Every year, Microsoft hosts the Imagine Cup, one of the world’s most influential student software development competitions. The company pits developer teams from around the world against each other in a Disrupt Battlefield-like pitch competition, and the winners get substantial awards. Until last year, that was the end of it for the student developer teams, but Microsoft now also provides a number of Imagine Cup Grants to some of the companies in the program that have the potential to become large “social enterprises or nonprofits that will address a specific social issue.”

This year, the company has chosen five teams that will get a share of its three-year, $3 million competitive grant program. If you followed along with this year’s Imagine Cup finals in Australia, chances are the winners don’t come as a surprise to you.

Germany’s Team Graphmasters won the grand prize of $100,000 for its “solution called nunav that reduces vehicle carbon emissions through an innovative navigation system” (we covered their pitch in more detail here when the team still used the name Greenway). Australia’s Team StethoCloud got the second-place grant of $75,000 for its cloud-powered, mobile-hybrid stethoscope for the early detection of pneumonia.

Microsoft also awarded $50,000 grants to Team Vivid from Egypt for its app for accessing medical records in the cloud; to Team Cipher256 from Uganda for its mobile app and listening device to analyze fetal hear rates; and Team QuadSquad – the winners of this year’s Imagine Cup software development competition – for their gloves that can translate sign language-to-speech.

In addition to the grants, Microsoft will provide software, cloud computing services and access to its network of investors, nongovernmental organizations and business partners.

“The Imagine Cup Grants will help students evolve a great idea for addressing a societal issue into a real-world business,” said Dan’l Lewin, Microsoft’s corporate vice president of Strategic and Emerging Business Development, in a canned statement today. “These students have developed incredible approaches that show great potential for positive local impact. We are excited to offer financial and other support to help them transform these ideas into businesses with real-world impact.”

Article courtesy of TechCrunch

Editor’s note: Laura A. Schoppe is the president and founder of Fuentek, LLC, a consulting firm that provides intellectual property and technology transfer services. 

On May 22nd, Sens. Moran and Warner were joined by Sens. Rubio and Coons in introducing Startup Act 2.0, a revised version of legislation proposed last December that contained questionable provisions to allow university professors to choose their own agents to help transfer their technology rather than be tied to their home university’s technology transfer office (TTO)—the so-called free agency provision.

I dug into the new legislation, comparing it to the original wording, to figure out exactly what’s changed (besides the fact that the accelerated commercialization of research provisions are now part of Section 8 rather than 7). Here’s what I figured out.

This legislation is not much better than the original version when it comes to the free agency issue in managing university intellectual property (IP). All of my previously stated concerns (as well as those stated by AUTM®) about the practicality of giving individual innovators authority to commercialize their own technologies still holds.

But let’s look at the specifics in the bill.

The Grant Program in General

• What it says: Per Section 8(b)(1) on page 25, funding will come from taking $150K for every $100M in R&D funding from all government agencies and giving it to the U.S. Dept. of Commerce’s Advisory Council on Innovation and Entrepreneurship for awarding two types of grants: Capacity Building Grants and Accelerator Grants.
• What it means: Less funding is available for the actual work of developing innovative technologies. There also is no indication of how this funding will be split between the two types of grants.
• My thoughts: R&D funding is already on the decline, and this funding structure will further erode that critical situation. Furthermore, the legislation should state how much is to be allocated to Capacity Building Grants versus Accelerator Grants. Not only is this needed for transparency, but it also would make clear Congress’s intent for supporting technology transfer initiatives, because there are key differences in these two grants, as you will see below.

Capacity Building Grants vs. Accelerator Grants

• What it says: The stated goal of the Capacity Building Grants (Section 8(b)(2)(B) on page 27) is to accelerate commercialization through licensing and startups and, in particular, “to support innovative approaches to achieving these goals that can be replicated by other institutions.” There is no goal stated for the Accelerator Grants; rather, it states only that it will “allow faculty to directly commercialize research” (Section 8(b)(2)(B) on page 28).
• What it means: The Accelerator Grants appear to be in conflict with the Capacity Building Grants because, by basing their construct on individual innovators (i.e., their personal skills and desires), it’s impossible to develop best practices and a repeatable, sustainable structure.
• My thoughts: The Accelerator Grants will be one-off successes (or failures) where the return on investment to our society as a whole cannot be fully realized, even if a few of the grantees do achieve some economic success. (Not only will the investment be far greater than the payback, but the success can’t be leveraged by or replicated at other institutions or in related situations.) Furthermore, the implementation appears not to have been thought through. For example, let’s look at…

