Issue Date: April 16, 2012
Early in his career as a professor at the University of Pittsburgh, chemical engineer Eric J. Beckman immersed himself in his research on polymers. When he stumbled on a new tissue adhesive in 2002, Beckman saw the promise of a publication. His collaborator, oral surgeon Michael J. Buckley, saw much more than that: He saw the adhesive as a powerful surgical tool. Buckley encouraged Beckman to start a company with him to commercialize the product.
Having no background in business, Beckman was initially skeptical. Nevertheless, the two drafted a business plan. “It was really naive, and I would be embarrassed to show it to anyone now,” Beckman says. “But the business plan forced us to sit down and look at what we would need going forward.” Beckman took a two-year entrepreneurial leave from his faculty position to help launch the company in 2006. Now, Pittsburgh-based Cohera Medical employs 30 people, including four in Europe.
In today’s sluggish job market, entrepreneurship may be one of the best ways to create new jobs—even if it’s just a single job. “What you’re doing is keeping yourself employed,” says Joseph E. Sabol, program chair for the American Chemical Society’s Division of Small Chemical Businesses (SCHB), who has run his own company for the past 12 years. “That’s one less person who’s unemployed.”
In many ways, chemists are well suited to become entrepreneurs because they have passion and they have ideas. But few undergraduate or graduate chemistry programs delve into the business aspects of the chemistry enterprise, so chemists often find themselves ill-prepared to successfully translate their research into a commercial product.
“The good news is that for decades, the chemical industry in the U.S. has been incredibly healthy with lots of good jobs,” Beckman says. “The bad news is that we’ve never put in place the processes by which we teach our people how to start their own businesses.”
Programs in the chemical sciences are beginning to add more business-related courses to their curricula. At the University of Pittsburgh, for example, Beckman has developed a course on product design for chemical engineering students. It began as an elective, but now it’s a required course. “I don’t think we can expect our students to magically become entrepreneurs if we don’t teach them some of the fundamentals, and it starts with product design,” says Beckman, who has resumed his position as a chemical engineering professor at Pitt. “If we’re serious about providing this opportunity for our students, we have to be serious about including it in the curriculum.”
The Alabama Innovation & Mentoring of Entrepreneurs (AIME) Center at the University of Alabama offers a course on new venture development, which brings together students studying business, law, and the sciences. The course gives students from different backgrounds an opportunity to work together on a team, so they can complement each other’s strengths, says Daniel Daly, director of AIME. Each team identifies a promising technology through the university’s Office for Technology Transfer, develops a prototype, and then tests the final product. “That technology now has a much higher probability of being commercialized because it’s not just a piece of paper; it’s a prototype with test results behind it,” Daly says. “My goal is to take the intellectual property of the University of Alabama and get it into a start-up company.” The center offers other resources such as workshops on business plan writing and opportunities for students to interact with investors.
Whitney Hough, who earned a Ph.D. in chemistry from the University of Alabama in 2010 and is currently a second-year M.B.A. student there, says the courses she took through AIME made her realize how many factors are involved in producing a successful business. “Having a great product is just one small part of the equation,” she says.
Last year, Hough founded a local tutoring company to help undergraduate students at the University of Alabama improve their test scores. Her company is profitable, and she recently rented additional space for tutoring. Hough, who hopes to launch her own cosmetics company one day, knows that she first needs to gain more experience by working for a small company after she graduates.
Beckman concurs. “What I would recommend to any fresh Ph.D. is that, if you want to become an entrepreneur, go work for a small company and learn how it works,” he says. “What you get by working for a small company is an understanding of how a new business is created, how it’s financed, and how it’s run. It’s almost like an internship for being an entrepreneur.”
Chemist Andrew K. Boal took this route by joining MIOX, a small firm in Albuquerque, N.M., specializing in water treatment technologies, in 2008. “I’ve done everything from making sales calls to doing a presentation of our technology directly to a customer to doing trade shows where I talk to potential customers about the technology,” he says. These experiences were eye-opening. “There are so many things that go into developing a successful technology beyond just whether or not your chemistry works that simply hadn’t crossed my mind,” he says.
Boal was previously a senior member of the technical staff and a postdoc at Sandia National Laboratories. “I didn’t really understand, before I came to MIOX, how a technology or a science or a discovery transitions from the laboratory to a product,” he says. “I can definitely say that I’ve gotten a better grip on some of the things it takes to be successful in the business world.”
What’s more, his entire perspective on R&D has changed. “When you’re doing R&D as an academic, you’re thinking about what’s the coolest thing you could possibly do,” he says. “In the business world, you have to ask the question, ‘What can I do that gives the most value to somebody overall?’ ”
Small companies aren’t the only option for scientists with an entrepreneurial bent who want to gain business skills. These researchers can become “intrapreneurs” within a larger organization. “For the people in big companies who are a little restless, take the opportunity to move around in the company and learn different things. If there’s a business assignment,” take it, says Michael D. McCreary, deputy chief technology officer at E Ink, a Cambridge, Mass., company that produces electronic paper displays.
