Incorporate or perish!
Universities are now pushing professors to commercialize their research as the number of university inspired startups have risen 16% in 2013 from an increase of 5% in 2012 over 2011, according to the Wall Street Journal.
Called “spinouts,” fewer than 20% of these firms have received venture capital funding although about 18% have found angels. Thus, the universities are now starting their own funds to help with the University of California to pony up to $250 million. Others find alternative sources of funds including grants and even crowdfunding.
The schools like these new businesses, as they create a new revenue stream from the licensing of the technology and typically provide an equity interest of between 5 to 10%.