Awarding of Grants

• What it says: Per Section 8(b)(2)(A)(i) on page 25, the two types of grants shall be awarded “to institutions of higher education.”
• What it means: Well, I’m not sure, because I can’t figure out how the Accelerator Grants are to be implemented by the innovator if funding has to be awarded to the institution. Is the intent that the institution (e.g., its TTO) actually receives and controls the funds and is responsible for the implementation of singular projects, much like a seed fund? If this is the case, then it is erroneous (or perhaps disingenuous) to state that the Accelerator Grant allows “faculty to directly commercialize research” since they in fact are not directly responsible or have the authority to do the commercialization project.
• My thoughts: This legislation should be changed so that either (a) Section 8(b)(2)(A)(i) is clarified to include the ability for individual innovators to submit and receive grants or (b) Section 8(b)(2)(B) is modified to more accurately describe a seed-type program. (BTW, I have no objections to a seed-type program, but I think the funding levels should be substantially lower than those of the Capacity Building Grants.)

At the end of Section 8 (on page 32), the bill explicitly states that nothing in the section changes the Bayh-Dole Act, which specifically authorizes the institution to hold the IP rights and therefore control the decisions on commercialization. This control also includes an institution’s ability to “release” the technology to the innovators to allow them to expend their own resources (time and money) to patent, license, and otherwise commercialize the technology.

It’s kinda funny that this aspect of how TTOs can release the IP to the innovator is equivalent to the desires of Kauffman’s free agency concept but provides clarity on authority and responsibility.

Well, I guess you’d need a pretty dark sense of humor to find that funny.

Article courtesy of TechCrunch

Etsy, the popular marketplace for all things handmade, just announced that it will not just be hosting the 2012 session of Hacker School at its headquarters in New York, but that it will also offer ten $5,000 grants to women who would like to attend this year’s session but don’t have the financial means to do so. As Etsy’s VP of engineering Marc Hedlund notes, the idea here is to ensure that about 50% of the next Hacker School class of about 40 participants will be female.

Hacker School is one of the many recently launched programs that aim to teach budding programmers to become better hackers. It’s a three-month, full-time program based in New York. The application deadline for this year’s summer session is May 7 and the program will run from June 4 to August 25. Hacker School itself is a free program and those who get the Etsy grants “can spend the money on whatever expenses necessary to free you up for Hacker School, no questions asked.”

Hacker School co-founder Nick Bergson-Shilcock also notes that the female applicants will be judged on the same scale as men. “It frustrates us a little that we feel the need to say that,” writes Bergson-Shilcock, “and we think it underlines the sexism (intentional and not) that so pervades the programming world.”

Etsy’s Marc Hedlund acknowledges that “20 is a small number,” but that he himself has only hired about 20 female engineers in the past 17 years. He also notes that he would be more than happy to hire any of the female engineers from this next batch of participants, “but more importantly, we just want to see these women go on to get fun, creative, lucrative jobs in technology — and hopefully tell other women about the great experiences they’ve had.” At Etsy, a site that has given many female entrepreneurs a chance to start their own businesses, eleven women currently work in Engineering and Operations. That’s up from just three last September. Etsy has about 100 employees in Engineering and Operations.

Article courtesy of TechCrunch

Entrepreneurs and small businesses are integral to the engine of job creation. According to the White House, companies less than five years old created 44 million jobs over the last three decades in the U.S. and what’s more, accounted for all net new jobs created over that time. In a struggling economy, the incubators and accelerators that help grow startups and SMBs, giving them access to the network and capital they need to grow, are essential to job creation and building a healthy economy.

Accelerators have been popping up around the U.S. (and the world) in the past year, and the big incubation houses (like TechStars, Y Combinator, 500 Startups, etc.) continue to grow. Yet, these generators can (and should) have the most influence not in big cities/markets like New York, San Francisco, and Boston, but in places where unemployment is high and economies are stagnating.

