Tony Armstrong recognizes the importance of forging alliances.
It’s a core part of his job as the president and CEO of Indiana University’s Research and Technology Corporation—the university’s tech transfer arm—and as the assistant vice president in the Office of the Vice President for Engagement. Armstrong says partnerships are especially key to advancing innovation and entrepreneurship in a state like Indiana, where the pools of talent and capital are smaller and more spread out than in coastal hubs of tech and life sciences activity.
“With partnerships I think, throughout the state, we’re trying to leverage what we have and raise the tide of all ships,” says Armstrong, who is also an Xconomist. “We need each other in some ways. We’re complementary.”
Case in point: Indiana University has the only medical school in the state, but its flagship Bloomington campus doesn’t have an engineering school. (An engineering program will launch there this fall, Armstrong says.) That’s probably a driver of partnerships such as an outpost of IU’s medical school on Notre Dame’s campus; anengineering school run by Purdue University on the campus of Indiana University-Purdue University Indianapolis (IUPUI); and a graduate certificate program in biomedical entrepreneurship formed through a partnership between Purdue’s schools of management and biomedical engineering and Indiana’s school of medicine.
Now, as Indiana University (IU) searches for new and varied ways of nurturing high-tech research and entrepreneurship across its eight campuses, it’s seeking partners not just within the state, but also beyond its borders.
Armstrong says university leaders are considering creating an alumni-backed venture fund that would support startups emerging from IU.
The details are still being worked out, but Armstrong says the idea would be for Hoosier alumni around the world to make tax-deductible donations to the fund. That money would then be used to fund market research and other activities to get university startups off the ground, and perhaps also to make early investments in the form of grants, he says. (Equity investments are another possibility, Armstrong says, but it sounds like that would be down the road.)
The fund would also have a mentorship and consulting component. For example, an alum with cybersecurity expertise might help vet an idea for a security startup, make business connections for the founders, and so on.
“I think we need to get more input from outside our ecosystem to help guide what we’re doing,” Armstrong says. He wants the relationship with the fund’s backers to be more than “a contribution and we send you a brochure once a year. It would be hopefully, for us, a way to engage with alums.”
Alumni have shown some interest in the idea during early conversations, and those talks will continue, Armstrong says. The concept has also received good feedback from the boards of the IU Foundation and IU’s Research and Technology Corporation, he says.
The goal is to formalize the plan for the fund and start making donation requests this year, Armstrong says. “We’re trying to refine what it’ll look like,” he adds.
The discussions around IU’s alumni fund come as Purdue University is raising money from private donors for a new $10 million startup fund.
IU also runs the Innovate Indiana Fund, a $10 million vehicle launched in late 2009 to make equity investments in companies with ties to the university. Armstrong says the fund was primarily backed by the university’s return on its stake in Angel Learning, an education technology spinout acquired by Blackboard in 2009 for about $95 million.
The venture capital funds are part of a broader effort at IU to spur business innovation and entrepreneurship. Other initiatives in recent years include forming the SpinUp IUprogram, which helps university researchers (primarily in the life sciences) commercialize their discoveries.
IU has had a mixed track record of producing startups in recent years (see table above). It’s something Armstrong says the university is trying to improve, but he emphasizes that creating companies isn’t the only goal. He points to a research initiative between IU and business and community partners that is focused on precision medicine—the first program to receive funding from the university’s $300 million “Grand Challenges Program.” Grand Challenges will involve hiring up to 175 new faculty members and hundreds of graduate students and postdoctoral fellows over the next several years. IU calls it the most ambitious research program in the university’s nearly 200-year history.
“I think it’s those kinds of things—marshaling resources and focusing on a specific challenge in the world and [seeing] what we can do to help solve that or make a dent in it,” Armstrong says. “We’ll still do startups. But there may be a more holistic way of going about having an impact.”