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In 1980, the passage of the Bayh-Dole Act revolutionized the commercialization of government-funded technological developments. Prior to the Act, the government retained title to inventions developed under government funding. This resulted in cumbersome licensing and minimal commercialization of inventions. The Bayh-Dole Act transferred title to the universities and institutions performing the research. This ownership and the ability to grant exclusive licenses facilitated licensing and development of technologies in conjunction with the private industry. Particularly, this Act has been instrumental as America’s economy has evolved from a manufacturing-based economy to a knowledge-based economy.
However, the ability of universities to obtain traditional sources of research funding is becoming harder and harder each day. With ownership of their technologies, universities created technology transfer offices designed to identify research that has potential commercial interest and strategies for how to exploit it. In order to fulfill their mission, offices are now seeking non-traditional funding sources with which to support scientific research at their universities. An up and coming source of funding is crowdfunding. Perhaps you’ve heard of Kickstarter, a crowdfunding platform for creative projects. The Kickstarter website exhibits independent projects, complete with videos, pictures, and ideas. After an individual launches a project, the community gets to pledge money towards the project. If the pledge amount is met, all those who pledged are charged. This platform creates less risk for everyone, it motivates people to support and spread the work, and it works.
Universities now have jumped on this creative platform, although it’s not quite clear how crowd funding and science will match up. The University of Rochester has two biomedical devices that will soon come to market thanks to crowdfunding. One device benefits children with autism and the other will benefit those individuals who have lost the use of one or more of their limbs. The devices are being funded through Innovocracy, a crowdfunding platform with a twist. Crowdfunding works on the premise that small donations can add up to big results. This scheme applies to science differently than other projects. When it comes to university research, there is the typical bureaucracy that creates barriers when it comes to things like tax deductibility and intellectual property rights. Innovocracy aims to fill the gaps of early-stage capital, as venture capital firms focus on later stage investing. This timing prevents the risk of inventors disclosing pertinent information related to an invention before a university has had the ability to file a patent application. This is particularly important given the changing underlying policy of patent law in the United States from a first-to-invent system to a first-inventor-to-file system.
Unlike supporting foundations aimed at general research for certain disease, crowdfunding allows members of the community to support specific projects in a very transparent and accessible way. It allows passionate supporters, oftentimes those close to someone suffering a certain disease or need, to connect with passionate innovators who simply need a small amount of funding. It seems to me that crowdfunding university research can revolutionize the way research is funded and carried out. In conjuction with university technology transfer offices, crowdfunding platforms can provide funds for small projects and diversify a university’s portfolio.
– Sonal Patel
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