Cities like Detroit are depressed, but they are doing everything they can to encourage innovation and fuel business development. Another is St. Louis. St. Louis has a rich big-company history, and has at various times been home to the headquarters of a slew of Fortune 500 companies. Anheuser-Busch still makes its home there. Yet, while headquarters may live there, the production likely happens elsewhere.

The city wants to fight stalling unemployment by building an innovation-focused ecosystem, which is why Arch Grants was born and launched last month. Arch Grants is a non-profit organization led and supported by a band of lawyers, investors, real estate managers, entrepreneurs, civic leaders, and more, that wants to create a more robust startup culture and infrastructure in St. Louis. The company wants to turn the city into a place where entrepreneurs want to go to grow their businesses.

Arch is starting with a business plan competition that selects the most promising startups, giving them $50K in grants to turn their ideas into reality. Typically, accelerators offering venture capital take equity stakes in the startups they choose, but Arch Grants offers non-dilutive capital — they are, as one would expect, grants and therefore don’t require founders to cough up any equity in exchange for the capital.

After receiving the initial $50K grant, startups then go on to compete for a second round of up to $100K in funding, along with access to angel investors. Arch Grants President Jerry Schlichter, a trial lawyer, says that the program will be selecting at least 12 companies per year, and plans to run the program for at least three years.

Generally speaking, it’s tough for non-profit organizations that dish out growth capital to for-profit companies to receive approval from the government, but the IRS makes exceptions in areas of high unemployment, and Schlichter says that they were surprised by how quickly Arch Grants was able to be approved.

To that point, Arch Grants isn’t a business accelerator, but they want to, for all intents and purposes, operate like one — or at least create the same opportunities for their startups. The organization has tapped five local universities, business mentoring organizations, experts, investors, and a host of other support organizations to offer resources and assistance to its founders.

Its affiliates can also hook up startups with affordable apartments and office space, business networking and mentoring, free legal and accounting services, and collaboration with local universities, etc.

While Arch Grants has a model that may be slightly unusual for startups and entrepreneurs used to the Y Combinator approach, Schlichter and others believe that the real hook for entrepreneurs can be that they would be part of something broader than their own goals, helping to put a city back to work. “These startups are going to get a deep level of support here, because this is something that is really important to the entire city,” he says, “because it has greater implications and importance than it does for Silicon Valley.”

To assist it in its endeavors, Arch Grants today announced that it has secured a $150K donation from Peabody Energy (the largest private-sector coal company in the world). This donation brings the organization’s total funding to $2.5 million, which has been contributed by a mix of individual and corporate donors.

Another feather in the cap for Arch Grants? It’s also officially announcing today that Square Co-founder Jim McKelvey (who along with co-founder Jack Dorsey is a St. Louis native) will head the organization’s advisory board. This means that, among other things, McKelvey will help lead strategy for the business plan competition and selection of grant recipients as well as advising the selected startups and founders.

Again, while tech companies will be the program’s focus, all entrepreneurs are encouraged to apply. Arch Grants is currently accepting applications through its proposed deadline of March 9th. Those interested in applying can do so here.

And young entrepreneurs looking for another cool pitch competition and resource/hub for entrepreneurs, should check out Intel Innovators. More here.

Article courtesy of TechCrunch

Energy storage system producer 24M Technologies spun out of lithium-ion battery maker A123 Systems today to become a separate venture.

The company raised a $10 million Series A funding round from Charles River Ventures and North Bridge Venture Partners.

The company raised an additional $6 million in a grant from the Department of Energy‘s Advanced Research Projects Agency – Energy (ARPA-E). The funding will help 24M develop batteries that can store more energy for a lower price.

24M’s technology, created in collaboration with A123 and MIT, combines the best of rechargeable batteries, fuel cells and flow batteries to create new energy storage systems. Specifically, the company wants to create batteries that improve on the energy storage capabilities of lithium ion batteries. 24M especially wants to target the transportation and electric grid industries, with the hope of creating more affordable and effective electric car batteries, some of which currently cost upwards of $10,000.

A123 will continue its involvement in the venture by helping with product development and commercialization. A123 will also receive a seat on 24M’s board of directors and an equity stake in the company.

The $6 million grant 24M received comes from the Department of Energy and its APRA-E program. It is intended to help 24M commercialize its products in collaboration with Rutgers and MIT.

Article courtesy of TechCrunch