That’s what McCreary did while he was working in Eastman Kodak’s microelectronics technology division in the 1980s. When his then-manager, Rajinder P. Khosla, approached him about starting up a sales group for the division, McCreary’s initial reaction was, “You’ve got to be kidding. I’m a scientist, what do I know about business?”
But he took up the challenge and began soliciting marketing and sales advice from his business colleagues. He teamed up with public relations companies on ad campaigns, and worked with Kodak’s corporate lawyers on joint development agreements and negotiations with large companies. McCreary expanded the business and hired sales representatives in France, Israel, Japan, and the Netherlands. “I built up a worldwide business within this large company,” he says. “Having the opportunity to see what was going on not just inside of a company but around the world was very exciting.”
McCreary’s combination of technical expertise and business acumen has served him well. In 2000, E Ink recruited McCreary to join the company as vice president of research and development. He took the initiative to expand the company’s research by acquiring funding from major corporations such as Samsung, Epson, and Sony. “Because I had the marketing and sales background at a big company, and because I’d worked with lawyers at a big company doing joint development agreements, I got approval to do this,” he says.
Looking back, McCreary says he’s glad he took a risk early in his career. “There are different inflection points in a career where you have the opportunity to just be comfortable and keep doing the same thing or take a chance and make a bigger jump,” he says. “I’m really glad I made the jump. I think it’s really enriched my life.”
For many entrepreneurs, the rewards are worth the risk. “When I went on entrepreneurial leave, my research program suffered a lot,” says Pitt’s Beckman. “On the other hand, I think I’m a different scientist now. I’m not content to have the end simply be a publication. I want my research to serve a purpose. I want it to impact quality of life in a positive way.”
But being an entrepreneur doesn’t mean that you have to be the chief executive officer of a company. “One of the smartest things I did was realize that I’m not a CEO, I’m a molecule person,” says Beckman, who holds the titles of cofounder and senior scientist at Cohera Medical. But he says that assembling a team with the right mix of talent is critical. He hired a CEO, who helped the company secure a $100,000 grant to demonstrate proof-of-concept on an early version of the medical adhesive product. “Having an energetic CEO and that early work allowed us to raise $7 million from angel investors,” he says. “Once we had $7 million, we could move the company forward.” To date, Cohera has raised more than $50 million, and its first product, TissuGlu, is on sale in Europe and being tested in the U.S.
Numerous resources exist to help start-up companies and small businesses gain traction. For example, ACS’s SCHB division brings small chemical business owners together to network and share ideas, and it highlights the experiences of small businesses in its ACS national meeting programming. At each national meeting, SCHB schedules its flagship symposium “True Stories of Success from Chemical Entrepreneurs.” The division also hosted “Issues in Intellectual Property Affecting Small Businesses” and “Small Business Spin-Offs into the Commercial Sector” at the fall 2011 ACS national meeting in Denver and “Health Care Reform and the Impact on Chemists and the Chemical Community” and “Chemistry Education: The Case for Business Skills” (with the Division of Professional Relations) at the spring 2012 ACS national meeting in San Diego. The division has a full program planned for the fall 2012 ACS national meeting in Philadelphia and at five regional ACS meetings this year.
ACS as a whole is recognizing the need to help entrepreneurs better prepare themselves in the business world. The society issued the report “Innovation, Chemistry, and Jobs: Meeting the Challenges of Tomorrow” and is creating a virtual marketplace that will provide entrepreneurs with access to the resources they need to create business plans, obtain patents, access capital, and more (C&EN, Nov. 7, 2011, page 47).
ACS Webinars offers a series of webinars on becoming a chemical entrepreneur. Past webinars, which are archived at acswebinars.org, have included “Writing a Winning Executive Summary and Business Plan” and “The ‘Art’ in Startups: Getting Funded.”
The National Science Foundation is encouraging scientists to explore the commercial viability of their NSF-supported research through the NSF Innovation Corps, or I-Corps, funding program. Teams of researchers receive guidance and specially designed training from experts on technology transfer, in addition to $50,000 to begin assessing the commercial readiness of their technology. The first class of awardees was announced in October (C&EN, Oct. 17, 2011, page 42). The government also awards grants through its Small Business Innovation Research program, accessible at SBIR.gov, which encourages small businesses in the U.S. to engage in research that has the potential for commercialization.
Ultimately, the hope is that these investments will also pay off in creating more jobs for chemists. For Beckman, that’s been his greatest source of pride. “I like the notion that thanks to something I did in the lab a long time ago, there are 30 people with jobs,” he says.
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