Technology Transfer for Startups and SMBs

Over $2 trillion is invested in research and development globally. Governments are the largest investors in R&D. The United States invests $130 billion in federal funds, annually. Most European countries invest around 2% of GDP but have goals for 3%. Countries like Israel, South Korea, and the United Kingdom aim significantly higher. Concurrently, the EU’s $80 billion Horizon 2020 program is restarting as Horizon Europe aiming to invest over $120 billion between 2021 and 2027.

And why does any of this matter? Governments do not engage in commercial business. They do not take inventions and bring them to market for a profit. In most cases, the research and patents produced become public property. Research is published. Patents are often made available for licensing. It can be exponentially faster to procure a patent license for new technology than engineering a new way to replicate it. Technology Transfer is the catch-all phrase for being able to tap into governmental R&D projects.

Simply stated, Technology Transfer (or T2) is the process of licensing patents for new inventions and innovations to companies able to bring them to market. Many of these patents are created by academics, universities, and inventors on behalf of the government for a specific purpose (defense, communications, healthcare, etc.). However, the invention may have multiple commercial uses that the government cannot exploit.

Technology Transfer makes it possible for the government to license patents to companies able to bring new products to the market. While T2 encompasses all manner of patents like drugs and alternative energy solutions, it includes computer hardware and software, cybersecurity, robotics, AI and blockchain technologies, and more.

If you’d like a more in-depth introduction to Technology Transfer, the European Commission provides a free eLearning T2 course. It’ll provide you a quick orientation on how to protect an invention, exploit it, and bring it to market. The following video by the US Federal Labs Consortium provides a top-level view of the possibilities available in Technology Transfer.

As we covered in Israel’s Top Five Accelerator Programs, Israel is very active and heavily invested in supporting startups. For starters, Israel’s Innovation Authority stands ready to invest in nearly any entrepreneur with a good idea. You won’t find comparable funding startup opportunities anywhere else without a proof of concept, MVP, or demonstration that you already have market traction. T3 ~ Technion Technology Transfer is the branch of Technion, Israel Institute of Technology responsible for technology transfer projects in Israel. Its main website is still under construction, they plan to have a searchable database of technologies available for licensing.

In the UK, technology transfer is better known as knowledge transfer. The UK’s Knowledge Transfer Program links businesses with an academic or research organization and a graduate. Participation in the program requires a financial contribution of about $45k for startups and SME’s. It’s just one of several UK organizations and programs to help businesses grow.

The UK Research and Innovation (UKRI) has a $7.75 billion budget for investing in science and research projects. Under UKRI, there’s also Innovate UK which supports innovations in business via grant funding, loans, or procurements. Additionally, at any given time you can find two-dozen or so Innovation competitions.

Deciphering everything that is available for startups in Europe is a monumental task as most of its 44 countries have startup and technology transfer programs of their own. This warrants a local search while letting us focus on the EU regardless of Brexit meaning it has 27 or 28 member countries or counting its various associate memberships.

The European Union has its own Technology Transfer Program, but of special significance the Horizon 2020 and Horizon Europe programs. Horizon 2020 was a $94 R&D investment program that started in 2014 and concludes in December 2020. Starting in 2021, it is being replaced by the Horizon Europe program which aims to award $120 billion in R&D funds through 2027. While limited to five fairly broad missions, the EU also provides direct and indirect funding for other projects of interest.

The Federal Labs Consortium (FLC) is THE “One Stop Shop” for more R&D resources than you could ever imagine… and yet so few people know about it. It’s part of the National Institute of Standards and Technology (NIST) – and well, it doesn’t have a very large marketing budget. The FLC is probably best described as the gatekeeper or “the Amazon store” of technology projects being worked on by over 300 federal laboratories (each with over 200 engineers/researchers).

• Google-like search utility for technology projects per lab.
• A simple three-step Technology Transfer process and toolkit
• Free T2 online learning course and webinars.
• Collaborative R&D projects with world-class R&D labs.
• Physical access to federal facilities and state-of-the-art equipment.
• Facilitates networking, alliances, conferences, and technical assistance.
• Grants licenses to use government-owned patents and technologies often with favorable terms.

Additionally, the Small Business Administration’s Technology Program Office administers the Small Business Innovation Research (SBIR) Program and the Small Business Technology Transfer (STTR) Program:

“Through these two competitive programs, SBA ensures that the nation’s small, high-tech, innovative businesses are a significant part of the federal government’s research and development efforts. Eleven federal departments participate in the SBIR program; five departments participate in the STTR program awarding $2 billion to small high-tech businesses.”

Programs offered by Israel, the UK, EU, and USA do favor resident businesses, but they are not exclusive programs. They do provide international investment and networking options. Many companies choose to open their HQ office in major tech hub cities while having R&D centers n many countries. Companies like Amazon, Alphabet, Oracle, Samsung, and Ubisoft, to name a few, are increasingly recognizing the value advantage in Outsourcing R&D to Ukraine

Historically, partnering with government programs has been tedious, difficult, and seemingly limited to megacorps. That’s not so much the case today, as governments are eager to help local and international business development. While many companies focus on funding, R&D and technology transfer programs can accelerate your time to market while delaying licensing costs until after you’ve gone to market. It can take up to two full years for a patent application to be fully processed, and even then – there’s no guarantee of receiving a patent. Patent licensing plus the value advantage of Ukraine IT Outsourcing can dramatically extend your funding runway or ramp up to push your product to the market considerably faster.