One idea is a new optical filter for use in commercial printing, medical imaging or with a smartphone to precisely identify colors and ensure consistent pigment reproduction.
Another is software that analyzes video recordings of robotic surgeries at hospitals, using this data to evaluate the surgeons’ performance.
A third is a computer-based method to help manage irritable bowel syndrome and other painful, chronic diseases.
Area scientists are pursuing these and similar ideas in their laboratories every day, winning grants to support their research and publishing the results in academic journals.
What they aren’t doing, to any significant degree, is taking those innovations from the lab bench to the consumer – because it’s difficult to raise enough money from investors to launch a startup company.
Experts say this region doesn’t have a lot of venture capital to draw from, and even downstate’s deep-pocketed investors send most of their money to California, Massachusetts or elsewhere out of state.
“That’s another huge problem, particularly in the upstate region,” said Judy Albers, a managing partner with Neworks,the organization putting on a three-day workshop at the Buffalo Niagara Medical Campus.
The workshop is an attempt to help scientists here translate their ideas into pitches for prospective investors.
Researchers behind 10 innovations – including the three above – made practice presentations Thursday to a panel of industry experts who asked tough questions and assessed whether they have business potential.
“This gives you a venue where you can start thinking about – if you have a technology, if you have some breakthrough – what’s the market value? Can we actually do something that’s useful and create jobs and have an impact that’s well beyond the research?” said Alexander N. Cartwright, the University at Buffalo’s vice president for research and economic development and a professor of electrical engineering who presented the optical filter.
This is the sixth Pre-Seed Workshop held in Buffalo. Researchers have aired more than 350 business ideas at the 60 total workshops, most held in New York, and 45 percent have become companies, Albers said.
The workshops offer intensive guidance to scientists who are adept at cutting-edge research but lack experience as entrepreneurs. “All they have is a raw technology,” Albers said.
Buffalo Niagara has made gains in promoting the life sciences and advanced manufacturing, but still lags in some areas. For example, looking at the rate at which our scientists earn patents, a key indicator of innovation, the region’s rate of 0.46 patents per 1,000 workers ranks 61st among U.S. metro areas, well below Rochester’s 2.32 (No. 6), Albany’s 1.91 (No. 9) and Syracuse’s 0.84 (No. 32), according to a recent report by the Brookings Institution.
And there isn’t enough investment money available to build a company out of the best ideas, experts say.
New York State as a whole only attracts 4 percent of the country’s venture capital, while California attracts 47 percent of the total, the governor’s office reported last month in announcing a competition meant to help attract venture capital to the state.
The limited access to capital puts more pressure on entrepreneurial-minded scientists to make a good impression on potential investors.
“The entry into the marketplace is going to be very challenging,” said Venkat N. Krovi, associate professor of mechanical engineering and applied mechanics at UB, who presented the robotic-surgery software.
The researchers, who weren’t in their natural element in making their presentations Thursday, did their best to describe their business model, revenue stream, customer base and market size.
For example, Cartwright talked about the “Color Cipher.”
The scientists have filed a patent, they are licensing the technology from UB and are working with Mutoh, a manufacturer of top-end printers.
The researchers expect to begin making the filters at a cost of $35 each and sell the filters to Mutoh for $300 each, a lower price than the $500 to $600 the company now pays to install a filter in its printers. Mutoh sells 20,000 of these printers a year, meaning the UB scientists’ company could earn $6 million per year from this one partnership.
The Color Cipher team hopes to translate the same filter technology for use as a smartphone attachment – imagine taking a picture of the paint on your wall and getting back a code with information on its precise color, Cartwright said – and the technology could some day be used in low-cost medical imaging.
Cartwright and the panelists discussed the pros and cons of making the filters in-house, versus contracting the manufacturing. Fred Davies, managing director of the Niagara Angel Network in Ontario, wondered about the “huge dichotomy” between making a filter for a copier compared to one for the medical field.
Another presenter, Jeffrey M. Lackner, an associate professor of medicine at UB, discussed his team’s Digiteque, which is meant to help people who live with a chronic disease such as irritable bowel syndrome to manage their symptoms.
It is a computer-assisted program of behavioral exercises that have shown promise as a therapy, particularly when compared to the drugs used to treat IBS, though further testing is required, Lackner said.
He estimated the cost of developing the software and renting enough server space to support the program to come out to about $2 per patient, while the revenue is estimated at $80 per patient, with up to $120 million in company revenue by their fifth year in business.
“Who are you selling to?” asked panelist Steve Nicosia, general manager with Emphasys Software.
Lackner brought up his team’s strategic partnership with Tadeka Pharmaceuticals, which licenses the IBS drug Amitiza, and their hope that doctors will prescribe Digiteque to patients as part of a Tadeka “suite” of treatment.
As for Krovi’s software to improve outcomes of robotic surgeries, the panelists wondered who needs this service and how well doctors will respond to it.
“The market’s very small,” said Teo Balbach, a principal with Mercury Capital Partners.
Krovi said more and more surgeries will be performed via robotics in the future, and the Action-Lytics technology also can be applied to data-driven analysis of golf swings and dance techniques.