This is the “View from the Valley” update, from Joelle Faulkner. I am an engineer/lawyer/business person who has spent time developing medical devices at Stanford in the Silicon Valley/MedTech Mecca. Today’s post is the result of conversations with you; specifically, a reader: a PhD student in Ottawa.
It’s a question on commercializing technology. About location (where to actually start the company) . My answer is: try to start wherever you have the network, but after that, stop being so lovely (and Canadian) and go where you need to build to the vision. Below I detail the question and my answer.
I would love to have more questions for next time, so email and comment away! Also, I imagine that many of you will have comments that will be valuable and insightful, so please comment away. Good luck to the respondents and let me know how we can help you further!
QUESTION: I am looking to do early stage development; should I follow the American trail of money and expertise?
JAF Answer: Consider being wherever you can get support, and potentially non-dilutive funding. While you’re doing that, make sure to sort out IP ownership.
With a promising optical biosensor technology in Ottawa, there are companies that are looking to “commercialize” the technology, but should the PhD candidate look to develop it in Canada, or hightail it to the US and work from there, where experience is more plentiful?
My answer rests on a foundation of three assumptions:
Let’s address the last point first.
Right now you should get money from wherever you can – especially early money. I have heard mixed stories about that in Ontario. One newly Toronto, previously Bay Area resident, reported that the money is plentiful if you have a good plan; other experts in Toronto believe that the Canadian funding is very discovery focused and complain that there isn’t a Canadian equivalent of SBIR, which helps fund commercialization (but notably requires an American to own 51% of the company). If you can get money, especially non-dilutive (meaning they don’t take ownership) — take it. That means look in Canada, look in the US and look to people who have enough to fund you. When you are looking in the US, though, find a way to get a “warm introduction” to anyone who can help. If you don’t know why a warm intro is necessary, as opposed to a cold call, read Guy Kawasaki’s book “Reality Check” or “The Art of Start”.
Eventually you may have to look to the US venture capital firms, often in Boston, MA (Route 128) or in the Bay Area of CA (Sandhill Road). Until then…
Moving will involve lag time and resources are important. This part of the answer is the part where I say just how many people are going to be required to get your project from beginning to middle: tons! The energy required and diligence required and modeling and testing and everything else will take more people and time than you will guess. While it is important to have the right people it is actually pretty important to have willing people and those are likely people that you already know. So, my big argument for starting out exactly where you are now, is that you can recruit advice and help from people that are local, that you know or can meet. Note, though, that I said “starting out”. Like money, you can make an effort to develop connections with and assistance from US counterparts and if it turns out that your project’s support network develops in the US then you may want to consider a move.
Now — more questions? Please send them to me! In addition to providing answers I will try, where I can, to help provide the connections to others I know.
All my best,