A growing gap in the transition of inventions from research labs to market is slowing the development and scale-up of new hardware technologies in the United States. This is particularly evident in complex microelectronics advancements, in which U.S. leadership has lagged. A workshop on semiconductor technology translation and hard-tech startups recently gathered stakeholders from across the country to analyze this challenge and propose solutions.
Presented jointly last month by MIT, the State University of New York (SUNY), and Rensselaer Polytechnic Institute (RPI), the virtual event brought together academic researchers, members of industry, venture capital firms, state and federal agencies, nonprofit organizations, venture accelerators, and startups for a wide-ranging conversation on how to recapture U.S. leadership.
In his opening remarks, MIT Provost Martin Schmidt challenged the speakers and attendees to seize the moment. “We need to think boldly, act decisively, be prepared to reinvent our practices, and not be encumbered by old models of engagement,” said Schmidt, who will assume the presidency of RPI in July. “This workshop will tackle one area that is ripe for work, and that is the process by which we bring the work of academia to have impact through commercialization.”
An audience of 632 individuals joined the 30 invited speakers for a discussion across four sessions: innovation ecosystems, stakeholder perspectives, preparing proto-companies and startups, and startup experiences and shared facilities.“It takes a village to grow a fledgling idea into a prototype that can then become a product that will hopefully reach millions,” said Vladimir Bulović, the Fariborz Maseeh Professor in Emerging Technology, faculty director of MIT.nano, and workshop co-organizer. “Starting and sustaining more hard-tech startups will generate more technology and more new jobs, which will benefit the established industry partners, nurture new industries, and lead to the resurgence of U.S. leadership in microelectronics.”
An environment built for success
What contributes to a thriving innovation ecosystem — and how do we create one for hard-tech? Fiona Murray, the William Porter (1967) Professor of Entrepreneurship and associate dean of innovation and inclusion at the MIT Sloan School of Management, suggested three main characteristics: strategic focus, a system of key resources for founders such as human talent and funding, and stakeholder connectivity — a community purposely built around the priority areas.
This concept of connectivity echoed throughout the workshop. “Proximity promotes connectivity promotes collaboration,” said Bob Metcalfe, professor emeritus of innovation and entrepreneurship at the University of Texas at Austin. Metcalfe noted seven “species” all needed for a thriving startup ecosystem: funding agencies, research professors, graduating students, scaling entrepreneurs, venture capitalists, strategic partners, and early adopters.
To explore the perspectives of these many stakeholders, the workshop featured talks by experts in different roles from different geographical locations. Speaking from the view of industry and venture capital, Senior Vice President and Chief Technology Officer of Applied Materials Omkaram Nalamasu, Intel Capital Managing Director Sean Doyle, and In-Q-Tel Managing Director Eileen Tanghal offered advice on what they look for when investing in hard tech. Common topics included proof of concept, shared-development facilities for both cost and efficiency, access to talent, and ability to engage customers.
“Hard-tech startups have this very wide valley of death. They have a lot of challenges when it comes to finding the right people, getting money, and getting partnerships.” said Tanghal, describing hurdles for startups such as an aging workforce in the semiconductor sector, supply chain issues, and difficulties in finding a first customer.
From university to commercialization
Expanding the talent pool has its own obstacles. Julie Lenzer, the chief innovation officer at the Advanced Regenerative Manufacturing Institute, discussed challenges facing universities in supporting hard tech — the slow speed of academia, an aversion to risk, intellectual property (IP) ownership, mission misalignment when entrepreneurial activity by faculty or students is not celebrated by the institution, and the problem that universities don’t produce ready-for-market products.
“Oftentimes, when we come out of the lab, it’s very low-and-slow technology readiness levels; it’s very early tech,” said Lenzer, formerly the chief innovation officer at University of Maryland. “That presents a high-technical risk — is this going to work? We don’t know yet, but it’s going to take a lot of capital to get there. Is the market ready for it? Is it better enough for someone to disrupt the way they’ve been doing things? It’s not just about the technology, it’s about the market opportunity.”
To help prepare hard-tech startups, support systems are needed. Greentown Labs Senior Director of Membership Jason Ethier, Activate Executive Managing Director Aimee Rose, and Howard University College of Engineering and Architecture Director of Innovation Grant Warner explored best practices for preparing founders, stressing the importance of articulating a business hypothesis, understanding the market need, and being open-minded and coachable.
The startup perspective
The workshop also called on startup founders themselves to share experiences and pain points. Veronika Stelmakh, CEO and co-founder of Mesodyne, emphasized the many entrepreneurship competitions and accelerator programs she and her co-founder participated in to learn customer discovery, how to run a business, and what grants to apply for.
Now, she said, their main challenge is cost reduction. “For this we need volume. To get volume, we need traction with customers. To get traction with customers, you need a product, and if your product is expensive, you can’t get there,” she said. “This chicken-and-egg problem is why we need programs, especially for hard-tech startups, that enable us to build things with limited resources.”
Access to shared facilities and tool sets to help reduce costs and boost the development of new hard-tech technologies was a repeated theme throughout the workshop. “Space is precious,” said John Iacoponi, vice president of technology strategy at NY CREATES, which runs the Albany NanoTech Complex. “We find that startups need the ability to change materials, to have flexible space and tools that any one entity can’t afford to buy.”
In closing, Bob Karlicek, electrical, computer, and systems engineering professor at RPI and workshop co-organizer, spelled out the challenges facing academia. “We need fab tech earlier in the educational process,” Karlicek said. “We need more student-and-faculty-accessible fabs to drive that talent pool creation, and much faster innovation at the university level. We need to think of IP strategies for protecting startups. We need better early-stage funding models, bigger pools of reserved early-stage capital.”
“Universities need to be seen as talent generators, not just for training the next engineers, but the next batch of entrepreneurs,” continued co-organizer Nick Querques, director of new ventures at the SUNY Research Foundation. “Significant capital is needed at all levels, starting with non-dilutive government funding for technologies and multi-institutional centers, and ending with investments from industry in both startups and facilities.”
The workshop on semiconductor technology translation and hard-tech startups demonstrated the high level of concern and interest from stakeholders across the nation to improve the process for getting new hard-tech to market. For change, it will take the whole ecosystem.
“It’s not just the idea, it’s also the process of scaling that idea, the process of training the talent, and understanding the stakeholders you will encounter,” summarized Bulović. “We need a national program that can bring many more startups to the scale-up stage. We need more shots at the goal, and that will yield more successes and resurgence of national ability to remaster the dominance in microelectronics and many other hard-tech industries.”