants.
Source: Inside Purdue
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